/raid1/www/Hosts/bankrupt/TCR_Public/210119.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Tuesday, January 19, 2021, Vol. 25, No. 18
Headlines
01 BH PARTNERSHIP: Fine-Tunes Plan; Resolves Deutsche Bank's Claim
AAC HOLDING: Enters Chapter 11 Amid Dispute With Cerberus
ADAPTHEALTH LLC: Moody's Completes Review, Retains Ba3 CFR
ADEPTUS HEALTH: Flawed Business Model & COVID-19 Forced Chapter 7
ADVANCED INTEGRATION: Moody's Affirms Caa1 CFR, Outlook Stable
ADVISOR GROUP: Moody's Affirms B3 CFR & Alters Outlook to Stable
AFFORDABLE CARE: Moody's Upgrades CFR to Caa1, Outlook Stable
AGILITI HEALTH: Moody's Completes Review, Retains B2 CFR
ALFREDO GONZALEZ: Solmar Buying Harlingen Property for $219K
AMBICA M&J: Comfort Inn in Saratoga Springs, NY Seeks Chapter 11
AMBICA M&J: Seeks to Hire Nolan Heller as Counsel
AMERICAN ACHIEVEMENT: Surprised by Junior Lenders' Bid for Ch. 11
AMERICAN DENTAL: Moody's Completes Review, Retains B3 CFR
AMN HEALTHCARE: Moody's Completes Review, Retains Ba2 CFR
ARETEC GROUP: Moody's Affirms B3 CFR & Alters Outlook to Stable
AUTO MASTER: $439K Sale of Juncos Property to Route 65 Approved
AVEANNA HEALTHCARE: Moody's Completes Review, Retains B3 CFR
BARNEYS NEW YORK: Reopens at Saks After Bankruptcy
BAVARIA INN: Hires Saltzman LLC as Expert Witness
BELK INC: Taps Lazard, Kirkland for Restructuring Advice
BELZO LLC: New Jersey CVS Buying Substantially All Assets for $360K
BERRY GLOBAL: Moody's Rates $800MM First Lien Notes 'Ba2'
BIOCLINICA HOLDING: Moody's Completes Review, Retains Caa1 CFR
BIOSOIL FARM: Files for Chapter 7 Bankruptcy Protection
BR HEALTHCARE: Unsecureds to Recover Up to 94% in Liquidating Plan
BRIAN A. HANSEN: DWD Penalties Not Dischargeable, Says E.D. Wis.
CALIFORNIA RESOURCES: Back to Bond Market After Bankruptcy
CARECENTRIX INC: Moody's Completes Review, Retains B2 CFR
CCO HOLDINGS: Fitch Rates USD2.9 Billion Sr. Unsecured Notes 'BB+'
CDRH PARENT: Moody's Completes Review, Retains Caa3 CFR
CELLA III: Court Says Girod is Oversecured Creditor
CENTRO EVANGELISTICO: Sets Bid Procedures for Cutler Bay Asset Sale
CHG HEALTHCARE: Moody's Completes Review, Retains B2 CFR
CHRISTOPHER & BANKS: Store Closing Sales Begin at 400+ Stores
CITY WIDE INVESTMENTS: E.D. Wis. Affirms $281K Monetary Award
COLDWATER DEVELOPMENT: Case Summary & 16 Unsecured Creditors
CP VI BELLA: Moody's Completes Review, Retains B3 CFR
CRACKED EGG: Diner Defying Mask Rule Fights to Stay Open
CT TECHNOLOGIES: Moody's Completes Review, Retains B3 CFR
DEAN EPISCOPO: Hearing on Warren Property Sale Set for Jan. 26
DONALD KING OSTERBYE, JR: $575K Sale of Tallahassee Property Okayed
DYNASTY ACQUISITION: Fitch Lowers LongTerm IDR to 'B-'
EAST VILLAGE: EVF1 Funding Down to $3.13M; Unsecureds Recover 25%
EAST VILLAGE: Feb. 12 Plan Confirmation Hearing Set
ETS OF WASHINGTON: Seeks to Tap DDavison Law as Special Counsel
EXAMWORKS GROUP: Moody's Completes Review, Retains B2 CFR
FADYRO DISTRIBUTORS: Seeks to Tap Landrau Rivera as Counsel
FERRELLGAS PARTNERS: Gets OK to Hire Prime Clerk as Claims Agent
FLORIDA QUALITY: Seeks Approval to Hire Litigation Counsel
FRIENDLY VILLAGE: Trustee Sets Bid Procedures for Long Beach Asset
GEORGIA DEER: Selling Ford F250 & Ford F150 to Harrods for $71K
GLOBAL ASSET: Heineken Says Plan Disclosures Inadequate
GREGORY GILBERT: Averys Buying Reno Home for $1.01 Million
HANGER INC: Moody's Completes Review, Retains B1 CFR
HEALTHCHANNELS: Moody's Completes Review, Retains B3 CFR
HESPERUS PEAK: Asks to Extend Plan Filing Deadline
HGIM CORP: S&P Upgrades ICR to 'CCC+'; Outlook Negative
HOBERT K. SANDERSON: Public Auction of Kinston Property Approved
HUB INTERNATIONAL: Moody's Rates $1.5BB Repriced Term Loan 'B2'
HYTERA COMMUNICATIONS: Hires of Stapleton Group as CRO
INFRASTRUCTURE SOLUTION: Selling Equipment to Philly for $206K
INTERLOGIC OUTSOURCING: Committee Seeks Approval to Hire Co-Counsel
JAMES EDWARD HALL: Trustee McLemore's Sale of 10 Calves Approved
KEYSTONE ACQUISITION: Moody's Completes Review, Retains B3 CFR
KNOWLTON DEVELOPMENT: Fitch Cuts Issuer Default Ratings to 'B-'
KR MEDICAL: Seeks to Hire Lane Law Firm as Counsel
L.S.R. INC: Waiting for Sale Contract, Seeks to Delay Plan Hearing
LAKEWAY PUBLISHERS: Bid to Modify Confirmed Plan Opposed
LEGENDS HOSPITALITY: Moody's Retains B3 CFR Amid Sec. Note Upsize
LIGHTHOUSE RESOURCES: Court OKs Bankruptcy Sale, Employee Bonuses
LOVES FURNITURE: U.S. Trustee Appoints Creditors' Committee
LSC COMMUNICATIONS: Feb. 24 Plan Confirmation Hearing Set
LSC COMMUNICATIONS: Unsec. Creditors Get 4.4% With RRD Settlement
MALLINCKRODT PLC: Buxton Helmsley Push Board & Management Change
MDVIP LLC: Moody's Completes Review, Retains B3 CFR
MEDASSETS SOFTWARE: Fitch Affirms 'B' LongTerm IDRs
MEDICAL SOLUTIONS: Moody's Completes Review, Retains B3 CFR
MEDNAX INC: Moody's Completes Review, Retains B1 CFR
MERCER INT'L: Moody's Rates New $500MM Unsec. Notes Due 2029 'Ba3'
MERCER INTERNATIONAL: S&P Rates New Senior Unsecured Notes 'B+'
METAL PRODUCTS: Proposed $545K Sale of Assets to CIA Approved
MIDWEST PHYSICIAN: Moody's Completes Review, Retains B2 CFR
MINDY L. HITCHCOCK: Ch. 11 Suit to Be Dismissed
MPH ACQUISITION: Moody's Completes Review, Retains B2 CFR
MT. GOX: CoinLab Cuts Deal With Trustee Over Bitcoin Claims
MURPHY OIL: Moody's Affirms Ba1 CFR & Rates $500M Unsec. Notes Ba2
MURPHY USA: S&P Affirms 'BB+' ICR on QuickChek Acquisition
MY BROTHERS KEEPERS: Hires McDowell Law as Counsel
NAPA MANAGEMENT: Moody's Completes Review, Retains Caa1 CFR
NATIONAL MENTOR: Moody's Completes Review, Retains B2 CFR
NEOPHARMA INC: U.S. Trustee Appoints Creditors' Committee
NEW CITIES INVESTMENT: Bravo Buying Palm Desert Property for $6.35M
NEW CITIES INVESTMENT: Hearing on Palm Desert Asset Sale on Feb. 11
NEW JERSEY HOUSING: Moody's Affirms Ba1 Rating on 2004-1 Bonds
NS8 INC: Former CEO Considers Plea Deal Amid Ongoing Investigations
NUVERRA ENVIRONMENTAL: 3rd Cir. Affirms Denial of Hargreaves Appeal
ONE CALL: Moody's Completes Review, Retains B3 CFR
ONEX TSG: Moody's Completes Review, Retains B2 CFR
OPTION CARE: Moody's Upgrades CFR to B2 & Alters Outlook to Stable
OUTCOMES GROUP: Moody's Completes Review, Retains B3 CFR
OWENS PRECISION: Trustee's Sale of Tangible Assets or Business OK'd
PACKAGING COORDINATORS: Moody's Completes Review, Retains B3 CFR
PARADOX ENTERPRISES: Has Until Feb. 22 to File Amended Disclosures
PARAMOUNT INVESTING: Unsecureds to Recover 50% in Plan
PETVET CARE: Moody's Completes Review, Retains B3 CFR
PHOENIX GUARANTOR: Moody's Completes Review, Retains B2 CFR
PIKE CORP: Moody's Rates New $730MM Term Loans 'Ba3'
PROFESSIONAL FINANCIAL: Affiliates Tap Donlin as Claims Agent
PROFESSIONAL FINANCIAL: Affiliates Tap Kimball as Special Counsel
PROFESSIONAL FINANCIAL: Affiliates Tap Nardell as Special Counsel
PROFESSIONAL FINANCIAL: Affiliates Tap Sheppard Mullin as Counsel
PROFESSIONAL FINANCIAL: Affiliates Tap Trodella as Legal Counsel
PUERTO RICO ELECTRIC: Union Loses Benefits Appeal in 1st Circuit
QUALITY PERFORATING: U.S. Trustee Unable to Appoint Committee
QUINCY STREET: Hires Miles & Stockbridge as Special Counsel
RADIOLOGY PARTNERS: Moody's Completes Review, Retains Caa1 CFR
RFA FRONTINO: Seeks to Hire Meltzer Lippe as Bankruptcy Counsel
RGV SMILES: State of Texas Suit Exempted From Automatic Stay
ROCKIES EXPRESS: Fitch Lowers LongTerm IDR to 'BB+'
RV RETAILER: S&P Assigns 'B' ICR on Acquisition Strategy
RVR DEALERSHIP: Moody's Assigns First Time B2 Corp. Family Rating
SALLY BEAUTY: S&P Raises Second-Lien Sr. Secured Rating to 'BB+'
SBA COMMUNICATIONS: S&P Rates New $1.5BB Sr. Unsecured Notes 'BB-'
SBW PROPERTIES: Seeks Court Approval to Hire Bankruptcy Counsel
SCIENCE APPLICATIONS: S&P Alters Outlook to Stable, Affirms BB+ ICR
SCSG EA ACQUISITION: Moody's Completes Review, Retains B2 CFR
SEMILEDS CORP: Files Form 10-Q for Quarter Ended Nov. 30
SEP-PRO SYSTEMS: U.S. Trustee Unable to Appoint Committee
SGR WINDDOWN: Objection to N.Y. DOF's Claim No. 205 Sustained
SMITTY'S LAND: Voluntary Chapter 11 Case Summary
SOTERA HEALTH: Moody's Completes Review, Retains B1 CFR
SOUND INPATIENT: Moody's Completes Review, Retains B1 CFR
SSRE HOLDINGS: Case Summary & 20 Largest Unsecured Creditors
STEAKHOUSE HOLDINGS: Hires McNair McLemore as Tax Preparer
STUDIO MOVIE GRILL: Withdraws Plans to Open in Citrus Heights, CA
SYSTEMS INTEGRATORS: Hires Pro Business as Appraiser
TEA OLIVE: Stock+Field's Going-Out-of-Business Sales Underway
TEAM HEALTH: Moody's Completes Review, Retains Caa2 CFR
THOMAS PATRICK SWEENEY: Selling 50% Interest in Bethesda Property
TOPP'S MECHANICAL: Case Summary & 20 Largest Unsecured Creditors
TOWNHOUSE HOTEL: Seeks Continuation of Jan. 23 Hotel Sale Hearing
TRANSDIGM INC: Moody's Rates New Sr. Subordinated Notes 'B3'
UNITED AIRLINES: Brashear, et al's Bid for Reconsideration Denied
US ANESTHESIA: Moody's Completes Review, Retains B3 CFR
VETCOR PROFESSIONAL: Moody's Completes Review, Retains B3 CFR
VIDEO DISPLAY: Posts $1.88 Million Net Income in Third Quarter
VIRTUS INVESTMENT: S&P Alters Outlook to Positive, Affirms 'BB' ICR
VOYA INT'L HIGH DIVIDEND FUND: Board OKs Termination of Fund
VTES INC: Seeks to Hire Griffin Hamersky as Counsel
VTES INC: Seeks to Hire Ordinary Course Professionals
VTES INC: Seeks to Hire Rock Creek as Financial Advisor
VTES INC: Seeks to Hire Stretto as Administrative Advisor
WALL010 LLC: Seeks to Hire Joyce W. Lindauer as Counsel
WANSDOWN PROPERTIES: Court Partly Reconsiders Wansdown Suit
WAYNE P. BURICK: Keybank's Bid to Vacate Property Sale Order Voided
WESTERN HERITAGE: Seeks to Tap Martelle Gordon & Assoc. as Counsel
WESTINGHOUSE ELECTRIC: SCANA, Fluor Not Liable Under WARN Act
WILLIAM BURCH: 5th Cir. Dismisses Appeals v. Homeward, Ocwen
WP CITYMD: Moody's Completes Review, Retains B2 CFR
YS GARMENTS: S&P Alters Outlook to Positive, Affirms 'B-' ICR
ZAANA-17 LLC: $752K Sale of Pelham Property to White, Others OK'd
ZELIS PAYMENTS: Moody's Completes Review, Retains B2 CFR
[*] AIRA Announces 8 CIRA Certification Awards
[*] Bankruptcy Relief for Small Business Under Latest Stimulus Bill
[*] SSG Advised Green's Natural in Sale to Hudson Equity
[^] Large Companies with Insolvent Balance Sheet
*********
01 BH PARTNERSHIP: Fine-Tunes Plan; Resolves Deutsche Bank's Claim
------------------------------------------------------------------
01 BH Partnership filed a Second Amended Chapter 11 Plan of
Reorganization and a corresponding Disclosure Statement on January
12, 2021.
The Second Amended Plan discusses the large expenditures on behalf
of Debtor in the three years preceding this bankruptcy case.
First, on or about June 6, 2017, $19,598 was paid for property
taxes. Second, in late 2018, $23,000 was paid to demolish and
remove an unpermitted guesthouse on Lots 34 - 36 to comply with the
City's requirements. Third, multiple surveys, of Lots 34 - 36, for
use in the civil litigation with Aghchay were obtained at a total
cost of in excess of $20,000. Fourth, $2,500.00 was expended on or
about Sept. 23, 2020 for clean-up and brush clearance. Fifth, on
January 11, 2021, property taxes for the 18 Vacant Lots, in the
total sum of $22,926, were paid on behalf of the Debtor, which
should include all post-petition amounts which were due, including
but not limited to the $3,708 identified by Aghchay filed on
January 7, 2021, as well as a substantial portion of prepetition
property taxes.
The Franchise Tax Board and the Internal Revenue Service have
liens, for taxes unpaid by Christian Spannhoff, one of Debtor's
partners, against the Vacant Lots (and Lots 34 – 36), estimated
to be approximately $135,000 and $4,000,000, respectively.
Provided that the Vacant Lots will be free and clear of any liens
pursuant to this Plan, on or before the Effective Date, the Debtor
will acquire the remaining 90% interest in the Vacant Lots, and the
FTB and/or the IRS will be paid the value of any available equity
in the Vacant Lots, estimated to be approximately $200,000 for a
100% interest. Otherwise, the value of Debtor's 10% interest
payable to the FTB/IRS would only be about $20,000.
Although Bank of America as Servicer for Deutsche Bank ("Bank")
filed a proof of secured claim for $1.75 million, the value of Lots
34 - 36 (the security), according to Debtor's and Bank's respective
appraisals, is approximately $300,000 to $925,000, and Bank and
Debtor have stipulated to the value of Bank's claim, as a secured
interest, in the sum of $612,500 filed on Oct. 20, 2020 (the
"Stipulation"). Pursuant to the Stipulation, Bank's total claim
will be deemed to be $612,500, which will be paid monthly, with
interest at 7% per annum, amortized over 30 years, commencing April
1, 2021 in the sum of $4,075 per month.
Upon the Debtor's Plan being confirmed, prior to the Effective
Date, the Debtor will have $750,000 in cash for the purpose of
carrying out its Plan. Approximately $400,000 will be required to
tear down and remove as much of the existing house as needed and
build a new house on Lots 34 - 36, which Debtor would then sell for
a minimum of $1,000,000, but probably closer to $2,000,000. This
is expected to take about one to two years. The expenses which
will be incurred in the interim will be approximately $5,000 per
month starting April 1, 2021, and about $11,000 per month starting
on the Effective Date. Assuming a June 1, 2021 Effective Date,
such expenses would be about $142,000 (one year to build and sell)
to $274,000 (2 years). $750,000 - $400,000 - $274,000 = $76,000.
If additional funds would be needed, they would be available.
The Plan will be funded by the Debtor's general partners. One of
the Debtor's General Partners, 540 Van, LLC, has caused to be set
aside and held in trust in the Debtor's counsel's Client Trust
Accounts, for a capital contribution to the Debtor on or before the
Effective Date provided the Debtor's Plan is confirmed the sum of
$750,000, plus has in excess of an additional $250,000 in cash,
immediately available, to contribute to Debtor, as needed, to fund
any required payments pursuant to the Plan.
Christian Spannhoff has a negative net worth, his largest asset, a
75% interest in the Vacant Lots, is subject to tax liens orders of
magnitude more than their value, and he has substantially no other
assets. The other general partner, 540 Van, LLC, currently has no
assets or liabilities independent of 01 BH, but $750,000, has been
set aside on its behalf and is being held in Client Trust Accounts
of Debtor's counsel for the purpose of making a capital
contribution to Debtor to fund its Chapter 11 Plan if the Plan is
confirmed. The source of these funds was from 13 Montgomery, LLC,
of which Ahron Zilberstein is the managing member. More than
$250,000 remains in the account from which the $750,000 was drawn,
and such $250,000, remains available to additionally contribute to
Debtor as needed. Other companies controlled by Ahron Zilberstein
also have additional liquid resources available to be contributed
to Debtor as a capital contribution by 540 Van, LLC should
additional funds be required.
The Disclosure Statement hearing is scheduled for March 9, 2201, at
11:30 a.m. The hearing to consider confirmation of the Plan is
tentatively scheduled for May 4, 2021, at 11:30 a.m., in Courtroom
1639 of the Hon. Deborah Saltzman, United States Bankruptcy Court,
255 E. Temple Street, Los Angeles, CA 90012.
A full-text copy of the Disclosure Statement describing Second
Amended Plan of Reorganization dated Jan. 12, 2021, is available at
https://bit.ly/3oLblEi from PacerMonitor.com at no charge.
Attorneys for the Debtor:
Mark E. Goodfriend
LAW OFFICES OF MARK E. GOODFRIEND
16055 Ventura Boulevard, Suite 800
Encino, California 91436
Telephone: (818) 783-8866
Facsimile: (818) 783-5445
E-mail: markgoodfriend@yahoo.com
About 01 BH Partnership
01 BH Partnership is the fee owner of a 1,087-square-foot family
residence located at 1001 N. Beverly Glen Blvd., Los Angeles. It
also owns 10 percent interests in 18 adjacent undeveloped, vacant
lots.
It previously sought bankruptcy protection (Bankr. C.D. Cal. Case
No. 18-11040) on April 25, 2018.
01 BH Partnership again sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. C.D. Cal. Case No. 19-11924) on July 31,
2019. At the time of the filing, the Debtor disclosed $245,000 in
assets and $10,562,927 in liabilities. The case is assigned to
Judge Maureen Tighe. The Law Offices of Mark E. Goodfriend is the
Debtor's counsel.
AAC HOLDING: Enters Chapter 11 Amid Dispute With Cerberus
---------------------------------------------------------
The Wall Street Journal reports that the parent company of American
Achievement Corp., which makes graduation caps, gowns and
yearbooks, is seeking bankruptcy protection after the coronavirus
pandemic crushed sales, sparking a corporate governance battle with
lender Cerberus Capital Management LP.
AAC Holding Corp. filed for chapter 11 protection following efforts
by Cerberus to fill the company's governing boards with "handpicked
directors" after it defaulted on $463 million in debt.
Widespread cancellation of graduations curbed revenue at American
Achievement, leading to a $463 million debt default and touching
off a corporate governance dispute.
About AAC Holding
American Achievement Corporation is a provider of education and
special moment affinity products and services. It sells yearbooks,
class rings, and graduation products.
AAC Holding Corp., parent of American Achievement Corporation,
sought Chapter 11 protection (Bankr. N.D. Tex. Case No. 21-30057)
on Jan. 14, 2021. The Debtor estimated assets and debt of $100
million to $500 million.
The Hon. Harlin Dewayne Hale is the case judge.
The Debtor tapped Susan B. Hersh, in Dallas, as counsel.
ADAPTHEALTH LLC: Moody's Completes Review, Retains Ba3 CFR
----------------------------------------------------------
Moody's Investors Service has completed a periodic review of the
ratings of AdaptHealth, LLC and other ratings that are associated
with the same analytical unit. The review was conducted through a
portfolio review discussion held on January 11, 2021 in which
Moody's reassessed the appropriateness of the ratings in the
context of the relevant principal methodology(ies), recent
developments, and a comparison of the financial and operating
profile to similarly rated peers. The review did not involve a
rating committee. Since January 1, 2019, Moody's practice has been
to issue a press release following each periodic review to announce
its completion.
This publication does not announce a credit rating action and is
not an indication of whether or not a credit rating action is
likely in the near future. Credit ratings and outlook/review status
cannot be changed in a portfolio review and hence are not impacted
by this announcement.
Key rating considerations.
AdaptHealth's Ba3 (on review for downgrade) Corporate Family Rating
reflects the company's moderate scale in the provision of home
healthcare equipment and related supplies in the United States and
moderately high financial leverage. The company focuses on a broad
range of patient needs including sleep, home medical equipment,
diabetes and respiratory products, the majority of which relate to
chronic medical conditions with high levels of recurring revenues.
AdaptHealth is somewhat concentrated in sleep related products
which are approximately 33% of pro forma revenue, and also has some
geographic concentration. The ratings are constrained by Moody's
expectation that AdaptHealth will remain acquisitive.
The principal methodology used for this review was Business and
Consumer Service Industry published in October 2016.
ADEPTUS HEALTH: Flawed Business Model & COVID-19 Forced Chapter 7
-----------------------------------------------------------------
Bill Hethcock of Dallas Business Journal reports that flawed
business model and COVID-19 pandemic contributed to the bankruptcy
of North Texas-based operator of First Choice Emergency Rooms fell
victim to a flawed business model and, to a lesser extent, the
coronavirus pandemic. Now, it faces a rocky road to liquidation,
according to an expert.
That's the picture painted by bankruptcy filings and legal experts
of Irving-based Adeptus Health LLC, the parent company of First
Choice ER, which was the oldest and largest freestanding
emergency-room network in the country. Adeptus filed for voluntary
Chapter 7 bankruptcy protection on Dec. 18, 2020.
Adeptus Health, First Choice ERs and Adeptus' other entities have
ceased operations, according to the company's website.
Business Model
Adeptus and companies like it suffer from a faulty business model,
said Wade Emmert, partner at Carrington Coleman Sloman & Blumenthal
and a board-certified health lawyer.
"A lot of freestanding ERs are getting crushed," said Emmert, who
is not directly involved in the case. "They're getting crushed
from a regulatory perspective. They're getting crushed because of
poor patient PR because they're charging patients more than
patients would otherwise be charged if they went to a hospital
ER."
"Their business model in large part is based on a misunderstanding
by patients," said Emmert, who is also an adjunct professor at
Texas A&M School of Law in Fort Worth, where he teaches a health
care transactions course and others.
Hospital ERs are typically in-network for health care coverage, but
freestanding ERs usually are not in insurance companies' networks,
he said.
"Freestanding ERs will tell the patients, 'we take every
insurance,' and that's true," Emmert said. "But the insurance only
pays in-network rates and then the patient has to pick up the
rest."
Many patients are now figuring out the difference between hospital
ERs and freestanding ones, which is one reason the latter are
struggling, Emmert said.
Declining Revenue
This isn't the first time Adeptus has filed for bankruptcy. In
2017, the company filed for Chapter 11 bankruptcy protection, and
New York health care-focused hedge fund Deerfield Management bought
outstanding bank debt totaling $212.7 million from Adeptus. In the
new bankruptcy filing, Adeptus listed roughly $6.8 million and
debts of about $278.2 million. On the asset side of Adeptus' new
Chapter 7 filing, just over $1.1 million is real estate and about
$5.7 million is equipment and other personal property.
The Adeptus Board of Directors met Nov. 18 and considered the
company's financial and operational condition, as well as its
historical performance, before directing CEO Steve Bussey to file
the bankruptcy petition, according to a board resolution contained
in the Chapter 7 filing.
Adeptus' gross revenue declined sharply to about $62.5 million in
2020, the bankruptcy filing says. That compares to gross revenue of
$172.7 million in 2019 and $229.7 million in 2018.
While COVID-19 didn't cause Adeptus' Chapter 7 filing, Emmert said
it's likely a contributing factor.
"Since last March 2020, I have a lot of health care clients that
are nervous about the prospect of the outlook for health care, so
they're looking to branch out and diversify into other areas, which
is an option that many freestanding ERs like Adeptus don't have,"
he said. "COVID likely played a role in the conversion to Chapter
7 because it brought them to a conclusion sooner that they don't
have a path forward."
About Adeptus Health
Adeptus Health LLC -- http://www.adpt.com/-- through its
subsidiaries, owns and operates hospitals and free standing
emergency rooms in partnership with various healthcare providers.
Lewisville, Texas-based ADPT DFW Holdings LLC and its affiliates,
including Adeptus Health, Inc., and Adeptus Health LLC, each filed
Chapter 11 bankruptcy petitions (Bankr. N.D. Tex. Lead Case No.
17-31432) on April 19, 2017, listing $798.7 million in total assets
and $453.48 million in total debt as of Sept. 30, 2016.
In the Chapter 11 case, Norton Rose Fulbright US LLP served as the
Debtors' bankruptcy counsel; FTI Consulting, Inc., was the CRO
provider; and Houlihan Lokey, Inc., was the investment banker. The
Creditors Committee tapped Akin Gump Strauss Hauer & Feld LLP as
counsel and CohnReznick as financial advisors. The Equity
Committee hired Winstead P.C. as legal counsel.
Adeptus Health LLC sought Chapter 7 protection (Bankr. N.D. Tex.
Case No. 20-33071) on Dec. 18, 2020. In its Dec. 18, 2020
bankruptcy petition, the company listed debts of about $278.2
million and assets of nearly $6.8 million.
The Debtor's counsel in the Chapter 7 case:
Louis R. Strubeck, Jr.
Norton Rose Fulbright Us LLP
E-mail: louis.strubeck@nortonrosefulbright.com
The Chapter 7 trustee:
Daniel J. Sherman
509 N. Montclair
Dallas, TX 75208
ADVANCED INTEGRATION: Moody's Affirms Caa1 CFR, Outlook Stable
--------------------------------------------------------------
Moody's Investors Service affirmed ratings for Advanced Integration
Technology LP ("AIT"), including the company's Caa1 corporate
family rating and Caa2-PD probability of default rating.
Concurrently, Moody's affirmed the Caa1 ratings for the company's
senior secured credit facilities. The ratings outlook has been
changed to stable from negative.
RATINGS RATIONALE
The revised outlook reflects the benefits from AIT's recent
extension of the tenor of its undrawn revolving credit facility,
which improves near-term financial flexibility. The stable outlook
also reflects Moody's expectations of a more stable operating
environment during 2021, that is likely to be accompanied by
moderate growth in earnings and improved cash generation.
The Caa1 CFR broadly reflects AIT's modest size, a relatively
concentrated customer and platform base, and exposure to cyclical
end markets. The rating also considers AIT's often lumpy and
large-sized customer contracts that reduce cash flow visibility
while adding volatility to earnings. This earnings volatility is
compounded by the use of percentage of completion accounting for
most contracts which leads to ongoing and sometimes meaningful
revisions (upward and downward) to contract costs and
profitability.
Following the contraction of work for commercial aerospace
customers during 2020, AIT now derives substantially most of its
revenue and earnings from defense end-markets. Moody's expects
demand for military and defense customers to remain stable during
2021 and this should help mitigate any incremental COVID-related
sales pressures with commercial aerospace customers. Nonetheless,
AIT currently has a highly leveraged balance sheet with
debt-to-EBITDA in excess of 8x, and Moody's expects leverage to
remain elevated (in excess of 6.5x) through 2021. Furthermore, AIT
has a mixed and relatively volatile track record of cash
generation. As such, the company's ability to consistently generate
more stable and positive cash flow will be an important rating
consideration over the next 12 to 18 months.
The Caa2-PD Probability of Default rating is one notch lower than
the Caa1 CFR. This reflects the higher default risk incorporating
an expectation that secured creditors would move quickly with the
covenant protection afforded by their loan documents to preserve
asset values. Those protections also imply a higher family recovery
due to the singular class of debt with a security interest in all
assets.
The rapid spread of the coronavirus outbreak, the deteriorating
global economic outlook, low oil prices and high asset price
volatility have created an unprecedented credit shock across a
range of sectors and regions. Moody's regards the coronavirus
outbreak as a social risk under its ESG framework, given the
substantial implications for public health and safety.
Notwithstanding some early signs that the adverse impact of the
coronavirus outbreak on AIT and the deterioration in credit quality
that it triggered may be relatively short-lived and subsiding, the
company remains vulnerable to shifts in market demand and changing
sentiment in these unprecedented operating conditions.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Ratings could be upgraded if there is an improvement in AIT's
liquidity profile involving the consistent generation of free cash
flow such that free cash flow-to-debt was expected to be at least
in the low single-digits, along with expectations of substantial
availability under the revolving credit facility. Ratings could
also be upgraded if there is a demonstrated improvement in
operational and financial execution on a sustained basis. Any
upward ratings momentum would be predicated on expectations of
conservative financial policies, with Moody's-adjusted
debt-to-EBITDA anticipated to be sustained below 6.75x. Given the
company's relatively small scale, Moody's would expect AIT to
maintain credit metrics that are stronger than levels typically
associated with comparatively larger companies at the same ratings
level.
A ratings downgrade could occur if AIT is unable to generate
positive free cash flow during 2021, if the company becomes more
reliant on its revolver, or if AIT is unable to demonstrate revenue
and earnings growth over the next 12 months. The ratings could also
be downgraded with any debt-financed distributions to shareholders
or sizable debt-financed acquisitions over the near-term that would
indicate a higher tolerance for financial risk.
Issuer: Advanced Integration Technology LP
Corporate Family Rating, affirmed Caa1
Probability of Default Rating, affirmed Caa2-PD
Senior Secured Bank Credit Facility, affirmed Caa1 (LGD3)
Outlook, changed to Stable, from Negative
Advanced Integration Technology LP ("AIT"), headquartered in Plano,
Texas, is a provider of turnkey factory automation and complex
automated and non-automated tooling to the commercial aerospace and
defense industries. AIT's primary business is to design, engineer,
manufacture, and install machines and systems which enable the
automated assembly of aerospace structures and other industrial
equipment. The company is equally owned by management and funds
affiliated with Onex Corporation.
The principal methodology used in these ratings was Aerospace and
Defense Methodology published in July 2020.
ADVISOR GROUP: Moody's Affirms B3 CFR & Alters Outlook to Stable
----------------------------------------------------------------
Moody's Investors Service affirmed Advisor Group Holdings, Inc.'s
B3 Corporate Family Rating. Moody's also affirmed the B2 ratings
for Advisor Group's senior secured debt and the Caa2 rating on
Advisor Group's senior unsecured notes. Concurrently, Moody's
changed Advisor Group's rating outlook to stable from negative.
Moody's has taken the following rating actions on Advisor Group
Holdings, Inc.:
Corporate Family Rating, Affirmed B3
$1,500 million Senior Secured 1st Lien Term Loan B, Affirmed B2
$325 million Senior Secured 1st Lien Revolving Credit Facility,
Affirmed B2
$500 million Senior Secured Notes, Affirmed B2
$413 million Senior Unsecured Regular Bond/Debenture, Affirmed
Caa2
Outlook, Changed To Stable from Negative
RATINGS RATIONALE
Moody's said the ratings affirmation reflects Advisor Group's
successful navigation of the challenges presented by the
coronavirus pandemic, equities markets volatility and sharp decline
in short-term interest rates in early 2020.
Moody's said that Advisor Group's seasoned management team swiftly
lowered expenses, raised efficiencies and adapted the firm's
operations to a new remote work environment. In addition, Advisor
Group was able to accelerate its integration of Ladenburg Thalmann,
realizing a large portion of its forecasted expense synergies ahead
of schedule. The firm has also exceeded its advisor retention
targets, an important driver of client asset levels.
These credit positive actions highlight the company's ability to
adapt, the rating agency noted, and puts Advisor Group in a
stronger position to benefit from improving operating conditions
and a strong, broad-based rise in equities markets.
The rebound in broad equities markets has aided in lifting Advisor
Group's client asset levels, a key driver for the firm's advisory
revenue. The increase in market levels during the fourth quarter of
2020 -- and Moody's estimate of the firm's client asset levels for
the period -- will set the stage for strong first quarter 2021
advisory revenue and asset-linked commission revenue, a credit
positive.
The change in Advisor Group's outlook to stable from negative
reflects Moody's expectation that the firm's expense management,
substantial synergy benefits from the acquisition and strengthened
client asset levels will improve the firm's credit profile during
2021.
In accordance with Moody's Loss Given Default for Speculative-Grade
Companies methodology, the B2 rating on Advisor Group's $500
million senior secured notes, $1,500 million first lien senior
secured term loan and $325 million revolving credit facility
reflect their priority ranking in Advisor Group's capital
structure. The Caa2 rating of Advisor Group's $413 million senior
unsecured notes is also based upon the application of Moody's Loss
Given Default for Speculative-Grade Companies methodology and the
notes' secondary ranking in Advisor Group's capital structure.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Advisor Group's ratings could be upgraded if the company were to
experience a sustainable improvement in its debt leverage on a
Moody's adjusted basis to below 6.5x; or were to undergo a
significant expansion of existing business activities that
generated a sustainable improvement in profitability.
Moody's said the ratings could be downgraded were Advisor Group to
suffer a significant deterioration in liquidity resulting in
challenges to its ability to sustain operations at a competitive
level, especially in recruiting and retaining advisors; were the
firm's debt leverage on a Moody's adjusted basis to rise above 7.5x
on a sustained basis; or were the firm to undertake additional
debt-funded M&A activity resulting in further delay of its
de-leveraging path.
In addition, Moody's noted that the ratings on Advisor Group's
secured debt could be downgraded were there to be a significant
reduction in the amount of unsecured debt outstanding, resulting in
a reduction of the loss absorption provided by the unsecured debt
and lifting the expected loss rate on the secured debt. The same
could happen if the amount of secured debt was increased, becoming
a larger proportion of the firm's overall capital structure.
The principal methodology used in these ratings was Securities
Industry Service Providers Methodology published in November 2019.
AFFORDABLE CARE: Moody's Upgrades CFR to Caa1, Outlook Stable
-------------------------------------------------------------
Moody's Investors Service upgraded the ratings of Affordable Care
Holding Corp. ("ACH") including the Corporate Family Rating to Caa1
from Caa2, the Probability of Default Rating to Caa1-PD from
Caa2-PD, and the first lien senior secured bank credit facilities
to B3 from Caa1. The outlook remains stable.
The upgrade reflects ACH's return of patient volumes to near
pre-coronavirus levels and improved leverage to 7.7x for the twelve
months ended September 30, 2020. At the same time, ACH has been
able to improve its liquidity with about $79 million of cash and
full access to its $50 million revolver at September 30, 2020.
Liquidity improved as ACH's Affiliated Practices received CARES act
funding and moderated its growth capital expenditures and managed
variable costs in 2020. The company continues to benefit from the
mix shift to more dental implants which are a higher margin product
than traditional dentures.
The stable outlook reflects Moody's expectation that this level of
leverage, along with the company's ability to reduce variable costs
and growth capital expenditures if necessary, positions the company
well to withstand the potential for further stress from the
coronavirus pandemic and/or a weakening of the economy. Moody's
expects ACH will generate positive free cash flow, though with some
variability depending on working capital changes. That said, the
stable outlook also reflects Moody's view that another nationwide
mandate to defer dental services is unlikely. ACH's geographic
diversity should limit the impact from coronavirus outbreaks in any
particular region.
Ratings Upgraded:
Issuer: Affordable Care Holding Corp.
Corporate Family Rating, upgraded to Caa1 from Caa2
Probability of Default Rating upgraded to Caa1-PD from Caa2-PD
First Lien Senior Secured Term Loan, upgraded to B3 (LGD3) from
Caa1 (LGD3)
Senior Secured Revolving Credit Facility, upgraded to B3 (LGD3)
from Caa1 (LGD3)
Outlook Actions:
Issuer: Affordable Care Holding Corp.
Outlook, remains Stable
RATINGS RATIONALE
ACH's Caa1 Corporate Family Rating reflects its high financial
leverage and a short-term debt maturity profile. ACH has limited
revenue diversification with roughly 75% of revenue derived from
denture services, which is mostly self-pay. While not subject to
reimbursement risk, the company is reliant on continued
availability of consumer financing to fund a meaningful portion of
its sales, most of which is self-pay. The credit profile also
reflects rising risk of a prolonged recession in the US could
reduce demand for ACH's product. The rating is supported by ACH's
strong market presence as the largest provider of dentures in the
US, good geographic diversification across the U.S., and
historically positive trends in same-store sales growth. The rating
is further supported by favorable industry dynamics, with a growing
market of edentulous patients, due to the aging population.
Moody's considers ACH to have adequate liquidity. The company has
historically had negative free cash flow due to growth and
acquisition spending, but ACH has conserved cash during the
coronavirus pandemic. Liquidity is supported by the company's
approximately $79 million of cash as of September 30, 2020, as well
as another $50 million available on the revolver. ACH has
refinancing risk as its revolver expires in October 2021 and its
$530 million first lien term loans mature in October 2022. The
revolver is currently undrawn and is not expected to be drawn in
the next 12 months.
Moody's considers coronavirus to be a social risk given the risk to
human health and safety. Aside from coronavirus, ACH faces other
social risks such as the rising concerns around the access and
affordability of healthcare services. While Moody's does not
consider the affiliated dental practices to face the same level of
social risk as many other healthcare providers, ACH in particular,
generates a majority of revenues from fee-for-service,
out-of-pocket payments paid directly by patients. Further, ACH had
a cybersecurity incident in mid-2019. As a result, the incident has
led the company to invest further into its cybersecurity systems
and practices, which should allow it to protect itself from future
cyber-attacks. From a governance perspective, Moody's views ACH's
growth strategy to be aggressive given its history of debt-funded
acquisitions and high leverage.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Moody's could upgrade ACH if it addresses its near-term debt
maturities, leverage is sustained below 7.5x, while sustaining
positive free cash flow, and effective management of growth.
Moody's could downgrade ACH if operating performance or liquidity
weakens, the company is unable to make progress addressing its
near-term debt maturities, or the probability of a default
including by way of a transaction that Moody's would deem a
distressed exchange rises.
ACH is a U.S. dental services organization which provides
management and dental laboratory services to affiliated dental
centers, primarily focused on dentures. Under management service
agreements, ACH provides business support services necessary for
the administration of the non-clinical aspects of the dental
operations, while the affiliated practices, operated by dental
practitioners, are responsible for providing dental care to
patients. In addition to providing dental facilities (primarily
leased from third parties), dental supplies and support staff to
the affiliated practices, the company also provides business
operations, financial, marketing, and other administrative
services. ACH is affiliated with more than 352 dental offices
across 40 U.S. states. The company is owned by Berkshire Partners
LLC, and had $260 million of LTM September 30, 2020 net revenue. As
a privately-owned company, ACH discloses limited information
publicly.
The principal methodology used in these ratings was Business and
Consumer Service Industry published in October 2016.
AGILITI HEALTH: Moody's Completes Review, Retains B2 CFR
--------------------------------------------------------
Moody's Investors Service has completed a periodic review of the
ratings of Agiliti Health, Inc. and other ratings that are
associated with the same analytical unit. The review was conducted
through a portfolio review discussion held on January 11, 2021 in
which Moody's reassessed the appropriateness of the ratings in the
context of the relevant principal methodology(ies), recent
developments, and a comparison of the financial and operating
profile to similarly rated peers. The review did not involve a
rating committee. Since January 1, 2019, Moody's practice has been
to issue a press release following each periodic review to announce
its completion.
This publication does not announce a credit rating action and is
not an indication of whether or not a credit rating action is
likely in the near future. Credit ratings and outlook/review status
cannot be changed in a portfolio review and hence are not impacted
by this announcement.
Key rating considerations.
Agiliti Health, Inc.'s B2 Corporate Family Rating is constrained by
the company's high financial leverage. The company's credit profile
is also constrained by its moderate scale and narrow focus on
hospital equipment needs. Agiliti Health benefits from its leading
market position in the medical equipment management and service
business and expansion into clinical engineering and onsite managed
services business, which are faster-growth and less capital
intensive than its equipment solution business. Moody's expects
Agiliti Health will continue its track record of steady revenue and
earnings growth.
The principal methodology used for this review was Business and
Consumer Service Industry published in October 2016.
ALFREDO GONZALEZ: Solmar Buying Harlingen Property for $219K
------------------------------------------------------------
Alfredo Gonzalez and Hector Facundo ask the U.S. Bankruptcy Court
for the Southern District of Texas to authorize the sale of their
non-exempt real property identified as 817 W Matz Ave., in
Harlingen, Texas, to Geovinci Martinez, Sonia Martinez/Solmar
Properties, LLC for $219,000, on the terms of their One to Four
Family Residential Contract (Resale) Contract.
Objections, if any, must be filed within 21 days from the day the
Motion was served.
The Debtors have a valid offer to purchase the subject property for
an amount of $219,000 with a current listing price being $227,500.
However, they believe that the subject property may have
encumbrances, with regards to Judgement Liens, affecting the
property.
The Purchasers' offer is the best that has been received for the
Property and the sale price is consistent with the fair market
value of the Property. Specifically, the Purchasers agree to pay
Debtor the sum of $219,000 for the Property. They are prepared to
pay the purchase price, immediately and has provided proof of funds
to the listing Agent: It is a "Conventional Loan" sale.
The closing cost will include the ad valorem taxes, that the year
2021 ad valorem tax liens will be retained against the subject
property until said taxes are paid in full, at closing. Other
closing costs will include but are not limited to are: Title
Policy; Survey fee, the Sellers' assistance to the Buyers; Tax
service fee; Escrow fee; State Fees; Documents Preparation; Sales
Commission will be paid with the $219,000 sales proceeds.
The net balance of the sale proceeds, currently estimated to be
$201,265, stated in the Estimated Closing Disclosure, will be paid
into the Registry of the Court pending further order of the Court.
To provide adequate protection of the lien interest Claimed by
Creditors of the Debtors' Bankruptcy Estate, but will be paid over
to their Bankruptcy Estate only on further order of the Court.
The Debtors have negotiated the terms of the Contract in good faith
to sell the Property to the Purchasers. They submit that the sale
is in the best interest of the Debtors, the Estate, and their
creditors. Specifically, the sale of the Property is part of the
Debtors' plan to liquidate those assets that drain available cash
from the Estate so that they can submit a feasible and good faith
Chapter 11 Plan of Reorganization.
The closing date for the Contract is Jan. 29, 2021. Accordingly,
the Debtors ask that the notice and deadline for responses and
objections be shortened to four days. Specifically, Jan. 18, 2021
and, schedule the hearing on the Motion for Jan. 20, 2021, at 9:00
a.m. (CT).
A copy of the Contract and Exhibit A is available at
https://tinyurl.com/y2gyfund from PacerMonitor.com free of charge.
Alfredo Gonzalez and Hector Facundo sought Chapter 11 protection
(Bankr. S.D. Tex. Case No. 20-10209) on Aug. 31, 2020. The Debtors
tapped Christopher Phillippe, Esq., as counsel.
AMBICA M&J: Comfort Inn in Saratoga Springs, NY Seeks Chapter 11
----------------------------------------------------------------
Robin K. Cooper of Albany Business Review reports that the owners
of the Comfort Inn & Suites Hotel and Golden Corral restaurant just
outside Saratoga Springs have filed for Chapter 11 bankruptcy
protection to stop a receiver taking control of the finances and
hiring a hospitality company to run the business.
Mother-and-son owners Nirmala Patel and Niral Patel are trying to
reorganize their finances as they contend with a sharp drop in
hotel occupancy and work to reinvent their buffet restaurant that
was forced to close amid the Covid-19 pandemic.
"Right now there is an unprecedented adverse economic impact from
the pandemic, hopefully before too long the restaurant will be able
to operate again, people will start traveling and the track will
reopen," said Justin Heller, the Patel's attorney and a managing
partner with Nolan Heller Kauffman LLP in Albany.
The Patels filed Chapter 11 in federal bankruptcy court in Albany
on Jan. 11, 2021 after acting state Supreme Court judge Richard
Sise signed an order for a receiver from Saratoga Springs to take
control and retain Hostmark Hospitality Group of Illinois to manage
day-to-day operations.
The Patels' primary lender, SDI Matto JV Holdco LLC of Florida, was
in the process of foreclosing after the owners defaulted on a
loan.
The family operates Comfort Inn & Suites hotels outside Saratoga
Springs and Albany, along with seven Golden Corral restaurants.
They filed three Chapter 11 cases relating to the Golden Corral and
Comfort Inn and the real estate where they sit at 15-17 Old Gick
Road in Wilton, just off Exit 15 of the Interstate 87 Northway.
The Patels own 7 acres on Old Gick Road under a holding company
called Ambica M&J Two LLC. A Chapter 11 filing for Ambica shows
the holding company owes $9.77 million in secured debt, including
$600,000 to a private lender from Glens Falls and $9.17 million
owed to SDI Matto.
The family defaulted several years ago and has faced foreclosure
before, Heller said. Once the default occurred, lenders
accelerated repayment and the Patels struggled to keep up until a
repayment agreement was worked out about a year ago. When the
pandemic hit, the family was unable to keep up after the restaurant
was forced to close and hotel occupancy dropped.
Hotel occupancy currently is hovering around 30%, Heller said,
about half of what it normally would be at this time of year, the
slowest season for the property.
"We believe these businesses will be able to return to normal or
new normal operations. They will be able to generate significant
cash flow so they can repay the debts. And they will return to
being a significant employer in the community," Heller said.
The Chapter 11 filing is unrelated to the Patels' dispute with
Adirondack Trust Co., which accused the family of improperly
spending some of the $1.98 million they received through the
federal Paycheck Protection Program.
The bank froze spending relating to the federal money and sued the
Patels in state Supreme Court in October, claiming money was spent
to pay residential mortgages and other personal expenses instead of
being used to contend with pandemic-related problems at the
family's two Comfort Inn hotels and seven Golden Corral
restaurants.
The family filed a countersuit against Adirondack Trust last month
asking for the release of the federal money, plus $10 million in
damages.
"The underlying grounds for Adirondack Trust Co.'s claims are all
based on flawed assumptions and mischaracterizations," Heller said
last month.
The bank contends that Nirmala Patel used the federal money to make
five mortgage payments on her home, totaling more than $17,000.
Adirondack Trust also alleges that Nirmala Patel improperly
transferred $26,000 from her personal account that included federal
money to her son's personal checking account.
Because the Patels filed an emergency Chapter 11 case to stop the
receiver from stepping in, they have a few more weeks to file
financials with the court.
Besides debt associated with the real estate, the Chapter 11 filing
for Jagdamba II Corp., which controls the Golden Corral on Old Gick
Road, lists more than $3 million in debt that is unsecured by
collateral. The largest creditors include Bank United of Florida,
which is owed $2.5 million, plus $208,000 owed to the Internal
Revenue Service and a $173,000 claim with Adirondack Trust Co. of
Saratoga Springs.
Maha Laxmi II Corp., the entity that controls the 87-room Comfort
Inn, lists some of the same debts in a separate Chapter 11 filing.
Additional debts include more than $275,000 in unsecured claims
with Adirondack Trust, Choice Hotels International, National Grid
and Spectrum.
About Ambica M&J Two
Ambica M&J Two LLC is a Single Asset Real Estate debtor (as defined
in 11 U.S.C. Section 101(51B)), which owns property that's occupied
by the Comfort Inn & Suites Hotel and Golden Corral restaurant at
17 Old Gick Road, Saratoga Springs, New York. Maha Laxmi II Corp.
is the entity that controls the 87-room Comfort Inn. Jagdamba II
Corp. controls the Golden Corral. The three entities are owned by
mother-and-son team Nirmala Patel and Niral Patel.
To stop a receiver from taking control of the hotel and restaurant,
Ambica M&J Two LLC, Jagdamba II Corp., and Maha Laxmi II Corp.
sought Chapter 11 protection (Bankr. N.D.N.Y. Case No. 21-10014 to
21-10016) on Jan. 11, 2021. The petitions were signed by Niral
Patel, secretary.
Ambica M&J Two estimated assets and liabilities of $1 million to
$10 million. Jagdamba II Corp. estimated assets of $500,000 to $1
million and liabilities of $10 million to $50 million. Maha Laxmi
II Corp. estimated assets of $1 million to $10 million and
liabilities of $10 million to $50 million.
The Hon. Robert E. Littlefield Jr. is the case judge.
NOLAN HELLER KAUFFMAN LLP, led by Justin A. Heller, is serving as
the Debtors' counsel.
AMBICA M&J: Seeks to Hire Nolan Heller as Counsel
-------------------------------------------------
Ambica M&J Two LLC, and its debtor-affiliates seek authority from
the U.S. Bankruptcy Court for the Northern District of New York to
employ Nolan Heller Kauffman LLP, as counsel to the Debtors.
Ambica M&J requires Nolan Heller to:
a. give the Debtor legal advice with respect to its powers and
duties as debtor in possession of the continued operation
of the business and management of its property;
b. prepare on the behalf of the Debtor in possession in
necessary applications, answers, reports, orders,
disclosure statement and plan, and other legal papers;
c. represent the Debtor in litigations;
d. represent the Debtor in various transactional and other
legal matters as may be required or desirable; and
e. perform all legal services for the Debtor as may be
necessary herein.
Nolan Heller will be paid at the hourly rates of $285 to $330.
The Debtors paid Nolan Heller an initial retainer in the amount of
$40,000. The amount of $6,926.50 has been applied to accrued
pre-petition fees incurred collectively by the Debtors, with the
balance of $33,073.50 held as equal retainers for each Debtor in
the individual amount of $11,024.50 pending future applications and
allowance of fees by the Court for post-petition services.
Nolan Heller will also be reimbursed for reasonable out-of-pocket
expenses incurred.
Justin A. Heller, a partner of Nolan Heller Kauffman LLP, assured
the Court that the firm is a "disinterested person" as the term is
defined in Section 101(14) of the Bankruptcy Code and does not
represent any interest adverse to the Debtors and their estates.
Nolan Heller can be reached at:
Justin A. Heller, Esq.
NOLAN HELLER KAUFFMAN LLP
80 State Street, 11th Floor
Albany, NY 12207
Tel: (518) 449-3300
E-mail: jheller@nhkllp.com
About Ambica M&J Two LLC
Ambica M&J Two LLC is a Single Asset Real Estate debtor (as defined
in 11 U.S.C. Section 101(51B)), which owns property that's occupied
by the Comfort Inn & Suites Hotel and Golden Corral restaurant at
17 Old Gick Road, Saratoga Springs, New York. Maha Laxmi II Corp.
is the entity that controls the 87-room Comfort Inn. Jagdamba II
Corp. controls the Golden Corral. The three entities are owned by
mother-and-son team Nirmala Patel and Niral Patel.
To stop a receiver from taking control of the hotel and restaurant,
Ambica M&J Two LLC, Jagdamba II Corp., and Maha Laxmi II Corp.
sought Chapter 11 protection (Bankr. N.D.N.Y. Case No. 21-10014 to
21-10016) on Jan. 11, 2021. The petitions were signed by Niral
Patel, secretary.
Ambica M&J Two estimated assets and liabilities of $1 million to
$10 million. Jagdamba II Corp. estimated assets of $500,000 to $1
million and liabilities of $10 million to $50 million. Maha Laxmi
II Corp. estimated assets of $1 million to $10 million and
liabilities of $10 million to $50 million.
The Hon. Robert E. Littlefield Jr. is the case judge.
NOLAN HELLER KAUFFMAN LLP, led by Justin A. Heller, is serving as
the Debtors' counsel.
AMERICAN ACHIEVEMENT: Surprised by Junior Lenders' Bid for Ch. 11
-----------------------------------------------------------------
American Achievement Corporation, the digital retailer and premier
provider of school recognition products, on Jan. 15, 2021,
disclosed that an involuntary Chapter 11 petition was filed in the
Bankruptcy Court for the Northern District of Texas Dallas Division
by four of the Company's junior lenders against the Company and
certain of its subsidiaries. The Company will promptly respond to
the petition within the permitted 21 days.
"While we were surprised by the actions of the junior lenders,
American Achievement Corporation is committed to working through
this process," said Bob Myers, American Achievement Corporation's
Chief Executive Officer. "Our valued employees, customers and
partners can be assured that we will continue to operate.
Employees, representatives and suppliers will be paid as normal and
our customers can expect orders to be fulfilled as always."
COVID-19 has adversely affected the commencement, graduation, and
yearbook business—as it has many industries. Despite this, the
Company continues to be profitable, as it has successfully pivoted
and adjusted to operating in the pandemic.
"Despite the challenging business environment, the Company is
profitable and during the past year has grown its market share in
its commencement-related businesses," Myers said. "The Company has
the support of its senior lenders and sufficient liquidity to
operate in the ordinary course of business and will continue to do
so. We look forward to continuing to serve and support students."
"As we enter peak ordering and delivery season, it is important to
remain focused on helping our schools celebrate the most meaningful
moments in their students' lives, this year more than ever," Myers
added.
About American Achievement
American Achievement Corporation is the world's largest Collegiate
and High School commencement services company leading the industry
in digital product innovation by helping students and their
families celebrate life's most important achievements with a suite
of digital commencement services & innovations. The School's
personalized, customized products and services are available
through digital technology, personal in-school deliveries and
customized school assortments on Balfour.com, the destination for
Graduation products.
Junior bondholders filed involuntary Chapter 11 petitions for
American Achievement Corporation and 14 affiliates (Bankr. N.D.
Tex. Lead Case No. 21-30058) on Jan. 14, 2021.
Alleged creditors who signed the involuntary petitions are
Prudential Capital Partners IV, L.P., Prudential Capital Partners
Management Fund IV, L.P., Prudential Capital Partners (Parallel
Fund) IV, L.P., and Falcon Strategic Partners IV, LP., who assert
at least $120 million in claims on account of 8.00% Senior
Subordinated Notes issued by the Debtors.
GRAY REED & MCGRAW LLP, led by Jason S. Brookner, is representing
the Junior Bondholders.
AMERICAN DENTAL: Moody's Completes Review, Retains B3 CFR
---------------------------------------------------------
Moody's Investors Service has completed a periodic review of the
ratings of American Dental Partners, Inc. and other ratings that
are associated with the same analytical unit. The review was
conducted through a portfolio review discussion held on January 11,
2021 in which Moody's reassessed the appropriateness of the ratings
in the context of the relevant principal methodology(ies), recent
developments, and a comparison of the financial and operating
profile to similarly rated peers. The review did not involve a
rating committee. Since January 1, 2019, Moody's practice has been
to issue a press release following each periodic review to announce
its completion.
This publication does not announce a credit rating action and is
not an indication of whether or not a credit rating action is
likely in the near future. Credit ratings and outlook/review status
cannot be changed in a portfolio review and hence are not impacted
by this announcement.
Key rating considerations.
American Dental Partners, Inc.'s ("ADPI") B3 CFR reflects its high
financial leverage and weak free cash flow and interest coverage
metrics. The rating is constrained by the company's aggressive
growth strategy, which has shifted from opening new offices to
acquiring existing dental practices. The credit profile is also
constrained by weaker operational performance resulting from volume
declines experienced amidst the coronavirus pandemic. The rating
benefits from ADPI's solid market presence in the growing dental
services industry and the highly fragmented dental care market.
The principal methodology used for this review was Business and
Consumer Service Industry published in October 2016.
AMN HEALTHCARE: Moody's Completes Review, Retains Ba2 CFR
---------------------------------------------------------
Moody's Investors Service has completed a periodic review of the
ratings of AMN Healthcare, Inc. and other ratings that are
associated with the same analytical unit. The review was conducted
through a portfolio review discussion held on January 11, 2021 in
which Moody's reassessed the appropriateness of the ratings in the
context of the relevant principal methodology(ies), recent
developments, and a comparison of the financial and operating
profile to similarly rated peers. The review did not involve a
rating committee. Since January 1, 2019, Moody's practice has been
to issue a press release following each periodic review to announce
its completion.
This publication does not announce a credit rating action and is
not an indication of whether or not a credit rating action is
likely in the near future. Credit ratings and outlook/review status
cannot be changed in a portfolio review and hence are not impacted
by this announcement.
Key rating considerations.
AMN Healthcare's Ba2 Corporate Family Rating benefits from the
company's moderate leverage, leading market position in the
temporary healthcare staffing industry and very good liquidity
profile. The rating is constrained by highly cyclical nature of
Nurse and Allied Solutions segment which contributes approximately
70% of revenues and exposure to an economic downturn given that the
coronavirus pandemic is still ongoing.
The principal methodology used for this review was Business and
Consumer Service Industry published in October 2016.
ARETEC GROUP: Moody's Affirms B3 CFR & Alters Outlook to Stable
---------------------------------------------------------------
Moody's Investors Service affirmed Aretec Group, Inc.'s B3
Corporate Family Rating. Moody's also affirmed Aretec's B2 first
lien senior secured term loan and revolving credit facility ratings
and its Caa2 second lien senior secured term loan rating.
Concurrently, Moody's changed Aretec's rating outlook to stable
from negative. Moody's said Aretec is Cetera Financial Group's
holding company.
Moody's has taken the following rating actions on Aretec Group,
Inc.:
Corporate Family Rating, Affirmed at B3
$100 million first lien senior secured revolving credit facility,
Affirmed at B2
$930 million first lien senior secured term loan, Affirmed at B2
$190 million second lien senior secured term loan, Affirmed at
Caa2
Outlook, Changed to stable from negative
RATINGS RATIONALE
Moody's said Aretec's B3 CFR reflects its weak profitability and
debt servicing capacity, with elevated levels of debt. Moody's said
Aretec's stabilizing financial advisor base and growth strategy
focused on advisor recruiting help support its CFR.
Moody's said the March 2020 Federal Reserve Board cut to the fed
funds rate to its current target range of 0%-.25% has had a
negative effect on Aretec's asset-based fees where it earns fee
income on its clients' uninvested cash balances. However, in
response Aretec's strong management team swiftly lowered expenses,
accelerated some of its projects with focus on efficiencies and
adapted the firm's operations to a new remote work environment.
These credit positive actions demonstrate the company's ability to
adapt, the rating agency noted, and put Aretec in a stronger
position to benefit from improving operating conditions and a
strong, broad-based rise in equities markets. Moody's said these
considerations were the key drivers behind the change in the rating
outlook to stable from negative.
Were client asset levels to rise further from here - which are
broadly driven by advisor recruiting, elevated and stable retention
rates and broad equities markets levels -- would put Aretec back on
its path of organic deleveraging, a credit positive said Moody's.
The change in Aretec's outlook to stable from negative reflects
Moody's expectation that the firm's attentive and granular
management of its cash flows in 2020 will help it in accelerating
its recovery from the challenges of the coronavirus pandemic. The
change in outlook also reflects Aretec's stabilizing financial
advisor base and client assets levels and the firm's improving
liquidity position which was the result of management swift focus
on cost-cutting and improving efficiencies.
In accordance with Moody's Loss Given Default for Speculative-Grade
Companies methodology, the rating of the $930 million first lien
term loan and $100 million revolving credit facility are B2,
reflecting their priority ranking in Aretec's capital structure.
The Caa2 rating of Aretec's $190 million second lien loan is also
based upon the application of Moody's Loss Given Default for
Speculative-Grade Companies methodology and the facility's
secondary ranking in Aretec's capital.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Aretec's ratings could be upgraded if the company were to
experience a significant improvement in its debt leverage on a
Moody's adjusted basis to below 6.5x; a significant expansion of
existing revenue streams, or development of new ones, resulting in
a sustainable increase in revenue diversification and less reliance
on the macroeconomic environment; and strong advisor recruitment
and improved advisor retention rates leading to growth in client
assets and a sustainable improvement in profitability.
Moody's said that the ratings could be downgraded should it become
clear that leverage levels will increase above 7.5x on a
sustainable basis, such as through an increase in leverage to help
fund additional acquisitions or advisor recruiting loans; were
Aretec to suffer a deterioration in revenue, not offset by expense
management, resulting in an EBITDA/interest expense below 1.0x; or
were the firm to experience a significant decline in number of
financial advisors or a deterioration in advisor retention levels.
In addition, Moody's noted that the rating of Aretec's first lien
loan could be downgraded should there be some prepayments on the
existing second lien loan, resulting in reduction of the loss
absorption provided by the second lien loan and lifting the
expected loss rate on the first lien loan. The same could happen
should the first lien loan be upsized, resulting in it having a
larger proportion relative to the firm's overall capital structure
and a higher expected loss rate.
The principal methodology used in these ratings was Securities
Industry Service Providers Methodology published in November 2019.
AUTO MASTER: $439K Sale of Juncos Property to Route 65 Approved
---------------------------------------------------------------
Judge Enrique S. Lamoutte of the U.S. Bankruptcy Court for the
District of Puerto Rico authorized Auto Master Express, Inc. and
its secured creditor, Route 65, Inc., to sell the Service Station
located at PR 198 km 16.0, Ceiba Norte Ward, in Juncos, Puerto
Rico, investment property at Carr. 198 km 16.0 Bo. Ceiba Norte, in
Juncos, Puerto Rico, to Route 65 for $408,000, plus $30,575 to the
Municipal Revenue Collection Center ("CRIM").
Route 65 will pay of the CRIM's Secured Claim No. 2 the amount of
$30,575. Any remaining amount will be paid through the Plan by the
Debtor.
The sale is free and clear of all liens and encumbrances. The
liens, leases and/or encumbrances encumbering the Property are to
be completely or caused to be cancelled pursuant to the provisions
of Sections 363 of the Bankruptcy Code and in accordance with the
terms of the Order.
Any and all claims, interests (including possession), liens, and
encumbrances that may have been assessed and/or registered at the
CRIM, the Puerto Rico Treasury Department, and the Puerto Rico
Property Registry over the Property will be cancelled.
The Executive Director of the Municipal Revenue Collection Center,
after the receipt of the $30,575 due by the Debtor, will perform
all operations necessary in the systems and records of the CRIM to
cancel, eliminate and/or extinguish any and all real property taxes
that appear as liens, claims, interests or encumbrances over the
Property.
The Secretary of the Puerto Rico Treasury Department will perform
all operations necessary in the systems and records of Treasury to
cancel, eliminate and/or extinguish any and all real property taxes
that appear as liens, claims, interests or encumbrances over the
Property.
The Puerto Rico Property Registrar will perform all registrations
and operations necessary in its systems and records of the PR
Property Registry to cancel, eliminate and/or extinguish any and
all claims, interests or encumbrances over the Property.
A Writ of Cancellation of Liens will be issued by the Clerk of the
Court, whereby the Executive Director of the CRIM, the Secretary of
the Puerto Rico Treasury Department, and/or the Puerto Rico
Property Registrar will be instructed to cancel any liens, claims,
interests or encumbrances assessed over the Property.
Each and every Commonwealth of Puerto Rico governmental agency or
department and state and local governmental agency or department is
directed to accept any and all documents and instruments necessary
and appropriate to consummate the transfer of title of the Property
to Route 65 free and clear of any and all Interests, including the
registration of Route 65 as owner of any real estate acquired from
the Debtor.
The authorizing notary will be exempt from cancellation of any and
all stamp tax, internal revenue and legal aid stamps, or similar
taxes for the transactions set forth at length in the original
deeds of transfer and cancellation of mortgages.
About Auto Master Express
Auto Master Express Inc. sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. D.P.R. Case No. 18-01464) on March 19,
2018. At the time of the filing, the Debtor estimated assets of
less than $500,000 and liabilities of less than $1 million. The
Debtor engaged Lcdo. Carlos Alberto Ruiz, CSP, as its legal
counsel.
AVEANNA HEALTHCARE: Moody's Completes Review, Retains B3 CFR
------------------------------------------------------------
Moody's Investors Service has completed a periodic review of the
ratings of Aveanna Healthcare LLC and other ratings that are
associated with the same analytical unit. The review was conducted
through a portfolio review discussion held on January 11, 2021 in
which Moody's reassessed the appropriateness of the ratings in the
context of the relevant principal methodology(ies), recent
developments, and a comparison of the financial and operating
profile to similarly rated peers. The review did not involve a
rating committee. Since January 1, 2019, Moody's practice has been
to issue a press release following each periodic review to announce
its completion.
This publication does not announce a credit rating action and is
not an indication of whether or not a credit rating action is
likely in the near future. Credit ratings and outlook/review status
cannot be changed in a portfolio review and hence are not impacted
by this announcement.
Key rating considerations.
Aveanna Healthcare LLC's B3 Corporate Family Rating reflects its
high financial leverage, highly concentrated payor mix, and
meaningful geographic concentration. Aveanna's rating benefits from
its leading position in the otherwise fragmented market of
pediatric home health services, and favorable long-term industry
growth prospects. The overall market has solid growth prospects due
to population trends, and its service offerings will remain
critical in nature.
The principal methodology used for this review was Business and
Consumer Service Industry published in October 2016.
BARNEYS NEW YORK: Reopens at Saks After Bankruptcy
--------------------------------------------------
Kim Bhasin of Bloomberg News reports that Barneys New York is
finally returning to its hometown after the pandemic delayed its
post-bankruptcy revival plans.
The retailer, which for decades was a mainstay of the city's retail
scene, opened Friday, January 15, 2021, inside Saks Fifth Avenue's
Manhattan flagship under the name Barneys at Saks. It follows an
11-month absence from the city.
At 54,000 square feet, the Barneys store-within-a-store is about a
fifth the size of its old location that was located several blocks
to the north. That store closed in early 2020 after the retailer
went bankrupt for the second time.
About Barneys New York
Barneys New York -- https://www.barneys.com/ -- is a creative
destination for modern luxury retail, entertainment and dining.
Barneys is renowned for being a place of discovery for some of the
world's leading designers, and for creating the most discerning
edit across women's and men's ready-to-wear, accessories, shoes,
jewelry, cosmetics, fragrances, and home. Barneys' signature
creativity and style comes to life through its innovative concepts
and experiences, imaginative holiday campaigns, famed window
displays, and exclusive activations. Barneys also operates its
iconic restaurants, Freds at Barneys New York, serving an
Italian-inspired and contemporary American menu within four of its
flagship stores.
Barneys New York, Inc., and four affiliates sought Chapter 11
protection (Bankr. S.D.N.Y. Lead Case No. 19-36300) in
Poughkeepsie, N.Y. The cases are assigned to Judge Cecelia G.
Morris.
Barneys disclosed $457 million in assets and $377 million in
liabilities as of July 6, 2019.
The Debtors tapped Kirkland & Ellis LLP as legal advisor, Houlihan
Lokey as financial advisor, M-III Partners, L.P., as restructuring
advisor, and Katten Muchin Rosenman LLP as conflicts counsel.
Bankruptcy Management Solutions, Inc., which conducts business
under the name Stretto, was the claims agent.
* * *
As no other qualified bids were received, the Debtors sold the
business in October 2019 to Authentic Brands Group for $271.4
million, a deal that also led to the resignation of Barney's New
York's CEO at the time, Daniella Vitale. The buyer, ABG-Barneys
LLC, is a wholly-owned subsidiary of B. Riley Financial, Inc., a
publicly traded, diversified financial services
company.
BAVARIA INN: Hires Saltzman LLC as Expert Witness
-------------------------------------------------
Bavaria Inn Restaurant, Inc. d/b/a Shotgun Willies, seeks authority
from the U.S. Bankruptcy Court for the District of Colorado to
employ Saltzman LLC, as expert witness to the Debtor.
Bavaria Inn requires Saltzman LLC to render expert opinion to the
Debtor to value its business, including cash flow projections for 5
years to include in the Debtor's Plan.
Saltzman LLC will be paid at the hourly rate of $385.
Saltzman LLC will also be reimbursed for reasonable out-of-pocket
expenses incurred.
Scott Saltzman, a partner of Saltzman LLC, assured the Court that
the firm is a "disinterested person" as the term is defined in
Section 101(14) of the Bankruptcy Code and does not represent any
interest adverse to the Debtor and its estates.
Saltzman LLC can be reached at:
Scott Saltzman
Saltzman LLC
5655 S. Yosemite St., Suite 205
Greenwood Village, CO 80211
Tel: (303) 333-3554
E-mail: scott@saltzmanllc.com
About Bavaria Inn Restaurant
Based in Denver, Colo., Bavaria Inn Restaurant, Inc., operates
under the name Shotgun Willies, owns and operates a bar and
restaurant.
Bavaria Inn Restaurant sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. D. Colo. Case No. 20-17488) on Nov. 18,
2020. The petition was signed by Deborah Dunafon, president.
At the time of the filing, the Debtor estimated assets of between
$500,000 and $1 million and liabilities of between $1 million and
$10 million.
Judge Elizabeth E. Brown oversees the case.
Weinman & Associates, P.C., is the Debtor's legal counsel.
BELK INC: Taps Lazard, Kirkland for Restructuring Advice
--------------------------------------------------------
Eliza Ronalds-Hannon and Lauren Coleman-Lochner of Bloomberg News
report that Belk Inc., the department store chain owned by Sycamore
Partners, is talking with creditors about easing its almost $2.4
billion debt load and has tapped law firm Kirkland & Ellis and
investment bank Lazard Ltd. for advice.
Belk and its advisers are huddling with holders of the retailer's
debt -- which includes first-lien and second-lien securities,
according to people with knowledge of the matter. Options could
include a debt-for-equity exchange and new financing, according to
the people, who asked not to be named discussing private
negotiations.
Discussions are in the early stages and plans could change,
according to the people.
Belk raised alarms among suppliers in late 2020 by delaying vendor
payments for months amid pandemic shutdowns, Bloomberg reported. A
term loan of more than $900 million issued in 2019 now trades for
around 39 cents on the dollar.
About Belk Inc.
Belk, Inc., is an American department store chain founded in 1888
by William Henry Belk in Monroe, North Carolina. Now based in
Charlotte, North Carolina, Belk operates 292 stores in 16 states
primarily in Southeastern states. The company generated revenue of
approximately $3.8 billion during the the year Nov. 2, 2019. The
company was acquired by Sycamore Partners in a transaction valued
at $3 billion in December 2015.
BELZO LLC: New Jersey CVS Buying Substantially All Assets for $360K
-------------------------------------------------------------------
Belzo, LLC, doing business as Rockaway Pharmacy & Compounding, asks
the U.S. Bankruptcy Court for the District of New Jersey to
authorize the bid procedures relating to the sale of substantially
all operating assets, including prescription records and files,
customer lists and similar goodwill, inventory (both prescription
and non-prescription), equipment and machinery, tools, accessories,
computers, furniture and supplies used in connection with its
business, to New Jersey CVS Pharmacy, L.L.C. for $360,000 plus the
value of the inventory, subject to overbid.
Pursuant to a contract of sale, dated July 18, 2014; and a bill of
sale, dated Aug. 4, 2014, the Debtor acquired all of the assets of
Alblez, Inc., consisting of the retail pharmacy business of
Rockaway Pharmacy & Compounding, including inventory, accounts
receivable, fixtures, equipment, prescription records and files,
good will, and related assets. The Debtor also received an
assignment of a lease, dated Aug. 9, 2005 for the premises located
at 25 W. Main Street, Rockaway, New Jersey ("Premises").
Upon the completion of the acquisition, the Debtor operated a
retail pharmacy and compounding business at the Premises, where it
continues to still operate today. An individual named Greg DePaolo
is the sole member and managing member of the Debtor. The Debtor
currently employs two full time employees, including Mr. DePaolo,
and six part-time employees.
The Debtor has multiple creditors that assert secured claims.
Cardinal Health has a first lien upon the Debtor's assets arising
from the sale of goods on credit pursuant to (i) that certain
Security Agreement, dated Sept. 4, 2014, by and between the Debtor
and Cardinal Health, and (ii) that certain Prime Vendor Agreement
entered into by and between Rockaway and Cardinal Health with an
initial term of Nov. 1, 2017 to Oct. 31, 2019 ("PVA").
The Debtor defaulted under the terms of the PVA on Jan. 9, 2020,
and Cardinal Health obtained an Arbitration Award against the
Debtor and Mr. DePaolo, jointly and severally, in the Superior
Court of New Jersey, Morris County, Docket Number MRS-L-1911-18 in
the amount of $350,000. Subsequently, on Sept. 21, 2020 Cardinal
Health received payments totaling approximately $61,733 on Sept. 9,
2020.
As reflected in the Interim Cash Collateral Order, dated Oct. 9,
2020, Cardinal Health has a properly perfected first lien and
security interest in all of the Debtor's assets. The Cash
Collateral Order is now the Final Cash Collateral Order pursuant to
the terms of the Order and the lack of any objections thereto.
Pursuant to the Cash Collateral Order, Cardinal Health agreed to a
carveout for the Debtor's professional fees in the amount of up to
$47,500. Cardinal Health filed a secured proof of claim on Dec.
11, 2020 reflecting a balance due of $427,386.
The Debtor has granted various liens upon its assets to several
high interest rate lenders, several of which can likely be
characterized as "merchant cash advance" lenders that purport to
purchase the borrower's receivables. All of these lenders are
subordinate to Cardinal Health's first lien upon the Debtor's
assets.
The Debtor obtained a loan from Bankers Healthcare Group in
December 2018. Bankers Healthcare filed a secured proof of claim
on Dec. 14, 2020 in the amount of $111,548 (Claim 17). Upon
information and belief, Bankers Healthcare asserts that it has the
second lien upon the Debtor's assets.
The Debtor received two loans from Kapitus Servicing in June 2019
and December 2019. Kapitus filed a secured proof of claim on Nov.
13, 2020 in the amount of $172,783 (Claim 7). Subsequently, on
Nov. 16, 2020, Kapitus filed an amended claim reflecting the same
dollar amount. The Debtor understands that Kapitus is asserting
that it purchased the Debtor's accounts receivable outright, and
further asserts that its UCC filing is third in priority.
The Debtor received a loan from The Fundworks, LLC ("FW") on Dec.
9, 2019 in the amount of $90,000. FW filed a UCC Financing
Statement with the New Jersey Division of Commercial Recording on
Aug. 7, 2019. It filed a secured proof of claim on Nov. 24, 2020
in the amount of $80,978 (Claim 9). FW received a payment from the
Debtor in the amount of approximately $20,000 in August 2020.
The Debtor has unsecured debt in the range of approximately $1
million.
The Debtor owes administrative claims to its landlord regarding the
Premises, Moorehouse Properties, in an unliquidated amount, and
believes that there might be some post—petition wages due to Mr.
DePaolo.
In light of the Debtor's marginal ability to operate profitably, it
has been exploring an expeditious sale of the Assets. Toward that
end, the Debtor has been engaged in extensive efforts during the
past year to identify and attract entities who may be interested in
purchasing the Assets, and engaged in extensive negotiations with
several prospective purchasers.
As a result of those efforts, the Debtor is negotiating an Asset
Purchase Agreement with the Purchaser providing for the sale of the
Assets. In addition, the Debtor has received a written purchase
offer from the Walgreens Co. and received expressions of interest
from at least two other parties. To ensure that maximum value is
received for the Assets, the Debtor proposes, to provide notice of
the sale to several other parties potentially interested in
purchasing the Assets.
The APA provides for the sale of the Assets, which consist of the
Debtor's: (i) inventory, including prescription inventory,
non-prescription inventory and "front store" merchandise; (ii)
prescription files, records and data, and (iii) goodwill. The
Purchaser has agreed to pay $360,000 plus the value of the
inventory. The price of the inventory will be based upon an actual
inventory, subject to a maximum price of $160,000 for the
prescription inventory, and a $5,000 maximum price for the front of
store merchandise.
The sale is subject to the approval of the Court, and the entry of
an order thereby providing for the Assets to be conveyed to the
Purchaser free and clear of all liens, claims, encumbrances and
liabilities. The Purchaser reserves the right to file an
application with the Court asking to recover a breakup fee of up to
$25,000. The Debtor believes that Cardinal Health is likely to
consent to the sale of the Assets.
The Debtor's principal, Greg DePaolo, has agreed to a restrictive
covenant, and agreed to utilize reasonable efforts to facilitate
the sale. He will not be receiving an employment agreement in
connection with the proposed sale.
The Compounding Business is excluded from the sale. The Debtor
purchased the Compounding Business approximately two years ago for
a price of $75,000. The Compounding Business is a specialty niche
which the Purchaser has no interest in acquiring. The Debtor is
attempting to arrange a private sale of the Compounding Business in
order to preserve its value.
The Debtor respectfully proposes and ask approval of the following
bid procedures:
a. The Assets must be sold to a single bidder, in a single
sale. All bidders must be willing to sign an asset purchase
agreement on substantially the same or better terms as the APA,
unless the Debtor waives such requirement. Bids must not be
subject to any financing or other contingencies not otherwise
expressly contained in the APA or waived by the Debtor.
b. The Purchaser is authorized to bid at the Auction Sale.
In order to be a qualified bidder and entitled to bid at the
Auction Sale, other prospective bidders must submit to the Debtor's
counsel a written bid for the Assets in an amount of at least
$35,000 more than the Purchaser's bid, and deliver an earnest money
deposit to the Debtor's counsel equal to 10% of the cash component
of the purchase price, payable to the trust account of the Debtor's
counsel at least two business days before the auction sale. The
bid must identify the bidder and contain such documents and
information as to establish the bidder's financial ability to
close. The Purchaser will also be obligated to provide a deposit
of $36,000 payable to the trust account of the Debtor's counsel at
least two business days before the auction sale. The Debtor's
counsel will notify Purchaser's counsel in writing of any competing
bids within one day of the counsel's receipt thereof. The Deposit
will be forfeited as liquidated damages if the Successful Bidder
fails to close by reason of its material breach of the contract of
sale to be signed by the Debtor and the Successful Bidder.
c. If higher or better bids are timely submitted, an open
auction sale on the record will be conducted at the law offices of
Cullen and Dykman LLP, 433 Hackensack Avenue, Hackensack, New
Jersey. The Purchaser and other qualified bidders who have
complied with the bidding procedures delineated may improve their
bids at the auction sale in increments of $10,000. The bidding
will be continuous and competitive and will not end until all
bidders have submitted their last and best offers.
d. At the conclusion of the auction, the Debtor will announce
the highest and best bid and the second highest and best bid. The
Successful Bidder will supplement its deposit by wire transfer or
other immediately available funds within one business day so that,
to the extent necessary, such deposit equals 10% of the cash
component of the highest and best bid.
e. The sale must close or the deposit must be returned by
March 1, 2021.
f. An evidentiary hearing to confirm the results of the
auction sale, if any, will be held as soon after the auction sale
as the Court's calendar will permit.
g. Expense Reimbursement Fee: $25,000
In View of the Debtors' immediate need to close on this sale, it
asks that upon approval of Motion, the 10-day period pursuant to
Rule 6004(g) be waived by the Court.
A copy of the APA is available at https://tinyurl.com/yymcgbmg from
PacerMonitor.com free of charge.
About Belzo LLC
Belzo LLC operates as a full service Morris County pharmacy and
compounding center.
Belzo LLC d/b/a Rockaway Pharmacy & Compounding, based in
Rockaway,
NJ, filed a Chapter 11 petition (Bankr. D.N.J. 20-21322) on Oct.
5,
2020. The petition was signed by Greg DePaolo, managing member.
In its petition, the Debtor disclosed $572,500 in assets and
$1,761,853 in liabilities.
Cullen and Dykman LLP, serves as bankruptcy counsel to the Debtor.
BERRY GLOBAL: Moody's Rates $800MM First Lien Notes 'Ba2'
---------------------------------------------------------
Moody's Investors Service assigned a Ba2 rating to Berry Global
Inc.'s (a wholly owned subsidiary of Berry Global Group Inc.
("Berry")) $800 million senior secured first lien notes due 2024.
The Ba3 Corporate Family Rating, Ba3-PD Probability of Default
Rating, and SGL-2 Speculative Grade Liquidity Rating under Berry
Global Group Inc. are unchanged. The outlook remains stable. The
proceeds from the new notes will be used to repay the senior
secured first lien term loans due 2022 at par and pay fees and
expenses. Moody's considers the transaction credit neutral.
The Ba2 ratings on the first lien senior secured term loans and
notes, one notch above the Ba3 CFR, reflect the instruments'
subordination to the asset based revolver for the most liquid
assets (accounts receivable and inventory) and the benefit of the
loss absorption provided by a considerable amount of second lien
debt. The Ba3 CFR reflects an expectation of continued high
leverage through 2021 resulting from the debt financed acquisition
of RPC Group PLC in July 2019.
Assignments:
Issuer: Berry Global Inc.
Senior Secured Regular Bond/Debenture, Assigned Ba2 (LGD3)
The rating is subject to the receipt and review of the final
documentation.
RATINGS RATIONALE
Moody's expects Berry to improve leverage to 4.7 times by year-end
2021 driven primarily by debt reduction as the company continues to
use free cash flow to pay down debt. Strengths in Berry's credit
profile include its considerable scale (revenue), a concentration
of sales in relatively stable end markets (food and healthcare),
and strong free cash generation. Berry is the largest rated
packaging manufacturer by revenue and has 75% of its customer
business under long-term contracts with cost pass-through
provisions (raises customer switching costs and protects against
increases in volatile raw material costs). Governance risks are low
given that Berry is a public company and nine of its ten board
members are independent.
Weaknesses in Berry's credit profile include high leverage, some
exposure to more cyclical end markets and lengthy lags in
contractual cost pass-through mechanisms with customers (leaving
the company exposed to changes in volumes before increases in raw
material prices can be passed through). Berry operates in the
fragmented and competitive packaging industry which has many
private, unrated competitors and strong price competition.
The stable outlook reflects management's pledge to direct all free
cash flow to debt reduction until metrics improve to
pre-acquisition levels.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATING
The ratings could be upgraded if the company sustainably improves
credit metrics within the context of a stable competitive
environment while maintaining good liquidity. Specifically, the
ratings could be upgraded if funds from operations to debt is above
15.5%, debt to EBITDA is below 4.25 times, and EBITDA to interest
expense is above 5.25 times.
The rating could be downgraded if Berry fails to improve credit
metrics or there is any deterioration in liquidity or the
competitive environment. Additional debt financed acquisitions or
excessive acquisitions (regardless of financing) could also prompt
a downgrade. Specifically, the ratings could be downgraded if funds
from operations to debt is below 13%, debt to EBITDA is above 4.8
times, or EBITDA to interest expense is below 4.25 times.
Based in Evansville, Indiana, Berry Global Group Inc. is a
manufacturer of both rigid and flexible plastic packaging for food,
beverage, health care, personal care, and industrial end markets.
Berry generates approximately 51% of sales in North American, 40%
in EMEA, 5% in Asia Pacific, and 4% in the rest of the world. Net
sales for the twelve months ended September 30, 2020 totaled
approximately $11.7 billion.
The principal methodology used in this rating was Packaging
Manufacturers: Metal, Glass and Plastic Containers Methodology
published in September 2020.
BIOCLINICA HOLDING: Moody's Completes Review, Retains Caa1 CFR
--------------------------------------------------------------
Moody's Investors Service has completed a periodic review of the
ratings of BioClinica Holding I, LP and other ratings that are
associated with the same analytical unit. The review was conducted
through a portfolio review discussion held on January 11, 2021 in
which Moody's reassessed the appropriateness of the ratings in the
context of the relevant principal methodology(ies), recent
developments, and a comparison of the financial and operating
profile to similarly rated peers. The review did not involve a
rating committee. Since January 1, 2019, Moody's practice has been
to issue a press release following each periodic review to announce
its completion.
This publication does not announce a credit rating action and is
not an indication of whether or not a credit rating action is
likely in the near future. Credit ratings and outlook/review status
cannot be changed in a portfolio review and hence are not impacted
by this announcement.
Key rating considerations.
BioClinica Holding I, LP's Caa1 CFR broadly reflects its modest
absolute size and very high financial leverage. The rating also
reflects BioClinica's narrow product focus on specialized services
for the pharmaceutical industry, exposure to cancellations and
delays of clinical trials. BioClinica benefits from its good market
position as one of the leaders within the specialized niche of
outsourced imaging services for clinical trials. Further, while
overall liquidity is good, the company's revolving credit facility
will expire in October 2021. In December 2020, BioClinica announced
that it had reached an agreement to merge with eResearch
Technology, Inc.
The principal methodology used for this review was Business and
Consumer Service Industry published in October 2016.
BIOSOIL FARM: Files for Chapter 7 Bankruptcy Protection
-------------------------------------------------------
BioSoil Farm Inc. filed a Chapter 7 bankruptcy petition (Bankr.
N.D.N.Y. Case No. 20-11614) on Dec. 30, 2020.
A meeting of creditors under 11 U.S.C. Sec. 341(a) is scheduled for
Feb. 5, 2021 at 9:15 a.m.
The Chapter 7 Trustee:
Christian H. Dribusch-Trustee
1001 Glaz Street
East Greenbush, NY 12061
The Debtor's counsel:
Marc S. Ehrlich
Ehrlich Law Firm PC
Tel: 518-272-2110
E-mail: mehrlich@eapclaw.com
A copy of the Chapter 7 petition is available at
https://bit.ly/3ipGNp9 from PacerMonitor.com at no charge.
Albany Business Review reports that the company listed an address
of 204 Glenville Industrial Park, Schenectady, New York. It listed
assets up to $71,737 and debts up to $318,308. The filing's
largest creditor was listed as Scotia Industrial Park Inc.-047 with
an outstanding claim of $54,037.
About BioSoil Farm Inc.
BioSoil Farm is a NYS Licensed Hemp Farm. It started as a worm
farm committed in producing the best quality worm castings
available anywhere in the world. It sells tons of its premium worm
castings to clients all over the United States. While it still
manufactures worm castings and encapsulated worm castings, it
evolved into a controlled-environment, soil based hemp farm.
BR HEALTHCARE: Unsecureds to Recover Up to 94% in Liquidating Plan
------------------------------------------------------------------
BR Healthcare Solutions, LLC, f/d/b/a Karnes City Health &
Rehabilitation Center, filed a Small Business Chapter 11 Plan of
Liquidation and a Disclosure Statement on Jan. 13, 2021.
A hearing on the Disclosure Statement is scheduled for Feb. 22,
2021 at 10:00 a.m. via Telephone-Conference Dial-In Number:
(650)479-3207; Access Code: 160-591-1937.
The Debtor conducted business as a long-term care and short-term
rehabilitation facility in Karnes City, Texas, under the name
Karnes City Health & Rehabilitation Center. In January 2020, the
Debtor's principal, in consultation with counsel, decided to cease
operations as the entity did not have sufficient revenues to
continue operations. All of the remaining patients were
transitioned out of the facility in February 2020.
The Debtor received $238,445 in April and May, 2020, in relief
funds from the United States Department of Health and Human
Services as authorized by the Coronavirus Aid, Relief, and Economic
Security Act, also known as the "CARES Act". The funds remain in
the Debtor's accounts.
The Debtor does not believe any creditor will hold an allowed
secured claim in the case.
Holders of Class 4 general unsecured claims are impaired.
Creditors will receive (a) cash in an amount not to exceed the
amount of such claims; (b) in the event there are no sufficient
funds available to pay Class 4 claims in full, then each such
holders will receive a pro rata distribution of the funds available
to pay such claims; or (c) other treatment as may be agreed upon by
the parties.
According to the Liquidation Analysis, unsecured claims totaling
$1,049,247 will have a 94 percent recovery, assuming all A/R is
collectible and all HHS Funds may be used by the Debtor. In
contrast, in a Chapter 7 liquidation, recovery will be 83 percent.
The Plan will be funded from HHS Relief Funds and liquidated
assets.
A full-text copy of the Disclosure Statement dated January 13,
2021, is available at https://bit.ly/3su7RZ2 from PacerMonitor.com
at no charge.
Attorney for the Debtor-in-possession:
H. Anthony Hervol
LAW OFFICE OF H. ANTHONY HERVOL
4414 Centerview Road, Suite 207
San Antonio, Texas 78228
Tel: (210) 522-9500
Fax: (210) 522-0205
About BR Healthcare Solutions
BR Healthcare Solutions, LLC, operated as a long-term care and
short-term rehabilitation facility in Karnes City, Texas, under the
name Karnes City Health & Rehabilitation Center. In January 2020,
the facility ceased operations as it did not have sufficient
revenues to continue operations. The Company is controlled by
Sanjeev Bhatia, M.D., the 100% owner and authorized
representative.
BR Healthcare Solutions filed a Chapter 11 petition (Bankr. W.D.
Tex. Case No. 20-50627) on March 20, 2020. In its petition, the
Debtor estimated $500,000 to $1 million in assets and $1 million to
$10 million in liabilities. The petition was signed by Sanjeev
Bhatia, as member. The Hon. Craig A. Gargotta presides over the
case. H. Anthony Hervol, Esq., at the Law Office of H. Anthony
Hervol, is the Debtor's bankruptcy counsel.
BRIAN A. HANSEN: DWD Penalties Not Dischargeable, Says E.D. Wis.
----------------------------------------------------------------
Judge Brett H. Ludwig of the United States District Court for the
Eastern District of Wisconsin reversed the bankruptcy court's order
which concluded that a penalty imposed by the State of Wisconsin
Department of Workforce Development (DWD) against Brian Hansen for
his company's failure to maintain workers' compensation insurance
was dischargeable in Hansen's bankruptcy case.
The DWD previously assessed a $128,361.98 penalty against Brian
Hansen's company, H&S Landscape Products, Inc., for its failure to
maintain workers' compensation insurance to protect its employees
from workplace injuries, as required by Wisconsin law. As the sole
stockholder, president, and operating officer of H&S, Hansen was a
"responsible person" under Wis. Stat. Section 102.83(8) and
personally liable for the assessment.
Just before the DWD issued notice of the assessment, Hansen and his
spouse filed a joint Chapter 11 bankruptcy petition. In their
bankruptcy case, the Hansens proposed, and the bankruptcy court
confirmed, a reorganization plan under which general unsecured
creditors would receive annual installments equal to the Hansens'
annual future disposable income. The DWD did not filed a proof of
claim for the workers' compensation assessment and no portion of
the assessment was paid through the plan. The bankruptcy court
entered a Final Decree on October 7, 2016 and the case was closed.
On May 12, 2017, the DWD filed a motion in the bankruptcy court,
asking the court to confirm that the state could proceed with
collection of the worker's compensation assessment from Hansen,
notwithstanding his bankruptcy. The DWD argued that Hansen's
confirmed plan did not bar collection because the assessment was
excluded from the debtors' discharge under sections 523(a)(1)(A)
and 523(a)(7).
The bankruptcy court denied DWD's motion, holding that the DWD was
bound by the terms of the confirmed plan and was barred from
pursuing collection of the workers' compensation assessment from
Hansen.
The DWD appealed, arguing that the bankruptcy court committed error
in failing to conclude that Hansen's debt was a nondischargeable
excise tax under Section 523(a)(1)(A) or, in the alternative, a
nondischargeable penalty under Section 523(a)(7).
Section 523(a)(7) of the Bankruptcy Code excepts from discharge any
debt "to the extent such debt is for a fine, penalty, or forfeiture
payable to and for the benefit of a governmental unit, and is not
compensation for actual pecuniary loss, other than a [specified
type of] tax penalty."
The bankruptcy court held that the assessment is not "for the
benefit of a governmental unit" because the assessments benefited
injured workers. Thus, the court concluded that the DWD assessment
fell outside section 523(a)(7)'s exception to discharge.
Judge Ludwig of the district court disagreed. He held that
penalties recovered under Wis. Stat. Section 102.82(2)(a) are
payable to and for the benefit of a governmental unit. "The DWD is
not acting simply as a pass through for funds that are being
returned to specific victims. Indeed, none of the money that DWD
collects from Hansen will go to specific victims; the funds are not
even earmarked for distribution to Hansen's own injured employees.
Rather, the penalty will be used to offset the cost of an existing
state program that provides compensation to the injured employees
of uninsured employers. This is a direct benefit to the DWD, which
administers that program," explained the judge.
Judge Ludwig thus concluded that these penalties satisfy all
elements of 11 U.S.C. Secttion 523(a)(7) and are not dischargeable
in bankruptcy.
The case is STATE OF WISCONSIN, Appellant, v. BRIAN A HANSEN, AMIE
R HANSEN, Appellees, Case No. 17-cv-1635-bhl (E.D. Wis.). A
full-text copy of Judge Ludwig's decision and order, dated January
8, 2021, is available at https://tinyurl.com/y2wvuzor from
Leagle.com.
About Brian and Amie Hansen
Brian A. Hansen and Amie R. Hansen filed for Chapter 11 bankruptcy
protection (Bankr. E.D. Wis. Case No. 15-29453) on August 18, 2015.
CALIFORNIA RESOURCES: Back to Bond Market After Bankruptcy
----------------------------------------------------------
Carolina Gonzalez of Bloomberg News reports that just months after
emerging from bankruptcy, California Resources Corp. is back in the
bond market as interest rates fall.
The oil and gas company borrowed $600 million of five-year
unsecured notes in a deal that priced late on Thursday to yield
7.125%, below initial expectations. It plans to use proceeds from
the offering to repay debt.
California Resources is the latest energy company to try its luck
in the junk-bond market to capitalize on rallying energy prices and
some of the lowest interest rates in years.
About California Resources Corp.
California Resources Corporation is an oil and natural gas
exploration and production company headquartered in Los Angeles.
The company operates its resource base exclusively within
California, applying complementary and integrated infrastructure to
gather, process and market its production. Visit
http://www.crc.com/for more information.
On July 15, 2020, California Resources and its affiliates sought
protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D.
Tex. Lead Case No. 20-33568). At the time of the filing, California
Resources estimated assets of between $1 billion and $10 billion
and liabilities of the same range.
Judge David R. Jones oversaw the cases.
The Debtors tapped Sullivan & Cromwell, LLP and Vinson & Elkins LLP
as their bankruptcy counsel, Perella Weinberg Partners as
investment banker, Alvarez & Marsal North America, LLC as
restructuring advisor, and Epiq Corporate Restructuring, LLC, as
claims agent.
* * *
California Resources Corporation in October 2020 emerged from the
bankruptcy process after cutting $5.91 billion in debt to $725
million. CRC's Joint Plan of Reorganization in its Chapter 11 case
cancelled pre-existing debt, consolidated CRC's ownership in the
Elk Hills power plant and cryogenic gas plant, and provided for the
payment in full of all valid and undisputed trade and contingent
claims in the ordinary course of business.
CARECENTRIX INC: Moody's Completes Review, Retains B2 CFR
---------------------------------------------------------
Moody's Investors Service has completed a periodic review of the
ratings of CareCentrix, Inc. and other ratings that are associated
with the same analytical unit. The review was conducted through a
portfolio review discussion held on January 11, 2021 in which
Moody's reassessed the appropriateness of the ratings in the
context of the relevant principal methodology(ies), recent
developments, and a comparison of the financial and operating
profile to similarly rated peers. The review did not involve a
rating committee. Since January 1, 2019, Moody's practice has been
to issue a press release following each periodic review to announce
its completion.
This publication does not announce a credit rating action and is
not an indication of whether or not a credit rating action is
likely in the near future. Credit ratings and outlook/review status
cannot be changed in a portfolio review and hence are not impacted
by this announcement.
Key rating considerations.
CareCentrix, Inc's B2 CFR reflects the company's high financial
leverage in light of a weakened business profile following the
expected loss in 2021 of its largest client, which contributes over
half of the company's earnings and cash flow. The rating is
supported by the company's leading market position in the home
health benefits management market, favorable industry outlook and
very good liquidity.
The principal methodology used for this review was Business and
Consumer Service Industry published in October 2016.
CCO HOLDINGS: Fitch Rates USD2.9 Billion Sr. Unsecured Notes 'BB+'
------------------------------------------------------------------
Fitch Ratings has affirmed the 'BB+'/'RR4' ratings for CCO
Holdings, LLC's (CCOH) 4.5% senior unsecured notes due August 2030
($2.75 billion outstanding) and 4.5% senior unsecured notes due May
2032 ($2.9 billion). The affirmation is driven by Fitch's
inadvertent prior omission of these issues and will be effective as
of April 14, 2020. CCOH is an indirect, wholly owned subsidiary of
Charter Communications, Inc. (Charter). CCOH's Long-Term Issuer
Default Rating (IDR) is 'BB+'. The Rating Outlook is Stable.
Charter had approximately $82.1 billion of debt outstanding as of
Sept. 30, 2020, including $57.9 billion of senior secured debt, pro
forma for debt issuance in October and December 2020, plus
completed and expected debt repurchases, redemptions or
repayments.
KEY RATING DRIVERS
Leading Market Position: Charter is the third-largest MVPD in the
U.S. behind Comcast Corp. and AT&T Inc. through its DirecTV
subsidiary, and the second-largest cable MVPD behind Comcast. Fitch
Ratings continues to view Charter's May 2016 merger with TWC and
the acquisition of Bright House Networks, LLC as a positive, as
they strengthened Charter's overall credit profile.
Strong Credit Profile: Charter had 30.9 million customer
relationships as of Sept. 30, 2020, positioning it as one of the
largest MVPDs in the U.S. and providing significant scale benefits.
Revenue and EBITDA totaled approximately $47.2 billion and $18.0
billion, respectively, at the LTM ended Sept. 30, 2020.
Fitch-calculated gross leverage was 4.6x in the period, and secured
leverage was 3.1x, pro forma for a recent debt issuance, plus
completed and expected debt repurchases, redemptions or
repayments.
Improving Operating Metrics: Charter's operating strategies
positively affect its operating profile while strengthening its
competitive position. Charter's focus on enhancing its video
service's competitiveness and leveraging its all-digital
infrastructure improves subscriber metrics, revenue, average
revenue per user and operating margins. Fitch believes Charter's
mobile service expansion under its mobile virtual network operator
agreement with Verizon Communications Inc. offers potential
bundling benefits and should eventually offset near-term
infrastructure spending.
Integration Execution: Charter's ability to manage the integration
of simultaneous transactions while limiting disruptions in existing
systems is reflected in the company's improved cable operating
performance. Fitch believes Charter realized its expected run-rate
transaction integration synergies, but systemwide wireless rollout
costs are expected to negatively affect near-term total margins.
Coronavirus Pandemic's Impact: The cable sector has proven more
resilient to downturns than other sectors, given the integral
nature of broadband services and the industry's predictable
recurring payment stream. Fitch believes shelter-in-place efforts
will continue to drive broadband growth in the near term, which
should more than offset continued declines in video subscribers,
near-term declines in business services and an expected advertising
recession, excluding political, which Fitch expects to last into
2021.
Long-term financial damage to the sector and the recovery
trajectory remain highly uncertain, depending on the severity and
duration of the pandemic. Fitch expects the decline in business
services will be temporary, and it will recover with the economy.
However, the pandemic could have an outsized negative effect on
small and medium businesses, as owners may be unwilling or unable
to reopen. Fitch believes this segment represents less than 10% of
Charter's LTM ended Sept. 30, 2020 total revenues.
Debt Capacity: Charter maintains a target net leverage of
4.0x-4.5x, and secured leverage up to 3.5x. Fitch expects Charter
to continue creating debt capacity and remain within its target
leverage through EBITDA growth. Proceeds from prospective debt
issuance proceeds under created debt capacity are expected to be
used primarily for shareholder returns, along with internal
investments and accretive acquisitions. Charter's stock buyback
program had authority to purchase up to $1.6 billion of its class A
common stock and CCH's common units as of Sept. 30, 2020.
Fitch does not expect Charter to maintain significant cash
balances, resulting in Fitch-calculated total gross leverage
roughly equating total net leverage over the rating horizon.
DERIVATION SUMMARY
Charter is well-positioned in the MVPD space, given its size and
geographic diversity. Its 30.9 million customer relationships make
Charter the third-largest U.S. MVPD, following Comcast and AT&T,
through its DirecTV subsidiary. Both Comcast (A-/Stable) and AT&T
(A-/Stable) are rated higher than Charter due primarily to lower
target and actual total leverage levels and significantly greater
revenue size, coverage area and segment diversification.
Charter's ratings are likely to remain at the current level as the
company expects to continue issuing debt under additional debt
capacity created by EBITDA growth, while remaining within its
target total net leverage range of 4.0x-4.5x. Proceeds from
prospective debt issuances under this additional debt capacity are
expected to be used for shareholder returns, along with internal
investment and accretive acquisitions. No Country Ceiling or
parent-subsidiary relationship factors affect the rating.
KEY ASSUMPTIONS
Fitch's key assumptions within its rating case for the issuer
include:
-- Total revenues increase by mid-single digits as Fitch expects
the coronavirus pandemic to have offsetting effects on
Charter's business segments. Fitch expects significant
declines in SMB revenues through 2021, as shelter-in-place
requirements increase the potential for companies to go out of
business.
-- Advertising is expected to be soft over the same period, while
political spending offsets mid- to high-single-digit declines
in underlying advertising spend in 2020. The absence of
political ads in 2021 results in a high-single-digit overall
decline. However, these issues are more than offset by
internet revenue growth, expected in the mid-teens in 2020 due
to increased internet usage, and returning to historical mid
single-digit increases thereafter. In addition, video revenues
are expected to realize continued low-single-digit growth over
the rating horizon, despite ongoing underlying subscriber
losses.
-- Total EBITDA margins improve by almost 100bps over the rating
horizon, as continued cable margin improvement more than
offsets negative wireless margins.
-- Capital intensity begins to decline as primary cable — 100%
digital using DOCSIS 3.1 to offer 1GHz of service — and
wireless infrastructure upgrades are completed and revenues
continue to grow. However, annual capex spending declines by
less than 10% over the rating horizon.
-- FCF improves to $9.4 billion from $4.4 billion by 2023.
-- Charter issues sufficient debt to fund maturities and
shareholder returns using debt capacity created by EBITDA
growth.
-- Charter remains at the high end of its target net leverage of
4.0x-4.5x.
-- Fitch excludes M&A activity given the lack of transformational
acquisition opportunities.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
-- Demonstrating continued progress in closing gaps relative to
industry peers regarding service penetration rates and
strategic bandwidth initiatives;
-- A strengthening operating profile as the company captures
sustainable revenue and cash flow growth, and the reduction
and maintenance of total leverage below 4.0x.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
-- A leveraging transaction or adoption of a more aggressive
financial strategy that increases leverage above 5.0x in the
absence of a credible deleveraging plan;
-- Perceived weakening of its competitive position or failure of
the current operating strategy to produce sustainable revenue,
cash flow growth and strengthening operating margin.
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 regards Charter's liquidity position and
overall financial flexibility as satisfactory. Charter's financial
flexibility will improve in line with the continued growth in FCF
generation. The company's liquidity position as of Sept. 30, 2020
comprised approximately $2.0 billion of cash, pro forma for the
October 2020 debt issuance, plus completed and expected debt
repurchases, redemptions or repayments. Company liquidity was
supported by full availability under its $4.75 billion revolver,
$249 million of which matures in March 2023 and $4.5 billion in
February 2025, as well as anticipated FCF generation.
Charter's maturities thorough 2022 are manageable. Including
required term loan amortization, $1.3 billion in 2021 (pro forma
for Charter's prefunding of $0.7 billion of 2021 maturities with
December 2020 debt issuance) and $3.3 billion in 2022. Over the
following 10 years, annual bond maturities range from $1.5 billion
in 2023 to $5.8 billion in 2030, while required term loan
amortization and maturities total $10.2 billion through 2027.
Charter will need to dedicate a significant portion of potential
debt issuance during that period to service annual maturities,
which could reduce cash available for share repurchases, especially
in the event of market dislocation. Fitch expects Charter would be
able to access capital markets to meet its upcoming maturities, but
its liquidity profile could be weakened if a market dislocation is
severe enough to hinder the company's access.
CCO is the public issuer of Charter's senior secured debt, and CCOH
is the public issuer of Charter's senior unsecured debt. All of
CCO's existing and future secured debt is secured by a
first-priority interest in all of CCO's assets and is guaranteed by
all of CCO's subsidiaries, including those that hold the assets of
Charter, TWC, Bright House and CCOH. All of CCOH's existing and
future debt is structurally subordinated to CCO's senior secured
debt and is neither guaranteed by nor pari passu with any secured
debt.
Charter's Fitch-calculated secured leverage is expected to remain
below 4.0x over the rating horizon. Fitch does not view Charter's
secured leverage and strong underlying asset value as structural
subordination that could impair recovery prospects at the unsecured
level. Therefore, Charter's unsecured notes are not notched down
from its IDR.
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.
CDRH PARENT: Moody's Completes Review, Retains Caa3 CFR
-------------------------------------------------------
Moody's Investors Service has completed a periodic review of the
ratings of CDRH Parent, Inc. and other ratings that are associated
with the same analytical unit. The review was conducted through a
portfolio review discussion held on January 11, 2021 in which
Moody's reassessed the appropriateness of the ratings in the
context of the relevant principal methodology(ies), recent
developments, and a comparison of the financial and operating
profile to similarly rated peers. The review did not involve a
rating committee. Since January 1, 2019, Moody's practice has been
to issue a press release following each periodic review to announce
its completion.
This publication does not announce a credit rating action and is
not an indication of whether or not a credit rating action is
likely in the near future. Credit ratings and outlook/review status
cannot be changed in a portfolio review and hence are not impacted
by this announcement.
Key rating considerations.
CDRH Parent, Inc.'s ("Healogics") Caa3 CFR reflects its
unsustainably high leverage, deteriorating liquidity stemming from
its weak operating performance, and approaching debt maturities in
2021. The credit profile is also constrained by Healogics'
declining volumes in wound care centers and hyperbaric oxygen
treatments, as well as the company's narrow focus on wound care
management. These operating pressures constrain Healogics' ability
to reduce leverage to a more manageable level prior to the
company's need to address its 2021 debt maturities. The rating
benefits from Healogics' good customer diversification, minimal
direct government reimbursement risk, and its leading position in
outsourced wound care treatments.
The principal methodology used for this review was Business and
Consumer Service Industry published in October 2016.
CELLA III: Court Says Girod is Oversecured Creditor
---------------------------------------------------
Judge Meredith S. Grabill of the United States Bankruptcy Court for
the Eastern District of Louisiana granted in part and denied in
part the relief sought in Girod LoanCo, LLC's application for
allowance of post-petition interest and attorney's fees as
oversecured creditor pursuant to 11 U.S.C. Section 506(b).
The judge found that Girod became oversecured in January 2020, thus
allowing post-petition interest. Girod's request for attorneys'
fees and costs, however, was denied.
Cella III, LLC owns property located at 4531 and 4545 Veterans
Boulevard in Metairie, Louisiana, on which sits three buildings.
Cella leases parts of the property to a Hertz car rental business,
a Smoothie King franchise, and to East Jefferson General Hospital
(EJGH), and Cella operates a mini-storage and vault business in
another part of the property.
Prior to Cella's bankruptcy, First NBC Bank (FNBC) held notes owed
by Cella and affiliated companies, including Wild Horse of Old
Military Road, LLC. Those notes are secured by a mortgage on
Cella's Louisiana property and an assignment of rents therefrom, as
well as by a mortgage on the personal residence of Cella's sole
member, George Cella. When FNBC was closed, Girod acquired Cella's
notes, as well as other notes owed by Cella affiliates.
On June 14, 2019, Cella filed a Motion for Interim and Final
Orders: (i) Authorizing Use of Cash Collateral Pursuant to 11
U.S.C. Section 363, (ii) Granting Adequate Protection of
Prepetition Secured Party Pursuant to 11 U.S.C. Sections 361, 362
and 363, and (iii) Scheduling Final hearing Pursuant to Bankruptcy
Rule 4001(b). Through the Cash Collateral Motion, Cella sought to
use Girod's cash collateral to pay for its operations, an insider's
salary, and professional fees pursuant to an attached budget.
Cella asserted that Girod enjoys a comfortable equity cushion in
its collateral. Cella and Girod reached an agreement for adequate
protection whereby Cella would pay three monthly payments of
$20,000 in adequate protection to Girod beginning in July 2019,
until a final hearing on the matter could be held in September.
The Court issued an Order approving the Cash Collateral Motion on
an interim basis, reflecting that agreement. After the final
hearing on September 4, 2019, the Court issued an Order dated
September 12, 2019 that modified its Interim Order to remove the
requirement to pay adequate protection for the month of September
2019 onwards.
On August 21, 2019, Girod filed Proof of Claim No. 4 against the
Cella estate, asserting a secured claim in the amount of
$7,999,333.72. On May 15, 2020, Girod amended its proof of claim
to reduce its asserted secured claim to $7,750,751.42, removing
approximately $248,000 in prepetition default interest. Cella did
not dispute that Girod's claim is $7,750,751.42 as of June 5, 2019,
the Petition Date.
On November 10, 2020, the Court held a hearing to consider Girod's
Section 506(b) motion. The Court considered documentary evidence
and heard testimony from Michael Truax, Cella's appraiser of the
Louisiana property; Denis Stratford, a representative of Girod;
George Cella, the principal of Cella; and Robert Foley, an expert
who provided testimony regarding costs of renovating the property.
Mr. Truax authenticated and provided testimony regarding his expert
report, valuing the property at $7,695,000 as of January 20, 2020.
Girod stipulated to that value which was accepted by the Court.
Judge Grabill held that Girod is entitled to post-petition interest
under Section 506(b).
The judge stated that Section 506 of the Bankruptcy Code provides
that "[to] the extent that an allowed secured claim is secured by
property the value of which ... is greater than the amount of such
claim, there shall be allowed to the holder of such claim, interest
on such claim, and any reasonable fees, costs, or charges provided
for under the agreement ..."
Judge Grabill found that the Louisiana property is not the only
collateral securing repayment of the debt owed to Girod, as Girod's
collateral includes the cash generated post-petition by Cella's
operations. As of the petition date, Cella's cash-on-hand totaled
$1,298.00. As of January 31, 2020, Cella's accumulated cash
totaled $130,200. As of November 30, 2020, Cella's accumulated
cash totaled $385,492. After crediting Girod's claim in the amount
of $40,000 representing the only two adequate protection payments
made by Cella over the course of this case, Judge Grabill found
that Girod became oversecured in January 2020 and remained
oversecured during the months of the case thereafter, enjoying an
equity cushion of between approximately $115,000 in January 2020
and $369,000 as of November 2020.
Thus, Judge Grabill found that Girod met its burden to shot it is
entitled to post-petition interest pursuant to Section 506(b). The
judge found that Girod is entitled to accrue non-default interest
starting in January 2020, the point in time when Girod became
oversecured, and continuing through a plan's confirmation or its
effective date, whichever is later, to be calculated per the terms
of the loan documents.
However, Judge Grabill pointed out that the post-petition interest
and/or attorneys' fees cannot exceed that value of the collateral.
Even applying a straightforward 5.5% rate on just the principal due
on the three notes, the juge inferred that Girod's interest from
January 2020 through December 2020 would be at least $33,000 per
month, or $396,000. The judge found that that amount exceeds
$369,740.58, the largest equity cushion that Girod has enjoyed thus
far, and disallowed any accrued post-petition interest that
exceeds $369,740.58 because it is neither recoverable under Section
506(b) nor Section 502(b)(2).
Further, Judge Grabill held that Girod would also be entitled to
reasonable attorneys' fees under Section 506(b), chargeable from
January 2020 through a plan's confirmation or its effective date,
whichever is later. However, the judge found that after
post-petition interest, no collateral remains to secure such fees.
The judge thus concluded that Girod is not eligible for
post-petition attorneys' fees under Section 506(b).
The case is IN RE: CELLA III, LLC, Chapter 11, Debtor, Case No.
19-11528, SECTION "A" (Bankr. E.D. La.).
A full-text copy of Judge Grabill's memorandum opinion dated
January 6, 2021 is available at https://tinyurl.com/yxd5t6gv from
Leagle.com.
About Cella III LLC
Cella III, LLC, owns the building and real estate bearing the
municipal address 4545, 4539 and 4531 Veteran's Memorial Highway,
Metairie, LA. This property is located at a prominent, heavily
traveled commercial intersection of Veterans Memorial Boulevard and
Clearview Parkway.
Cella III, LLC, filed a Chapter 11 petition (Bankr. E.D. La. Case
No. 19-11528) on June 5, 2019. In the petition signed by George A.
Cella, III, member and manager, the Debtor was estimated to have
$10 million to $50 million in assets and $1 million to $10 million
in liabilities.
The Hon. Jerry A. Brown oversees the case.
The Debtor tapped Congeni Law Firm, LLC as bankruptcy counsel;
Sternberg, Naccari & White, LLC as special counsel; and Patrick J.
Gros, CPA, APAC as accountant.
CENTRO EVANGELISTICO: Sets Bid Procedures for Cutler Bay Asset Sale
-------------------------------------------------------------------
Centro Evangelistico La Roca, Inc., asks the U.S. Bankruptcy Court
for the Southern District of Florida to authorize the bidding
procedures relating to the sale of the real property located at
20851 SW. 97th Avenue, in Cutler Bay, Florida, Folio Number
36-6009-000-0160, to Century Homebuilders Group, LLC for $1.5
million, on the terms of their Asset Purchase Agreement, subject to
overbid.
The Debtor owns Property. The Property is a lot sized 184,694.4
sq. ft. with a church sized 4,118 sq. ft. The Property comprises
substantially all of the Debtor's respective assets.
On Aug. 31, 2007, the Debtor executed a promissory note for
$950,000 secured by a recorded mortgage in favor of an entity named
Group Investors, LLC. Subsequently, Group Investors issued several
assignments of mortgage to several entities. The Debtor filed its
adversary proceeding against the Assignees on Aug. 5, 2020, Centro
Evangelistico La Roca, Inc. v. Group Investors, LLC, et. al, case
number 20-01304-LMI. Through a Judicial Settlement Conference with
Judge Mora on Nov. 13, 2020, all parties agreed to a settlement
satisfying all claims in the estate subject to the Property selling
for at least $1.6 million.
Unfortunately, the sales price of $1.6 million was not realized.
On Jan. 8, 2021, the Debtor accepted a cash offer with no due
diligence period to sell the Property for $1.5 million. Presently,
the Parties have not agreed as to the net distribution of sale's
proceeds at $1.5 million.
After arms'-length negotiations, the Debtor, together with the
Stalking Horse Bidder, agreed in principal and subject to Court
approval to the terms of the Stalking Horse APA for the Sale of the
Property for the purchase price of $1.5 million.
The material terms of the Stalking Horse APA are:
a. Purchase Price: $1.5 million
b. Deposit: $100,000
c. Acquired Assets: The Prevailing Bidder will acquire the
Property described in the Stalking Horse APA, all buildings and
improvements thereon, and including, if any, all of the right,
title, and interest of the Debtor in and to all rights-of-way,
easements, public and private streets, roads, avenues, and alleys,
in front of or abutting the Property.
d. The Prevailing Bidder will acquire the Property free and
clear of all liens, claims, interests, with any such valid liens,
claims, and interests with the exception of encumbrances attaching
to the proceeds of the sale.
e. The Sale will close no later than 30 days following the
entry of the Approval Order, which Approval Order will contain a
waiver of any stay pending appeal; provided, however, that in
either case Closing will not be earlier than five business days
after the entry of the Approval Order.
f. The Prevailing Bidder accepts the condition of the Property
"as is, where is, with all faults."
g. Breakup Fee: $20,000
The Stalking Horse Agreement will require that the Bid Procedures
Order approves the Bid Procedures. The Debtor will have until the
Bid Deadline to market the Property to third parties and solicit
and accept Qualified Bids for the purchase of the Property.
The salient terms of the Bidding Procedures are:
a. Bid Deadline: 30 days from the entry of the Court's order
approving the requested Bid Procedures and scheduling a Sale
Hearing
b. Initial Bid: $1.55 million
c. Deposit: $100,000
d. Auction: If one or more Qualified Bids are received, Debtor
will conduct an auction with respect to the Property prior to the
Sale Hearing via Zoom or similar video or electronic format.
e. Bid Increments: $50,000
Within 72 hours after the conclusion of the Auction, the Debtor
will file a notice identifying the Prevailing Bidder and any Backup
Bidders.
The Debtor respectfully asks that, in a preliminary hearing, the
Court approves its entry into the Stalking Horse APA, approves the
Bid Procedures and Break-U, approves the form and manner of the
Sale, schedules a Bid Deadline, schedules an Auction, and schedules
a Sale Hearing.
To facilitate the sale of the Property, the Debtor asks that the
Court authorizes the sale free and clear of liens, claims,
encumbrances, and other interests to the Prevailing Bidder at a
final Sale Hearing to be scheduled by the Court at the preliminary
hearing on the relief sought in the Motion.
It is critical that the Debtor closes the sale of the Property as
soon as possible after the final Sale Hearing. Accordingly, it
asks that the Court waives the 14-day stay periods under Bankruptcy
Rules 6004(h).
A copy of the Agreement and the Bidding Procedures is available at
https://tinyurl.com/yxezy64p from PacerMonitor.com free of charge.
About Centro Evangelistico La Roca
Centro Evangelistico La Roca, Inc. sought protection under Chapter
11 of the Bankruptcy Code (Bankr. S.D. Fla. Case No. 20-17654) on
July 15, 2020. At the time of the filing, the Debtor had
estimated
assets of between $1 million and $10 million and liabilities of
between $500,001 and $1 million. Judge Laurel M. Isicoff oversees
the case. Debtor has tapped Sagre Law Firm, P.A. as its legal
counsel.
CHG HEALTHCARE: Moody's Completes Review, Retains B2 CFR
--------------------------------------------------------
Moody's Investors Service has completed a periodic review of the
ratings of CHG Healthcare Services, Inc. and other ratings that are
associated with the same analytical unit. The review was conducted
through a portfolio review discussion held on January 11, 2021 in
which Moody's reassessed the appropriateness of the ratings in the
context of the relevant principal methodology(ies), recent
developments, and a comparison of the financial and operating
profile to similarly rated peers. The review did not involve a
rating committee. Since January 1, 2019, Moody's practice has been
to issue a press release following each periodic review to announce
its completion.
This publication does not announce a credit rating action and is
not an indication of whether or not a credit rating action is
likely in the near future. Credit ratings and outlook/review status
cannot be changed in a portfolio review and hence are not impacted
by this announcement.
Key rating considerations.
CHG Healthcare Services Inc's B2 Corporate Family Rating is
constrained by its high leverage and niche focus in the locum
tenens business, along with operating challenges presented by the
ongoing coronavirus pandemic. The credit profile is also
constrained by the company's aggressive dividend strategy. The
company's CFR benefits from its good scale and leading market
position in the locum tenens segment, good long-term industry
dynamics, and a good liquidity profile.
The principal methodology used for this review was Business and
Consumer Service Industry published in October 2016.
CHRISTOPHER & BANKS: Store Closing Sales Begin at 400+ Stores
-------------------------------------------------------------
Christopher & Banks, on Jan. 13, 2021, filed for Chapter 11
reorganization and authorized store closing sales to be conducted
by Hilco Merchant Resources. The store closing process has begun
at more than 400 stores nationally, according to a Jan. 14, 2021
announcement by Hilco.
Since 1956, Christopher & Banks has been providing customers with
style, value and service that help her look fabulous and feel
amazing, every day and for life's special moments and still focuses
on putting "her" first.
Christopher & Banks customers will now save 40-60% off original
prices on all merchandise. Christopher & Banks offers a variety of
missy, women's and petite sizes in their stores, now at 40-60% off
the original price. These incredible discounts are valid throughout
the stores and include customers' favorite styles across all
departments. "The closing stores feature an abundant assortment of
merchandise at very significant price reductions. Customers will
save on their favorite apparel for work, play and special
occasions," a spokesperson for Hilco Merchant Resources stated. "We
encourage shoppers to visit their nearby location now and take
advantage of these tremendous savings before it's too late."
Store fixtures are also being sold at compelling prices as part of
these closing sales.
A full list of closing locations is attached. Store detail are also
available on the Christopher & Banks Store Locator page.
Christopher & Banks online sales will continue. Closing discounts
will not apply to online purchases.
About Hilco Merchant Resources
Hilco Merchant Resources -- http://www.hilcomerchantresources.com/
-- provides a wide range of analytical, advisory, asset
monetization, and capital investment services to help define and
execute a retailer's strategic initiatives. Hilco Merchant
Resources' activities fall into several principal categories
including acquisitions; disposition of underperforming stores;
retail company or division wind downs; event sales to convert
unwanted assets into working capital; facilitation of mergers and
acquisitions; interim company, division or store management teams;
loss prevention; and, the monetization of furniture, fixtures and
equipment. Additionally, HMR now includes among its subsidiaries
the nation's premier fixture and equipment liquidation firm, Hilco
Fixed Asset Recovery (www.hilcoffe.com), and an innovative sale
locater website called Shop Genius (www.shopgenius.com). Hilco
Merchant Resources is part of Northbrook, Illinois based Hilco
Global (www.hilcoglobal.com), one of the world's leading
authorities on maximizing the value of business assets by
delivering valuation, monetization and advisory solutions to an
international marketplace.
About Christopher & Banks
Christopher & Banks Corporation (OTC: CBKC) is a Minneapolis-based
specialty retailer featuring exclusively designed privately branded
women's apparel and accessories. As of Jan. 13, 2021, the Company
operates 449 stores in 44 states consisting of 315 MPW stores, 76
Outlet stores, 31 Christopher & Banks stores, and 28 stores in its
women's plus size clothing division CJ Banks. The Company also
operates the www.ChristopherandBanks.com eCommerce website.
Christopher & Banks Corporation and two affiliates sought Chapter
11 protection (Bankr. D.N.J. Lead Case No. 21-10269) on Jan. 13,
2021.
As of Dec. 14, 2020, the Company had $166,396,185 in assets and
$105,639,182 in liabilities.
The Hon. Andrew B. Altenburg Jr. is the case judge.
The Company's restructuring counsel is Cole Schotz P.C., its
financial advisor is BRG, LLC, and its investment banker is B.
Riley Securities Inc. Omni Management Solutions is the claims
agent.
CITY WIDE INVESTMENTS: E.D. Wis. Affirms $281K Monetary Award
-------------------------------------------------------------
Judge Brett H. Ludwig of the United States District Court for the
Eastern District of Wisconsin affirmed the bankruptcy court's
ruling which awarded Chapter 11 Debtor-In-Possession, City Wide
Investments, LLC, the sum of $280,894.56.
The bankruptcy court held that the City of Milwaukee's
pre-bankruptcy seizure, through an in rem tax foreclosure
proceeding, of an apartment complex owned by City Wide, was a
fraudulent transfer under 11 U.S.C. Section 548(a)(1)(B). The
award was calculated based on the court's determination of the fair
market value of the apartment building at the time of the improper
transfer, less amounts City Wide owed the City for outstanding
taxes, fines and associated costs.
City Wide is a limited liability company that owns various rental
properties in Milwaukee. Prior to January 4, 2016, City Wide's
holdings included an eight-family apartment building located at
8940 North Michele Street. When City Wide failed to pay more than
$49,000 in property taxes, fines, and associated costs on the
property for the years 2012 through 2015, the City initiated an in
rem tax foreclosure proceeding and, on January 4, 2016, succeeded
in obtaining title to the property. A little more than a year
later, on March 17, 2017, the City sold the property to a
third-party buyer for $150,000.
On April 3, 2017, City Wide filed for bankruptcy. In the
bankruptcy court, City Wide began an adversary proceeding against
the City to set aside the tax foreclosure as a constructively
fraudulent transfer pursuant to 11 U.S.C. Section 548(a)(1)(B).
The primary issue at trial was the value of the apartment complex.
City Wide introduced testimony from appraiser Steven Stiloski, who
opined that the fee simple market value of the property at the time
of the transfer was $340,000. Stiloski explained that he performed
a retrospective appraisal by looking at comparable sales completed
around the time of the transfer. In response, the City introduced
testimony from Dwayne Edwards, a real estate specialist from its
Department of City Development, who contended the best evidence of
the property's value was its recent sale to a third party for
$150,000.
The bankruptcy court confirmed that City Wide had not received
reasonably equivalent value for the City's seizure of the property.
While the City obtained title to the property through the
foreclosure, City Wide received only the elimination of its $49,000
tax debt. The bankruptcy court concluded that City Wide was
entitled to the fair market value of the property at the time of
the transfer which was $330,000. After subtracting the
consideration City Wide received in the form of debt forgiveness,
which the parties agreed was $49,105.44, the bankruptcy court found
the City received a constructively fraudulent transfer in the
amount of $280,894.56 and entered judgment accordingly.
On appeal, the City primarily complained that the $280,894.56
monetary award offends equitable principles by giving City Wide an
unfair windfall while simultaneously imposing an unfair penalty on
the City. The City insisted the award should have been based on
the value the City was able to realize when it resold the apartment
complex at a foreclosure sale prior to City Wide's bankruptcy.
Judge Ludwig explained that if the bankruptcy court correctly
applied the relevant Bankruptcy Code provisions concerning City
Wide's fraudulent transfer claim, neither general principles of
equity nor Section 105(a) are bases for overruling the bankruptcy
court's determinations.
The judge found that the bankruptcy court acted within its proper
factfinding role in arriving at a final valuation determination
that is amply supported by the evidence. The bankruptcy court had
adopted the valuation of Steven Stiloski. The bankruptcy court
also concluded, based on factual findings that are adequately
supported by testimony in the record, that the approximate cost to
bring the property into rentable condition was $20,000. Because
Mr. Stiloski's appraisal already deducted $10,000 to account for
deferred maintenance, the court deducted another $10,000 from his
$340,000 opinion of value, and determined the fair market value of
the property at the time of the transfer was $330,000.
Judge Ludwig did not find any errors in any of the bankruptcy
court's findings sufficient to warrant reversal.
The case is CITY OF MILWAUKEE, Appellant, v. CITY WIDE INVESTMENTS,
LLC, Appellee, Case No. 17-cv-1403-bhl (E.D. Wis.). A full-text
copy of Judge Ludwig's decision and order dated January 8, 2021 is
available at https://tinyurl.com/yynw22tb from Leagle.com.
About City Wide Investments
City Wide Investments, LLC, filed a Chapter 11 bankruptcy petition
(Bankr. E.D. Wis. Case No. 17-22900) on April 3, 2017. John
Nazario, member, signed the petition. At the time of filing, the
Debtor estimated $100,000 to $500,000 in assets and $500,000 to $1
million in liabilities.
Leonard G. Leverson, Esq., at Leverson Lucey & Metz SC serves as
bankruptcy counsel; and Commercial Property Consultants, Inc., is
the appraiser.
COLDWATER DEVELOPMENT: Case Summary & 16 Unsecured Creditors
------------------------------------------------------------
Two affiliates that concurrently filed voluntary petitions for
relief under Chapter 11 of the Bankruptcy Code:
Debtor Case No.
------ --------
Coldwater Development LLC 21-10335
11301 W. Olympics Blvd. #537
Los Angeles, CA 90064
Lydda Lud, LLC 21-10336
11301 W. Olympic Blvd. #537
Los Angeles, CA 90064
Chapter 11 Petition Date: January 15, 2021
Court: United States Bankruptcy Court
Central District of California
Judge: Hon. Vincent P. Zurzolo
Debtor's Counsel: Aram Ordubegian, Esq.
ARENT FOX LLP
555 West Fifth Street, 48th Floor
Los Angeles, CA 90013-1065
Tel: 213-629-7400
Fax: 213-629-7401
E-mail: Aram.Ordubegian@arentfox.com
Each Debtor's
Estimated Assets: $50 million to $100 million
Each Debtor's
Estimated Liabilities: $10 million to $50 million
The petitions were signed by Mohamed Hadid, member.
Copies of the petitions are available for free at PacerMonitor.com
at:
https://www.pacermonitor.com/view/4FLMTPA/Coldwater_Development_LLC__cacbke-21-10335__0001.0.pdf?mcid=tGE4TAMA
https://www.pacermonitor.com/view/4OQ3DJY/Lydda_Lud_LLC__cacbke-21-10336__0001.0.pdf?mcid=tGE4TAMA
A. List of Coldwater Development's 16 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
1. Bel Air Project LLC Loan $429,147
9454 Wilshire Blvd.
#320
Beverly Hills, CA 90212
2. Construction Enterprise & Loan $1,458,698
Services
11301 W. Olympic Blvd. #537
Los Angeles, CA 90064
3. Land Phases Inc. Services $11,250
5158 Cochran St. Rendered
Simi Valley, CA 93063
4. Larry A. Rothstein Services $4,851
2945 Townsgate Rd., Suite 200 Rendered
Westlake Village, CA 91361
5. Law Offices of Adulaziz, Services $305
Grossbart and Rudman Rendered
6454 Coldwater
Canyon Ave.
North Hollywood, CA 91606
6. LC Engineering Group, Inc. Services $110,874
889 Pierce Court, Suite 101 Rendered
Thousand Oaks, CA 91360
7. Los Angeles County Property Tax $162,409
Tax Collector
P.O. Box 54018
Los Angeles, CA 90054
8. Los Angeles County Property Tax $69,151
Tax Collector
P.O. Box 54018
Los Angeles, CA 90054
9. Los Angeles County Property Tax $40,710
Tax Collector
P.O. Box 54018
Los Angeles, CA 90054
10. Los Angeles County Property Tax $17,163
Tax Collector
P.O. Box 54018
Los Angeles, CA 90054
11. Los Angeles Department of Utility $589
Water and Power
P.O. Box 51111
Los Angeles, CA 90051
12. Permits Unlimited Services $15,596
4340 Caleta Rd. Rendered
Agoura Hills, CA 91301
13. Shahbaz Law Group Services $104,270
15760 Ventura Blvd., Rendered
Ste. 850
Encino, CA 91436
14. State of California Taxes Unknown
Department of Industrial Relations
6150 Van Nuys Blvd# 105
Van Nuys, CA 91401
15. Tree Lane LLC Loan $50,000
11301 W. Olympic Blvd. #537
Los Angeles, CA 90064
16. Treetop Development LLC Loan $138,525
11301 W. Olympic Blvd. #537
Los Angeles, CA 90064
B. List of Lydda Lud's 14 Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
1. Bel Air Project LLC Loan $429,147
9454 Wilshire Blvd. #320
Beverly Hills, CA 90212
2. Construction Enterprise & Loan $1,458,698
Services
11301 W. Olympic Blvd. #537
Los Angeles, CA 90064
3. Los Angeles County Property Tax $23,016
Tax Collector
P.O. Box 54018
Los Angeles, CA 90054
4. Los Angeles County Property Tax $19,294
Tax Collector
P.O. Box 54018
Los Angeles, CA 90054
5. Los Angeles County Property Tax $10,598
Tax Collector
P.O. Box 54018
Los Angeles, CA 90054
6. Los Angeles County Property Tax $9,681
Tax Collector
P.O. Box 54018
Los Angeles, CA 90054
7. Los Angeles County Property Tax $8,116
Tax Collector
P.O. Box 54018
Los Angeles, CA 90054
8. Los Angeles County Property Tax $4,446
Tax Collector
P.O. Box 54018
Los Angeles, CA 90054
9. Los Angeles County Property Tax $4,206
Tax Collector
P.O. Box 54018
Los Angeles, CA 90054
10. Los Angeles County Property Tax $1,963
Tax Collector
P.O. Box 54018
Los Angeles, CA 90054
11. Shahbaz Law Group Services $104,270
15760 Ventura Blvd., Rendered
Ste. 850
Encino, CA 91436
12. State of California Taxes Unknown
Department of Industrial Relations
6150 Van Nuys Blvd# 105
Van Nuys, CA 9140
13. Tree Lane LLC Loan $50,000
11301 W. Olympic Blvd. #537
Los Angeles, CA 90064
14. Treetop Development LLC Loan $138,525
11301 W. Olympic
Blvd. #537
CP VI BELLA: Moody's Completes Review, Retains B3 CFR
-----------------------------------------------------
Moody's Investors Service has completed a periodic review of the
ratings of CP VI Bella Topco, LLC and other ratings that are
associated with the same analytical unit. The review was conducted
through a portfolio review discussion held on January 11, 2021 in
which Moody's reassessed the appropriateness of the ratings in the
context of the relevant principal methodology(ies), recent
developments, and a comparison of the financial and operating
profile to similarly rated peers. The review did not involve a
rating committee. Since January 1, 2019, Moody's practice has been
to issue a press release following each periodic review to announce
its completion.
This publication does not announce a credit rating action and is
not an indication of whether or not a credit rating action is
likely in the near future. Credit ratings and outlook/review status
cannot be changed in a portfolio review and hence are not impacted
by this announcement.
Key rating considerations.
CP VI Bella Topco, LLC's B3 CFR reflects the company's elevated
financial leverage, aggressive financial policies and substantial
customer concentration, with the three largest customers generating
over 50% of revenue. However, the credit profile is supported by
MedRisk's strong value proposition to its payor clients and network
providers which will continue to drive organic growth, as well as
the company's good liquidity. The company also has a national
presence with only moderate geographic concentration.
The principal methodology used for this review was Business and
Consumer Service Industry published in October 2016.
CRACKED EGG: Diner Defying Mask Rule Fights to Stay Open
--------------------------------------------------------
Hannah Albarazi of Law360 reports that a Pittsburgh-area
restaurant, Cracked Egg, that has been operating in defiance of
Pennsylvania's COVID-19-related mask mandate asked a federal
bankruptcy judge Thursday to extend a stay on the Allegheny County
Health Department's effort to shut it down, citing its appeal to
the U.S. District Court.
The Cracked Egg urged U.S. Bankruptcy Judge Jeffery Deller to put
back in place a stay on the county's enforcement action pending the
restaurant's district court appeal of his order, or until a pending
action in federal court challenging the constitutionality of
Pennsylvania's mask mandate is resolved.
The restaurant said Judge Deller erroneously held that his court
lacked the authority to decide whether the exercise of the police
power was legitimate.
Attorneys representing the Cracked Egg argue the judge relied on
the U.S. Supreme Court's decision in Board of Governors of Fed.
Reserve System v. MCorp Financial, Inc. , which they say has been
"overruled" by the U.S. Supreme Court's decision in Celotex Corp.
v. Edwards.
Cracked Egg attorney, James R. Cooney of the Robert O. Lampl Law
Office, told Law360 in a telephone interview Friday that "[w]e
believe the Celotex case implicitly overruled that."
The restaurant's attorneys also maintain that its constitutional
claims are supported by a Pennsylvania federal judge's September
ruling in the case, County of Butler v. Wolf, which struck down
emergency COVID-19 business closure and crowd-size restrictions
imposed by Gov. Tom Wolf. In that case, a Third Circuit panel
reinstated the restrictions while the court hears an appeal from
Gov. Wolf.
Sy O. Lampl of the Robert O. Lampl Law Office, who is also
representing the restaurant, told Law360 that the Third Circuit
hasn't issued a decision in that case yet, and therefore the
district court's ruling still stands.
Lampl said the restaurant remains open and is following all
"validly enacted" laws, but is not following the COVID-19 mandates
ordered by Gov. Wolf, which he describes as an "improper use of
legislative authority" and a "violation of our constitutional
rights."
A voice recording at the Cracked Egg on Friday said: "Here at the
Egg, we do not follow any of the edicts of the tyrannical
government. The Allegheny County Health Department is aware of
this."
The health department, which declined to comment on the pending
litigation Friday, filed a lawsuit against the Cracked Egg and its
parent company The Cracked Egg LLC in state court in September,
stating the county had cited the restaurant repeatedly and revoked
its operating permit, but that the owners kept it open anyway.
The county said the restaurant 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.
But the Cracked Egg filed a federal countersuit attempting to
overturn the mitigation measures, claiming violations of its civil
rights.
The restaurant's owners said in an online legal defense fundraising
campaign that they complied with the orders for the first five
months of the pandemic, but "took a stand" in July when they
resumed normal operations.
But in early October 2020, the restaurant filed for bankruptcy,
bringing all the litigation to a halt.
In December 2020, the health department asked the bankruptcy judge
to lift the automatic stay imposed when the restaurant filed for
Chapter 11 protection so it could pursue its injunction in state
court. The Cracked Egg, however, argued the pandemic mandates that
the health department sought to enforce were illegal, and therefore
the department's lawsuit was not an enforcement action exempt from
the bankruptcy stay.
The bankruptcy judge lifted the stay on Jan. 7, 2021 allowing the
health department to proceed with its lawsuit. Judge Deller said it
was not for the bankruptcy court to decide whether the state's
COVID-19 control measure orders were legal and said the automatic
bankruptcy stay does not provide a debtor "with a carte blanche
excuse to avoid health and safety regulations."
The health department's case against The Cracked Egg was remanded
to the Allegheny County Court of Common Pleas, and a hearing on the
county's motion for a preliminary injunction is currently scheduled
for Jan. 22, 2021.
The Cracked Egg told the bankruptcy court in its expedited bid
Thursday that it "will be irreparably harmed if the case is not
stayed pending appeal." The restaurant said the health department
has indicated it intends to shut it down, which would negatively
impact its ability to reorganize under Chapter 11.
"Unless this matter is heard on an expedited basis, the injunction
will put the Cracked Egg out of business," the restaurant told the
court.
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 LLC 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 In re The Cracked Egg LLC, case number 20-22889, in
the U.S. Bankruptcy Court for the Western District of Pennsylvania;
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
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.
CT TECHNOLOGIES: Moody's Completes Review, Retains B3 CFR
---------------------------------------------------------
Moody's Investors Service has completed a periodic review of the
ratings of CT Technologies Intermediate Holdings, Inc. and other
ratings that are associated with the same analytical unit. The
review was conducted through a portfolio review discussion held on
January 11, 2021 in which Moody's reassessed the appropriateness of
the ratings in the context of the relevant principal
methodology(ies), recent developments, and a comparison of the
financial and operating profile to similarly rated peers. The
review did not involve a rating committee. Since January 1, 2019,
Moody's practice has been to issue a press release following each
periodic review to announce its completion.
This publication does not announce a credit rating action and is
not an indication of whether or not a credit rating action is
likely in the near future. Credit ratings and outlook/review status
cannot be changed in a portfolio review and hence are not impacted
by this announcement.
Key rating considerations.
CT Technologies Intermediate Holdings, Inc.'s (Ciox Health) B3 CFR
reflects its moderately high pro forma debt/EBITDA, as well as the
company's narrow business focus providing medical information
exchange management and retrieval services to US healthcare
providers and insurance carriers. The rating also incorporates
legal risks associated with the release of protected health
information. However, the rating is supported by Ciox Health's
leading position in the medical information management industry,
multi-year contracts with a large number of US hospitals, and high
visibility and predictability of revenues provided by contract
renewal rates in the mid-90% range.
The principal methodology used for this review was Business and
Consumer Service Industry published in October 2016.
DEAN EPISCOPO: Hearing on Warren Property Sale Set for Jan. 26
--------------------------------------------------------------
Judge Stacey L. Meisel of the U.S. Bankruptcy Court for the
District of New Jersey will convene a hearing on Jan. 26, 2021, at
10:00 a.m., to consider Dean Episcopo's sale of his right, title,
and interest in his real property located at 140 Stirling Road, in
Warren, New Jersey, to Amanda Corn and Vincent Nascone for
$965,000, or to such other party who may make a higher or better
offer.
The Objection Deadline is Jan. 25, 2021, at 3:00 p.m. The Parties
are directed to make arrangements to appear telephonically via
Court ܆Solutions (https://www.court-solutions.com/ or dial (917)
746-7476).
The Debtor and his non-debtor spouse Monica Episcopo co-own the
Property. The Debtor actively marketed the Property without use of
a realtor via Zillow and other multiple listing sites. Therefore,
the only realtor commission, payable out of Monica's share of the
net sale proceeds, due at the closing is a 2.5% commission due to
the Purchaser's realtor Suzanne McGratty with the firm of Turpin
Realtors, 8 East Main Street, in Mendham, New Jersey.
On Sept.25, 2020, the Debtor filed an Application to retain L.
Mifflin Hayes, Esq. as his Special Real Estate Counsel, which the
court approved on Oct. 6, 2020. On Nov. 17, 2020, the Court
entered an Order Requiring Debtor to File A Plan And Disclosure
Statement requiring the Debtor to file his proposed Chapter 11 Plan
and Disclosure Statement by Feb. 5, 2021.
The Property was listed for sale Zillow since the spring of 2020.
The listing indicated that the Property was being sold as part of
the Debtor's Chapter 11 bankruptcy proceeding and was subject to
Court approval. The listing also that the sale was "as is where
is."
On Nov. 15, 2020 the Debtor, Monica and the Purchasers executed a
Contract of Sale for Real Estate Agreement for the purchase of the
Property for a purchase price of $965,000 with a deposit of $96,500
held in Special Real Estate Counsel's attorney trust account.
The parties' counsel negotiated a Rider to the Sale Agreement which
the parties signed on Dec. 9, 2020. Their obligations under the
Sale Agreement and the Rider are expressly subject to (i) entry of
an Order by the Court, pursuant to Section 363 of the Bankruptcy
Code, approving the Sale of the Property free and clear of liens,
claims and encumbrances, with the foregoing, if any, to attach to
the proceeds of the Sale, and (ii) higher and better offers.
The parties' real estate counsel previously conducted a period of
attorney review. The Purchasers also previously retained
professionals to conduct an inspection of the Property. The Debtor
is in the process of obtaining a Certificate of Occupancy for the
Property and believes that he will obtain it prior to the scheduled
closing.
The Debtor's counsel spoke with the Purchasers' real estate counsel
and confirmed that the Purchasers are aware of the requirement that
the Debtor obtain Bankruptcy Court approval on the sale of the
Property. The Purchasers are paying for the Property in part
through personal funds of $144,750, including the $96,500 deposit
being held by the Debtor's Special Real Estate Counsel. The
Purchasers, through their realtor and counsel, provided the
Debtor's counsel with proof of funds in personal bank accounts.
The Purchasers are financing the balance of the purchase price with
a private mortgage of $820,250 from Ms. Corn's parents, with
commitment letters and proof of funds provided to the Debtor's
counsel by their counsel.
At the signing of the Rider, the parties anticipated a closing date
in the beginning of February 2021, with the Sale Agreement revised
to indicate that time is not of the essence. Investors Bank,
pursuant to the terms of a state court settlement, holds a second
mortgage on real property owned by the Debtor's and Monica's, and
on real property owned by Joseph, in the full amount of the debt.
In order to permit a sale of each property, Investors Bank agreed
to allow half of the total amount due real property, to be paid at
the sale of each property. The counsel for Investors Bank
indicated that his client wants the hearing on the subject sale
motion to be considered at the same time as the motion to approve
the sale of Joseph's real property.
Title report and judgment search obtained by the Purchasers shows
the following liens against the Property:
a. Wells Fargo Bank holds a valid first lien on the property
with an estimated payoff as of the Petition Date of $267,352
pursuant to its filed Proof of Claim, docketed as Claim No. 1 on
the Bankruptcy Court Claims Register.
b. Pursuant to the terms of a settlement of state court
litigation with the Debtor and his brother Joseph Episcopo,
Investors Bank holds a second mortgage against the Property and
Joseph Episcopo's real property in the total amount of
approximately $469,303 as of Dec. 31, 2020 pursuant to a payoff
statement dated Dec. 15, 2020 obtained by Joseph. Investors Bank
agreed to allow the Debtor and Joseph Episcopo to each sell their
real property with payment at closing on each property of one-half
of the payoff amount, approximately $234,652, subject to the
provision that Investors Bank's lien remains on as a lien in the
amount of the on whichever property remains unsold.
c. A judgment in the amount of $14,889 was docketed under
Judgment Number DJ-089633-2020 on Sept. 8, 2020 by the State of New
Jersey post-petition in violation of the stay provisions of Section
362 of the Bankruptcy Code. Therefore, the docketing of the
judgment is void and, no distribution will be made to State of New
Jersey at the closing of the sale of the Property.
The Purchase price is greater than the aggregate value of all
allowed liens of record filed against the Property. The sale will
be free and clear of all liens.
The Debtor asks that the Court waives the stay period under the
Federal Rule of Bankruptcy Procedure 6004(h).
A copy of the Agreement is available at
https://tinyurl.com/y4z3snvp from PacerMonitor.com free of charge.
Dean Episcopo sought Chapter 11 protection (Bankr. D. N.J. Case No.
20-15961) on April 29, 2020. The Debtor tapped Milica A. Fatovich,
Esq., as counsel.
DONALD KING OSTERBYE, JR: $575K Sale of Tallahassee Property Okayed
-------------------------------------------------------------------
Judge Karen K. Specie of the U.S. Bankruptcy Court for the Northern
District of Florida authorized Donald King Osterbye, Jr.'s sale of
the real property located at 4987 Glen Castle Dr., in Tallahassee,
Florida, legally described as Lot 11, Highgrove, Phase IV, to
Timothy S. Byrnes and Anne Byrnes for $575,000.
The sale is free and clear of all liens, claims, encumbrances, and
interests.
The closing of the sale will not occur prior to Jan. 22, 2021,
absent further Court order, or written consent by creditors Karen
Cross and Fournier Law, PLLC.
The Debtor has made sufficient allegations and a request in the
Motion to waive the 14-day stay requirement of Bankruptcy Rule
6004(h). No objections being raised, the 14-day stay requirement
of Rule 6004(h) is lifted immediately upon execution of the Order.
The Debtor is authorized to execute and deliver such documents and
perform all things necessary to effectuate the sale. He will file
any specific objections to Karen Cross' payoff amount as set forth
in her Motion to Determine Secured Status on Jan. 13, 2021. An
evidentiary hearing on Cross' Motion will be scheduled for Jan. 21,
2021 by separate notice. Cross' allowed claim, as determined by
the Court prior to closing or agreed upon by the Debtor and Cross,
will be satisfied in full at closing prior to or simultaneously
with the payment of any junior liens, claims, or encumbrances.
The secured claim of Fournier, plus statutory interest as
permitted, will be paid at any closing. Fournier's claim to
post-petition attorneys' fees on its secured claim will be resolved
at a later date either by agreement or via appropriate filings.
Any valid prepetition liens of the Highgrove Homeowners Association
will be paid at closing.
The claims of Bank of America, N.A. (Claim No. 3) and VyStar Credit
Union (Claim No. 13) will be paid in full at any closing.
All funds not paid directly to creditors or other non-debtor third
parties out of the sale's closing will be remitted to Bruner
Wright, P.A.'s Trust Account for further distribution in accordance
with any confirmation order(s) or other order of the Court
authorizing such distributions.
Donald King Osterbye, Jr. sought Chapter 11 protection (Bankr. N.D.
Fla. Case No. 20-40313) on Aug. 10, 2020. The Debtor tapped Byron
Wright, Esq., as counsel.
DYNASTY ACQUISITION: Fitch Lowers LongTerm IDR to 'B-'
------------------------------------------------------
Fitch Ratings has downgraded Dynasty Acquisition Co. Inc.'s
(StandardAero; SA) Long-Term Issuer Default Rating (IDR) to 'B-'
from 'B'. Fitch has also downgraded the long-term ratings of the
company's ABL revolver to 'BB-'/'RR1' from 'BB'/'RR1', first lien
secured revolver and first lien term loan 'B' to 'B+'/'RR2' from
'BB-'/'RR2'. The Rating Outlook is Stable.
The downgrade principally reflects Fitch's expectation that the
recovery for SA has shifted further to the right than previously
expected. This will likely result in leverage exceeding Fitch's
negative sensitivities until YE 2023. The downgrade also
incorporates the weakness in the aviation industry and belief that
the recovery to a more stabilized environment will be fragile as
nations balance the staged re-opening of their economies with
vaccine roll-outs. Airlines retiring older aircraft, which
typically require much greater MRO services, is also a concern,
though Fitch incorporates steadily paced retirements into its
forecasts.
The rating and stable outlook are supported by SA's strong market
position, diversification, adequate FCF, and the high degree of
regulation on aircraft maintenance, which is likely to increase
over time. Revenue is also typically highly visible, which allows
the company to manage working capital effectively. Fitch believes
SA's liquidity and financial flexibility will remain adequate over
the horizon as it manages the current downturn.
KEY RATING DRIVERS
High Leverage, Some Deleveraging Capacity: Fitch calculates SA's
2020 leverage (debt/EBITDA) at 9.4x, which is well outside the
company's negative sensitivities at the previous 'B' rating.
Leverage will likely remain high and trend towards the 6x level by
2023 as air traffic and flight capacity begin to return to 2019
levels. The agency assigns a relatively high importance to the
company's financial structure given the relative fragility of the
aviation industry, although Fitch also believes this concern is
partially offset by the company's strategic profile, strong market
position, and capacity to reduce debt over the next few years given
its cash flow generation. Risks to deleveraging include potential
debt-funded acquisitions, terming out additional ABL balances,
failure to execute on outstanding contracts, or extended periods of
negative FCF.
Predictable Revenue, Temporary Disruption: SA's ratings in the 'B'
category are supported by its relatively predictable revenue during
a normal operating environment due to highly regulated aircraft and
engine maintenance requirements. However, during the first few
months of the coronavirus pandemic this visibility was temporarily
disrupted due to airlines taking a significant portion of their
fleets out of service and delaying external maintenance by
utilizing a greater proportion of spares. This disruption has begun
to reverse and Fitch forecasts the company will likely approach
2019 levels towards the end of 2023 as passenger traffic and flight
capacity rebound.
Strong Market Position, Supported by Certifications: Fitch believes
SA's market position is strong and defensible. It is one of the
largest independent commercial aviation maintenance, repair and
operation (MRO) companies in the world, and has longstanding
relationships with the largest aerospace engine OEMs. The company's
main focus is engine repair and overhaul for commercial, military
and business jet aircraft. Performing such work requires OEM
authorizations and regulatory certifications -- one for each engine
program -- that are expensive and take a significant amount of time
for new market entrants to acquire. Fitch believes the company's
wide range of program certifications, coupled with its strong OEM
relationships, is a major differentiator compared with peers and
creates a defensible barrier against competition.
Most of SA's contracts span more than 10 years and often last
through the life of an engine. When the contacts come up for
re-negotiation, SA has been able to retain all of its contracts due
to the company's consistent execution and longstanding customer
relationships. During a typical year, approximately 50% of total
revenue is provided under long-term agreements, with the other 50%
being short cycle sales, mostly with long-term customers.
Organic Growth Expected Post-Recovery: Fitch expects SA's revenue
will continue to grow after recovering from the pandemic-stemmed
downturn as it takes advantage of legacy certifications. The agency
believes future revenue and cash flow will be supported by engine
programs such as the PW127, CF34 and CFM56, for which MRO volumes
are expected to grow significantly over the next several years. In
particular, the CFM56 is an important program, as it is the largest
engine program in the industry, and demand for additional MRO
capacity will be high over the foreseeable future.
Positive FCF Expected: Fitch projects SA will generate positive FCF
over the next three to four years on average despite the current
broader market headwinds. Fitch believes this is a significant
factor supporting the stable outlook. During 2020, SA should
realize some cash flow benefit from working capital as inventory is
drawn down. Then as revenue and EBITDA begin to recover, these
flows should reverse and become a cash use through 2023 while the
company replenishes to meet increased demand.
Contract and Geographic Diversification: Fitch believes
diversification across programs, geography and end markets further
reduces the risks arising from a loss of any individual contract.
The company estimates it has a top three market share on more than
a dozen of the world's largest engine programs, including the CF34,
PW 100/150 and CFM56, which should continue to grow over the next
several years. SA has more than 40 locations in 10 countries, with
around 35%-40% of sales occurring outside of the U.S. It also
services several end-markets including military, energy,
helicopters, airlines & fleets, and business aviation. Defense
revenue has particularly been a mitigant during the current
aviation downturn.
Execution Risk: Fitch considers continued operational execution to
be a priority for SA. Fitch expects instances of poor execution
would likely diminish the company's currently strong reputation and
could result in customers switching to SA's competitors. Mitigating
this risk is the fact that SA does not have a history of material
contract cancellations over the past several years and has a very
experienced management team, which Fitch believes would be capable
of navigating potential challenges.
Customer Concentration Enhances Execution Risk: Fitch believes the
likelihood of significant customer loss is negligible in the near
term, though the potential future risk is amplified by the
company's degree of customer concentration, despite its diversified
portfolio of contracts and certifications. Fitch estimates around
40% of revenue is derived from the company's top four customers,
with GE and Rolls Royce each representing between 15% and 20% of
sales. While much of the revenue derived from these top customers
is subcontracted work stemming from other end-customers, poor
execution on one or more contracts for one these major customers
could lead to reduced work allocation. The loss of one of these
OEMs as customers would likely result in negative rating momentum.
Supplemental Acquisitions: Fitch expects SA will continue to
supplement organic growth with incremental bolt-on acquisitions, in
line with its strategy over the past few years. Fitch believes the
company will be able to partially fund future purchases with
internally generated cash. Fitch believes the company could pursue
tactical transactions to acquire additional certifications or
improve diversification over time. The company has recently drawn
on its ABL facility to fund transactions, and the facility could
remain a funding source depending on the magnitude of the
transactions, though Fitch anticipates the company will prioritize
liquidity over acquisitions in the near term.
Necessity of Future Authorizations: While the company has
historically maintained strong relationships with customers and
OEMs, Fitch recognizes the company must continue to win future
authorizations over the long term to maintain operations. Fitch
believes the OEMs benefit from SA absorbing much of the required
demand for MRO services on maturing engines so OEMs can focus their
resources on new development programs. However, the OEMs maintain a
certain degree of buying power over SA, and a change in the
relationship could hinder the company's ability to win future
authorizations as maturing engines exit the fleet.
DERIVATION SUMMARY
StandardAero is well positioned as the largest independent MRO
provider in the world, although competition exists from OEMs and
in-house airline MRO operations, including higher-rated General
Electric Company (BBB/Stable), Honeywell International, Inc.
(A/Stable), Rolls Royce plc (BB+/Negative), MTU Aero Engines AG
(BBB/Negative), and Delta Air Lines (BB+/Negative), among others.
The company's leverage and financial structure are important
factors to the rating, and has substantially weakened during 2020.
Fitch’s expectation is that leverage will remain elevated over
the next 24 months, which contributed to the downgrade to 'B-' from
'B' and the current one notch differential between SA and peer The
NORDAM Group (B/Negative).
The rating and stable outlook is supported by the company's lesser
degree of cyclicality compared to OEs, and its stable and
predictable revenue stream, which Fitch considers strong for the
rating. The company's leading market position was also an important
factor in deriving the rating, and is reinforced by the company's
portfolio of certifications and diversification. No country
ceiling, parent/subsidiary linkage or operating environment factors
were in effect for these ratings.
KEY ASSUMPTIONS
Fitch's key assumptions within Fitch’s rating case for the issuer
include:
-- Revenue declines by nearly 20% in 2020, then stabilizes
heading into 2021 and rebounds in 2022 and 2023 as air traffic
and flight capacity approaches 2019 levels;
-- EBITDA margins are pressured in 2020 and 2021 as the company
navigates the current downturn, then returns to near 2019
levels in 2022 and 2023;
-- Cash inflows from working capital in 2020 due to inventory
drawdown; cash outflows from working capital between 2021 and
2023 as the company builds inventory back up to meet resumed
demand;
-- Capex in 2020 and 2021 is predominantly maintenance-related;
growth capex resumes in 2022;
-- Company takes advantage of 100% PIK interest on unsecured
notes through mid-2020 and 50% PIK interest through mid-2021;
-- ABL borrowings repaid by end of 2020; forecasted debt
repayment only includes scheduled amortization and minimal
excess FCF sweep;
-- No dividends projected in Fitch’s forecasts.
Recovery Assumptions
The recovery analysis assumes that SA would be considered a
going-concern in bankruptcy and that the company would be
reorganized rather than liquidated. A 10% administrative claim is
assumed in the recovery analysis.
Fitch assumes SA will receive a going-concern recovery multiple of
6.5x EBITDA under this scenario. Fitch considers this multiple to
be toward the upper middle range of recovery multiples assigned to
companies in the Aerospace & Defense sector.
Fitch assumes $410 million as the going-concern EBITDA in the
analysis. The agency's assumption represents an average of Fitch's
forecasted EBITDA for SA over the next three years, which Fitch
believes would be a reasonable going-concern expectation upon
emergence. Fitch believes a GC EBITDA greater than 2020 EBITDA is
appropriate in this instance, due to the highly cyclical nature of
the industry, particularly following one of the greatest aviation
downturns in history as a result of the coronavirus pandemic and
based on Fitch's assumption that liquidity/refinancing issues,
rather than a further deterioration in the business, would be the
catalyst for a restructuring.
In Fitch's recovery analysis, potential default is assumed to come
from a combination of one or more of the following scenarios: a
significantly prolonged recovery from the coronavirus pandemic,
which exceeds Fitch’s forecasted industry recovery by one to two
years; poor contract execution causes several periods of
significant cash outflows and a materially negative hit to the
company's reputation; or the company incurs significant cash costs
resulting from failure to integrate one or more acquisitions.
Fitch's recovery assumptions are based on SA's industry-leading
reputation, variable cost structure, solid and predictable backlog,
diversified contract and certification portfolio, strong market
position, and high industry barriers to entry. Each of these
factors would likely support the company's ability to recover from
severe distress in the case of bankruptcy, at a level greater than
2020 EBITDA. Fitch also considered the meaningful execution risk
and potential for cost overruns, though unlikely. Most of the
defaulters in the Aerospace & Defense sector observed by Fitch in
recent bankruptcy case studies were smaller in scale, had less
diversified product lines or customer bases and were operating with
highly leveraged capital structures.
Fitch generally assumes a fully drawn first lien revolver in its
recovery analyses since credit revolvers are tapped as companies
are under distress. Fitch assumed the company's recently upsized
$400 million ABL revolver was 85% drawn, which demonstrates the
contraction of the borrowing base as a company becomes distressed.
This is in line with other examples observed in bankruptcy studies
and differs from Fitch's recent review of StandardAero following
the company's decision to term out its ABL borrowings. The
increased size also reduces the overcollateralization cushion of
the current inventory and receivables balances, which supports
Fitch's renewed assumption to consider the ABL 85% drawn.
The 'BB-' rating and Recovery Rating of 'RR1' on the ABL revolver
are based on Fitch's recovery analysis under a going-concern
scenario, which indicates outstanding recovery prospects in the
range of 91% to 100%. The 'B+' rating and Recovery Rating of 'RR2'
on the company's first lien term loan and senior secured revolver
would indicate strong recovery prospects for the credit facility in
the range of 71% to 90%.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
-- Leverage (total debt/EBITDA) around or below 6.0x for a
sustained period;
-- Sustained positive FCF;
-- FFO Interest Coverage ratio greater than 1.7x over a sustained
period.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
-- Material contract cancellations caused by weakened reputation;
-- Sustained negative FCF or weakened liquidity position;
-- FFO Interest Coverage ratio less than 1.2x over a sustained
period.
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 believes that StandardAero's liquidity
will fluctuate between $500 million and $600 million over the
rating horizon, comprising between $75 million and $150 million in
cash, as well as a combination of availability under its ABL
facility and revolving credit facility. Liquidity, along with
internally generated cash, should be sufficient to cover near-term
expenses such as working capital growth, debt amortization and
capex. The company's capital structure includes a senior secured
ABL facility, senior first lien revolver and senior first lien term
loan B. The company also has private unsecured notes.
ESG Considerations
Dynasty Acquisition has an ESG Relevance Score of '4' for Financial
Transparency and disclosure risk due to the its private financials
and intermittent reporting which, in combination with other
factors, impacts the rating. Overall, Fitch does not consider this
to be a significant concern in the near to intermediate term, but
could become exacerbated during an extreme stress case scenario.
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.
EAST VILLAGE: EVF1 Funding Down to $3.13M; Unsecureds Recover 25%
-----------------------------------------------------------------
East Village Properties LLC, et al., submitted a Third Amended
Disclosure Statement and a Second Amended Joint Plan of Liquidation
on Jan. 11, 2021.
In 2017, the Debtors proposed a Plan to be implement EVF1 funding
the amount of $13,500,000 in exchange for EVF1 taking title to the
Debtors' Properties. In that Plan, unsecured creditors were
projected to recover 100% of their claims.
However, in September 2017, the Office of the Attorney General of
the State of New York filed proofs of claim seeking $5 million,
which claims, if recognized as valid, would result in a substantial
dilution of the unsecured creditor distribution, including tenants
at the Properties. EVF1 was eventually able to resolve the AG
investigation, which resolution is documented by a settlement
agreement. In addition, the financial impact of the statewide
shutdown due to the Covid-19 pandemic is not quantifiable at this
juncture, but the value of real estate has further diminished.
Accordingly, 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 Second Amended Plan filed Jan. 11, 2021, will be funded by
secured creditor EVF1 LLC. The sum of $3,125,000 will be funded by
EVF1 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; (ii) to pay the entire Manager Administrative Claim; 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.
Class 4 General Unsecured Claims and Class 5 Allowed Tenant Claims
will each receive pro rata distribution from the Plan Fund. Class
4 and Class 5 will be paid from the $1,487,500 to be contributed by
EVF1 to the Plan Fund on or before the Effective Date, and the
remaining balance to be paid from the $1,487,500 to be contributed
by EVF1 to the Plan Fund after the Effective Date which pro rata
distribution shall be payable in installments upon the sales of
each of the Properties. It is anticipated that this will result in
an aggregate distribution of approximately 25%.
Eligible tenants will receive a rent credit related to the
Settlement Agreement. Even though this is in the form of a credit,
not a cash distribution, the Settlement Agreement provides that a
rent credit in the cumulative amount of $1,050,000 will be
distributed to eligible tenants in the sole and absolute discretion
of the AG and will be a rent credit against rental arrears.
The Plan Administrator will have the discretion to extend the July
1, 2022 payment deadline to Allowed Unsecured Claims and Allowed
Tenant Claims for a period of not more than 90 days to Oct. 1, 2022
without the need for Bankruptcy Court approval.
A full-text copy of the Third Amended Disclosure Statement dated
January 11, 2021, is available at https://bit.ly/2XERPxj from
PacerMonitor.com at no charge.
Attorneys for the Debtors:
A. Mitchell Greene
Fred B. Ringel
Lori Schwartz
ROBINSON BROG LEINWAND GREENE GENOVESE & GLUCK P.C.
875 Third Avenue
New York, New York 10022
Tel: 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.
* * *
In 2017, the Debtors proposed a Plan to be implement EVF1 funding
the amount of $13,500,000 in exchange for EVF1 taking title to the
Debtors' Properties. The Office of the Attorney General of the
State of New York's investigation into the Debtor, and the Covid-19
pandemic forced the parties to scrap that plan. In the latest
plan that the Debtors will seek to confirm in February 2021, EVF1,
which is owed $145 million, will take control of the Debtors'
properties in exchange for funding of only $3,125,000.
EAST VILLAGE: Feb. 12 Plan Confirmation Hearing Set
---------------------------------------------------
East Village Properties LLC and its affiliated debtors filed their
Second Amended Joint Plan of Liquidation and their Third Amended
Disclosure Statement for Joint Plan of Liquidation on Jan. 11,
2021.
On Jan. 12, 2021, Judge Robert D. Drain ordered that:
* The Disclosure Statement is approved as containing adequate
information within the meaning of Sec. 1125 of the Bankruptcy
Code.
* Feb. 5, 2021 at 5:00 p.m. is fixed as the last day to
deliver all ballots of holders of claims in classes 2, 4, and 5 to
be counted for voting Purposes.
* Feb. 5, 2021 is fixed as the last day to file objections to
confirmation of the Plan.
* Feb. 9, 2021 is the deadline for filing and service of
replies to any objection to confirmation of the Plan.
* Feb. 5, 2021 is the deadline for the filing of
administrative expense claims against the Debtors' estates other
than claims for professional fees, ordinary course claims,
administrative claims that have already been acknowledged or
settled, or claims incurred after February 5, 2021.
* Feb. 12, 2021 at 10:00 a.m. is the telephonic hearing on
confirmation of the Plan.
A full-text copy of the order entered Jan. 12, 2021, is available
at: https://bit.ly/3qrzCQh
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.
* * *
In 2017, the Debtors proposed a Plan to be implement EVF1 funding
the amount of $13,500,000 in exchange for EVF1 taking title to the
Debtors' Properties. The Office of the Attorney General of the
State of New York's investigation into the Debtor, and the Covid-19
pandemic forced the parties to scrap that plan. In the latest plan
that the Debtors will seek to confirm in February 2021, EVF1, which
is owed $145 million, will take control of the Debtors' properties
in exchange for funding of only $3,125,000. Unsecured creditors
are slated to recover 25% in the latest plan, compared with 100% in
the original plan.
ETS OF WASHINGTON: Seeks to Tap DDavison Law as Special Counsel
---------------------------------------------------------------
ETS of Washington LLC seeks approval from the U.S. Bankruptcy Court
for the District of Columbia to employ DDavison Law, Inc. as
special counsel.
The Debtor needs the assistance of a special counsel to institute,
pursue or handle objections, civil claims and other legal matters
in connection with its acquisition of land located at 2207 Foxhall
Road, N.W., Wash.
The Debtor's members are willing to pay the fees and expenses of
DDavison Law.
Dennis Davison, Esq., an attorney at DDavison Law, disclosed in
court filings that the firm has no connection with the Debtor,
creditors or any other party-in-interest.
The firm can be reached through:
Dennis A. Davison, Esq.
DDavison Law, Inc.
2501 Q Street, N.W., Suite B-21
Washington, DC 20007
Telephone: (202) 744-9501
Email: dennis@ddavisonlaw.com
About ETS of Washington
ETS of Washington, LLC filed a voluntary petition for relief under
Chapter 11 of the Bankruptcy Code (Bankr. D.D.C. Case No. 20-00397)
on Sept. 28, 2020. Jason Porcier, member manager, signed the
petition.
At the time of the filing, the Debtor had estimated assets of
between $1,000,001 and $10,000,000 and liabilities of between
$500,001 and $1,000,000.
Judge Elizabeth L. Gunn oversees the case. The Debtor tapped
Samuelson Law, LLC as legal counsel and DDavison Law, Inc. as
special counsel.
EXAMWORKS GROUP: Moody's Completes Review, Retains B2 CFR
---------------------------------------------------------
Moody's Investors Service has completed a periodic review of the
ratings of ExamWorks Group, Inc. and other ratings that are
associated with the same analytical unit. The review was conducted
through a portfolio review discussion held on January 11, 2021 in
which Moody's reassessed the appropriateness of the ratings in the
context of the relevant principal methodology(ies), recent
developments, and a comparison of the financial and operating
profile to similarly rated peers. The review did not involve a
rating committee. Since January 1, 2019, Moody's practice has been
to issue a press release following each periodic review to announce
its completion.
This publication does not announce a credit rating action and is
not an indication of whether or not a credit rating action is
likely in the near future. Credit ratings and outlook/review status
cannot be changed in a portfolio review and hence are not impacted
by this announcement.
Key rating considerations.
ExamWorks' B2 CFR reflects its high financial leverage due to its
aggressive debt funded growth strategy, integration risk and
vulnerability to regulatory reviews. ExamWorks' credit profile is
also constrained by its moderate scale. However, ExamWorks benefits
from its leading market share of the independent medical
examination industry, solid EBITDA margins and diversity of its
customer base. The company's good liquidity profile is supported by
positive free cash flow generation, a sizable revolver and no near
term maturities.
The principal methodology used for this review was Business and
Consumer Service Industry published in October 2016.
FADYRO DISTRIBUTORS: Seeks to Tap Landrau Rivera as Counsel
-----------------------------------------------------------
Fadyro Distributors, Inc. seeks approval from the U.S. Bankruptcy
Court for the District of Puerto Rico to employ Landrau Rivera &
Assoc. as its legal counsel.
Landrau Rivera & Assoc. will render these legal services:
(a) advise the Debtor regarding its duties and powers in its
Chapter 11 case under the laws of the United States and Puerto Rico
in which it conducts its business, or is involved in litigation;
(b) advise the Debtor whether a reorganization is feasible
and, if not, assist the Debtor in the orderly liquidation of its
assets;
(c) assist the Debtor in negotiation with its creditors in the
preparation of a Chapter 11 plan;
(d) prepare legal documents;
(e) appear before the bankruptcy court, or any court in which
the Debtor asserts a claim interest or defense directly or
indirectly related to its bankruptcy case;
(f) employ other professional services as necessary to
complete the Debtor's financial reorganization; and
(g) perform other legal services.
The hourly rates of Landrau Rivera & Assoc.'s counsel and staff are
as follows:
Noemi Landrau Rivera, Esq. $200
Josue A. Landrau Rivera, Esq. $175
Legal and Financial Assistants $75
In addition, Landrau Rivera & Assoc. will seek reimbursement for
fees and expenses.
The Debtor paid a retainer of $10,000.
Noemi Landrau Rivera, Esq., an attorney at Landrau Rivera & Assoc.,
disclosed in court filings that the firm and its members are
"disinterested persons" within the meaning of Section 101(14) of
the Bankruptcy Code.
The firm can be reached through:
Noemi Landrau Rivera, Esq.
Landrau Rivera & Assoc.
P.O. Box 270219
San Juan, PR 00927-0219
Telephone: (787) 774-0224
Facsimile: (787) 793-1004
Email: nlandrau@landraulaw.com
About Fadyro Distributors
Fadyro Distributors, Inc. filed a voluntary petition for relief
under Chapter 11 of the Bankruptcy Code (Bankr. D.P.R. Case No.
21-00029) on Jan. 5, 2021. At the time of the filing, the Debtor
disclosed assets of between $1 million and $10 million and
liabilities of the same range.
Landrau Rivera & Assoc., led by Noemi Landrau Rivera, Esq., serves
as the Debtor's legal counsel.
FERRELLGAS PARTNERS: Gets OK to Hire Prime Clerk as Claims Agent
----------------------------------------------------------------
Ferrellgas Partners LP and Ferrellgas Partners Finance Corp.
received approval from the U.S. Bankruptcy Court for the District
of Delaware to employ Prime Clerk LLC as their claims and noticing
agent.
Prime Clerk will oversee the distribution of notices and will
assist in the maintenance, processing and docketing of proofs of
claim filed in the Debtors' Chapter 11 cases.
Prior to the petition date, Prime Clerk received an advance in the
amount of $50,000 from Ferrellgas Partners, LP's non-debtor
affiliate, Ferrellgas LP.
The hourly rates of Prime Clerk's claim and noticing services are
as follows:
Analyst $30 - $50
Technology Consultant $35 - $95
Consultant/Senior Consultant $65 - $165
Director $175 - $195
The hourly rates of the firm's solicitation, balloting and
tabulation services are as follows:
Solicitation Consultant $190
Director of Solicitation $210
In addition, Prime Clerk will seek reimbursement for out-of-pocket
expenses.
Benjamin Steele, vice president of Prime Clerk, 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:
Benjamin J. Steele
Prime Clerk LLC
One Grand Central Place
60 East 42nd Street, Suite 1440
New York, NY 10165
Telephone: (212) 257‐5490
Email: bsteele@primeclerk.com
About Ferrellgas Partners
Ferrellgas Partners, LP is a publicly traded Delaware limited
partnership formed in 1994 that has two direct subsidiaries,
Ferrellgas Partners Finance Corp. and non-debtor Ferrellgas, LP.
Ferrellgas Partners Finance is a Delaware corporation formed in
1996 and has nominal assets, no employees and does not conduct any
operations, but solely serves as co-issuer and co-obligor for the
2020 Notes. Ferrellgas, primarily through non-debtor OpCo, is a
distributor of propane and related equipment and supplies to
customers in the United States. Ferrellgas' market areas for
residential and agricultural customers are generally rural while
the market areas for industrial and commercial and portable tank
exchange customers are generally urban.
Ferrellgas Partners LP and Ferrellgas Partners Finance filed
voluntary petitions for relief under Chapter 11 of the Bankruptcy
Code (Bankr. D. Del. Case Nos. 21-10021 and 21-10020) on Jan. 11,
2021. James E. Ferrell, chief executive officer and president,
signed the petitions.
At the time of the filing, Ferrellgas Partners, LP was estimated to
have $100 million to $500 million in both assets and liabilities
while Ferrellgas Partners Finance was estimated to have less than
$50,000 in assets and $100 million to $500 million in liabilities.
Judge Mary F. Walrath oversees the cases.
The Debtors tapped Squire Patton Boggs (US) LLP as primary
bankruptcy and restructuring counsel; Chipman, Brown, Cicero &
Cole, LLP as local bankruptcy counsel; Moelis & Company LLC as
investment banker; and Ryniker Consultants as financial advisor.
Prime Clerk LLC is the claims, noticing & solicitation agent.
FLORIDA QUALITY: Seeks Approval to Hire Litigation Counsel
----------------------------------------------------------
Florida Quality Roofing, Inc. seeks approval from the U.S.
Bankruptcy Court for the Southern District of Florida to employ
Sanford Topkin, Esq., an attorney at Topkin & Partlow, PL, as its
litigation counsel.
The Debtor needs legal assistance in a civil action styled Paul Q.
Baker v. Florida Quality Roofing, Inc. and Efrain Osorio, Broward
Circuit Civil Case No. CACE-20-017635.
All fees and costs incurred in connection with this representation
will be paid by AmGUARD Insurance Company.
Mr. Topkin disclosed in court filings that he is a "disinterested
person" as that term is defined in Section 101(14) of the
Bankruptcy Code.
The attorney can be reached at:
Sanford R. Topkin, Esq.
Topkin & Partlow, PL
1166 W. Newport Center Drive, Suite 309
Deerfield Beach, FL 33442
Telephone: (954) 422-8422
Email: stopkin@topkinlaw.com
About Florida Quality Roofing
Florida Quality Roofing, Inc. sought protection for relief under
Chapter 11 of the Bankruptcy Code (Bankr. S.D. Fla. Case No.
20-21477) on Oct. 20, 2020, listing under $1 million in both assets
and liabilities. Judge Peter D. Russin oversees the case.
The Debtor tapped Zach B. Shelomith, Esq., at Leiderman Shelomith
Alexander + Somodevilla, PLLC as legal counsel and Sanford R.
Topkin, Esq., at Topkin & Partlow, PL as litigation counsel.
FRIENDLY VILLAGE: Trustee Sets Bid Procedures for Long Beach Asset
------------------------------------------------------------------
Richard A. Marshack, the Chapter 7 Trustee of the bankruptcy estate
of Friendly Village MHP, Associates, L.P., asks the U.S. Bankruptcy
Court for the Central District of California to authorize the
bidding procedures in connection with the sale to ACI Friendly
Village, Inc. for $11 million, subject to overbid, of all of the
rights, titles, shares, claims and interest, if any, to the extent
they are assignable, of the Estate in the following:
(1) Fee simple title to those certain parcels of land located
in the City of Long Beach, County of Los Angeles, State of
California: (a) consisting of approximately 18.73 acres; (b)
commonly known by the street address of 5450 North Paramount Blvd.,
Long Beach, CA 90805, on which is situated a mobile home park with
approximately 182 spaces; and (c) identified by Assessor's Parcel
Number 7157-006-008.
(2) All buildings, structures and other improvements located
on the Land owned by the Seller, the Improvements include, without
limitation: (a) a clubhouse and pool facility, and (b) a two-unit
apartment building.
(3) All right, title and interest of Seller in and to any
privileges, easements and appurtenances relating to the Land and
Improvements, including all easements, rights-of-way, rights to
utility connections and hook-ups, and other appurtenances used or
connected with the beneficial use or enjoyment of the Land and
Improvements.
(4) All rights, title and interests of Seller, if any, and
without any the Seller's warranty but with third-party warranties
attendant to such, if any, in and to all machinery, fixtures and
equipment located on the Land or in the Improvements (including,
without limitation, that certain decal number ABEYY84 for the
double-wide mobile home located at Space No. 25) as of the Closing
Date under the Agreement of Purchase and Sale and Escrow
Instruction that are: (a) owned by the Seller; (b) attached to the
Land or the Improvements as of the Execution Date of the Agreement;
and (c) used in connection with the operation, ownership,
maintenance, management, occupancy or improvement of the Land and
Improvements, and all trailers and modular housing, if any, that
are owned by Seller and located upon or attached to the Land as of
the close of escrow ("Tangible Personal Property"). The Tangible
Personal Property does not include any items of machinery,
fixtures, equipment, trailers or modular housing owned by Tenants
under Tenant Leases (both as hereinafter defined) or owned by third
parties.
(5) To the extent assignable, the Seller or the Debtors'
current general liability, property and umbrella policies, which
will be prorated through escrow. With the exception of the Admiral
Insurance Policy, as defined below, no other insurance policy under
which Debtors or Trustee are a named insured or an additional
insured other than the Current Policies is included in the
transaction.
(6) All rights, title and interests of the Seller, if any,
and without any Seller's warranty but with all third-party
warranties attendant to such, if any, in and to all intangible
personal property used in connection with the ownership of the Land
and Improvements as of the Closing Date under Agreement.
(7) All rights and interests of the Seller and all
obligations of Seller in all leases, lease amendments, exhibits,
addenda and riders thereto, including any operating leases, rental
agreements, licenses or similar instruments creating a possessory
interest in the Land, Improvements, Appurtenances, and Tangible
Personal Property and any applicable Rent Reduction and Release
Agreements entered into by any of the tenants under such Tenant
Leases.
(8) All rights and interests of Seller and all obligations of
the Seller in all service agreements which are part of the
Agreement ("Assigned Service Contracts").
(9) All rights and interests of and interests of the Seller
and all obligations of the Seller in an Environmental Impairment
Liability issued by Admiral Insurance Co., Policy No.
FEI-EIL-18895-00.
A hearing on the Motion is set for Feb. 4, 2021 at 10:30 a.m.
FV Debtor is the owner of the Real Property. Its general partner
is an entity called Friendly Village, GP, LLC ("GP Debtor"), which
in turn is owned by the Family Trusts of Lee Kort and Michael
Scott.
The bankruptcy cases were precipitated by ongoing state court
litigation commenced on Aug. 13, 2015, by some of the Debtors'
tenants in the Superior Court of the State of California, County of
Los Angeles, entitled Celestino Acosta, an individual, et al., v.
City of Long Beach, a municipality; Friendly Village Mobile
Associates L.P., D.B.A. Friendly Village of Long Beach, a
California Limited Liability Company; Friendly Village MHP
Associates L.P., D.B.A. Friendly Village of Long Beach, a
California Limited Liability Company; Friendly Village, GP, LLC, a
California Limited Liability Company; Sierra Corporate Management,
Inc.; Kort and Scott
Financial Group LLC; and Does 1-100, assigned as Case No.
BC591412.
Concurrently with attempting to sell the Real Property and
operating the Park, the Trustee also was very involved in
negotiating a settlement to resolve the State Court Action and
other litigation (to which the FV Debtor and GP Debtor were a
party). Such efforts proved fruitful. The parties agreed to
global settlement that provided over $42.5 million to resolve
multiple state court litigations. The settlement funds from the
State Court litigation have been paid to the Plaintiffs.
The State Court Action was pending for over 4 years, and the first
phase of the trial representing only 22% of the Plaintiffs resulted
in a verdict against the Debtors of approximately $5.5 million in
compensatory damages and over $6 million in punitive damages.
On Feb. 7, 2019, the Trustee filed a notification of asset case.
The claims bar dates in both bankruptcy cases were set for May 13,
2019. The Plaintiffs' proofs of claim and the Claimants' proofs of
claim were timely filed. The creditor matrixes filed in the GP
Debtor's case indicate that most, if not all, of its creditors are
also creditors in FV Debtor's case. The proofs of claims filed by
current and former tenants of the Real Property, 246 of whom are
the Plaintiffs in the State Court Action and 103 of which are only
Claimants. Other than the current and former tenants at the Real
Property, the claims against the Estates are less than $60,000.
To date, proofs of claim have been filed in the GP Debtor case
totaling $57,877,879. Of the GP Total Claims, approximately $1,730
is an administrative claim and the remainder were filed as
unsecured claims.
To date proofs of claim have been filed in the FV Debtor case
totaling $58,471,686. Of the LP Total Claims, the previously filed
priority claim in the amount of $800 has been paid, the $63,252
secured claim has been withdrawn, and the remainder were filed as
unsecured claims.
The Trustee retained Force Ten Partners, LLC to market the Real
Property shortly after his appointment. When the Trustee
originally retained Force 10, he believed he had two bona fide
offers each at an approximate $15 million purchase price, with a
quick closing. Since the initial offers, the prospective
purchasers have rescinded their interest due to the ongoing repair
and remediation issues and the complexity of the transaction.
In addition to the compensation based on a percentage of the Real
Property, the Trustee understands that Force 10 will also be asking
compensation on an hourly basis for work done when the Prior Buyer
failed to timely close.
On Jan. 14, 2021, the Trustee and the Buyer entered into the
Agreement for the sale of the Property for $11 million. As set
forth in the Agreement, $1 million of the $11 million is to be paid
to the GP Debtor's Estate for its interest in the Admiral Policy.
The Trustee has determined that it is in the best interest of the
Estate to proceed with the sale of the Property for the sum of $11
million. Although the Buyer is obtaining a loan, the payment of
the Purchase Price to the Seller is all cash.
Within three business days of execution of the Agreement, the Buyer
will deposit $100,000 into Escrow Holder. The Deposit will be
non-refundable, unless Seller defaults or as otherwise provided in
the Agreement. The balance of the Purchase Price, will be
deposited by the Buyer with Escrow Holder no later than 12:00 noon
(PT) one Business Day prior to the Closing Date. The Closing
Payment will be subject to adjustment for any prorations required
pursuant to Article VII of the Agreement.
The Buyer will approve the preliminary title report issued by First
American Title Insurance Co. within five Business Days after the
Execution Date. If the Title Company issues any supplements or
amendments to the Preliminary Title Reports after the execution of
the Agreement, the Buyer will have five Business Days following
delivery of the supplement or amendment in which to approve or
disapprove any exception contained therein not caused or created by
the Buyer and not disclosed in the Preliminary Title Reports or
prior supplement or amendment thereto.
The Real Property will be conveyed by Seller to the Buyer on the
Closing Date free and clear of all liens, claims, encumbrances and
easements, excepting only the following Permitted Encumbrances
defined in the Agreement.
The Trustee will also pay to Force 10, the Estate's financial
advisor, 3.3% of the Purchase Price in accordance the Renewed and
Amended Application to Employ Force Ten Partners, aproved by order
of the Court entered Sept. 18, 2019. Force 10 also believes that
it is due additional hourly compensation and will be bringing a
separate motion seeking the same to be heard concurrently with the
instant Motion.
The Trustee proposes to distribute the sale proceeds in the
following amounts estimated in accordance with the Global
Settlement Agreement and Settlement Order:
Description Total
Sale Price $11,000,000
Force 10 Fee (3.3% of Sales Price) ($363,000)
Force 10 Hourly Fee and Costs ($95,000)
Title, escrow, taxes, ($20,000)
recording charges (approx.)
Property Taxes (2018) (approx.) ($515,000)
Property Taxes (2020/2021) (approx.) ($90,000)
Assigned Security Deposits ($88,950)
Estimated Net Proceeds $9,828,050
While the Trustee is prepared to accept the Purchase Price for the
Property as set forth in the Motion, he is also interested in
obtaining the maximum price for the Property. Accordingly, he has
filed the Sale Procedures Motion to authorize him to implement an
auction and overbid procedures regarding the sale of the Property
The salient terms of the Bidding Procedures are:
a. Bid Deadline: Feb. 4, 2021 at 10:30 a.m.
b. Initial Bid: $11.1 million
c. Deposit: $1,665,000 (15 % of the Minimum Overbid) made
payable to Richard A. Marshack, Chapter 7 Trustee
d. Auction: If one or more timely conforming Initial Overbids
is received, the Trustee will conduct the Auction on Feb. 4, 2021,
at 10:30 a.m., in Courtroom 5A of the United States Bankruptcy
Court located at 411 West Fourth Street, Santa Ana, California
92701. Bidding will commence at the highest and otherwise best
offer.
e. Bid Increments: $50,000
f. Break-Up Fee: $50,000
Any Sale will be on an "as-is, where-is" basis and without
representations or warranties of any kind by the Trustee, his
agents, or the Estate.
Because the opinion of the Estates' accountant, the Trustee does
not believe that there will be tax consequences to the Estates
arising from the proposed sale.
The Trustee is also asking authority to assume and assign the
Tenant Leases. The rejection of these leases could lead to a large
administrative claim for relocation benefits to the Tenants.
The Trustee previously assumed the Admiral Policy by Order entered
on Aug. 25, 2020. A condition of the Buyer to purchase the
Property is the assignment by the Trustee of the Admiral Policy and
its assumption by the Buyer. The Admiral Policy will provide funds
to pay for the continued environmental monitoring and remediation
of the methane conditions at the Property. The Trustee estimates
that there will be approximately $2.5 million of remaining limits
on the Admiral Policy at the time of the assignment to the Buyer.
The GP Estate is to be paid $1 million for its interest in the
Policy.
While the Current Policies are not as critical as the assignment of
the Admiral Policy, if approved, it will result in FV Debtor
receiving reimbursement of approximately $50,000 out of the
approximately $110,000 which it paid for the Current Policies.
The Court approved the Rent Reduction Agreements in November 2018,
and all but one or two of the current tenants have signed them.
Pursuant to the terms of the Rent Reduction Agreements, the Trustee
agreed to reduce the monthly rent. In exchange, the tenants
granted a general release to the Trustee. A condition of the
Agreement is the assignment of the Rent Reduction Agreements to the
Buyer, and the Buyer assuming its obligations. There is nothing in
the Rent Reduction Agreement that prevents it assignment. There is
a benefit to the Tenants in that they will continue to receive the
benefit of the rent reduction.
A copy of the Agreement and the Bidding Procedures is available at
https://tinyurl.com/y3zvlwo3 from PacerMonitor.com free of charge.
The Purchaser:
ACI FRIENDLY VILLAGE, INC.
Attn: Maurice A. Priest
7420 Greenhaven Drive, #125
Sacramento, CA 95831
Telephone: (916) 761-3383 and (916) 399-4993
E-mail: rop@att.com
The Purchaser is represented by:
GOLDFARB & LIPMAN LLP
550 South Hope Street, Suite 2685
Los Angeles, California 90071
Attention: Joshua J. Mason
Telephone: (213) 627-6336
E-mail: jmason@goldfarblipman.com
About Friendly Village MHP, Associates, L.P.
On Oct.2, 2018, Friendly Village MHP Associates, L.P., filed a
voluntary petition under Chapter 7 of Title 11 of the United States
Code. Initially, Karen S. Naylor was appointed as the Chapter 7
Trustee. On Oct. 5, 2018, Ms. Naylor resigned, and Richard A.
Marshack was appointed as the Chapter 7 Trustee.
GEORGIA DEER: Selling Ford F250 & Ford F150 to Harrods for $71K
---------------------------------------------------------------
Georgia Deer Farm, Inc., asks the U.S. Bankruptcy Court for the
Northern District of Georgia to authorize the sale of its interests
in (i) a 2016 Ford F250, VIN 1FT7W28T8GEB72337, to Roger Harrod for
$26,000; and (ii) a 2019 Ford F150, VIN 1FTEW1E5XKFD07674, to Ryan
Harrod for $45,000.
The Vehicles serve as security in regards to loans held by Ford
Motor Credit.
The Debtor estimates the balance of the loan with Ford Motor Credit
for the F250 to be approximately $6,000. It estimates the balance
of the loan with Ford Motor Credit for the F150 to be approximately
$43,000.
The Debtor has determined that it is in the best interest of its
estate to sell the Vehicles.
The Debtor asks approval to sell the Vehicles. The fair market
value of the F150 is approximately $30,000. The fair market value
of the F250 is approximately $33,000. The combined fair market
value of the vehicles is approximately $63,000.
The Buyers are interested in buying the Vehicles for $71,000.
Roger Harrod is an insider. He is the president of Georgia Deer
Farm. Ryan Harrod is also an insider. He is the son of the
president of the Debtor. Roger Harrod has offered to buy the F250
for $26,000. Ryan Harrod has offered to buy the F150 for $45,000.
By selling the Vehicles directly to the Harrods, the Debtor will
save the costs of sale, including but not limited to commissions,
and will be receiving more than fair market value, which will
directly benefit its creditors.
The Vehicles will be sold free and clear of all liens, claims and
encumbrances.
The Debtor has conducted an investigation of the Vehicles and has
evaluated its options regarding ongoing use versus its sale. As a
result, it believes that the buyer's offer as set forth, represents
the best offer and course of action for the estate.
The Debtor proposes to payoff the liens held by Ford Motor Credit
and to remit the remaining funds to the Debtor's counsel to be held
in escrow pending further order of the Court. Time is of the
essence in the referenced sale.
The Debtor further asks authority to enter into and execute any
agreements and/or documents necessary to liquidate the Vehicles as
contemplated, as well as to transfer title to the Buyer of the
Vehicles.
A hearing on the Motion is set for Feb. 11, 2021, at 10:15 a.m.
Given the current public health crisis, hearings may be telephonic
only.
A copy of the Agreement is available at
https://tinyurl.com/y3s5vcot from PacerMonitor.com free of charge.
About Georgia Deer Farm
Georgia Deer Farm, Inc., a tractor and farm equipment dealer in
Roopville, Ga., sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. N.D. Ga. Case No. 20-10563) on March 13,
2020. At the time of the filing, the Debtor had estimated assets
of less than $50,000 and liabilities of between $1 million and $10
million.
The case was previously assigned to the Hon. W. Homer Drake and
was
later reassigned to the Hon. Lisa Ritchey Craig.
The Debtor is represented by The Falcone Law Firm, P.C.
GLOBAL ASSET: Heineken Says Plan Disclosures Inadequate
-------------------------------------------------------
Creditor Heineken Global Procurement B.V. objects to Global Asset
Rental, LLC's Disclosure Statement and proposed Plan of
Liquidation.
Heineken points out that:
* The Disclosure Statement is plainly inadequate. The Debtor
has projected a de minimis distribution to creditors (1% to 2%)
under the Plan but has not provided a liquidation analysis.
* There is no analysis in the Disclosure Statement of the
estate's claims
against insiders, one of the very few assets of the estate.
Instead, the creditors committee, with the Debtor's support, has
filed a motion to expand its authority to settle insider claims
without providing any explanation of any investigation or due
diligence performed in connection with such claims.
* The proposed liquidating trustee under the Plan is the current
restructuring officer for the Debtor and as such would not be
sufficiently independent for the deeper evaluations into the claims
owned by the estate.
Heineken also notes that among the few assets of the estate is the
"Heinken Payment" which constitutes the right to receive 10% of an
alleged $17.8 million receivable purportedly due from Heineken.
The Debtor's financial reporting regarding this receivable is
grossly in error and more likely than not, backdated to December
31, 2019 by manual "non-sent" invoices, representing over $15
million of the claimed receivable.
The disclosure statement alleges that 70% of the debtor's claimed
accounts receivable, $17,883,654 of $24,727,526, is "due" from
Heineken and its affiliates. However, in recent documentary
exchanges with counsel for the debtor and for the asset purchaser,
White Oak Global Advisors, some of the itemized detail for this
receivable was provided. That detail shows that of the claimed
$17,883,653 over $15 million represent unexplained fiscal year end
December 31, 2019 accounting entries, in large multimillion sums,
but with no corresponding invoices to Heineken.
The requests for the back-up information relating to the alleged
receivable, first made in October 2020 by Heineken's counsel to
debtor and White Oak's counsel, is still underway because the
claimed "invoices" do not appear to be in the ordinary course of
business or actual invoices.
Haineken asserts that even if the disclosure statement were
adequate, which it is not, confirmation of the plan should be
denied:
* Confirmation of the plan appears to rely on votes of White
Oak in favor of the plan as an "impaired" Class 1 secured creditor
and as part of the unsecured creditor Class 5. However, White Oak
is not a secured creditor and it holds no secured claim at all.
* Although White Oak has no right to any distribution as an
unsecured creditor, its supposed deficiency "claim" has been placed
with the unsecured creditor Class 5 for voting purposes. These
attempts to create votes in favor of White Oak as a secured and
unsecured creditor -- when in reality White Oak holds no right to
any payment at all -- should be rejected as being contrary to
Section 1126(a) of the Bankruptcy Code and as bad faith attempts to
rig and gerrymander the vote
* Often creditors are asked to consider a liquidating trust as
a faster payout to unsecured creditors. However, the instant plan
offers essentially no benefit to unsecured creditors and is based
on suspect accounts receivable embroiled in an Amsterdam ICC case
with Heineken -- which, given Covid-19 conditions, likely will not
be resolved for many months.
Counsel for Heineken Global Procurement B.V.:
Michael A. Tessitore
MORAN KIDD LYONS JOHNSON GARCIA, P.A.
111 N. Orange Ave., Suite 900
Orlando, Florida 32801
Tel: 407-841-4141
Fax: 407-841-4148
E-mail: mtessitore@morankidd.com
Mark J. Rice
MCNEIL, SILVEIRA, RICE & WILEY
55 Professional Center Parkway, Suite A
San Rafael, CA 94903
Telephone: (415) 472-3434
Facsimile: (415) 472-1298
E-mail: markjrice@msrwlaw.com
About Global Asset Rental
Global Asset Rental, LLC -- http://www.globalkeg.com/-- is an
asset rental and logistics solutions company engaged in the
business of renting plastic pallets and kegs.
Global Asset Rental, LLC f/k/a Global Keg Rental, LLC, based in
Orlando, FL, filed a Chapter 11 petition (Bankr. M.D. Fla. Case No.
20-04126) on July 23, 2020. In its petition, the Debtor was
estimated to have $10 million to $50 million in assets and $50
million to $100 million in liabilities.
Genovese Joblove & Battista, P.A., serves as bankruptcy counsel to
the Debtor. KapilaMukamal, LLP’s Soneet R. Kapila is the CRO.
The U.S. Trustee for Region 21 on Aug. 12, 2020, appointed a
committee to represent unsecured creditors in the Chapter 11 case
of Global Asset Rental, LLC. The Committee retained Shraiberg
Landau & Page, P.A., as counsel.
* * *
International Keg Rental LLC, a provider of stainless-steel beer
keg leasing and rental services, announced Nov. 13, 2020, it has
completed the acquisition of substantially all of the assets of
Global Asset Rental.
GREGORY GILBERT: Averys Buying Reno Home for $1.01 Million
----------------------------------------------------------
Rebekah E. Gilbert asks the U.S. Bankruptcy Court for the District
of Nevada to authorize the sale of the real property located at
2670 Thomas Jefferson Drive, in Reno, Nevada, to Robert Clayton
Avery and Kelly Stitt Avery for $1.01 million.
Pursuant to her pending Chapter 11 Plan, the Debtor will in part
fund the plan through the proceeds from the sale of her home, the
Thomas Jefferson Property. The Thomas Jefferson Property is
encumbered by a first mortgage held by U.S. Bank Trust National
Association, as Trustee of the Bungalow Series IV Trust, with an
outstanding balance of approximately $344,265. It is also
encumbered by a second priority deed of trust securing a debt owed
to Wells Fargo Bank, N.A. without an outstanding balance of
approximately $105,252.
On Jan. 11, 2021, the Debtor received a Residential Offer and
Acceptance Agreement offering to purchase the Thomas Jefferson
Property for $1.01 million. On June 9, 2021, the Debtor executed
Counter Offer #1, which increased the earnest money deposit from
$5,000 to $10,000, and provided that the Debtor would pay up to
$1,000 for repairs, which the purchaser accepted.
The Debtor desires to accept the Purchase Offer. The sale will be
free and clear of all liens and claims, with the exception of the
first mortgage owed to U.S. Bank which will be paid in full at
closing.
The sale of the Thomas Jefferson Property will pay the claims of
U.S. Bank and Wells Fargo in full and bring funds to Debtor to fund
her plan of reorganization. The Debtor estimates her net sale
proceeds after paying the secured claims and costs of sale will be
approximately $488,000. The net sales proceeds Debtor receives
from the sale of the Thomas Jefferson Property will be used by the
Debtor to fund her Chapter 11 plan of reorganization.
Additionally, the Debtor asks that as provided for in FRBP 6004(h),
6006(d) and 7062, the order entered by the Court be effective and
enforceable immediately upon entry, so the sale may close
immediately.
A copy of the Offer is available at https://tinyurl.com/y52wul46
from PacerMonitor.com free of charge.
Gregory L. Gilbert and Rebekah E. Gilbert sought Chapter 11
protection (Bankr. D. Nev. Case No. 18-50772) on July 17, 2018.
The Debtor tapped Kevin A. Darby, Esq., at Darby Law Practice,
Ltd.
as counsel.
Counsel for Debtor:
Kevin A. Darby, Esq.
DARBY LAW PRACTICE, LTD.
E-mail: kad@darbylawpractice.com
HANGER INC: Moody's Completes Review, Retains B1 CFR
----------------------------------------------------
Moody's Investors Service has completed a periodic review of the
ratings of Hanger, Inc. and other ratings that are associated with
the same analytical unit. The review was conducted through a
portfolio review discussion held on January 11, 2021 in which
Moody's reassessed the appropriateness of the ratings in the
context of the relevant principal methodology(ies), recent
developments, and a comparison of the financial and operating
profile to similarly rated peers. The review did not involve a
rating committee. Since January 1, 2019, Moody's practice has been
to issue a press release following each periodic review to announce
its completion.
This publication does not announce a credit rating action and is
not an indication of whether or not a credit rating action is
likely in the near future. Credit ratings and outlook/review status
cannot be changed in a portfolio review and hence are not impacted
by this announcement.
Key rating considerations.
Hanger, Inc.'s B1 CFR reflects the highly specialized nature of its
operations, as well as its moderately high financial leverage. Its
credit profile also reflects declines in 2020 revenue related to
the coronavirus pandemic, as some patients delayed the replacement
of devices during the pandemic. Revenue and profitability should
improve in 2021 as demand for Hanger's services will ultimately
return. The Company has its strengths in the recurring nature of
its revenue, stable demand for the Company's products and services,
and large scale and geographic footprint relative to its
competitors.
The principal methodology used for this review was Business and
Consumer Service Industry published in October 2016.
HEALTHCHANNELS: Moody's Completes Review, Retains B3 CFR
--------------------------------------------------------
Moody's Investors Service has completed a periodic review of the
ratings of HealthChannels Intermediate Holdco, LLC and other
ratings that are associated with the same analytical unit. The
review was conducted through a portfolio review discussion held on
January 11, 2021 in which Moody's reassessed the appropriateness of
the ratings in the context of the relevant principal
methodology(ies), recent developments, and a comparison of the
financial and operating profile to similarly rated peers. The
review did not involve a rating committee. Since January 1, 2019,
Moody's practice has been to issue a press release following each
periodic review to announce its completion.
This publication does not announce a credit rating action and is
not an indication of whether or not a credit rating action is
likely in the near future. Credit ratings and outlook/review status
cannot be changed in a portfolio review and hence are not impacted
by this announcement.
Key rating considerations.
HealthChannels Intermediate Holdco, LLC's B3 CFR reflects its high
financial leverage, moderate scale and narrow focus on the medical
scribe industry. The rating is supported by company's
market-leading position within the medical scribe industry, and
expectation that HealthChannels will generate positive free cash
flow over the next 12 months.
The principal methodology used for this review was Business and
Consumer Service Industry published in October 2016.
HESPERUS PEAK: Asks to Extend Plan Filing Deadline
--------------------------------------------------
Hesperus Peak, Inc., and Bleu'Spa, Inc., asked the Court to extend
their Jan. 13 deadline to file a Plan and Disclosure Statement.
In addition, the Debtors also asked the Court to reset the Jan. 20,
2021 status hearing to Jan. 27, 2021.
The Debtors said they are still in the process of finalizing the
contents and exhibits to their Plans and Disclosure Statements and
expect to receive input from parties in interest.
A hearing on the Motion is scheduled for Jan. 20, 2021.
Counsel for the Debtors:
Paul M. Bauch
Carolina Y. Sales
BAUCH & MICHAELS, LLC
53 W. Jackson Blvd., Suite 1115
Chicago, IL 60604
Tel. (312) 588-5000
E-mail: csales@bmlawllc.com
Hesperus Peak, Inc., and affiliate Bleu'Spa, Inc., sought Chapter
11 protection (Bankr. N.D. Ill. Case Nos. 20-11616 and 20-11617)
on May 28, 2020. Hesperus estimated less than $500,000 in assets
and less than $1 million in liabilities as of the bankruptcy
filing.
HGIM CORP: S&P Upgrades ICR to 'CCC+'; Outlook Negative
-------------------------------------------------------
S&P Global Ratings raised its issuer credit rating on HGIM Corp., a
Louisiana-based offshore vessel provider, to 'CCC+' from 'SD'
(selective default), reflecting its assessment of the company's
credit risk going forward. The issue-level rating on the
first-lien term loan remains 'D', and S&P expects it to remain at
least until the second debt tender has closed.
HGIM recently completed its cash tender offer, announced Dec. 9,
2020, to repurchase a portion of its first-lien term loan due in
2023 at a significant discount to par. On Jan. 13, 2021, the
company announced a follow-up tender offer seeking to repurchase up
to $30 million of principal amount at a 45%-50% discount to par.
The negative outlook reflects the company's unsustainable leverage
and the risk liquidity could deteriorate if sector conditions do
not improve. S&P projects funds from operations (FFO) to debt of
less than 5% and debt to EBITDA of more than 8x in 2021.
S&P said, "The upgrade to 'CCC+' reflects our assessment of HGIM's
credit risk following its below-par term loan repurchases, which we
considered to be distressed. The rating reflects the company's
unsustainable leverage, with projected FFO to debt of less than 5%
and debt to EBITDA of more than 8x in 2021. We believe HGIM will
rely on improved demand for the offshore services sector, which has
been in prolonged weakness, before its vessel utilization, margins,
and leverage can meaningfully improve."
"Our 'D' issue-level rating on HGIM's first-lien term loan due in
2023 is unchanged. The company announced a second debt tender
targeting up to $30 million of principal amount, about 9% of its
remaining $345 million term loan. The repurchase offer range is a
45%-50% discount to par value, and we consider it to be distressed
as investors are receiving less than the original promise, while
also considering the company's overall unsustainable leverage
position. We do not expect to change the 'D' issue-level rating at
least until the second tender has closed, which is expected by late
January, and until we believe there will be no additional debt
repurchases that we would consider distressed."
"The negative outlook reflects HGIM's unsustainable leverage and
the risk liquidity could deteriorate if sector conditions do not
improve. We expect FFO to debt of less than 5% and debt to EBITDA
of more than 8x over the next 12 months."
"We could lower the rating if liquidity weakened or if we believe
there is an increased likelihood of a broader financial
restructuring within 12 months. This would most likely result from
an extended period of weak oil prices delaying recovery in the
offshore drilling market, which would hurt demand for HGIM's
services."
"We could revise the outlook to stable if the company's leverage
improved, including FFO to debt above 12% and debt to EBITDA below
6x for a sustained period, while it maintained adequate liquidity.
This would most likely result from improved conditions in the
offshore drilling sector leading to higher demand for HGIM's
services."
HOBERT K. SANDERSON: Public Auction of Kinston Property Approved
----------------------------------------------------------------
Judge Joseph N. Callaway of the U.S. Bankruptcy Court for the
Eastern District of North Carolina authorized Hobert Kennedy
Sanderson, Jr. and Denise C. Sanderson to sell the real property
located at Chinquapin Chapel Road, in Kinston, North Carolina,
bearing Parcel No. 446955423000, comprising 254.31 acres, more or
less, in Jones County, North Carolina, and being more particularly
described in Book 355, Page 156, Jones County Registry.
The proposed sale of the Property free and clear of any liens,
claims, encumbrances, rights, or interests, by way of a public
auction on Jan. 13, 2021, at 10:00 a.m., at the Subject Property,
to be conducted by Mike Gurkins of Country Boys Auction & Realty,
is allowed subject to the following:
1. The Property will be sold free and clear of all liens,
claims, encumbrances, rights, and interests of record, and all
valid and enforceable liens, claims, and interests in the Property
attach to the Net Proceeds of the sale;
2. The Debtor is authorized to execute such documents and
instruments as necessary to effectuate the sale; and
3. The Buyer will not have any responsibility for any
liabilities or obligations of the Debtor, whether in rem or in
personam.
Hobert Kennedy Sanderson, Jr. and Denise C. Sanderson sought
Chapter 11 protection (Bankr. E.D.N.C. Case No. 17-05040) on Oct.
13, 2017. The Debtors tapped David F. Mills, Esq., as counsel. On
March 21, 2019, the Court confirmed the Debtor's Chapter 11 Plan.
On Sept. 3, 2020, the Court confirmed a Modified Chapter 11 Plan.
HUB INTERNATIONAL: Moody's Rates $1.5BB Repriced Term Loan 'B2'
---------------------------------------------------------------
Moody's Investors Service has assigned a B2 rating to Hub
International Limited's (corporate family rating B3, together with
its subsidiaries, Hub) $1.5 billion repriced senior secured term
loan due April 2025. The rating outlook for Hub is unchanged at
stable.
RATINGS RATIONALE
Hub's B3 corporate family rating reflects its solid market position
in North American insurance brokerage, good diversification across
products and geographic areas in the US and Canada, and
consistently strong EBITDA margins. Hub has generated good organic
growth averaging in the low-single digits and has achieved strong
EBITDA margins in the low 30s (per Moody's calculations) over the
past few years. These strengths are tempered by the company's high
financial leverage and limited fixed charge coverage. The company
also faces potential liabilities from errors and omissions, a risk
inherent in professional services. Hub has grown through
acquisitions, which gives rise to integration risk, although the
company has a favorable track record in absorbing small and
mid-sized brokers.
Hub has performed relatively well through the coronavirus-related
slowdown, achieving organic revenue growth in the low single digits
during the third quarter, as well as through the last 12 months
ending September 2020. EBITDA margins have also slightly improved
largely due to expense savings.
Moody's estimates that Hub's pro forma debt-to-EBITDA ratio is
between 7.5-8.0x, with (EBITDA - capex) interest coverage above 2x,
and a free-cash-flow-to-debt ratio in the mid-single digits. These
metrics incorporate Moody's accounting adjustments for operating
leases, deferred earnout obligations and run-rate earnings from
completed acquisitions.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Factors that could lead to an upgrade of Hub's ratings include: (i)
debt-to-EBITDA ratio below 7.0x, (ii) (EBITDA - capex) coverage of
interest consistently exceeding 2x, and (iii)
free-cash-flow-to-debt ratio exceeding 5%.
Factors that could lead to a rating downgrade include: (i)
debt-to-EBITDA ratio above 8x, (ii) (EBITDA - capex) coverage of
interest below 1.2x, or (iii) free-cash-flow-to-debt ratio below
2%.
Moody's has assigned the following rating (and loss given default
(LGD) assessment):
$1.5 billion senior secured term loan maturing in April 2025 at
B2 (LGD3).
When the transaction closes, Moody's will withdraw the rating from
Hub's existing senior secured term loan maturing in April 2025.
The rating outlook for Hub is unchanged at stable.
The principal methodology used in this rating was Insurance Brokers
and Service Companies published in June 2018.
Based in Chicago, Hub ranks among the top ten of North American
insurance brokers, providing property and casualty, life and
health, employee benefits, investment and risk management products
and services through offices located in the US, Canada and Puerto
Rico. The company generated total adjusted revenue of $2.6 billion
in the 12 months through September 2020.
HYTERA COMMUNICATIONS: Hires of Stapleton Group as CRO
------------------------------------------------------
Hytera Communications America (West), Inc., and its
debtor-affiliates, seek authority from the U.S. Bankruptcy Court
for the Central District of California to employ David Stapleton of
Stapleton Group, as chief restructuring officer to the Debtor.
Hytera Communications requires Stapleton Group to:
-- develop a chapter 11 plan of liquidation;
-- create a liquidation analysis;
-- oversee cash management and disbursements, provide Monthly
Operating Reports (MORs), regular financial reports and
manage preparation of tax returns;
-- assist Imperial Capital with operational logistics as
requested, including the sale of inventory;
-- claims reconciliation (administrative and priority claims
for plan confirmation purposes);
-- communicate with creditors as requested by the Debtors;
-- management of services to be provided by the Debtors under
the Transition Services Agreement (e.g., oversee payroll
processing, transfer of human resource services, transfer
of assets, etc.);
-- assist legal counsel in the Debtors' chapter 11 bankruptcy
cases; and
-- provide other services to the Debtors, as needed.
Stapleton Group will be paid at these hourly rates:
CRO/Principal $425
Managing Director $375
Director/ Financial Advisory $350
Senior Financial Analyst $295
Controller $275
Jr. Analyst $225
Paralegal/Clerical $10
Stapleton Group will also be reimbursed for reasonable
out-of-pocket expenses incurred.
David Stapleton, partner of Stapleton Group, assured the Court that
the firm is a "disinterested person" as the term is defined in
Section 101(14) of the Bankruptcy Code and does not represent any
interest adverse to the Debtors and their estates.
Stapleton Group can be reached at:
David Stapleton
Stapleton Group
515 South Flower Street, 18th Street
Los Angeles, CA 90071
Tel: (213) 235-0600
Fax: (213) 235-0620
About Hytera Communications America
Hytera communications America (West), Inc. -- https://www.hytera.us
-- is a global company in the two-way radio communications
industry. It has 10 international R&D Innovation Centers and more
than 90 regional organizations around the world. Forty percent of
Hytera employees are engaged in engineering, research, and product
design. Hytera has three manufacturing centers in China and Spain.
On May 26, 2020, Hytera sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. C.D. Cal. Lead Case No. 20-11507). At the
time of the filing, the Debtor estimated assets of between $10
million and $50 million and liabilities of between $500 million and
$1 billion.
Judge Erithe A. Smith oversees the cases.
The Debtors tapped Pachulski Stang Ziehl & Jones, LLP as bankruptcy
counsel; Steptoe & Johnson, LLP as corporate and special counsel;
and Imperial Capital, LLC as financial advisor.
The Office of the U.S. Trustee appointed a committee of unsecured
creditors on June 15, 2020. The committee is represented by Levene
Neale Bender Yoo & Brill, LLP.
INFRASTRUCTURE SOLUTION: Selling Equipment to Philly for $206K
--------------------------------------------------------------
Infrastructure Solution Services, Inc., filed with the U.S.
Bankruptcy Court for the Middle District of Pennsylvania a notice
of its proposed sale to Philly Class A Demolition, Inc. of the
following items of equipment:
a. 2013 Komatsu PC200 LCB Excavator, Serial No. A89235 for
$22,400;
b. 2015 Komatsu, PC 210 LCI, Model PC210LCI-10, Serial No.
452500, with 36" Bucket and 52" Bucket for $33,000;
c. 2014 Komatsu Excavator PC138, Model No. PC138USLC-8, Serial
No. 23146 with 24" Bucket, 36" Bucket and BTI Hyd Plate Compactor
for $24,200;
d. 2014 Sakai 84" Drum Roller, Model No. SV505D-1, Serial No.
VSV16D-60102 for $22,400; and
e. Mack 2018 Triaxle Dump Truck, Model No. GU713, Serial No.
1M2AX09C5JM038990 for $104,000.
The Debtor is the owner of the Equipment.
The Komatsu Equipment is subject to a lien in favor of Komatsu
Financial Limited Partnership. The Mack Truck is subject to a lien
in favor of S&T Bank.
The Debtor proposes to pay costs and expenses associated with the
sale of the Equipment as aforesaid at Closing as follows:
a. Any notarization or incidental filing charges required to
be paid by the Debtor as the Seller;
b. All other costs and charges apportioned to the Debtor as
the Seller; and
c. All costs associated with the preparation of the
conveyance instruments and normal services with respect to closing,
including payment of a total of $10,000 from the sale of the
Equipment, split so that $5,000 is to be paid from the proceeds of
the Komatsu Equipment, and $5,000 is to be paid from the proceeds
of the Mack Truck, payable to the Debtor's counsel, Cunningham,
Chernicoff & Warshawsky, P.C., in connection with implementation of
the sale, the presentation and pursuit of the Motion, consummation
of closing and other approved professional fees and expenses in
connection with the case.
It is believed that after payment to S&T Bank on account of its
lien on Mack Truck, and subsequent to the payment of the costs of
sale, there will be additional net proceeds as it is anticipated
that the loans secured on the Mack Truck will be paid in full.
Accordingly, subject to the payment of the costs of sale and the
payment of the sum owed to S&T Bank on account of its lien on the
Mack Truck, the remaining proceeds from the sale of the Mack Truck
will be payable for administrative expenses and other creditors of
the Debtor as set forth in the Debtor's Plan.
Subsequent to the payment of the costs of sale, the Debtor proposes
to pay the net proceeds of any sale of the Komatsu Equipment to
Komatsu on account of its lien in an amount not to exceed the total
amount owed to Komatsu as to its allowed secured claim.
Any proceeds from the sale of the Komatsu Equipment over and above
the amount necessary to pay Komatsu in full as to its allowed
secured claim will be paid to S&T Bank on account of its blanket
security interest in all of the equipment of the Debtor, excluding,
however, the Mack Truck. It is not anticipated that there will be
any additional proceeds.
A hearing on the Motion is set for Feb. 9, 2021 at 9:30 a.m. If no
objections are timely filed with the Clerk of Bankruptcy Court by
Feb. 3, 2021, the Court may enter an Order approving the Sale
without a Hearing. Any Objection must conform to the Rules of
Bankruptcy Procedure. Any objecting party must appear at the
Hearing.
About Infrastructure Solution Services
Infrastructure Solution Services Inc. is a provider of green
stormwater infrastructure solutions in the Philadelphia market.
Based in Jonestown, Pa., Infrastructure Solution Services filed a
Chapter 11 petition (Bankr. M.D. Pa. Case No. 19-03915) on Sept.
13, 2019. In the petition signed by Corey Wolff, director, the
Debtor was estimated to have $1 million to $10 million in both
assets and liabilities.
Subsidiary Happy Endings Holdings, LLC, also filed for Chapter 11
(Bankr. M.D. Pa. 19-03916) on Sept. 13, listing under $1 million
in
assets and $1 million to $10 million in liabilities.
Another subsidiary, ISS Management, LLC, a privately held company
whose principal assets are located at 156 S Bethlehem Pike Ambler,
PA 19002, filed for Chapter 11 bankruptcy protection (Bankr. M.D.
Pa. Case No. 19-04825) on Nov. 12. In its petition, ISS was
estimated to have $1 million to $10 million in both assets and
liabilities.
All three cases are jointly administered under Infrastructure
Solution Services' case. The Hon. Henry W. Van Eck oversees the
cases. The petitions were signed by Corey Wolff, director of
Infrastructure Solution Services.
Robert E. Chernicoff, Esq., at Cunningham Chernicoff & Warshawsky,
P.C., serves as the Debtors' bankruptcy counsel.
On Oct. 20, 2020, the Court confirmed the Debtor’s Chapter 11
Plan
of Reorganization. Rhe Debtor is now operating under its Confirmed
Plan of Reorganization.
INTERLOGIC OUTSOURCING: Committee Seeks Approval to Hire Co-Counsel
-------------------------------------------------------------------
The official committee of unsecured creditors appointed in the
Chapter 11 cases of Interlogic Outsourcing, Inc. and its affiliates
seeks approval from the U.S. Bankruptcy Court for the Western
District of Michigan to employ May Oberfell Lorber as co-counsel.
May Oberfell will render these legal services:
(a) advise the committee on all legal issues as they arise;
(b) advise the committee regarding the terms of any sales of
assets or plans of reorganization or liquidation and assist the
committee in negotiations with the parties;
(c) represent the committee in all proceedings in the Debtors'
Chapter 11 cases;
(d) advise the committee regarding actions related to secured
creditors; and
(e) other legal services related to the Debtors' bankruptcy
cases.
The hourly rates of the law firm's counsel and staff are as
follows:
R. William Jonas, Jr., Partner $395
Jon Rogers, Partner $280
Linda Plata, Paralegal $155
R. William Jonas, Jr., Esq., a partner at May Oberfell, disclosed
in court filings that the firm neither holds or represents an
interest adverse to the committee and has no connection with the
Debtors, creditors or any other party-in-interest.
The firm can be reached through:
R. William Jonas, Jr., Esq.
May Oberfell Lorber
4100 Edison Lakes Pkwy., Suite 100
Mishawaka, IN 46545
Telephone: (574) 243-4100
Facsimile: (574) 232-9789
Email: RJonas@maylorber.com
About Interlogic Outsourcing
Founded in Elkhart, Indiana in 2002 and operating under the trade
name IOIPay, Interlogic Outsourcing, Inc. and its related entities
-- https://www.ioipay.com/ -- are a locally based payroll processor
with a national customer base and footprint. They provide payroll,
payroll tax, and benefit administration services directly to
clients in the United States, as well as through a network of
licensees in the United States and Canada.
Interlogic Outsourcing and six affiliates sought Chapter 11
protection (Bankr. N.D. Ind. Lead Case No. 19-31445) on Aug. 10,
2019. In the petition, Interlogic Outsourcing was estimated to have
less than $10 million in assets and at least $10 million in
liabilities.
Judge Scott W. Dales oversees the cases.
The Debtors tapped Jacobson Hile Kight LLC and Paul Hastings LLP as
their legal counsel, Prime Clerk LLC as claims agent, and Richard
W. Barry Consulting Services, LLC as fraud investigation
consultant.
The Office of the U.S. Trustee appointed an official committee of
unsecured creditors on Aug. 22, 2019. The committee tapped Ice
Miller LLP and May Oberfell Lorber as its legal counsel.
JAMES EDWARD HALL: Trustee McLemore's Sale of 10 Calves Approved
----------------------------------------------------------------
Judge Charles M. Walker of the U.S. Bankruptcy Court for the Middle
District of Tennessee authorized John C. McLemore, the Trustee of
James Edward Hall, to sell 10 calves, free and clear of all liens.
The sale will be under the terms and conditions set forth in the
Trustee's Motion to Sell Cattle, dated Jan. 14, 2021.
Counsel for Trustee:
Phillip G. Young, Jr., Esq.
THOMPSON BURTON PLLC
6100 Tower Circle, Suite 200
Franklin, TN 37067
Telephone: (615) 465-6000
E-mail: phillip@thompsonburton.com
James Edward Hall sought Chapter 11 protection (Bankr. M.D. Tenn.
Case No. 20-03735) on Aug. 11, 2020.
KEYSTONE ACQUISITION: Moody's Completes Review, Retains B3 CFR
--------------------------------------------------------------
Moody's Investors Service has completed a periodic review of the
ratings of Keystone Acquisition Corp. and other ratings that are
associated with the same analytical unit. The review was conducted
through a portfolio review discussion held on January 11, 2021 in
which Moody's reassessed the appropriateness of the ratings in the
context of the relevant principal methodology(ies), recent
developments, and a comparison of the financial and operating
profile to similarly rated peers. The review did not involve a
rating committee. Since January 1, 2019, Moody's practice has been
to issue a press release following each periodic review to announce
its completion.
This publication does not announce a credit rating action and is
not an indication of whether or not a credit rating action is
likely in the near future. Credit ratings and outlook/review status
cannot be changed in a portfolio review and hence are not impacted
by this announcement.
Key rating considerations.
Keystone Acquisition Corp.'s ("KEPRO") B3 CFR reflects its high
financial leverage, as well as event and financial policy risk due
to private equity ownership. The credit profile also reflects the
company's small scale and narrow product focus within the care
management, quality improvement organization and assessments and
eligibility sector for Medicare and Medicaid patients, as well as
material customer concentration with the top four customers
accounting for about 50% of total revenue. However, KEPRO benefits
from the favorable trends of the U.S. government increasingly
outsourcing the management of healthcare services, as well as its
long-term relationship with its customers. The credit profile is
also supported by KEPRO's solid margins.
The principal methodology used for this review was Business and
Consumer Service Industry published in October 2016.
KNOWLTON DEVELOPMENT: Fitch Cuts Issuer Default Ratings to 'B-'
---------------------------------------------------------------
Fitch Ratings has downgraded the Issuer Default Ratings (IDRs) for
Knowlton Development Corporation Inc. (KDC) and Knowlton
Development Holdco, Inc. to 'B-' from 'B'. The Rating Outlook is
Stable. Fitch has also downgraded the instrument ratings on the
company's revolver and term loans, which it plans to increase, to
'B-' from 'B+'. The Recovery Rating (RR) on the debt has been
revised to 'RR4' from 'RR3'.
The downgrade of KDC's ratings reflects Fitch's expectation that
leverage will increase to close to 7x, driven by the company's plan
to add debt to fund a $325 million shareholder distribution to its
equity holders including Cornell Capital. The downgrade also
reflects Fitch's expectations for negative FCF in fiscal 2021
(fiscal year ending April 2021) and fiscal 2022, as the company is
dramatically increasing capex for growth initiatives.
Prior to the shareholder distribution, Fitch had expected fiscal
2021 leverage to be close to 6x, due to EBITDA growth from new
acquisitions and debt reduction. While Fitch currently forecasts
leverage to improve modestly to mid-6x in fiscal 2022 and fiscal
2023, leverage could remain above 7x given ongoing investments to
drive revenue growth. In addition, weakness in KDC's color
cosmetics business stemming from the COVID-19 pandemic's impact on
consumer preferences could extend into 2022, and elevated capex
could result in increased borrowings under its revolver.
The company plans to increase the EUR460 million tranche term loan
due December 2025 by EUR100 million or $120 million to help fund
the $325 million shareholder distribution. KDC also plans to
increase its revolver due December 2023 to $345 million from $170
million. The increased revolver will support the company's
liquidity, including a jump in capital spending from the second
half of fiscal 2021 through fiscal 2023.
The ratings continue to reflect KDC's position as a global leader
in custom formulation, packaging and manufacturing solutions for
beauty, personal care and home care brands, supported by a diverse
product portfolio and customer base, with whom the company
typically maintains long-term relationships. Fitch expects KDC's
broadening platform and investment in R&D to enable the company to
sustain modest organic revenue growth over the long term.
KEY RATING DRIVERS
Debt-Funded Shareholder Distribution Raises Leverage: KDC ended
fiscal 1H21 with debt of about $1.49 billion, which was mostly
first-lien term loans as the company's revolver was undrawn. KDC
has proposed a $325 million shareholder distribution that it plans
to fund by increasing its term loan by $120 million and drawing
$104 million on its revolver, with the remainder funded by cash on
hand. The additional debt will push Fitch's forecast for leverage
up to around 7x by the end of fiscal 2021, from about 6x
previously.
Heavy Capex Drives Negative FCF: The shareholder distribution comes
at a time when KDC plans to sharply increase capex relative to
prior expectations to support the company's organic growth
initiatives and new contract wins. Fitch expects the higher capex
will result in negative FCF in fiscal 2021 and fiscal 2022 given
Fitch’s EBITDA projections. Fitch expects a return to positive
FCF in fiscal 2023 as growth capex tapers off, but this could be
delayed if there are new mandates requiring additional investment.
Assuming the company executes the increase of its revolver to $345
million, Fitch views pro forma liquidity as comfortable with over
$240 million available and nearly $130 million of cash.
Defensible Competitive Advantage: KDC is one of the largest players
in the market for outsourced custom formulation, packaging and
manufacturing solutions for beauty, personal care and home care
brands following its recent acquisitions with pre-COVID-19 revenue
over $2 billion. KDC's business model of partnering with its
customers to create new products and rapidly bringing them to
market creates deeply entrenched relationships. Significant
investment in R&D and technology and a breadth of product expertise
that enables KDC to provide turnkey solutions solidify its
competitive advantage.
KDC has expanded from operating a single factory in Canada in 2002
to operating 25 manufacturing facilities worldwide that serve over
800 customers. Within the beauty and personal care segment, the
company's customers range from indie brands to giants in consumer
packaged goods, providing a natural hedge to rapidly changing
industry dynamics. KDC also covers a wide range of products, such
as personal care, skincare, cosmetics, deodorants, soaps,
sanitizers, fragrances and shampoo. The company's recent
acquisitions provide critical mass to its home care segment while
also diversifying its portfolio. Customer concentration is
moderate; no single customer accounts for more than 15% of sales
pro forma the recent acquisitions.
Stable End Markets: KDC benefits from operating in end markets
where demand is relatively stable, even during recessionary
conditions. Fitch estimates that beauty sales remained flat to
positive during the global financial crisis as the sector benefits
from low price points and due to the fact that health and beauty
products are often everyday-use, consumable items. The company's
flexible manufacturing base allows it to redirect capacity from
segments of weak demand to areas of strength.
The impact of the coronavirus on the company's sales has been
mixed, with demand for personal care and home care products
increasing and demand for "non-essential" products, particularly
color cosmetics, down sharply. The net result in the six months
ended October 2020 has been 1% organic value-added revenue growth
for KDC YoY. These trends may continue in the near term despite the
rollout of vaccines as lingering caution among consumers results in
higher demand for soaps and sanitizers, while continued mask usage
reduces demand for color cosmetics. Over the medium term, Fitch
expects demand patterns for the company's products to return to
normal, contributing to a low-single-digit long-term organic growth
rate.
Acquisitive Strategy Supports Growth: KDC's acquisition strategy
supplements organic growth by adding capabilities in adjacent new
markets to enable the company to capitalize on cross-selling
opportunities in its customer base, which helps KDC to grow its
wallet share. KDC has acquired over a dozen companies over the last
five years with seven acquisitions in the last 18 months. The
company's M&A activity focuses on companies with additive
technologies, new geographies, strong customer bases and attractive
growth, margin and FCF profiles. The recent acquisitions were
sizable, more than doubling the EBITDA of the company on a pro
forma basis. The large equity contributions from the sponsor and
the roll of equity from one of the target's founders helped
mitigate the impact on gross debt/EBITDA.
DERIVATION SUMMARY
KDC's 'B-' rating reflects its position as a global leader in
custom formulation, packaging and manufacturing solutions for
beauty, personal care and home care brands, supported by a diverse
product portfolio and a customer base ranging from blue-chip names
to "indie" brands, with whom the company typically maintains
long-term relationships. Fitch expects KDC's broadening platform
and investment in R&D will enable the company to sustain modest
organic revenue growth over the long term. KDC's ratings near-term
are constrained by its elevated leverage and expected negative FCF
as the company plans to increase debt to fund a $325 million
shareholder distribution during a period when it is dramatically
increasing its capex spend to fund growth initiatives.
KDC is rated higher than Anastasia Intermediate Holdings, LLC
(CCC). Anastasia's rating reflects Fitch's view that its capital
structure is unsustainable following deterioration in Anastasia's
operating trends. After many years of strong growth, revenue turned
flat in 2018, and Fitch expects this could represent the company's
peak volume. EBITDA, which peaked at around $175 million, could
moderate toward $40 million over the next few years, yielding
leverage (gross debt to EBITDA) in the mid-teens. These projections
raise significant questions regarding the long-term health of the
brand and the ability of management to successfully execute new
product launches and expense management. The rating also considers
the company's narrow product and brand profile, and risk that
continued beauty industry market share shifts could further weaken
Anastasia's projected growth through new entrants and brand
extensions from existing large players.
KDC is rated similarly to Mattel, Inc. (B/Positive). Mattel's IDR
reflects the company's operating trajectory, with EBITDA expected
to improve to around $625 million in 2020 from the 2017 and 2018
trough of about $270 million, largely on cost reductions. EBITDA
improvement caused FCF to turn positive in 2019 after four years of
outflows; gross debt/EBITDA improved from the 11x peak in 2017 and
2018 to 6.4x in 2019, and Fitch expects further improvement to
mid-4x in 2020. Revenue, which declined from a $6.5 billion peak in
2013 to $4.5 billion in 2018, has stabilized around $4.5 billion.
The Positive Outlook reflects increasing confidence that the
company has successfully addressed many of its operating
challenges, yielding improvements to Mattel's cash flow and
leverage profile as well as its financial flexibility.
KDC is rated below Newell Brands Inc. (BB/Negative). Newell's
rating and Negative Outlook reflect elevated leverage (total
debt/EBITDA) of 4.4x following the completion of its asset
divestiture program and ongoing topline challenges in a number of
its categories. The ratings also reflect the significant business
interruption from the coronavirus pandemic and the potential of a
downturn in discretionary spending.
KEY ASSUMPTIONS
Fitch's key assumptions within its rating case for the issuer
include:
-- Fiscal 2021 revenue growth exceeds 85% largely due to
acquisitions as continued weakness in cosmetics is offset by
strength in personal care and home care. Organic revenue
growth returns to the low-single-digits in fiscal 2022 and
2023, benefiting from new business wins, continued strong
demand for personal care and home care products and recovering
demand for cosmetics.
-- EBITDA margins improve in 2021 due to acquisitions, synergy
capture, and fixed cost leveraging from new business wins.
-- Elevated capex in fiscal 2021 and fiscal 2022 results in
negative FCF while FCF turns positive in fiscal 2023 as growth
capex needs moderate.
-- Leverage improves from 14.7x at the end of fiscal 2020 (fiscal
2020 includes the debt from acquisitions but only a small
portion of the combined EBITDA) to around 7x in fiscal 2021.
While Fitch currently forecasts leverage to improve modestly
to the mid 6x in fiscal 2022 and fiscal 2023, leverage could
be sustained above 7x given ongoing investments to drive top
line, weakness in its color cosmetics business given the
impact of the pandemic on consumer preferences that could
extend into 2022, and elevated capex that could result in
increased borrowings under its revolver.
RATING SENSITIVITIES
Factor that could, individually or collectively, lead to positive
rating action/upgrade:
-- Positive rating action would be considered if KDC's operating
trajectory exceeds Fitch's expectations, with the high capex
leading to better-than-expected EBITDA growth, a return to
sustained and positive FCF and debt/EBITDA sustained under 7x.
Factor that could, individually or collectively, lead to negative
rating action/downgrade:
-- Negative rating action would be considered if top-line
weakness, pressure on margins and increased capex lead to
continued negative FCF beyond fiscal 2022, or an acceleration
of the company's acquisition strategy or any debt-financed
transaction such as special shareholder distributions results
in sustained debt/EBITDA over 8x, leading to concerns around
the viability of the company's capital structure.
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
Comfortable Liquidity: Liquidity proforma for the proposed
transactions totals around $370 million consisting of around $240
million available on the company's proposed $345 million revolver
and approximately $129 million of cash. The debt structure is
expected to include $104 million drawn on the revolver and
approximately $1.6 billion in term loans. The revolver is KDC's
first maturity, which comes due in December 2023, and, apart from
modest quarterly amortization, the company has no maturities until
December 2025 when the first lien term loan matures. The company is
subject to a single springing financial covenant (based on revolver
utilization) requiring first lien leverage to be no greater than
7.75x.
RECOVERY CONSIDERATIONS
For issuers with IDRs of 'B+' and below, Fitch performs a recovery
analysis for each class of obligations of the issuer. The issue
ratings are derived from the IDR, the relevant RR and prescribed
notching.
Fitch assumes a material loss in customers or significant
integration issues result in a loss of revenue around 20% with pro
forma EBITDA margins declining meaningfully due to the loss of
higher margin business and fixed cost deleveraging from the large
decline in sales.
Fitch applies a 6.0x enterprise value/EBITDA multiple, modestly
below the 6.3x median multiple for Food, Beverage and Consumer
bankruptcy reorganizations analyzed by Fitch. The multiple reflects
the company's leading position in its formulation, packaging and
manufacturing businesses, its diverse and sticky customer
relationships, and its lack of consumer brand recognition.
After deducting 10% for administrative claims, KDC's first lien
secured credit facility including revolver and term loan are
expected to have average recovery prospects (31%-50%) and have been
assigned 'B-/RR4' ratings. The revolver and term loan are secured
by a first priority interest in substantially all assets of the
borrowers (Knowlton Development Corporation Inc. and KDC US
Holdings, Inc.) and the guarantors (material direct and indirect
wholly-owned U.S. subsidiaries).
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.
KR MEDICAL: Seeks to Hire Lane Law Firm as Counsel
--------------------------------------------------
KR Medical Technologies, LLC, has filed an amended application with
the U.S. Bankruptcy Court for the Southern District of Texas to
hire The Lane Law Firm, PLLC, as its attorney.
KR Medical requires Lane Law to:
a. assist, advise and represent the Debtors relative to the
administration of the chapter 11 case;
b. assist, advise and represent the Debtors in analyzing the
Debtors' assets and liabilities, investigating the extent
and validity of lien and claims, and participating in and
reviewing any proposed asset sales or dispositions;
c. attend meetings and negotiate with the representatives of
the secured creditors;
d. assist the Debtors in the preparation, analysis and
negotiation of any plan of reorganization and disclosure
statement accompanying any plan of reorganization;
e. take all necessary action to protect and preserve the
interests of the Debtors;
f. appear, as appropriate, before this Court, the Appellate
Courts, and other Courts in which matters may be heard and
to protect the interests of the Debtors before said Courts
and the U.S. Trustee; and
g. perform all other necessary legal services in these cases.
Lane Law will be paid at these hourly rates:
Robert C. Lane $425
Associate Attorneys $225 to $350
Paralegals $150
Lane received a retainer on or about April 17, 2020, from the
Debtor in the amount of $5,000. Lane later received a retainer on
or about May 5, 2020, from the Debtor in the amount of $5,000. Lane
later received a final retainer on or about June 8, 2020, from the
Debtor in the amount of $35,000, for a total of $45,000 for
financial advice and representation of the Debtor.
Lane Law will also be reimbursed for reasonable out-of-pocket
expenses incurred.
Robert C. Lane, a partner of The Lane Law Firm, LLC, assured the
Court that the firm is a "disinterested person" as the term is
defined in Section 101(14) of the Bankruptcy Code and does not
represent any interest adverse to the Debtor and its estates.
Lane Law can be reached at:
Russell Van Beustring, Esq.
THE LANE LAW FIRM, PLLC
6200 Savoy, Suite 1150
Houston, TX 77036
Tel: (713) 595-8200
Fax: (713) 595-8201
About KR Medical Technologies
KR Medical Technologies, LLC, sought protection under Chapter 11 of
the Bankrupty Code (Bankr. S.D. Tex. Case No. 20-33139) on June 23,
2020, listing under $1 million in both assets and liabilities. THE
LANE LAW FIRM, PLLC, represents the Debtor as counsel.
L.S.R. INC: Waiting for Sale Contract, Seeks to Delay Plan Hearing
------------------------------------------------------------------
L.S.R. Inc submitted a motion to continue the Jan. 22, 2021 hearing
to consider the final approval of the First Amended Disclosure
Statement and confirmation of the Plan.
The Debtor tells the Court that it is awaiting a final version of
the contract of sell from Joe R. Pyle Realty and believes that
judicial economy would be best served by a brief continuance until
all documents are final and submitted to the court for approval.
Counsel for Debtor:
James M. Pierson
PIERSON LEGAL SERVICES
P.O. Box 2291
Charleston, WV 25328
Tel: (304) 925-2400
Fax: (304) 925-2603
About L.S.R. Inc.
L.S.R., Inc. owns a motel building with improvements located at 201
West 2nd Avenue Williamson, West Virginia. L.S.R. sought
protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D.
W.Va. Case No. 18-20221) on May 2, 2018. In the petition signed by
Doyle R. VanMeter II, president, the Debtor disclosed $1.02 million
in assets and $1.55 million in liabilities.
The Debtor is represented by:
James M. Pierson, Esq.
Pierson Legal Services
P.O. Box 2291
Charleston, WV 25328
Tel: (304) 925-2400
E-mail: jpierson@piersonlegal.com
LAKEWAY PUBLISHERS: Bid to Modify Confirmed Plan Opposed
--------------------------------------------------------
Pinnacle Bank on Jan. 12, 2021, filed an objection to the motion of
debtor Lakeway Publishers, Inc., to extend the sale deadline set
forth in its bankruptcy exit plan that was confirmed six months
ago.
The Debtor on Dec. 29, 2020 filed a motion to modify its Second
Amended Plan, which was confirmed by the court on June 26, 2020.
The Debtor's Plan has not been substantially consummated. Pursuant
to the Plan, the Debtor is required to complete a sale of Lakeway
Publishers of Missouri by Jan. 26, 2021 or else the case will
convert to a Chapter 7. Lakeway has been attempting to market and
sell its interests in Lakeway Publishers of Missouri. Due to the
Covid-19 crisis, the sale process has been delayed. The Debtor
wants the Plan modified to move the deadline to July 26, 2021. A
hearing on the Debtor's motion is scheduled for Jan. 19, 2021.
Pinnacle Bank notes that Paragraph 5.05 (the second of two
paragraphs numbered 5.05) of the Confirmed Plan provides:
"Extensions of Time. There shall be no extension of time to
conclude this sale unless approved by all secured creditors, ..."
Pinnacle Bank says it DOES NOT APPROVE of the Debtor's proposed
extension of time to conclude the sale.
The Bank OBJECTS to the Motion pursuant to 11 U.S.C. Sec. 1127(b)
in that the plan as modified cannot be confirmed under the
requirements of 11 U.S.C. Sec. 1129.
By virtue of the amount of Pinnacle Bank's secured claim in Class
3, the Bank effectively controls the class (even with the inclusion
of the claims of Andrew Johnson Bank) and Pinnacle Bank has not
accepted the Plan as modified. Further, Class 3 is impaired.
Thus, the Plan as modified does not comply with 11 U.S.C. Sec.
1129(a)(8). For that reason, the Bank OBJECTS to the Motion and
the Plan as modified.
Further, the Plan as modified is not feasible. Under 11 U.S.C.
Sec. 1129(a)(11), a plan may be confirmed only if "Confirmation of
the plan is not likely to be followed by the liquidation, or the
need for further financial reorganization, of the debtor or any
successor to the debtor under the plan, unless such liquidation or
reorganization is proposed in the plan."
In order to convince Pinnacle Bank to withdraw its Objection and
accept its Plan, the Debtor filed its Second Amended Plan] which
provided a date certain by which Lakeway Publishers of Missouri,
Inc. would be sold and a projected amount which its broker assured
it could be sold for, and agreed that if the sale was not concluded
by that date certain (January 26, 2021) then the stay would
terminate as to Pinnacle Bank and it would be allowed to realize on
its collateral, addressing the Bank's Objection to feasibility.
For the Debtor, on the cusp of that date certain, to now not want
to honor those commitments, which were specifically bargained for
by the Bank to address its feasibility concerns, is disingenuous at
best and smacks of sharp dealing, Pinnacle Bank tells the Court.
Accordingly, the Bank renews its objection to the Plan as modified,
due to its lack of feasibility, as predicted in its original
Objection to Amended Plan.
A full-text copy of Pinnacle Bank's objection dated Jan. 12, 2021,
is available at https://bit.ly/3nPMPkj from PacerMonitor.com at no
charge.
Attorneys for Pinnacle Bank:
Walter N. Winchester
E. Brian Sellers
Winchester, Sellers, Foster & Steele, P.C.
P.O. Box 2428
Knoxville, TN 37901-2428
Phone: (865) 637-1980
E-mail: wwinchester@wsfs-law.com
E-mail: bsellers@wsfs-law.com
About Lakeway Publishers
Lakeway Publishers, Inc. is a multi-state publisher of newspapers,
magazines and special publications. It owns and operates community
newspapers and magazines in Tennessee, Missouri, Virginia, and
Florida. Lakeway Publishers was incorporated in 1966 and is based
in Morristown, Tenn.
Lakeway Publishers and affiliate Lakeway Publishers of Missouri,
Inc. each filed a voluntary petition under Chapter 11 of the
Bankruptcy Code (Bankr. E.D. Tenn. Lead Case No. 19-51163) on May
31, 2019. In the petitions signed by Jack R. Fishman, president,
Lakeway Publishers disclosed $20,884,027 in assets and $9,245,645
in liabilities while Lakeway Publishers of Missouri listed
$7,047,972 in assets and $9,206,193 in liabilities.
The Debtors have tapped Quist, Fitzpatrick & Jarrard, PLLC as their
bankruptcy counsel, and Burnette Dobson & Pinchak and Maneke Law
Group as special counsel.
LEGENDS HOSPITALITY: Moody's Retains B3 CFR Amid Sec. Note Upsize
-----------------------------------------------------------------
Moody's Investors Service said that Legends Hospitality Holding
Company, LLC's announced increase to its proposed senior secured
note due 2026 by $50 million to $400 million will increase its
total debt, so Moody's considers the change a negative credit
development. The company plans to use the incremental $50 million
to reduce the amount of its proposed unrated unsecured floating
rate PIK loan due 2027 by $25 million to $100 million and add $25
million to balance sheet cash, leaving it with $116 million of cash
as September 30, 2020, pro forma for the financing. However,
Moody's notes that despite the total debt increase, the company's
interest coverage ratio will likely not decline, due to the secured
note's much lower interest rate compared to that of the unsecured
PIK note, while the $25 million increase in balance sheet cash is a
positive liquidity development. Therefore, the ratings, including
the B3 corporate family rating and B3 senior secured rating, as
well as the stable outlook, remain unchanged at this time.
Legends, headquartered in New York, New York, founded in 2008 by
affiliates of the New York Yankees Major League Baseball and Dallas
Cowboys National Football League franchises and controlled by
affiliates of Sixth Street Partners, LLC, is a provider of food &
beverage, merchandise, and further complementary solutions, such as
pre-construction feasibility studies, brand partnership sales and
event-day hospitality services to global sports franchises and
facilities, universities, events and tourist attractions. Moody's
expects 2020 revenues of less than $200 million, but anticipates
2021 revenue to approach the $871 million in sales the company
recorded in 2019.
LIGHTHOUSE RESOURCES: Court OKs Bankruptcy Sale, Employee Bonuses
-----------------------------------------------------------------
Alex Wolf of Bloomberg Law reports that bankrupt coal miner
Lighthouse Resources Inc. got court approval to implement two
employee bonus programs and move forward with efforts to sell some
of its assets.
Judge John T. Dorsey of the U.S. Bankruptcy Court for the District
of Delaware at a hearing Friday, January 15, 2021, approved sale
procedures for Lighthouse's Wyoming real property estates and
assets tied to a 540-acre port terminal facility in Washington
state.
The Wyoming assets include more than 2,800 acres of land, two state
coal leases, and other lease agreements that generate rental
income.
The company's employee bonus programs contemplate up to $840,000
total payments.
About Lighthouse Resources
Lighthouse Resources Inc. owns and operates two coal mines located
in Wyoming and Montana, delivering low sulfur, subbituminous coal
to both domestic and export customers. It also owns and operates
the Millennium Bulk Terminal in Longview, Washington. Lighthouse
Resources is widely recognized for its extraordinary performance in
both safety and environmental stewardship. Its flagship project is
the development of a trade route for coal from the Rocky Mountain
region of the United States to demand centers in Asia.
Utah-based Lighthouse Resources and 13 subsidiaries, including
Decker Coal Company, filed for Chapter 11 bankruptcy protection
(Bankr. D. Del. Case No. 20-13056) on Dec. 3, 2020.
Lighthouse Resources was estimated to have $100 million to $500
million in assets and liabilities as of the filing.
The Debtors tapped Jackson Kelly PLLC and Potter Anderson & Corroon
LLP as their bankruptcy counsel, BDO USA LLP as restructuring
advisor, and Stretto as claims and noticing agent and
administrative advisor. The Debtors also hired Energy Ventures
Analysis to market and sell their coal mining assets, and Lang
LaSalle Americas Inc. to market and sell assets related to the dock
facility owned by Millennium Bulk Terminals-Longview, LLC.
LOVES FURNITURE: U.S. Trustee Appoints Creditors' Committee
-----------------------------------------------------------
The U.S. Trustee for Regions 3 and 9 appointed an official
committee to represent unsecured creditors in the Chapter 11 case
of Loves Furniture, Inc.
The committee members are:
1. Matthew Speiser, General Counsel
TargetCast d/b/a Media Assembly
One World Trade Center, 67th Floor
New York, NY 10007
Phone: 914-282-1902
Email: matt.speiser@mdcmediapartners.com
2. Charles Aiosa, Senior Vice President
Rosenthal & Rosenthal, Inc.
1370 Broadway
New York, NY 10018
Phone: 212-356-1413
Email: Caiosa@Rosenthalinc.com
3. Erica Hayes
JB Hunt Transport
615 JB Hunt Corporate Dr.
Lowell, AR 72745
Phone: 479-419-3500
Email: erica.hayes@jbhunt.com
4. Carlos Santana, V.P. of Finance
Jonathan Louis International
12919 S. Figueroa St. Los Angeles, CA 90061
Phone: 320-770-3330 – Ext. 1090
Email: Carlos.santana@jonathanlouis.net
5. Frank Hood, CEO
Kingsdown, Inc.
126 W. Holt Street
Mebane, NC 27302
Phone: 919-563-3531
Email: fhood@kingsdown.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 Loves Furniture
Loves Furniture Inc. -- http://www.lovesfurniture.com/-- is a
furniture retailer that sells furniture, mattresses, home decor and
appliances. It conducts business under the name Loves Furniture
and Mattresses.
Loves Furniture sought Chapter 11 protection (Bankr. E.D. Mich.
Case No. 21-40083) on Jan. 6, 2021. The Debtor was estimated to
have $10 million to $50 million in assets and liabilities at the
time of the filing.
Butzel Long, A Professional Corporation, led by Max J. Newman,
Esq., is the Debtor's counsel.
LSC COMMUNICATIONS: Feb. 24 Plan Confirmation Hearing Set
---------------------------------------------------------
LSC Communications, Inc., and its affiliated Debtors filed with the
U.S. Bankruptcy Court for the Southern District of New York a
motion for entry of an order approving the Disclosure Statement for
Debtors' Joint Chapter 11 Plan of Liquidation.
The Disclosure Statement provides Holders of Claims in Class 3
(Junior Remaining Claims), Class 4A (General Unsecured Claims) and
Class 4B (SERP Claims) that are entitled to vote on the Plan (the
"Voting Classes") with adequate information in accordance with
section 1125(b) of the Bankruptcy Code and complies with the
applicable requirements of section 1125 of the Bankruptcy Code.
On Jan. 12, 2021, Judge Sean H. Lane granted the motion and ordered
that:
* The Disclosure Statement is approved pursuant to section
1125(b) of the Bankruptcy Code and Bankruptcy Rule 3017(b) and, to
the extent not withdrawn, settled or otherwise resolved, any
objections to approval of the Disclosure Statement are overruled.
* Feb. 16, 2021 at 4:00 p.m. is fixed as the last day to file
objections to confirmation of the Plan.
* Feb. 16, 2021 at 8:00 p.m. is fixed as the last day to
return Ballots for all Holders of Claims entitled to vote on the
Plan.
* Feb. 22, 2021 shall be the deadline to file the Voting
Certification.
* Feb. 22, 2021 at 4:00 p.m. shall be the deadline to file any
reply to objections to confirmation of the Plan.
* Feb. 24, 2021 at 11:00 a.m. is the hearing to consider
confirmation of the Plan.
Counsel to the Debtors:
Andrew G. Dietderich
Brian D. Glueckstein
Alexa J. Kranzley
Christian P. Jensen
SULLIVAN & CROMWELL LLP
125 Broad Street
New York, NY 10004-2498
Telephone: (212) 558-4000
Facsimile: (212) 558-3588
About LSC Communications
LSC Communications, Inc. -- http://www.lsccom.com-- is a Delaware
corporation established in 2016 with its headquarters located in
Chicago. It offers a broad range of traditional and digital print
products, print-related services, and office products. LSC
Communications has offices, plants and other facilities in 28
states, as well as operations in Mexico, Canada and the United
Kingdom.
LSC Communications and its affiliates filed a Chapter 11 petition
(Bankr. S.D.N.Y. Lead Case No. 20-10950) on April 13, 2020. In its
petition, LSC Communications estimated $1.649 billion in assets and
$1.721 billion in liabilities. Andrew B. Coxhead, chief financial
officer, signed the petition.
The Debtors tapped Sullivan & Cromwell LLP and Young Conaway
Stargatt & Taylor LLP as their bankruptcy counsel, Evercore Group
LLC as investment banker, AlixPartners LLP as restructuring
advisor, and Prime Clerk as notice, claims and balloting agent.
The U.S. Trustee for Region 2 appointed a committee to represent
unsecured creditors in the Debtors' Chapter 11 cases on April 22,
2020. The committee tapped Stroock & Stroock & Lavan, LLP and
Levenfeld Pearlstein, LLC as its legal counsel, Alvarez & Marsal
North America, LLC as its financial advisor, Jefferies LLC as
investment banker, and Prime Clerk LLC as information agent.
LSC COMMUNICATIONS: Unsec. Creditors Get 4.4% With RRD Settlement
-----------------------------------------------------------------
LSC Communications, Inc., et al., submitted a solicitation version
of their Joint Chapter 11 Plan of Liquidation and Disclosure
Statement.
ACR III Libra Holdings LLC, an entity affiliated with the Debtors'
secured creditors, emerged as the successful bidder for the
Debtors' assets. The buyer purchased the assets in exchange for
(i) cash, (ii) a credit bid for indebtedness under the term loan
facility and the senior secured notes, in an aggregate amount equal
to $63.44 million, and (iii) the assumption of certain specified
liabilities of the sellers, including obligations relating to the
Debtors' pension plan.
Following the Debtors' entry into the Acquisition Agreement, the
subsequent entry of the Oct. 7, 2020 Sale Order by the Bankruptcy
Court and the entry into the Stipulation Regarding Sale and Plan
(the "Plan Stipulation"), the Debtors have been working with their
key creditor constituencies on the development of the Plan, and the
continued orderly disposal of assets.
The Plan provides for the distribution of the proceeds (i) of the
sale and (ii) from the liquidation of the Debtors' assets that
remain after consummation of the sale.
Following its formation, the Official Committee of Unsecured
Creditors and its professionals engaged in a discovery and
diligence process related to the Company's Oct. 1, 2016 spin-off
from R.R. Donnelley & Sons Company. After extensive negotiations
among the Debtors, RRD, the Committee and the Ad Hoc SERP Group,
the parties agreed to settle all potential claims and causes of
action that could be asserted against RRD in connection with the
Spin-Off, the SERP and the RRD SERP and RRD agreed to waive and
release the Debtors' Estates from any liability related thereto.
The Plan provides that, upon satisfaction of the RRD Settlement
Conditions, the Debtors, RRD, the Ad Hoc SERP Group and the
Committee have agreed to resolve and settle (the "RRD Settlement")
numerous issues among them. Specifically, if the RRD Settlement
Conditions are satisfied, on the Effective Date, RRD will transfer
the SERP Settlement Payment to the SERP Distribution Account,
transfer the MEPP Settlement Payment to the MEPP Distribution
Account, and transfer $544,873 to counsel to the Ad Hoc SERP Group
on account of fees and expenses incurred thereby.
Under the Plan, Class 1 Other Priority Claims, which are unimpaired
under the Plan, total $901,867. Class 3 Junior Remaining Claims
total $629,954,183 and will recover 15.15% under the Plan, compared
to 14.9% under a liquidation scenario.
Class 4A General Unsecured Claims totaling $164,405,893 will
recover 4.4% under the Plan if the RRD Settlement Conditions are
satisfied and 2.7% if RRD Settlement Conditions are not satisfied,
compared to 2% in a liquidation.
Class 4B SERP Claims totaling $93,831,491 will recover 9.7% under
the Plan if the RRD Settlement Conditions are satisfied and 2.7% if
RRD Settlement Conditions are not satisfied, compared to 1.9% in a
liquidation.
If the RRD Settlement Conditions are satisfied, holders of Allowed
Class 4A Claims will each receive its pro rata share of the
Unsecured Claim Pool. If the RRD Settlement Conditions are not
satisfied, holders of Allowed Class 4A Claims will each receive (i)
its pro rata share of the Unsecured Claim Pool and (ii) its pro
rata share of the Litigation Trust Interests.
If the RRD Settlement Conditions are satisfied, holders of Allowed
Class 4B Claims will each receive its pro rata share of the
Unsecured Claim Pool. If the RRD Settlement Conditions are not
satisfied, holders of Allowed Class 4B Claims will each receive (i)
its pro rata share of the Unsecured Claim Pool and (ii) its pro
rata share of the Litigation Trust Interests.
"MEPP Settlement Payment" means $2.6 million funded from RRD to the
MEPP Distribution Account on the Effective Date of the Plan if the
RRD Settlement Conditions are satisfied. If the RRD Settlement
Conditions are not satisfied, there shall not be a MEPP Settlement
Payment.
"SERP Settlement Payment" means, if the RRD Settlement Conditions
are satisfied, RRD's payment of $4,955,127 on the Effective Date of
the Plan to the SERP Distribution Account pursuant to the RRD
Settlement.
"SERP" means the LSC Unfunded Supplemental Pension Plan and the
Supplemental Executive Retirement Plan - B for Designated
Executives of Moore Corporation Limited and Subsidiary Companies.
"RRD Settlement Conditions" means (i) the approval of the RRD
Settlement and the releases of RRD set forth in Articles 10.5-10.7
of the Plan and (ii) acceptance of the Plan by Class 4B. For the
avoidance of doubt, any modifications to the terms of the RRD
Settlement, including the releases set forth in the Plan, without
the consent of RRD will result in the failure of the satisfaction
of the RRD Settlement Condition.
A copy of the Disclosure Statement dated Jan. 12, 2021, is
available at
https://bit.ly/3qxpsgU
A copy of the Plan dated Jan. 12, 2021, is available at
https://bit.ly/3sEitoc
Counsel to the Debtors:
Andrew G. Dietderich
Brian D. Glueckstein
Alexa J. Kranzley
Christian P. Jensen
SULLIVAN & CROMWELL LLP
125 Broad Street
New York, New York 10004
Telephone: (212) 558-4000
Facsimile: (212) 558-3588
E-mail: dietdericha@sullcrom.com
gluecksteinb@sullcrom.com
kranzleya@sullcrom.com
jensenc@sullcrom.com
About LSC Communications
LSC Communications, Inc. -- http://www.lsccom.com/-- is a Delaware
corporation established in 2016 with its headquarters located in
Chicago. It offers a broad range of traditional and digital print
products, print-related services, and office products. LSC
Communications has offices, plants and other facilities in 28
states, as well as operations in Mexico, Canada and the United
Kingdom.
LSC Communications and its affiliates filed a Chapter 11 petition
(Bankr. S.D.N.Y. Lead Case No. 20-10950) on April 13, 2020. In its
petition, LSC Communications estimated $1.649 billion in assets and
$1.721 billion in liabilities. Andrew B. Coxhead, chief financial
officer, signed the petition.
The Debtors tapped Sullivan & Cromwell LLP and Young Conaway
Stargatt & Taylor LLP as their bankruptcy counsel, Evercore Group
LLC as investment banker, AlixPartners LLP as restructuring
advisor, and Prime Clerk as notice, claims and balloting agent.
The U.S. Trustee for Region 2 appointed a committee to represent
unsecured creditors in the Debtors' Chapter 11 cases on April 22,
2020. The committee tapped Stroock & Stroock & Lavan, LLP and
Levenfeld Pearlstein, LLC as its legal counsel, Alvarez & Marsal
North America, LLC as its financial advisor, Jefferies LLC as
investment banker, and Prime Clerk LLC as information agent.
MALLINCKRODT PLC: Buxton Helmsley Push Board & Management Change
----------------------------------------------------------------
The Buxton Helmsley Group Inc. said Jan. 15, 2021 that the
Mallinckrodt board and management has entirely abandoned
shareholder interests, attempting to push through a Chapter 11
restructuring plan (their case pending before the U.S. District of
Delaware Bankruptcy Court) that will extinguish all shareholder
interests, unnecessarily turn all shareholder equity over to a
handful of bondholders, and enrich management with a 10% allocation
of the reorganized company when they currently own less than 0.03%
of the existing company.
11 out of 12 Mallinckrodt Directors did not meet the requirement to
retain ownership of five times their annual cash retainer in common
stock as of the petition date, and far, far before that.
Mallinckrodt Chief Executive Officer Mark Trudeau was (and is
still) incompliant with his requirement to retain ownership of five
times his annual salary in common stock (throughout all of 2020),
and has -- since Chapter 11 petition filing -- sold off over 95% of
the little equity he did have in the company.
Vice President Stephen Welch stated during the recent December 16th
hearing on appointment of an official equity committee that the
company is now representing the interests of creditors, citing
Irish law, prematurely having breached their fiduciary duty to
shareholders without having pursued numerous attempts to preserve
equity value and prove insolvency (admitting not even an attempt to
sell the company), and pursuing the path of least assurance for a
distribution to equity holders (a reorganization with a maximum
distribution of zero to shareholders instead of a Chapter 7
liquidation with no set distribution ceiling for shareholders).
Buxton Helmsley calls to make immediate significant board and
management changes due to management's refusal to respond to
shareholder inquiries, offerings of financing opportunities, and
that express admission (at the recent equity committee appointment
hearing) of not attempting many paths to preserve equity (more
notably, no attempt at all to sell the company).
The Buxton Helmsley Group, Inc. (together with certain of its
affiliates and clients, "BHG" or "we"), the New York City-based
investment advisor to clients with significant, and increasing,
holdings of Mallinckrodt Plc common stock (OTC: MNKKQ), and with
the backing of other various significant shareholders, on Jan. 15
issued a letter to Mallinckrodt shareholders expressing utter
disdain with management's recent actions relating to their proposed
Restructuring Support Agreement (the "RSA") terms as part of the
Company's voluntary Chapter 11 reorganization case pending before
the U.S. District of Delaware Bankruptcy Court (the "Court").
Shareholders supporting the following described actions
contemplated by BHG should immediately e-mail
mnk@buxtonhelmsley.com for required materials to legally exercise
the power of their shares in support of the shareholder meeting and
the contemplated actions.
BHG is calling to remove all directors not in compliance with the
corporate governance (as part of the compensation plan) requirement
(11 out of 12 directors) that mandates they are/were to retain five
times their annual cash retainer in common stock of the Company, as
of the date which the Company filed its voluntary Chapter 11
petition. BHG is also calling to remove all officers who were not
in compliance with the corporate governance requirements
surrounding their common stock share ownership requirements as of
the petition date. That would include the removal and replacement
of Chief Executive Officer Mark Trudeau, who held a mere 228,384
shares (valued at ~$157,584) as of the Chapter 11 petition date,
despite being required to hold five times his annual salary in
common stock ($1.05 million being Mr. Trudeau's base salary,
requiring $5.25 million in equity retention) of the Company.
Trudeau was, throughout all of 2020, never in compliance with his
requirement to hold five times his salary in common stock of the
Company (far before the Chapter 11 petition filing date). Since
the Chapter 11 petition filing, Trudeau has further shown his lack
of care to abide by the compensation plan rules, selling 95% of the
puny amount of common stock he did have, as if he felt the right to
break the compensation plan rules even more after throwing
shareholders under the bus. BHG proposes the appointment of
certain new Company and board management, including the Chairman of
the Board (on grounds of ultimate responsibility for not holding
officers and directors accountable for compensation plan
requirements of minimum common stock holdings), Chief Executive
Officer, Chief Financial Officer, noting that these may be interim
positions until a more long-term plan can be formulated. If
necessary, BHG possesses contacts who are immediately able to fill
those positions (some, willing to take majorly equity-based
compensation), even if on a short-term basis.
BHG is moving for an immediate management and board reform with the
goal of setting the Company on a path for success while preserving
shareholder value. The current management neglected many, many
routes of preserving shareholder value, and used the less lethal
threat (and path of least assurance of a distribution to existing
equity holders) of Chapter 11 reorganization over Chapter 7
liquidation. BHG believes that, if equity cannot seal an
advantageous deal, creditors should scavenge for value just as much
as equity holders, leaving a Chapter 7 liquidation the only way to
prove out true actual value of assets and subsequent true
shareholder's equity. The Company's management attempts to portray
insolvency by turning over all equity interests, which in no way
proves that there is a shortfall of asset value causing insolvency,
and only leaves management with a much more debt-free balance sheet
(and, subsequently, a much more valuable allocation of
post-reorganization stock for management). BHG has also proposed
that the terms of the RSA be structured by a financial expert
representing the interests of all parties and stakeholders,
including shareholders. BHG further believes that far less
creditors need be impaired in order to emerge from reorganization
as a much stronger entity. They believe that neither the existing
Company management, nor the Board of Directors, are or will
adequately represent shareholder interests, given they -- with no
care -- have already vouched to extinguish shareholder value, while
enriching existing Company management with the 10% allocation of
common stock in the reorganized Company as part of the Management
Incentive Plan included in the existing RSA proposal, which -- as
of now -- virtually no parties support, except those receiving
highly preferential treatment.
"We've made numerous attempts to contact Company management and the
Board of Directors, requesting that the Company make immediate and
significant board and management changes due to management's
refusal to respond to shareholder inquiries, including offerings of
financing opportunities by shareholders whom I personally know,"
says Alexander Parker, Senior Managing Director of The Buxton
Helmsley Group, Inc. "The Company expressly admitted at the
December 16th, 2020 equity committee appointment hearing that they
have not attempted numerous paths to preserve shareholder equity.
Specifically, there has been no attempt by the Board of Company
management whatsoever to sell the Company, as admitted in that
hearing. Management has made it very clear they that they chose
the restructuring plans that enrich themselves with a 10%
allocation of the post-reorganization entity, and not only started
the negotiations for shareholders at zero, but admitted to being on
the side of creditors from the get-go. They claim the company is
insolvent without having proved it in any way, shape, or form. It
is very clear the shareholders are no longer being represented;
that is a mere fact the Company told the shareholders at that
hearing. We look forward to communicating the nominees for
director and executive positions in the weeks to come," said
Parker.
In the event management does not voluntarily resign, they will be
-- after the forcible removal and institution of replacement board
members – fired for cause on grounds of breach of fiduciary duty
(expressly admitted at the December 16th court hearing), when
--under the terms of their reorganization-related retention bonus
terms -- their bonuses will be clawed back. In anticipation of
friction in instituting the management and board changes, Buxton
Helmsley is preparing to imminently call for an immediate
"extraordinary general meeting" (as defined by Section 178 of the
Companies Act of 2014, or the "Act") to hold a vote for the
immediate institution of a majority of directors selected by BHG,
which would include Mr. Parker and other large shareholders (apart
from BHG) supporting BHG's reform efforts.
Shareholders supporting the described actions contemplated by BHG
should immediately e-mail mnk@buxtonhelmsley.com for required
materials to legally exercise the power of their shares in support
of the shareholder meeting and the contemplated actions.
The full letter to Mallinckrodt shareholders is available at
www.ReviveMallinckrodt.com.
About Buxton Helmsley: The Buxton Helmsley Group, Inc. ("BHG") is a
premier financial service, asset management and securities research
firm, providing an array of services to a diversified group of
individuals, corporations, trusts and other entities. The firm is
headquartered in New York City.
The Buxton Helmsley Group, Inc. (together with certain of its
affiliates and clients, the "Participants") intends to file with
the Securities and Exchange Commission (the "SEC") a definitive
proxy statement and accompanying form of proxy to be used in
connection with the solicitation of proxies from the shareholders
of Mallinckrodt plc (the "Company") in connection with an
"extraordinary general meeting" (as defined by Section 178 of the
Companies Act of 2014, or the "Act") of the Company (the "General
Meeting"). All shareholders of the Company are advised to read the
definitive proxy statement and other documents related to the
solicitation of proxies by the Participants in respect of the
General Meeting when they become available, as they will contain
important information, including additional information related to
the Participants, their nominees for election to the board of
directors of the Company and the General Meeting. The definitive
proxy statement and an accompanying proxy card will be furnished to
some or all of the Company's shareholders and will be, along with
other relevant documents, available at no charge on the SEC website
at http://www.sec.gov/and will be available upon request from the
Participants' proxy solicitor, soon to be announced.
About Mallinckdrodt
Mallinckrodt -- http://www.mallinckrodt.com/-- is a global
business consisting of multiple wholly owned subsidiaries that
develop, manufacture, market and distribute specialty
pharmaceutical products and therapies. The company's Specialty
Brands reportable segment's areas of focus include autoimmune and
rare diseases in specialty areas like neurology, rheumatology,
nephrology, pulmonology and ophthalmology; immunotherapy and
neonatal respiratory critical care therapies; analgesics and
gastrointestinal products. Its Specialty Generics reportable
segment includes specialty generic drugs and active pharmaceutical
ingredients.
As of March 27, 2020, the Company had $10.17 billion in total
assets, $8.27 billion in total liabilities, and $1.89 billion in
total shareholders' equity.
On Oct. 12, 2020, Mallinckrodt plc and certain of its affiliates
sought Chapter 11 protection in Delaware in the U.S. (Bankr. D.
Del. Lead Case No. 20-12522) to seek approval of a restructuring
that would reduce total debt by $1.3 billion and resolve
opioid-related claims against the Company.
Mallinckrodt plc disclosed $9,584,626,122 in assets and
$8,647,811,427 in liabilities as of Sept. 25, 2020.
Latham & Watkins LLP, Ropes & Gray LLP and Wachtell, Lipton, Rosen
& Katz are serving as counsel to the Company, Guggenheim
Securities, LLC is serving as investment banker and AlixPartners
LLP is serving as restructuring advisor to Mallinckrodt. Hogan
Lovells is serving as counsel with respect to the Acthar Gel
matter. Prime Clerk LLC is the claims agent.
MDVIP LLC: Moody's Completes Review, Retains B3 CFR
---------------------------------------------------
Moody's Investors Service has completed a periodic review of the
ratings of MDVIP LLC and other ratings that are associated with the
same analytical unit. The review was conducted through a portfolio
review discussion held on January 11, 2021 in which Moody's
reassessed the appropriateness of the ratings in the context of the
relevant principal methodology(ies), recent developments, and a
comparison of the financial and operating profile to similarly
rated peers. The review did not involve a rating committee. Since
January 1, 2019, Moody's practice has been to issue a press release
following each periodic review to announce its completion.
This publication does not announce a credit rating action and is
not an indication of whether or not a credit rating action is
likely in the near future. Credit ratings and outlook/review status
cannot be changed in a portfolio review and hence are not impacted
by this announcement.
Key rating considerations.
MDVIP LLC's B3 Corporate Family Rating reflects its modest scale
and singular business focus. The rating is further constrained by
MDVIP's moderately high financial leverage and aggressive financial
policy reflected by a track record of shareholder distributions.
Nevertheless, MDVIP's credit profile benefits from good revenue
visibility, a high customer retention rate, as well as its national
footprint. MDVIP's rating is also supported by its good liquidity
reflected in consistent free cash flow, and full availability under
its credit revolving facility.
The principal methodology used for this review was Business and
Consumer Service Industry published in October 2016.
MEDASSETS SOFTWARE: Fitch Affirms 'B' LongTerm IDRs
---------------------------------------------------
Fitch Ratings has affirmed the Long-Term Issuer Default Ratings
(IDRs) of MedAssets Software Intermediate Holdings, Inc. (nThrive
TSG) at 'B' with a Stable Rating Outlook. Fitch has also downgraded
the senior secured first-lien term loan rating to 'BB-'/'RR2' from
'BB'/'RR1'.
As a result of the strong investor interest received, the company
has increased the term loan offering by $60 million with a $40
million reduction in the second-lien, term loan offering. The
additional debt will be applied to the balance sheet as a liquidity
enhancement. The rating action follows the evaluation of the
updated financing package under Fitch's Recovery Criteria and the
determination that the increased first-lien leverage would reduce
expected recoveries to 71% - 90% as compared to 91% - 100% under
the original terms. Fitch's actions affect approximately $500
million of to-be-issued debt.
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). The 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 nondiscretionary 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 8.2x,
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., which 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 have 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 reexamine 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 U.S. 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 healthcare IT (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. The
agency 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 8.2x 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. The agency 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;
-- 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.
Due to the increased first-lien leverage under the newly updated
financing terms for the pending buyout of nThrive TSG, the recovery
model implies a downgrade of the first-lien senior secured
facilities to 'BB-' and a 'RR2' Recovery Rating, reflecting Fitch's
belief that lenders should expect to recover 71% - 90% of their
value 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 the Agency's 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 updated financing terms
including, the issuances of a $75 million first lien undrawn
RCF, a $500 million first-lien term loan, a $120 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 a
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 a
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 to $165 million by 2022 due to
accumulation of FCF and the expectation for the RCF to remain
undrawn.
ESG CONSIDERATIONS
nThrive TSG has an ESG Relevance Score of '4' for Governance
Structure due to its ownership by private equity sponsor Clearlake
Capital, which is assumed to be heavily biased in favor of
shareholder returns. This has a negative impact on the credit
profile and is relevant to the ratings in conjunction with other
factors.
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 minimal credit impact on the entity,
either due to their nature or the way in which they are being
managed by the entity.
MEDICAL SOLUTIONS: Moody's Completes Review, Retains B3 CFR
-----------------------------------------------------------
Moody's Investors Service has completed a periodic review of the
ratings of Medical Solutions Holdings, Inc. and other ratings that
are associated with the same analytical unit. The review was
conducted through a portfolio review discussion held on January 11,
2021 in which Moody's reassessed the appropriateness of the ratings
in the context of the relevant principal methodology(ies), recent
developments, and a comparison of the financial and operating
profile to similarly rated peers. The review did not involve a
rating committee. Since January 1, 2019, Moody's practice has been
to issue a press release following each periodic review to announce
its completion.
This publication does not announce a credit rating action and is
not an indication of whether or not a credit rating action is
likely in the near future. Credit ratings and outlook/review status
cannot be changed in a portfolio review and hence are not impacted
by this announcement.
Key rating considerations.
Medical Solutions Holdings, Inc.'s B3 Corporate Family Rating is
constrained by high financial leverage and execution risk
associated with the large-scale acquisition of C&A Industries. The
acquisition resulted in high leverage and deleveraging efforts will
be delayed by the impact of the coronavirus spread. The company's
CFR is supported by Moody's expectation that despite short-term
volatility, longer-term demand for Medical Solutions' services will
remain healthy. This is due to the aging demographics of the US
population and the growing demand by hospitals to outsource the
administration of their temporary staffing activities.
Additionally, given that a large portion of Medical Solutions'
costs are variable, the company has some ability to partially
mitigate the negative impact of the coronavirus.
The principal methodology used for this review was Business and
Consumer Service Industry published in October 2016.
MEDNAX INC: Moody's Completes Review, Retains B1 CFR
----------------------------------------------------
Moody's Investors Service has completed a periodic review of the
ratings of MEDNAX, Inc. and other ratings that are associated with
the same analytical unit. The review was conducted through a
portfolio review discussion held on January 11, 2021 in which
Moody's reassessed the appropriateness of the ratings in the
context of the relevant principal methodology(ies), recent
developments, and a comparison of the financial and operating
profile to similarly rated peers. The review did not involve a
rating committee. Since January 1, 2019, Moody's practice has been
to issue a press release following each periodic review to announce
its completion.
This publication does not announce a credit rating action and is
not an indication of whether or not a credit rating action is
likely in the near future. Credit ratings and outlook/review status
cannot be changed in a portfolio review and hence are not impacted
by this announcement.
Key rating considerations.
MEDNAX's B1 Corporate Family Rating reflects the company's
moderately high leverage, and exposure to an evolving reimbursement
and regulatory environment. Moody's expects that the impact of the
company's dispute with UnitedHealth Group Incorporated (A3
long-term issuer rating) will be milder after the divestiture of
the anesthesia and radiology businesses. However, the ongoing
dispute nevertheless remains an overhang for the company's CFR. The
company's ratings benefit from its strong market position in
women's and children's health services, good customer diversity,
and favorable healthcare services outsourcing market trends and
good liquidity.
The principal methodology used for this review was Business and
Consumer Service Industry published in October 2016.
MERCER INT'L: Moody's Rates New $500MM Unsec. Notes Due 2029 'Ba3'
------------------------------------------------------------------
Moody's Investors Service assigned a Ba3 rating to Mercer
International Inc.'s proposed $500 million senior unsecured notes
due 2029. Mercer intends to use the net proceeds of this offering
to refinance the 6.5% $250 million senior unsecured notes due 2024,
a portion of the 7.375% $550 million senior unsecured notes due
2025 and cover fees and expenses. The company's Ba2 corporate
family rating, Ba2-PD probability of default rating, Ba3 senior
unsecured debt rating, and the SGL-1 speculative grade liquidity
rating remain unchanged. The rating outlook remains stable.
Assignments:
Issuer: Mercer International Inc.
Senior Unsecured Regular Bond/Debenture, Assigned Ba3 (LGD4)
"The refinancing is essentially leverage neutral and Mercer's
existing ratings remain unchanged, reflecting our expectation that
company's leverage (adjusted Debt to EBITDA) will improve towards
4x in 2022 as pulp demand and prices return to normalized levels",
said Ed Sustar, Senior Vice President with Moody's.
RATINGS RATIONALE
Mercer's Ba2 CFR benefits from: its leading global market position
in northern bleached softwood kraft pulp; the partial stability
provided by material energy and chemical earnings; operational
flexibility and geographic diversity with several pulp mills in
Germany and Canada and a large sawmill in Germany, all which
produce surplus energy; and strong liquidity. Mercer is constrained
by: high leverage (about 6x adjusted debt/EBITDA expected for 2021
improving towards 4x in 2022); the inherent price and demand
volatility of market pulp; and high product concentration with over
80% of sales tied to pulp.
The company's new Ba3 rated $500 million senior unsecured notes and
the existing senior unsecured notes are one notch below the CFR,
reflecting the note holders' structural subordination to the
unrated revolving credit facilities and other indebtedness and
liabilities of the operating subsidiaries. The company's senior
unsecured notes do not benefit from operating subsidiary
guarantees.
Mercer has strong liquidity (SGL-1), supported by about $620
million of sources to cover about $50 million of cash burn over the
next four quarters. The company had about $360 million in cash at
December 2020, about $267 million of availability under several
committed credit facilities totaling about $300 million (most
maturing on or after 2023). Moody's expects the company will remain
within its covenants. Most of the company's fixed assets are
unencumbered, which could provide alternate liquidity. Mercer does
not have any significant debt maturities until its revolvers mature
in 2023.
The stable rating outlook reflects our expectation that Mercer will
maintain strong liquidity as leverage trends down towards 4x in
2022 as pulp prices and demand return to more normal levels.
Moody's expects that benchmark North American NBSK pulp prices
increase about 7% in 2021, as demand growth improves with a rebound
in the global economy and higher hygiene standards following the
coronavirus pandemic.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATING
Factors that could lead to an upgrade:
-- Less earnings volatility with increased diversification away
from the cyclical market pulp sector (pulp sales currently
represent over 80% of revenue)
-- The ratio of adjusted debt to EBITDA is sustained at or below
3x (6.6x expected for 2020)
-- The company's retained cash flow to adjusted debt is sustained
at or above 20% (8% expected for 2020)
-- The company maintains strong liquidity and conservative
financial policies
Factors that could lead to a downgrade:
-- Significant deterioration in the company's liquidity and
operating performance
-- Changes in financial management policies that would materially
pressure the company's balance sheet
-- The company total adjusted debt to EBITDA is sustained above
4.5x (6.6x expected for 2020)
-- The company's retained cash flow to adjusted debt is sustained
below 10% (8% expected for 2020)
The principal methodology used in this rating was Paper and Forest
Products Industry published in October 2018.
Mercer International Inc. is a leading producer of northern
bleached softwood kraft (NBSK) pulp and operates a large lumber
mill in Germany. Incorporated in the State of Washington and
headquartered in Vancouver, British Columbia, Mercer is a public
company with approximately $1.4 billion of revenue for the twelve
months ended September 2020.
MERCER INTERNATIONAL: S&P Rates New Senior Unsecured Notes 'B+'
---------------------------------------------------------------
S&P Global Ratings assigned its 'B+' issue-level rating to pulp and
lumber producer Mercer International Inc.'s proposed senior
unsecured notes due 2029. S&P expects proceeds from the notes will
be used to redeem senior unsecured notes with maturities in 2024
and 2025.
S&P said, "On completion of the refinancing, Mercer will not have a
material debt maturity until 2025, and its interest expenses will
modestly decline from the comparably lower coupon that we expect on
the new notes. The '3' recovery rating on the notes indicates our
expectation for meaningful (50%-70%; rounded estimate: 55%)
recovery in the event of default."
All other ratings on Mercer are unchanged, including S&P's 'B+'
long-term issuer credit rating. The planned refinancing is leverage
neutral, and its estimates for the company's prospective credit
ratios have not materially changed.
The negative outlook on the company is unchanged. The company
remains highly exposed to weak pulp market conditions, which
primarily account for the expected year-over-year decline in its
operating results in 2020. In addition, a weakening U.S. dollar
against the Euro and Canadian dollar has emerged as an additional
potential headwind to prospective operating results, given the
majority of Mercer's sales are priced in U.S. currency and its
costs are incurred in Germany and Canada. S&P continues to assume
Mercer's credit measures will remain high for the rating, including
adjusted debt-to-EBITDA above 5x in 2020 and 2021. S&P's estimates
incorporate roughly flat earnings from the pulp business in 2021,
as well as a modest free cash flow deficit due in part to higher
capital expenditures.
S&P said, "However, we believe there is less downside risk to
earnings than we had contemplated in our previous review. Pressure
on Mercer's operating results appears to have abated and the
company's cash position has improved through 2020. In addition, we
do not anticipate further declines in already weak pulp market
conditions this year; we believe stronger macroeconomic growth
should mitigate the impact of the structural decline in paper
volumes on pulp demand. Moreover, we believe pulp prices will
remain highly volatile, and we can't rule out an unexpected
increase this year that is likely required to support improvement
in Mercer's credit ratios and stabilize the rating."
ISSUE RATINGS--RECOVERY ANALYSIS
Key analytical factors
-- S&P has updated its recovery analysis for the proposed
refinancing transaction and assigned a '3' recovery rating and a
'B+' issue-level rating to Mercer's proposed senior unsecured notes
due 2029.
-- The '3' recovery rating and 'B+' issue-level rating on the
company's existing unsecured debt are unchanged and corresponds
with S&P's estimate of meaningful (50%-70%; rounded estimate: 55%)
recovery.
-- S&P values Mercer on a going-concern basis using a 5x multiple
of the rating agency's projected emergence EBITDA of close to
US$190 million.
-- S&P estimates that, for the company to default, EBITDA would
need to sharply weaken, most likely caused by a sustained
deterioration in pulp prices that erodes liquidity and Mercer's
ability to fund its fixed charges.
-- S&P assumes that, in its hypothetical bankruptcy scenario,
Mercer will draw on 60% of its Celgar and Peace River mills'
revolving asset-based credit facility and 85% of its Rosenthal and
Stendal mills' cash flow revolving credit facilities.
Based on these assumptions, S&P assumes that, in a default
scenario, secured lenders are fully covered and the remaining net
enterprise value is almost exclusively available for senior
unsecured note claims.
Simulated default assumptions
-- Simulated year of default: 2025
-- Emergence EBITDA after recovery adjustments: about US$190
million
-- EBITDA multiple: 5x
Simplified waterfall
-- Net enterprise value (after 5% administrative expenses): US$901
million
-- Valuation split in % (obligors/non-obligors): 100/0
-- Priority claims: US$263 million
-- Collateral value available to unsecured claims: US$638 million
-- Senior unsecured debt and pari passu claims: US$1.15 billion
-- Recovery expectations: 50%-70% (rounded estimate: 55%)
All debt amounts include six months of prepetition interest.
METAL PRODUCTS: Proposed $545K Sale of Assets to CIA Approved
-------------------------------------------------------------
Judge Charles M. Walker of the U.S. Bankruptcy Court for the Middle
District of Tennessee authorized Metal Products Co.'s sale of
assets to Cincinnati Industrial Auctioneers, Inc. ("CIA") for
$545,000, free and clear of liens, claims, and encumbrances.
The Debtor is authorized to execute the asset purchase agreement,
and sell the described Collateral to CIA on the terms set forth
therein. The sale of the Collateral will be free of all liens,
encumbrances, and interests of any kind.
The Debtor is authorized and directed to provide CIA a bill of sale
and/or other reasonable documentation to document the transfer of
the Collateral to CIA. It will execute all documents necessary to
deliver proceeds from the sale of the Collateral to First National
Bank of Middle Tennessee. First National will record and/or file
all documents necessary to release any interest in the Collateral.
Notwithstanding Bankruptcy Rule 6004(h), and as specifically
requested in the Motion, the Order will take effect immediately
upon entry.
About Metal Products
Metal Products Company filed a voluntary petition for relief under
Chapter 11 of the Bankruptcy Code (Bankr. M.D. Tenn. Case No.
20-04757) on Oct. 23, 2020. Metal Products President Arthur James
Dyer, III signed the petition.
At the time of the filing, the Debtor disclosed $956,732 in assets
and $2,938,737 in liabilities.
Judge Charles M. Walker oversees the case. Dunham Hildebrand,
PLLC
serves as the Debtor's legal counsel.
MIDWEST PHYSICIAN: Moody's Completes Review, Retains B2 CFR
-----------------------------------------------------------
Moody's Investors Service has completed a periodic review of the
ratings of Midwest Physician Admin Svcs, LLC and other ratings that
are associated with the same analytical unit. The review was
conducted through a portfolio review discussion held on January 11,
2021 in which Moody's reassessed the appropriateness of the ratings
in the context of the relevant principal methodology(ies), recent
developments, and a comparison of the financial and operating
profile to similarly rated peers. The review did not involve a
rating committee. Since January 1, 2019, Moody's practice has been
to issue a press release following each periodic review to announce
its completion.
This publication does not announce a credit rating action and is
not an indication of whether or not a credit rating action is
likely in the near future. Credit ratings and outlook/review status
cannot be changed in a portfolio review and hence are not impacted
by this announcement.
Key rating considerations.
Midwest Physician Administrative Services, LLC's (a core operating
company of DuPage Medical Group Ltd) B2 Stable CFR reflects Moody's
expectation that the company's financial leverage will remain high.
Debt/EBITDA is somewhat elevated due to the coronavirus pandemic,
but will improve in 2021. The credit profile also reflects the
risks associated with the company's high degree of geographic
concentration in the greater Chicago, IL area. Positive
consideration is given to the company's multi-specialty business
model which provides patients with a broad range of primary and
specialist care in an integrated setting. The company has
meaningful scale in its markets and has successfully executed an
organic and acquisition-led growth strategy.
The principal methodology used for this review was Business and
Consumer Service Industry published in October 2016.
MINDY L. HITCHCOCK: Ch. 11 Suit to Be Dismissed
-----------------------------------------------
Judge Thomas J. Tucker of the United States Bankruptcy Court for
the Eastern District of Michigan, Souther Division found cause to
dismiss the case captioned In re: MINDY L. HITCHCOCK, Chapter 11,
Debtor, Case No. 19-51991 (Bankr. E.D. Mich.).
Mindy L. Hitchcock initially filed a voluntary petition for relief
under Chapter 7 on August 20, 2019. Kenneth Nathan was appointed
the Chapter 7 Trustee. On January 28, 2020, the Court entered an
order converting the case to Chapter 11, based on a stipulation
between the United States Trustee and the debtor.
Hitchcock later filed a motion to voluntarily dismiss the Chapter
11 case. She alleged that cause exists to dismiss this case
because her business income has been reduced significantly and
continues to diminish due to the ongoing COVID-19 pandemic, and the
amount of her secured and priority debt to the Internal Revenue
Service and the State of Michigan is so high that she is no longer
able to propose a feasible reorganization plan.
However, although the United States Trustee did not file any
objection or other respones, the former Chapter 7 Trustee filed an
objection to the motion. He argued that conversion, not dismissal,
is in the best interest of creditors and the estate. This is so,
according to the former Chapter 7 Trustee, because if the Debtor's
Chapter 11 case were converted back to Chapter 7, he would object
to the "Debtor's exemption of real estate located at 28450 Bell
Road, Southfield, MI" and administer that real property for the
benefit of the Debtor's creditors.
Judge Tucker overruled the objection, finding that the former
Chapter 7 Trustee lacks standing to object to the Debtor's Motion.
The judge explained that the former Chapter 7 Trustee's service and
his standing and authority to act in this case were terminated on
January 28, 2020, when the Court entered its order converting the
Chapter 7 case to Chapter 11. "The former Chapter 7 Trustee has no
official role in this Chapter 11 case. Nor does he have standing as
a creditor, because he has no allowed and unpaid claim for
compensation," said the judge.
Neither the United States Trustee nor any creditor has filed an
objection to the Debtor's Motion.
A full-text copy of Judge Tucker's opinion dated January 8, 2021 is
available at https://tinyurl.com/y26v58rl from Leagle.com.
About Mindy L. Hitchcock
Mindy L. Hitchcock filed a voluntary petition for relief under
Chapter 7 on August 20, 2019. The case was converted to Chapter 11
on January 28, 2020.
MPH ACQUISITION: Moody's Completes Review, Retains B2 CFR
---------------------------------------------------------
Moody's Investors Service has completed a periodic review of the
ratings of MPH Acquisition Holdings LLC and other ratings that are
associated with the same analytical unit. The review was conducted
through a portfolio review discussion held on January 11, 2021 in
which Moody's reassessed the appropriateness of the ratings in the
context of the relevant principal methodology(ies), recent
developments, and a comparison of the financial and operating
profile to similarly rated peers. The review did not involve a
rating committee. Since January 1, 2019, Moody's practice has been
to issue a press release following each periodic review to announce
its completion.
This publication does not announce a credit rating action and is
not an indication of whether or not a credit rating action is
likely in the near future. Credit ratings and outlook/review status
cannot be changed in a portfolio review and hence are not impacted
by this announcement.
Key rating considerations.
MPH Acquisition Holding's (Multiplan) B2 CFR reflects its high
financial leverage and the company's very high customer
concentration, with around half of its revenue from two customers.
The credit profile is also constrained by the company's track
record of aggressive financial policies including numerous
debt-funded shareholder distributions. That said, Moody's expect a
less aggressive financial policy going forward as Multiplan
transitions to public ownership. Multiplan benefits from a strong
market position in the preferred provider organization industry,
robust operating margins, and solid free cash flow. The company
also benefits from high barriers to entry in the PPO industry and
high switching costs for its analytics business.
The principal methodology used for this review was Business and
Consumer Service Industry published in October 2016.
MT. GOX: CoinLab Cuts Deal With Trustee Over Bitcoin Claims
-----------------------------------------------------------
Matthew Leising of Bloomberg News reports creditors seeking to
regain Bitcoin lost on the Japanese exchange Mt. Gox in 2014 have a
chance to get their digital assets back before legal claims are
settled.
CoinLab Inc. said an agreement with Nobuaki Kobayashi, the trustee
to the Mt. Gox bankruptcy, and MGIFLP, a unit of Fortress
Investment Group LLC, will allow creditors to consider an offer of
as much as 90% of the remaining Bitcoin tied up in the bankruptcy.
The plan must be approved by creditors and investors aren't
obligated to take the early payment and can wait for the lawsuits
to settle, CoinLab said in a statement Friday.
Based in Japan, Mt. Gox was once the world's biggest Bitcoin
exchange, until it closed in early 2014 after losing about 850,000
Bitcoin belonging to thousands of customers. Many of those digital
coins have since been found, and the trustee is working to
reimburse creditors. The process has been bogged down in lawsuits
for the past seven years.
While Fortress has tried to buy claims from Mt. Gox creditors in
the past, the current deal would be paid to investors from the
trust. Not all the Bitcoin held by Mt. Gox when it went bankrupt
is available for recovery, according to the statement. For each
Bitcoin that was locked up in the bankruptcy that has a claim on
it, the estate has only 0.23 coin to give out, according to a
CoinLab spokesman. There are many more claims on Mt. Gox Bitcoin
than Bitcoin held by the trust.
CoinLab has a $16 billion claim against Mt. Gox in the bankruptcy.
CoinLab was co-founded in 2012 by Peter Vessenes, who also
co-founded the Bitcoin Foundation and has provided security
auditing for blockchain networks since about 2015, including on
Ethereum. Venture capitalist Tim Draper was an original investor
in CoinLab. CoinLab is not part of the settlement and will
continue its litigation, according to the statement.
"I am thrilled that people are finally getting paid by Mt. Gox,"
Draper said in the statement. "As Mt. Gox's creditors are some of
the earliest believers in cryptocurrency, I look forward to getting
my Bitcoin as do the tens of thousands of people that have
claims."
Bitcoin, which traded at $489 the day Mt. Gox filed for bankruptcy,
hit an all time high earlier this year at $41,982. It fell 6.5% to
$36,261 as of 5 p.m. Friday in New York, according to a composite
of prices compiled by Bloomberg.
About Mt. Gox
Tokyo-based MtGox Co., Ltd., operated a virtual currency
transaction system.
Mt.Gox was the largest exchange for most of Bitcoin's existence and
was handling about 6 percent of all Bitcoins in circulation.
In February 2014, MtGox Co., Ltd., announced in that it was filing
for bankruptcy after tens of millions of dollars worth of the
virtual currency and client funds disappeared.
In March 2014, MtGox sought bankruptcy protection in Japan. The
bankruptcy in
Japan came after the bitcoin exchange lost 850,000 bitcoins valued
at about $475 million "disappeared."
The Company filed a petition under Chapter 15 of the U.S.
Bankruptcy Code on March 9, 2014. It filed for bankruptcy
protection in the U.S. to prevent customers from targeting the cash
it holds in U.S. bank accounts.
The Chapter 15 case is In re MtGox Co., Ltd., Case No. 14-31229
(Bankr. N.D. Tex.). The Chapter 15 Petitioner is Robert Marie Mark
Karpeles, the company's chief executive officer. Mr. Karpeles is
represented by John E. Mitchell, Esq., and David William Parham,
Esq., at Baker & Mcckenzie LLP, in Dallas, Texas.
The bankruptcy trustee and foreign representative of MtGox Co.
Ltd. with respect to the Japan Bankruptcy Proceedings:
MtGox Co., Ltd.
Office of Bankruptcy Trustee
Kojimachi 3 chome building #202
Kojimachi 3-4-1
Chiyoda-ku, Tokyo
Tel: +81-3-4588-3922
Attn: Nobuaki Kobayashi
The Ontario Superior Court of Justice (Commercial List) on Oct. 3,
2014, ordered, pursuant to Section 272 of the Bankruptcy and
Insolvency Act, that the bankruptcy proceedings commenced with
respect to MtGox Co., Ltd. -- aka Mt. Gox KK and dba MtGox -- be
recognized as a "foreign main proceeding."
The Canadian legal counsel to the bankruptcy trustee and foreign
representative of MtGox Co., Ltd, are Jeffrey Carhart and Margaret
Sims, at Miller Thomson LLP.
MURPHY OIL: Moody's Affirms Ba1 CFR & Rates $500M Unsec. Notes Ba2
------------------------------------------------------------------
Moody's Investors Service assigned a Baa3 rating to Murphy Oil USA
Inc.'s ("MUSA") planned $750 million bank credit facility. At the
same time, Moody's affirmed MUSA's other ratings including its Ba1
corporate family rating, Ba1-PD probability of default rating, and
Ba2 senior unsecured rating. The company's speculative grade
liquidity rating of SGL-1 remains unchanged. Shortly after the
launch of this bank credit facility, MUSA will launch a $500
million senior unsecured note issuance which is being assigned a
Ba2. The outlook remains stable.
Proceeds from the bank credit facility -- which consists of a $350
million 5-year senior secured revolver and $400 million 7-year
senior secured term loan B -- along with the $500 million 10-year
senior unsecured note issuance will be used to finance the recently
announced acquisition of QuickChek Corporation, refinance its
existing credit facility, pay fees and expenses and put about $26
million of cash on the balance sheet. MUSA announced the $645
million acquisition of QuickChek's 157 locations on December 14,
2020.
"The affirmation of MUSA's existing ratings reflects the company's
strong metrics, which will remain appropriate for the Ba1 rating
when factoring in the acquisition, its very good liquidity and the
positive attributes of the QuickChek acquisition", stated Pete
Trombetta, Moody's Vice President -- Senior Analyst. "The
acquisition gives MUSA a presence in the desirable New Jersey/New
York region in the US where it is difficult to open new fuel
locations due to environmental regulations and QuickChek's fresh
food offering will enable MUSA to begin the process of improving
the offerings at its existing locations", added Trombetta.
Assignments:
Issuer: Murphy Oil USA Inc.
Senior Secured Term Loan, Assigned Baa3 (LGD2)
Senior Secured Revolving Credit Facility, Assigned Baa3 (LGD2)
Senior Unsecured Regular Bond/Debenture, Assigned Ba2 (LGD5)
Affirmations:
Issuer: Murphy Oil USA Inc.
Probability of Default Rating, Affirmed Ba1-PD
Corporate Family Rating, Affirmed Ba1
Senior Unsecured Regular Bond/Debenture, Affirmed Ba2 (LGD5)
Outlook Actions:
Issuer: Murphy Oil USA Inc.
Outlook, Remains Stable
RATINGS RATIONALE
MUSA's credit profile benefits from its strong credit metrics --
which Moody's expects will remain appropriate for the Ba1 rating
category following the acquisition -- its very good liquidity,
meaningful scale, good market position and geographic reach, and
our opinion that consumer demand for motor fuel and value priced
convenience items will retain some degree of stability regardless
of economic conditions. Moody's expects the company's credit
metrics to remain consistent with its Ba1 rating category and in
line with its debt/EBITDA (as reported) target of 2.5 times, even
during times of volatile earnings. The company is constrained by
its exposure to revenue and earnings volatility related to motor
fuel sales which account for a substantial majority of the
company's revenue and the company's low merchandise margins,
relative to rated peers.
The stable outlook reflects the integration risk associated with
the QuickChek acquisition as well as Moody's view that the company
will continue to look at acquisitions as a part of its growth
strategy.
The Baa3 rating assigned to the $750 million senior secured bank
credit facility -- one notch above the Ba1 CFR -- reflects the
support from the significant amount of junior ranking debt and
non-debt liabilities to these facilities, including unsecured
notes. The Ba2 rating on the company's unsecured debt reflects its
junior position to the significant amount of 1st lien senior
secured bank debt.
The credit facilities are expected to contain covenant flexibility
for transactions that could adversely affect creditors, including:
incremental facility capacity up to: (x) the greater of 100% of
Adjusted EBITDA at close and 100% of Adjusted EBITDA, calculated on
a pro forma basis, for the most recently ended four fiscal quarter
period plus (y) an additional amount such as (i) the First Lien
Leverage Ratio does not exceed 3.75 times (for pari passu first
lien debt); or (ii) the Secured Leverage Ratio does not exceed 3.75
times (for junior secured indebtedness); and (iii) either the Total
Leverage Ratio does not exceed 4.50x or the Fixed Charge Coverage
Ratio is not lower than 2.00 times (for unsecured indebtedness).
Alternatively, all of the ratios may be satisfied as long as the
leverage (coverage) does not increase (decrease) if incurred in
connection with a permitted acquisition or investment. A sublimit
of the incremental (amount to be agreed) will be permitted to be
incurred with an earlier maturity date than the term loans. Only
wholly-owned subsidiaries must act as subsidiary guarantors,
raising the risk that guarantees may be released following a
partial change in ownership. The credit facilities provide the
ability to make restricted payments, investments and certain
prepayments through a builder basket equal to the greater of a to
be determined amount and 10% of Consolidated Net Tangible Assets
plus (b) either (i) 50% of cumulative Consolidated Net Income or
(ii) 100% of cumulative retained "excess cash flow" plus (c) other
customary additions; provided that the use of clauses (b) and (c)
of the builder basket will be subject to absence of a continuing
default and compliance with a Fixed Charge Coverage Ratio of 2.00
to 1.00. Step downs in the asset sale prepayment requirement to 50%
and 0% if the First Lien Leverage Ratio is equal to or less than
3.25x and 2.75x, respectively and excluding amounts reinvested
within 12 months (subject to extension to 18 months).
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
An upgrade would require a balanced growth strategy and the
financial policy and capital structure that supports the credit
profile required of an investment grade rating. An upgrade would
also require very good liquidity, increased product diversification
to lower its reliance on fuel sales and increase its higher margin
merchandise revenues. Quantitatively, an upgrade would require
debt/EBITDA maintained below 2.5 times and EBIT/interest sustained
near 5.5 times. Deterioration in operating performance resulting in
weakening of liquidity or credit metrics could result in a
downgrade. A growth strategy that negatively impacts liquidity or
metrics could also pressure ratings. Specifically, ratings could be
downgraded if debt/EBITDA is sustained above 3.5 times and
EBIT/interest is sustained below 4.0 times.
Murphy Oil USA Inc. is the primary operating subsidiary of Murphy
USA Inc., and mainly sells retail motor fuel products and
convenience merchandise through a total of nearly 1,500 retail
stations, almost all of which are located close to Walmart stores.
The company's retail stations are located in 25 states, primarily
in the Southeast, Southwest, and Midwest United States. Revenues
were about $11.9 billion for the last 12 month period ended
September 30, 2020.
The principal methodology used in these ratings was Retail Industry
published in May 2018.
MURPHY USA: S&P Affirms 'BB+' ICR on QuickChek Acquisition
----------------------------------------------------------
S&P Global Ratings affirmed all of its ratings, including the 'BB+'
issuer credit rating, on El Dorado, Ark.-based fuel retailer Murphy
USA.
S&P is also assigning its 'BBB-' issue-level rating and '1'
recovery rating to the proposed senior secured credit facilities.
Concurrently, the rating agency is assigning its 'BB+' issue-level
rating and '3' recovery rating to the proposed senior unsecured
notes.
The stable outlook reflects S&P's expectation for Murphy to
successfully integrate QuickChek while executing its strategic
growth initiatives and maintaining adjusted leverage below 3.5x.
Murphy USA is issuing new debt to fund its $645 million acquisition
of convenience store operator QuickChek Corp. and partially
refinance its debt capital structure. The transaction will result
in adjusted debt to EBITDA increasing to the mid-2x area from 1.6x
as of third-quarter 2020.
S&P said, "Murphy's acquisition of QuickChek expands its
merchandising capabilities and diversity with manageable added
financial and integration risk, in our view. Murphy will fund the
$645 million acquisition through the issuance of a $400 million
term loan B and $500 million senior unsecured notes. It will use
the remaining proceeds to redeem its FILO term loan, pay
transaction fees, and deposit a modest cash sum to the balance
sheet. Additionally, the company is issuing a $350 million
revolving credit facility to replace its existing $325 million
asset-based lending (ABL) facility. We project adjusted debt to
EBITDA will rise above 3x in 2021 because of the incremental debt
to fund the purchase and our expectation for fuel margins to
compress. However, we believe leverage will return to below 3x in
2022 as earnings growth and debt reduction strengthen credit
metrics."
"Murphy's purchase of QuickChek will add 157 locations and expand
its geographic footprint to the Northeast. Strategically, we
believe QuickChek's food and beverage capabilities will bolster
Murphy's merchandise offerings, enabling it to diversify away from
fuel and tobacco sales. This deal is the latest in an increasingly
consolidating industry, though it marks a change in Murphy's
strategy, which has historically expanded organically. We believe
risks are manageable and the company's plan to continue operating
stores under their existing banner somewhat mitigate the
integration risks of the acquisition. Still, the added leverage and
complexities diminish the cushion Murphy had built to absorb
potential performance setbacks."
"Scale, supply chain, and store footprint underpin Murphy USA's
low-cost value proposition. Murphy employs a low-price, high volume
operating strategy that leverages its fuel sourcing capabilities,
low-cost small-format stores and proximity to high-traffic Walmart
locations. Today, approximately 77% of Murphy's stores are located
on Walmart lots, down from 85% at the time of its spin-off in 2013.
The company's strategic relationship with Walmart remains a
distinctive advantage as it enables Murphy to capture significant,
recurring traffic volumes. We also view Murphy's participation in
the Walmart+ program, which offers members a five-cents-per-gallon
fuel discount, positively as it provides Murphy direct access to a
different customer segment that currently doesn't fill up at its
sites."
"However, we anticipate the mix of on-lot locations will continue
to decline as Murphy pivots to opening new larger format stores,
targeting 50 locations per year. The added selling space will
enable Murphy to offer a wider array of merchandise and generate
higher margin inside sales. While the company has leading fuel
selling capabilities (its stores average 2.7 million gallons
compared to the National Association of Convenience Stores (NACS)
average of 1.7 million), it trails competitors in its foodservice
and beverage offerings. Further, its nonfuel sales are over-indexed
in lower-margin tobacco products, which account for approximately
70% of inside sales. Although the category remains an important
traffic driver, it faces elevated regulatory scrutiny and long-term
volume pressures."
"The QuickChek acquisition accelerates Murphy's ability to improve
its foodservice offerings in new and existing stores. We expect the
combined company will derive nearly 45% of its gross profit from
merchandise sales this year, which is an improvement from Murphy's
approximately 30%-35% contribution on a stand-alone basis and helps
narrow the gap to the NACS industry average that exceeds 50%.
QuickChek's broader merchandise mix and developed foodservice
program will enhance Murphy's overall margin profile. We anticipate
the company will expand the proportion of its gross profit it
derives from merchandise sales over time as it leverages
QuickChek's food and beverage capabilities in its existing
larger-format and new-to-industry stores. We believe this will
reduce Murphy's reliance on fuel, an inherently more volatile
source of earnings. Therefore, we view Murphy's competitive
position more favorably and are revising our business risk
assessment to fair from weak. Consequently, we now assess the
comparable ratings analysis modifier as neutral."
"The company's updated capital allocation strategy is incrementally
more aggressive, in our view. We expect capital spending will
accelerate in 2021 and remain elevated relative to recent years as
the company pursues its strategic growth initiatives. These include
opening 50 new stores annually, continuing its raze-and-rebuild
program that outfits locations with more selling space, and
diversifying its sales mix through enhanced inside sales
merchandising. We expect the company will also aim to expand the
QuickChek banner through new store openings. Murphy has taken a
number of shareholder friendly actions, recently instituting a
common dividend and increasing its share repurchase program to $500
million through December 2023. However, following this acquisition
and the subsequent increase in leverage, we anticipate Murphy will
prioritize integration, execution and deleveraging. In our view,
Murphy's public leverage target of 2.5x and its good cash flow
generation support our expectation that the company will deleverage
in 2022."
"Murphy's high exposure to fuel and tobacco sales result in greater
exposure to environmental and social risk factors. We expect
improving fuel margin efficiency to pressure long-term industry
fuel volumes. This is consistent with the EIA's forecast for
vehicle miles traveled in 2022 to be nearly equal to 2019 levels,
but for gasoline consumption to be 3.6% lower than in 2019.
Additionally, the growth of electric and hybrid vehicles driven by
consumer demand and regulatory stipulations for reduced emissions
and cleaner energy to address climate change poses a long-term
threat to Murphy's core fuel business. Separately, Murphy's heavy
reliance on tobacco sales expose it to social risk factors related
to the detrimental health effects of smoking."
"The stable outlook reflects our expectation that Murphy will
successfully integrate QuickChek, expand its mix of non-fuel sales
and gross profit, and maintain adjusted leverage below 3.5x."
S&P could lower the rating if:
-- Operating performance deteriorates because of a sharp,
sustained decline in fuel margins or volumes;
-- Murphy experiences integration or execution issues that weaken
its competitive position; or
-- Leverage exceeds 3.5x on a sustained basis because of
performance issues or a shift in financial policy.
S&P could raise the rating if:
-- Murphy expands its operations, diversifying its geographic
footprint and gross profit contribution; and
-- Implements a more conservative financial policy that keeps
adjusted leverage at or below 2x.
MY BROTHERS KEEPERS: Hires McDowell Law as Counsel
--------------------------------------------------
My Brothers Keepers Outreach Ministries, Inc., seeks authority from
the U.S. Bankruptcy Court for the District of New Jersey to employ
McDowell Law, PC, as counsel to the Debtor.
My Brothers Keepers requires McDowell Law to provide all required
advice to the Debtor as debtor-in-possession, and assist in
formulating and confirming the Plan of Reorganization.
McDowell Law will be paid at the hourly rates of $400.
McDowell Law will be paid a retainer in the amount of $6,500
McDowell Law will also be reimbursed for reasonable out-of-pocket
expenses incurred.
Ellen M. McDowell, a partner of McDowell Law, PC, assured the Court
that the firm is a "disinterested person" as the term is defined in
Section 101(14) of the Bankruptcy Code and does not represent any
interest adverse to the Debtor and its estates.
McDowell Law can be reached at:
Ellen M. McDowell, Esq.
MCDOWELL LAW, PC
46 West Main Street
Maple Shade, NJ 08052
Tel: (856) 482-5544
About My Brothers Keepers Outreach
My Brothers Keepers Outreach Ministries, Inc., filed a Chapter 11
bankruptcy petition (Bankr. D.N.J. Case No. 20-12438) on Feb. 13,
2020, disclosing under $1 million in both assets and liabilities.
The Debtor hired McDOWELL LAW, PC, as counsel.
NAPA MANAGEMENT: Moody's Completes Review, Retains Caa1 CFR
-----------------------------------------------------------
Moody's Investors Service has completed a periodic review of the
ratings of NAPA Management Services Corporation and other ratings
that are associated with the same analytical unit. The review was
conducted through a portfolio review discussion held on January 11,
2021 in which Moody's reassessed the appropriateness of the ratings
in the context of the relevant principal methodology(ies), recent
developments, and a comparison of the financial and operating
profile to similarly rated peers. The review did not involve a
rating committee. Since January 1, 2019, Moody's practice has been
to issue a press release following each periodic review to announce
its completion.
This publication does not announce a credit rating action and is
not an indication of whether or not a credit rating action is
likely in the near future. Credit ratings and outlook/review status
cannot be changed in a portfolio review and hence are not impacted
by this announcement.
Key rating considerations.
NAPA Management Services Corporation's Caa1 Corporate Family Rating
reflects the company's very high leverage, challenging business
environment and weak free cash flow. The CFR also reflects NAPA's
limited scale and high geographic concentration in northeastern
states. The company's ratings are supported by Moody's expectation
that the demand for the company's services will stabilize once the
COVID outbreak subsides. In May 2020, NMSC II, an affiliate of
NAPA, acquired the American Anesthesiology business from MEDNAX
Inc. (B1 positive). There is no immediate credit impact on NAPA due
to the way the deal was structured as there are no cross-guarantees
between the two companies.
The principal methodology used for this review was Business and
Consumer Service Industry published in October 2016.
NATIONAL MENTOR: Moody's Completes Review, Retains B2 CFR
---------------------------------------------------------
Moody's Investors Service has completed a periodic review of the
ratings of National MENTOR Holdings, Inc. and other ratings that
are associated with the same analytical unit. The review was
conducted through a portfolio review discussion held on January 11,
2021 in which Moody's reassessed the appropriateness of the ratings
in the context of the relevant principal methodology(ies), recent
developments, and a comparison of the financial and operating
profile to similarly rated peers. The review did not involve a
rating committee. Since January 1, 2019, Moody's practice has been
to issue a press release following each periodic review to announce
its completion.
This publication does not announce a credit rating action and is
not an indication of whether or not a credit rating action is
likely in the near future. Credit ratings and outlook/review status
cannot be changed in a portfolio review and hence are not impacted
by this announcement.
Key rating considerations.
National MENTOR Holdings, Inc.'s B2 CFR reflects the company's high
financial leverage and substantial business risk with reliance on
government programs and exposure to state budgets. Further, the
rating is challenged by moderately high geographic concentration,
with Minnesota and California accounting for a considerable portion
of revenue. It also reflects labor cost pressures and an aggressive
acquisition expansion strategy. Supporting the credit profile is
the company's size and scale as one of the leading providers of
residential services to individuals with intellectual and
developmental disabilities (I/DD) and catastrophic injuries. The
rating also benefits from industry trends shifting preferences
toward smaller, lower-cost community settings, which National
Mentor primarily operates.
The principal methodology used for this review was Business and
Consumer Service Industry published in October 2016.
NEOPHARMA INC: U.S. Trustee Appoints Creditors' Committee
---------------------------------------------------------
Paul Randolph, Acting U.S. Trustee for Region 8, appointed an
official committee to represent unsecured creditors in the Chapter
11 cases of Neopharma Inc. and Neopharma Tennessee, LLC.
The committee members are:
1. McKesson Corporation
Armando Fagundes, Senior Manager
Supplier Financial Risk
6927 Pasadena Ave.
Dallas, TX 75214
Email: armando.fagundes@mckesson.com
2. Professional Personnel Service, Inc.
Rando Sharrow, CFO
1040 Tidewater Court
Kingsport, TN 37620
Email: rsharrow@lstaff.com
3. Securitas Security Services
Andrea Hoepner
10200 Mallard Creek Road, Suite 104
Charlotte, NC 28262
Email: andrea.hoepner@securitasinc.com
4. Jekson Vision Private Limited
Mark Hilhorst
304 Sarkhej Bavla Highway
Changodar 382213
Ahmedabad, Gujarat India
Email: mark@jeksonvision.mt
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 Neopharma
Neopharma Inc. and Neopharma Tennessee, LLC, manufacturers of
pharmaceutical and medicinal products, sought protection under
Chapter 11 of the Bankruptcy Code (Bankr. E.D. Tenn. Lead Case No.
20-52015) on Dec. 22, 2020.
At the time of the filing, the Debtors disclosed assets of between
$1 million and $10 million and liabilities of the same range.
Judge Shelley D. Rucker oversees the cases. The Debtors tapped
Hunter, Smith & Davis, LLP as their counsel.
NEW CITIES INVESTMENT: Bravo Buying Palm Desert Property for $6.35M
-------------------------------------------------------------------
New Cities Investment Partners, LLC, asks the U.S. Bankruptcy Court
for the Northern District of California to authorize the private
sale of the real property located at 74351 Hovley Lane East, in
Palm Desert, California, APNs 624-040-019 and 624-060-089, to Bravo
Properties, LLC for $6.35 million, on the terms of their Purchase
and Sale Agreement.
A tele/videoconference on the Motion is set for Feb. 10, 2021, at
10:00 a.m.
The Property is encumbered by the claims of the Riverside County
Tax Collector and Century Housing Corp., a California nonprofit
corporation. Based on the Seller's settlement statement, and
communication between counsel for the Reorganized Debtor and a
title officer of First American Title Co., the secured claim of the
Riverside County Tax Collector is $332,683. Based on the figures
Century Housing provided in the disclosure statement, New Cities
Investment Partners, LLC estimated that Century Housing's secured
claim is in the amount of $4,962,061.
The estimated closing costs are supplied by the Seller settlement
statement prepared by First American. First American has indicated
that these figures are subject to change, and have not provided a
range of estimated closing costs. The closing costs based in part
on the Seller's settlement statement are: (i) $190,500 for the
commission of The Hoffman Co. and (ii) $13,500 for Title/Escrow
Charges. The transaction is also subject to a 1% United States
Trustee fee, which is approximately $63,500.
Out of an abundance of caution, the seller’s settlement statement
includes withholding from the California Franchise Tax Board in the
amount of $211,455. However, Hayashi Wayland, Accounting and
Consulting, LLP, the accounting firm employed by the estate, found
that the sale of the Property would not result in any tax
liability, including no withholding from the California Franchise
Tax Board.
The sale proceeds are estimated to pay the secured claims in full,
the administrative expense claims in full, and provide a pro rata
distribution to unsecured creditors: (i) Riverside County Tax
(Priority/Secured) (est. $332,683), (ii) Century Housing (Secured)
(est. $5,174,916), (iii) United States Trustee's Fees (Bankr.
Imposed Expense) (est. $63,500), (iv) Commission, The Hoffman Group
(Closing) (est. $190,500), (v) Title & Escrow Fees (Closing) (est.
$13,500), (vi) Hayashi Wayland, Accounting and Consulting, LLP
(Admin. Claim) (est. $34,000), and (vii) Macdonald Fernandez LLP
(Admin. Claim) (est. $120,000).
The Reorganized Debtor emphasizes that these are estimates, and
figures may change. They may overestimate administrative claims,
which are subject to Court approval.
The Property was appropriately marketed. The Hoffman Co. marketed
the Property through several means. It received three written
offers, of which the offer in the amount of $6.35 million made by
the Buyer and accepted was the highest and best offer. The sale
price of the Property exceeds its appraised value.
The material terms of the PSA are as follows:
a. Bravo Properties, LLC is the Purchaser and the Reorganized
Debtor is the Seller.
b. First American will be the escrow holder.
c. The Purchaser will deposit $50,00 with the escrow holder.
It will deposit with the escrow holder an additional $150,000.
d. The balance of the purchase price is in the amount of
$6.15 million.
e. The close of escrow will occur 90 days after acceptance of
the PSA. The Buyer and the Seller signed the PSA on Dec. 16 and
17, 2020, respectively. Thus, closing should be done by March 16
or 17, 2020.
f. The sale will be free and clear of all liens.
The most likely alternative to the proposed sale is foreclosure of
the Property or another sale for an unknown amount later. The
Reorganized Debtor expects that this would seriously depress the
value of the Property, undercutting distributions to other
creditors. Accordingly, it has determined that the proposed sale
is in the best interests of the estate.
The dynamics of the case justify a private sale of the Property
without overbidding. One, an overbid may discourage the Purchaser
from closing the sale. Two, the marketing efforts equates to a
competitive bidding process. Three, the Purchaser is not a
stalking horse bidder, and thus, lacks protections such as expense
reimbursements, and break-up fees. Four, the Property's purchase
price exceeds its appraised value. Five, as time goes on, the
Property's equity will continue to reduce. Six, the arrangement
strikes the balance of fairness, finality, integrity and the
maximization of assets. Seven, sale alternatives would likely not
result in a better return.
The Reorganized Debtor asks a waiver of the provisions Federal Rule
of Civil Procedure 62(a) and Federal Rule of Bankruptcy Procedure
6004(h) that would otherwise stay the order approving the sale be
waived under the circumstances.
A copy of the PSA is available at https://tinyurl.com/yxkuyf3v from
PacerMonitor.com free of charge.
About New Cities Investment Partners
New Cities Investment Partners, LLC is engaged in activities
related to real estate. The company owns a vacant real property
located in Palm Desert, Calif.
New Cities Investment Partners sought protection under Chapter 11
of the Bankruptcy Code (Bankr. N.D. Cal. Case No. 19-52584) on
Dec.
23, 2019. The petition was signed by Lee E. Newell, chief
executive officer of New Cities Land Company, Inc., Debtor's
manager. At the time of the filing, Debtor disclosed assets of
between $1 million and $10 million and liabilities of the same
range. Judge M. Elaine Hammond oversees the case.
Debtor has tapped MacDonald Fernandez LLP as its legal counsel and
Hayashi Wayland Accounting & Consulting, LLP as its accountant.
Debtor filed its Chapter 11 plan of reorganization and disclosure
statement on March 20, 2020.
NEW CITIES INVESTMENT: Hearing on Palm Desert Asset Sale on Feb. 11
-------------------------------------------------------------------
New Cities Investment Partners, LLC, filed with the U.S. Bankruptcy
Court for the Northern District of California its second corrected
notice of proposed private sale of the real property located at
74351 Hovley Lane East, in Palm Desert, California, APNs
624-040-019 and 624-060-089, to Bravo Properties, LLC for $6.35
million, on the terms of their Purchase and Sale Agreement.
A tele/videoconference on the Motion is set for Feb. 11, 2021 at
10:00 a.m.
The Notice is filed concurrently with the Motion, the Declaration
of Lee Newell, and the Declaration of Erik Christianson in
connection with the Motion to Sell Real Property Free and Clear of
Liens and related documents.
The Debtor proposes to sell the Property free and clear of liens.
The close of escrow for the Property is 90 days after the execution
of the PSA. The Debtor signed the PSA on Dec. 17, 2020. Bravo
signed the PSA on Dec. 16, 2020.
The material terms of the PSA are as follows: Bravo Properties, LLC
is the Purchaser. NCIP is the Seller. First American Title Co.
will be the escrow holder. The Purchaser will deposit $50,000 with
the escrow holder. The Buyer will deposit with the escrow holder
an additional $150,000. The balance of the purchase price is in
the amount of $6.15 million. The close of escrow will occur 90
days after acceptance of the PSA.
The Debtor asks the sale of the Property to be done without overbid
as a private sale under Federal Rule of Bankruptcy Procedure
6004(f)(1). The Motion is subject to approval of the Court.
The Debtor asks authority to pay out escrow closing costs, 3% of
commission of the total sale price of the Property to the broker
employed by the estate, United States Trustee Fees (estimated to be
$63,500) and other attendant costs. The following shows, among
other things, estimated costs of the sale of Property: (i)
Riverside County Tax (Priority/Secured) (est. $332,683), (ii)
Century Housing (Secured) (est. $5,174,916), (iii) United States
Trustee's Fees (Bankr. Imposed Expense) (est. $63,500), (iv)
Commission, The Hoffman Group (Closing) (est. $190,500), (v) Title
& Escrow Fees (Closing) (est. $13,500), (vi) Hayashi Wayland,
Accounting and Consulting, LLP (Admin. Claim) (est. $34,000), and
(vii) Macdonald Fernandez LLP (Admin. Claim) (est. $120,000).
As for tax consequence, Hayashi Wayland, Accounting and Consulting,
LLP, the accounting firm employed by the estate, found that the
sale of the Property would not result in any tax liability,
including no withholding from the California Franchise Tax Board.
The Motion is pursued under Sections 2.2, 2.4, 2.9 & 7.7 of the
confirmed Plan of Reorganization of New Cities Investment Partners,
LLC Dated March 20, 2020, Sections 105, 363, 363(b) of title 11 of
the United States Code, Section 363(f)(2), (f)(3) of the Bankruptcy
Code for a sale free and clear of any interest in the Property of
an entity other than the estate, Sections 363(m) & 1123(b)(4) of
the Bankruptcy Code, Federal Rules of Bankruptcy Procedure 2002,
4001 & 6004, and Bankruptcy Local Rule 6004-1.
The Debtor asks that the order approving the proposed sale of the
Property will be effective upon entry, and not otherwise stayed by
Rule 62(a) of the Federal Rules of Civil Procedure nor Federal Rule
of Bankruptcy Procedure 6004(h).
Any opposition to the Motion will be filed and served on the
initiating party at least 14 days prior to the actual scheduled
hearing date, as required by Bankruptcy Local Rule 9014-1(c). The
Motion may be viewed online and downloaded at
http://www.canb.uscourts.gov,or copies may be obtained upon
request to the counsel for NCIP.
For any questions regarding how to appear at a court hearing,
interested parties may contact the Bankruptcy Court by calling
888-821-7606 or by using the Live Chat feature on the Court's
website.
A copy of the PSA is available at https://tinyurl.com/yxkuyf3v from
PacerMonitor.com free of charge.
About New Cities Investment Partners
New Cities Investment Partners, LLC is engaged in activities
related to real estate. The company owns a vacant real property
located in Palm Desert, Calif.
New Cities Investment Partners sought protection under Chapter 11
of the Bankruptcy Code (Bankr. N.D. Cal. Case No. 19-52584) on
Dec.
23, 2019. The petition was signed by Lee E. Newell, chief
executive officer of New Cities Land Company, Inc., Debtor's
manager. At the time of the filing, Debtor disclosed assets of
between $1 million and $10 million and liabilities of the same
range. Judge M. Elaine Hammond oversees the case.
Debtor has tapped MacDonald Fernandez LLP as its legal counsel and
Hayashi Wayland Accounting & Consulting, LLP as its accountant.
Debtor filed its Chapter 11 plan of reorganization and disclosure
statement on March 20, 2020.
NEW JERSEY HOUSING: Moody's Affirms Ba1 Rating on 2004-1 Bonds
--------------------------------------------------------------
Moody's Investors Service has affirmed ratings on ten public
housing authorities' (PHA) capital fund bonds. The outlooks on all
PHA capital fund bonds is revised to stable from negative.
This rating action affects the following bond programs:
Alabama Public Housing Authorities' Capital Program Revenue Bonds,
Series 2003-B. Rating affirmed at Baa2 with a stable outlook.
District of Columbia Housing Finance Agency - Capital Fund Program
Bonds' Capital Program Revenue Bonds, Series 2005. Rating affirmed
at Baa2 with a stable outlook.
Denver City & County Housing Authority Capital Funding Program's
(CO) Capital Fund Program Revenue Bonds, Series 2007 (Three Towers
Rehabilitation Project). Rating affirmed at A2 with a stable
outlook.
East Providence Housing Authority-Capital Funds Housing Revenue
Bonds' (RI) Capital Funds Housing Revenue Bonds, Series 2002.
Rating affirmed at A3 with a stable outlook.
Industrial Development Board of New Orleans - Capital Fund Revenue
Bonds, LA's Capital Fund Program Revenue Bonds Series A of 2003.
Rating affirmed at A3 with a stable outlook.
Maryland Community Development Administration - Capital Fund
Securitization's Capital Fund Securitization Revenue Bonds, Series
2003. Rating affirmed at Baa2 with a stable outlook.
New Jersey Housing and Mortgage Finance Agency-Capital Fund
Program Revenue Bonds 2004's Capital Fund Program Revenue Bonds,
Series 2004A. Rating affirmed at Ba1 with a stable outlook.
New Jersey Housing and Mortgage Finance Agency-Capital Fund
Program Revenue Bonds 2007's Capital Fund Program Revenue Bonds,
2007 Series A. Rating affirmed at Baa2 with a stable outlook.
Pennsylvania Housing Finance Agency - Capital Fund
Securitization's Capital Fund Securitization Revenue Bonds, Series
2005A. Rating affirmed at Baa1 with a stable outlook.
Philadelphia Capital Fund Revenue Program's (PA) Capital Fund
Program Revenue Bonds, Series 2002A, and Capital Fund Program
Revenue Bonds Series C of 2003 and Series D of 2003. Ratings
affirmed at A2 with a stable outlook.
RATINGS RATIONALE
The ratings are based on continued satisfactory debt service
coverage levels at the respective rating levels. The financings
continue to benefit from debt service coverage levels that mitigate
potential future declines in funding. Future funding to the
programs, which rely on this funding stream as the primary
repayment source for the capital appropriation bonds, will depend
on future budgets, which may be materially reduced from the current
level.
RATING OUTLOOK
The stable outlook reflects the stability of capital fund
appropriations as well as satisfactory debt service coverage levels
of the projects countering the ongoing pressures on the sector
which is highly dependent on future levels of capital funding.
Historically, Congress has appropriated more capital funding than
requested in the President's annual budget proposals.
FACTORS THAT COULD LEAD TO AN UPGRADE OF THE RATINGS
While a rating upgrade is unlikely in a near to medium term,
significant and sustained improvement in the programs' debt service
coverage ratios, along with sustainable history of strong funding
levels and budget proposals would be credit positive
FACTORS THAT COULD LEAD TO A DOWNGRADE OF THE RATINGS
Substantial declines in capital fund appropriations, resulting in
substantial erosion of the respective debt service coverage levels
LEGAL SECURITY
PHA capital fund bonds are paid from capital fund allocations that
are appropriated annually by Congress to the US Department of
Housing and Urban Development. Under the program, the funding is
allocated by HUD to individual PHAs and used by the PHAs, first, to
pay debt service on bonds, if any, and then for other capital
improvements to their projects. The bond programs also benefit from
debt service reserve funds, sized and maximum annual debt service.
PROFILE
PHA Capital Fund financings are bonds issued by public housing
authorities to fund the modernization or repair of various public
housing developments. Program funding directly impacts PHA's
ability to repay the bonds. Thus the size of each PHA's annual
allocation relative to annual debt service on the bonds, the debt
service coverage, is one of the key credit factors of these
financings as it identifies the programs' resiliency to declines in
future funding.
METHODOLOGY
The principal methodology used in these ratings was US Public
Housing Authority Capital Fund Bonds published in June 2018.
NS8 INC: Former CEO Considers Plea Deal Amid Ongoing Investigations
-------------------------------------------------------------------
Law360 reports that a Nevada entrepreneur charged with looting $17
million from NS8 Inc., a cyberfraud protection company he founded,
is considering a possible plea deal amid ongoing investigations by
prosecutors and in bankruptcy court, a Manhattan federal judge
heard Friday, January 15, 2021.
U.S. District Judge John P. Cronan, who is overseeing the criminal
fraud case against former NS8 CEO Adam Rogas, sets Feb. 23, 2021
for the sides to return to court amid the production of volumes of
government evidence.
About NS8 Inc.
Las Vegas-based NS8 Inc. is a developer of a comprehensive fraud
prevention platform that combines behavioral analytics, real-time
scoring, and global monitoring to help businesses minimize risk.
Visit https://www.ns8.com for more information.
NS8 sought Chapter 11 protection (Bankr. D. Del. Case No. 20-12702)
on Oct. 27, 2020. The petition was signed by Daniel P. Wikel, the
chief restructuring officer.
The Debtor was estimated to have $10 million to $50 million in
assets and $100 million to $500 million in liabilities at the time
of the filing.
The Hon. Christopher S. Sontchi is the case judge.
The Debtor tapped Blank Rome LLP and Cooley LLP as its legal
counsel, and FTI Consulting Inc. as its financial advisor. Stretto
is the claims agent.
NUVERRA ENVIRONMENTAL: 3rd Cir. Affirms Denial of Hargreaves Appeal
-------------------------------------------------------------------
In the case captioned In re Nuverra Environmental Solutions, Inc.,
a/k/a Heckmann Corporation a/k/a Rough Rider Escrow, Inc., et al.,
Debtor David Hargreaves, Appellant, Case No. 18-3084 (3rd Cir.),
the United States Court of Appeals, Third Circuit concluded that
the District Court correctly determined that the appeal filed by
David Hargreaves is equitably moot.
The appellate court held that the relief that Hargreaves sought, a
personal payout, is disallowed by the Bankruptcy Code, and any
other form of relief would require unwinding the confirmed plan.
Nuverra Environmental Solutions, Inc. and its affiliated debtors
petitioned for Chapter 11 relief on May 1, 2017 and proposed a
prepackaged plan of reorganization. Following amendments, the Plan
was filed on June 23, 2017. It consisted of three parts, with
classes A1-12 associated with a joint plan for a subset of the
debtors, the "Nuverra Group Debtors," and classes B1-10 and C1-10
associated with individualized plans for two debtors, Appalachian
Water Services, LLC and Badlands Power Fuels, LLC.
Hargreaves is a member of Class A6, which includes holders of
unsecured 2018 Notes issued by Nuverra Group Debtors in the amount
of $40,436,000. Hargreaves holds $450,000 of such notes. The Plan
provided A6 creditors with securities and cash equal to six percent
of the face value of their notes. Nearly 80% of voting Class A6
noteholders voted in favor of confirmation, but, by value of
ownership stakes, 61% of Class A6 voted against confirmation.
In contrast to the treatment of Class A6, Class A7, which includes
certain trade and other creditors, whose debts arise out of the
debtor's day to day operations, received payment in full. The
parties characterized this payment to Class A7 as a "gift" to be
paid by secured creditors because such value would, otherwise,
inure to the benefit of the secured creditors who will own the
debtors' post emergence. The Bankruptcy Court approved of this
"payment in full" because "the debtors clearly explain that
separate classification is necessary to maintain ongoing business
relationships that the debtors need to ensure the continuance of
operations."
Hargreaves objected to the Plan, arguing that there was unfair
discrimination between classes of creditors. The Bankruptcy Court
confirmed the Plan over Hargreaves's objection, holding that,
"despite the disparate treatment between [C]lass A6 and other
unsecured creditors, there is no unfair discrimination here where
the gift by secured creditors to other unsecured creditors
constitutes no unfair discrimination as [C]lass A6 is indisputably
out of the money and not, otherwise, entitled to any distribution
under the Bankruptcy Code's priority scheme and provided further
that the proposed classification and treatment of other unsecured
creditors fosters a reorganization of these debtors." The
Bankruptcy Court further explained that the classification of the
A7 claims was reasonable because those claims "aris[e] out of
day-to-day operations of the companies."
On July 25, 2017, the same day the Bankruptcy Court confirmed the
Plan, Hargreaves filed his notice of appeal to the District Court.
A day later, Hargreaves filed an emergency motion for a stay of the
Confirmation Order. On August 3, 2017, the District Court denied
the stay request, and on August 7, 2017, the debtors implemented
the Plan. Some two months later, on October 16, 2017, the
reorganized debtors filed a motion to dismiss Hargreaves's appeal
for equitable mootness, arguing that the Plan was substantially
consummated and could not practically be unwound. The District
Court heard oral argument on May 14, 2018 and, ruling the appeal
equitably moot, dismissed it on August 21, 2018.
Hargreaves appealed further to the Court of Appeals, contending
that the Plan unfairly discriminates against the class of creditors
into which he falls and that his requested relief does not render
the appeal equitably moot. He believed that he should receive an
individual $450,000 payout, equal to a 100% recovery on his Class
A6 claim, to remedy the allegedly unfair discrimination of the Plan
against the entirety of Class A6. The reorganized debtors
responded that such relief would be contrary to the Code, and that
any relief Hargreaves could seek is practically impossible, leaving
his appeal equitably moot.
The appellate court observed that the Plan has already been
substantially consummated and that the only relief that might not
fatally scramble the Plan would be an individual payout of a
relatively small sum, like the $450,000 that Hargreaves seeks.
However, the court held that awarding such relief would violate the
Code's restriction on preferring certain individuals over others in
the same class.
Hargreaves's first response to the problems with his proposed
relief is to dwell on an irrelevancy, emphasizing how small the sum
he wants is, relative to the Reorganized Debtors' value. The
court, however, pointed out that the size of his request is simply
beside the point, as it ignores that such an individual payout to
one member of a class is not permitted by the Code.
Hargreaves also tried to get around the problem by saying his
receiving more than other A6 creditors would not violate the
principle that like creditors must be treated alike because the
other A6 creditors "had an equal opportunity to object to the Plan
and appeal the Confirmation Order" but chose not to. The court
found this "equal opportunity" argument unavailing, since Section
1129(b)(1) of the Code effectively prohibit payouts to a creditor
who seeks an individual benefit in derogation of the treatment
accorded other class members.
As the only way to give Hargreaves the money he wants is to give
all A6 creditors a 100% refund on their $40.4 million in unsecured
2018 notes, which would fatally scramble the Plan and significantly
harm third parties, the Court of Appeals concluded that Hargreaves'
claim must fail.
A full-text copy of the Third Circuit's opinion dated January 6,
2021 is available at https://tinyurl.com/y3ks9323 from Leagle.com.
Appellant is represented by:
James H. Millar, Esq.
Clay J. Pierce, Esq.
FAEGRE DRINKER BIDDLE & REATH
1177 Avenue of the Americas, 41st Flr
New York, NY 10036
Tel: (212)248-3140
Email: james.millar@faegredrinker.com
clay.pierce@faegredrinker.com
Appellees are represented by:
Jamie L. Chapman, Esq.
Kenneth J. Enos, Esq.
Pauline K. Morgan, Esq.
YOUNG CONAWAY STARGATT & TAYLOR
1000 North King Street
Wilmington, DE 19801
Tel: (302)571-6600
Email: jchapman@ycst.com
kenos@ycst.com
pmorgan@ycst.com
-- and --
Sara Coelho, Esq.
Fredric Sosnick, Esq.
SHEARMAN & STERLING
599 Lexington Avenue
New York, NY 10022
Tel: (212)848-4000
Email: sara.coelho@shearman.com
fsosnick@shearman.com
About Nuverra
Nuverra Environmental Solutions, Inc. provides water logistics and
oilfield services to customers focused on the development and
ongoing production of oil and natural gas from shale formations in
the United States. Its services include the delivery, collection,
and disposal of solid and liquid materials that are used in and
generated by the drilling, completion, and ongoing production of
shale oil and natural gas. The Company provides a suite of
solutions to customers who demand safety, environmental compliance
and accountability from their service providers.
Nuverra reported a net loss of $54.94 million for the year ended
Dec. 31, 2019, compared to a net loss of $59.26 million for the
year ended Dec. 31, 2018. As of Sept. 30, 2020, the Company had
$195.94 million in total assets, $57.56 million in total
liabilities, and $138.38 million in total shareholders' equity.
ONE CALL: Moody's Completes Review, Retains B3 CFR
--------------------------------------------------
Moody's Investors Service has completed a periodic review of the
ratings of One Call Corporation and other ratings that are
associated with the same analytical unit. The review was conducted
through a portfolio review discussion held on January 11, 2021 in
which Moody's reassessed the appropriateness of the ratings in the
context of the relevant principal methodology(ies), recent
developments, and a comparison of the financial and operating
profile to similarly rated peers. The review did not involve a
rating committee. Since January 1, 2019, Moody's practice has been
to issue a press release following each periodic review to announce
its completion.
This publication does not announce a credit rating action and is
not an indication of whether or not a credit rating action is
likely in the near future. Credit ratings and outlook/review status
cannot be changed in a portfolio review and hence are not impacted
by this announcement.
Key rating considerations.
One Call Corporation's credit profile is constrained by its high
financial leverage. Moody's expects that One Call will be able to
grow revenue and profits, benefiting from a new IT system
implemented in 2019. This will result in a meaningful reduction in
leverage. However, failure to materially improve earnings and cash
generation over the next several quarters will result in increasing
refinancing risk, pressuring the credit profile. The B3 credit
profile also reflects the company's considerable concentration of
revenues with its largest customers. These credit challenges are
balanced by One Call's leading market position in the stable
workers' compensation cost containment services industry and good
geographic and product diversity.
The principal methodology used for this review was Business and
Consumer Service Industry published in October 2016.
ONEX TSG: Moody's Completes Review, Retains B2 CFR
--------------------------------------------------
Moody's Investors Service has completed a periodic review of the
ratings of Onex TSG Intermediate Corp. and other ratings that are
associated with the same analytical unit. The review was conducted
through a portfolio review discussion held on January 11, 2021 in
which Moody's reassessed the appropriateness of the ratings in the
context of the relevant principal methodology(ies), recent
developments, and a comparison of the financial and operating
profile to similarly rated peers. The review did not involve a
rating committee. Since January 1, 2019, Moody's practice has been
to issue a press release following each periodic review to announce
its completion.
This publication does not announce a credit rating action and is
not an indication of whether or not a credit rating action is
likely in the near future. Credit ratings and outlook/review status
cannot be changed in a portfolio review and hence are not impacted
by this announcement.
Key rating considerations.
Onex TSG Intermediate Corp.'s B2 Corporate Family Rating reflects
its high leverage, significant exposure to bad debt expense in the
emergency department and the evolving regulatory and reimbursement
environment. Moody's expects that the company's leverage will
increase temporarily due to the impact of the coronavirus. However,
the debt/EBITDA will decline by mid-2021. The CFR benefits from the
company's market position as the third-largest emergency department
physician staffing company, good customer diversity, favorable
healthcare services outsourcing market trends, good liquidity and a
solid track record of integrating acquisitions.
The principal methodology used for this review was Business and
Consumer Service Industry published in October 2016.
OPTION CARE: Moody's Upgrades CFR to B2 & Alters Outlook to Stable
------------------------------------------------------------------
Moody's Investors Service upgraded the Corporate Family Rating of
Option Care Health, Inc to B2 from B3. Moody's also upgraded its
Probability of Default Rating to B2-PD from B3-PD. Moody's has
affirmed the senior secured credit facility (as increased by the
proposed fungible add-on) at B2 and the Speculative Grade Rating
remains an SGL-1. At the same time, Moody's revised the outlook to
stable from positive.
The upgrade reflects Moody's view that Option Care's leverage and
credit metrics have improved significantly since last year's merger
with BioScrip and will be sustained at more moderate levels. The
company repaid a portion of debt from a stock offering in late 2020
and Moody's estimates debt/EBITDA has improved to approximately
5.3x. The company is seeking a $250 million incremental first lien
term loan which will be used to repay its existing second lien
notes. This is expected to result in approximately $11 million of
annual interest rate savings.
The affirmation of the first lien credit facility at B2 reflects
the one-notch upgrade of the company's Corporate Family Rating as
well as the planned repayment in full of the company's second lien
credit facilities. The first lien rating is the same as the
Corporate Family Rating as it represents the preponderance of debt
in the company's capital structure.
Following is a summary of Moody's rating actions:
Issuer: Option Care Health, Inc
Ratings upgraded:
Corporate Family Rating upgraded to B2 from B3
Probability of Default Rating upgraded to B2-PD from B3-PD
Ratings affirmed:
Senior Secured First lien term loan B affirmed at B2 (LGD4 from
LGD3)
RATINGS RATIONALE
Option Care Health, Inc's B2 CFR reflects the company's high
financial leverage and competitive pressures stemming from large,
vertically integrated insurance companies that possess their own
home infusion providers and a challenging reimbursement
environment. That said, Option Care benefits from its large scale
with about $2.9 billion in revenue and market position as the
largest independent infusion providers. Option Care is well
diversified by payor, therapy and geography. Further, the home
infusion services industry has favorable long-term dynamics as the
home is generally the lowest cost of care and is the patient's
preferred setting. This holds particularly true in the context of
the coronavirus pandemic as demand for home infusion is expected to
grow.
The Speculative Grade Liquidity Rating of SGL-1 reflects Moody's
expectation of very good liquidity over the next 12-18 months.
Moody's expects that free cash flow will be consistently positive
over the next 12-18 months as many of the integration related costs
roll off and the company's interest expense declines. Liquidity is
supported by $140 million of cash and a $175 undrawn ABL revolving
credit facility, which was undrawn at September 30, 2020. The
company's term loan does not have any financial covenants, but the
ABL revolver contains a springing fixed charge coverage covenant of
1.0x. The covenant is only tested if the availability falls below
10% of the borrowing base or $10 million.
Moody's considers coronavirus to be a social risk given the risk to
human health and safety. Aside from coronavirus, Option Care faces
other social risks such as the rising concerns around the access
and affordability of healthcare services. However, Moody's does not
consider home health/ home infusion to face the same level of
social risk as hospitals, as care at home is an affordable
alternative to hospitals or skilled nursing facilities. In terms of
governance, Option Care is majority owned by private equity
sponsor, Madison Dearborn, and as such, Moody's expects financial
policies will generally benefit shareholders. These risks are
partially mitigated by its 36% public stock ownership, and minority
ownership by Walgreens Boots Alliance, Inc. Option Care's credit
profile will continue to benefit from its relationship with
Walgreens, as there is a lower risk of debt-funded dividends than
with typical private equity owned companies.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The ratings could be upgraded if Option Care continues to generate
sustained positive free cash flow, leverage improves below 4.5x,
profitability improves, and the company continues to maintain
conservative financial policies.
The ratings could be downgraded if liquidity materially weakens,
leverage is sustained over 6.0x, profitability declines materially,
or Option Care adopts more aggressive financial policies.
Option Care is the leading independent provider of home and
alternate treatment site infusion therapy services. These services
involve the preparation, delivery, administration and monitoring of
medication for a broad range of conditions. These include
infections, malnutrition, heart failure, bleeding disorders,
autoimmune disorders, and a variety of other rare conditions.
Madison Dearborn Partners (majority owner) and Walgreens Boots
Alliance, Inc. (minority owner), together own about 64% of the
combined public company. The other 36% of the company is publicly
owned by shareholders. Pro forma combined revenues are about $2.9
billion.
The principal methodology used in these ratings was Business and
Consumer Service Industry published in October 2016.
OUTCOMES GROUP: Moody's Completes Review, Retains B3 CFR
--------------------------------------------------------
Moody's Investors Service has completed a periodic review of the
ratings of Outcomes Group Holdings, Inc. and other ratings that are
associated with the same analytical unit. The review was conducted
through a portfolio review discussion held on January 11, 2021 in
which Moody's reassessed the appropriateness of the ratings in the
context of the relevant principal methodology(ies), recent
developments, and a comparison of the financial and operating
profile to similarly rated peers. The review did not involve a
rating committee. Since January 1, 2019, Moody's practice has been
to issue a press release following each periodic review to announce
its completion.
This publication does not announce a credit rating action and is
not an indication of whether or not a credit rating action is
likely in the near future. Credit ratings and outlook/review status
cannot be changed in a portfolio review and hence are not impacted
by this announcement.
Key rating considerations.
Outcomes Group Holdings' B3 CFR is constrained by high financial
leverage. Moody's forecasts leverage to decline by the end of 2021
due to steady revenue and earnings growth. The credit profile also
reflects the company's modest absolute size based on revenues, and
relatively high customer concentration within the niche sub-segment
of the worker's compensation case management industry. Paradigm's
scale is modest when compared to its customers, which are mostly
insurance companies and large third-party administrators. The
credit profile is supported by the company's leading market
position, high barriers to entry and solid earnings growth
prospects as it expands its service offerings. Further, Paradigm
has a good track record of organic revenue growth (even despite the
pandemic headwind) and managing the underwriting risk within its
contracts.
The principal methodology used for this review was Business and
Consumer Service Industry published in October 2016.
OWENS PRECISION: Trustee's Sale of Tangible Assets or Business OK'd
-------------------------------------------------------------------
Judge Bruce T. Beesley of the U.S. Bankruptcy Court for the
District of Nevada authorized W. Donald Gieseke, the Chapter 11
Trustee of Owens Precision, Inc., to:
(i) sell via auction the Debtor's tangible personal property
assets located at 5966 Morgan Mill Road, in Carson City, Nevada,
including the UMB Collateral1 and Wells Fargo Equipment, as
described in Exhibit A to the Guarantee Agreement to Remarket
Assets of Owens Precision, Inc., without any representations or
warranties at the Premises for the highest price to be paid in
cash; or
(ii) in the alternative, sell the Debtor's business on a
going concern basis consisting of the Sale Assets and intellectual
property as described in Exhibit B to the Guarantee Agreement,
without any representations or warranties for the highest price to
be paid in cash.
A hearing on the Motion was held on Jan. 12, 2021, at 2:00 p.m.
The Trustee's Sales Agents, as defined in the Motion, will pay the
net proceeds from the sale of the UMB Collateral (and any
applicable payment with respect to the guarantee) directly to UMB
after submission of a payoff to the Trustee. UMB's lien on the UMB
Collateral will be released upon the payment in full of its secured
claim.
The Trustee is authorized to pay $40,000 of incurred sale expenses
from gross proceeds following allocation of the guaranteed amounts
for either auction of the Sale Assets or sale of the Debtor's
business on a going concern basis consisting of the Sale Assets and
intellectual property.
The 15% buyer's premium to be retained by the Sales Agents will be
added to the price of the Sales Assets and paid by the winning
bidder at auction or, if the Debtor's business is sold on a going
concern basis, added to the purchase price to be paid by the
purchaser. The buyer's premium is not included as part of the
gross sale proceeds.
For non-Wells Fargo Equipment, the Trustee is authorized to split
the gross sale proceeds that exceed the guaranteed minimums and
sale expenses with 75% for the bankruptcy estate and 25% for the
Sales Agents.
If the Wells Fargo Equipment is sold as part of an auction:
a. There will be a minimum opening bid for each piece of the
Wells Fargo Equipment of $30,000 ($60,000 total for both pieces);
b. Wells Fargo will receive the lesser of (i) $100,000 or (ii)
90% of the net proceeds (with the remaining 10% of net sale
proceeds going to the estate);
c. The portion of the capped expenses (not to exceed $40,000)
to be assessed, pro rata, against Wells Fargo's sale proceeds is
based on the proportion of the amount Wells Fargo will receive from
the auction as compared to the total proceeds of the auction; and
d. The Sales Agents can charge a 15% buyer's premium on the
Wells Fargo Equipment to the buyers, but no additional amounts will
be deducted from the amount Wells Fargo receives from sale proceeds
of the Wells Fargo Equipment.
If the Wells Fargo Equipment is sold as part of a going-concern
sale of the Debtors' business:
a. Wells Fargo will receive $100,000 from the sale of the
Wells Fargo Equipment;
b. The portion of the capped expenses (not to exceed $40,000)
to be assessed, pro rata, against Wells Fargo's sale proceeds is
based on the proportion of the amount Wells Fargo will receive from
the sale as compared to the total sale proceeds from the sale of
the business; and
c. The Sales Agents can charge a 15% buyer's premium on the
Wells Fargo Equipment to the buyers, but no additional amounts will
be deducted from the amount Wells Fargo receives from sale proceeds
of the Wells Fargo Equipment.
The Trustee's Sales Agents, as defined in the Motion, will pay the
net proceeds from the sale of the Wells Fargo Equipment directly to
Wells Fargo.
The auction and sale described is "as is, where is and with all
faults" and specifically the purchaser(s) will take the purchased
property without any warranty, representation or guaranty of any
kind or character, express or implied, oral or written, past,
present or future, with respect to the asset.
The transfer of the Sale Assets and the Debtor's business on a
going concern basis consisting of the Sale Assets and intellectual
property: (i) will be a valid, legal, binding, and effective
transfer; (ii) will vest the purchaser(s) with all right, title,
and interest of the Debtor and the estate in the Sale Assets and
intellectual property; and (iii) will be free and clear of all
Claims, with all such Claims to attach to the proceeds of the sale
transaction ultimately attributable to the Sale Assets and
intellectual property against or in which such Claims are asserted,
or other specifically dedicated funds held in the estate.
The 14-day stay imposed by Bankruptcy Rule 6004(h) is waived and
the Order is effective immediately.
About Owens Precision
Owens Precision, Inc. is a Carson City, Nev.-based CNC machining
shop that provides contract manufacturing services to the
aerospace, defense, semiconductor and process control industries.
Visit http://owensprecision.com/for more information.
Owens Precision filed a Chapter 11 petition (Bankr. D. Nev. Case
No. 19-51323) on Nov. 12, 2019. At the time of the filing, the
Debtor was estimated to have assets of $1 million to $10 million,
and liabilities of the same range. Judge Bruce T. Beesley
oversees
the case. The Verstandig Law Firm, LLC, is the Debtor's legal
counsel.
On Oct. 21, 2020, W. Donald Gieseke was appointed as trustee in
Debtor's Chapter 11 case. Holley Driggs serves as his legal
counsel.
PACKAGING COORDINATORS: Moody's Completes Review, Retains B3 CFR
----------------------------------------------------------------
Moody's Investors Service has completed a periodic review of the
ratings of Packaging Coordinators Midco, Inc. and other ratings
that are associated with the same analytical unit. The review was
conducted through a portfolio review discussion held on January 11,
2021 in which Moody's reassessed the appropriateness of the ratings
in the context of the relevant principal methodology(ies), recent
developments, and a comparison of the financial and operating
profile to similarly rated peers. The review did not involve a
rating committee. Since January 1, 2019, Moody's practice has been
to issue a press release following each periodic review to announce
its completion.
This publication does not announce a credit rating action and is
not an indication of whether or not a credit rating action is
likely in the near future. Credit ratings and outlook/review status
cannot be changed in a portfolio review and hence are not impacted
by this announcement.
Key rating considerations.
Packaging Coordinators Midco, Inc. 's B3 Corporate Family Rating
reflects its high pro forma financial leverage, and event and
financial policy risk due to private equity ownership. Moody's
expects the company to remain acquisitive which brings associated
integration risks. PCI is also exposed to risk of revenue losses
stemming from selective in-sourcing by customers. Nonetheless, PCI
benefits from its leading position among contract packaging
services companies, a relatively well diversified customer base,
and favorable industry tailwinds. The company's good liquidity
profile reflects Moody's expectation of break-even to modestly
positive free cash flow over the next 12 months, and a sizable
revolving credit facility.
The principal methodology used for this review was Business and
Consumer Service Industry published in October 2016.
PARADOX ENTERPRISES: Has Until Feb. 22 to File Amended Disclosures
------------------------------------------------------------------
Judge Nicholas W. Whittenburg of the U.S. Bankruptcy Court for the
Eastern District of Tennessee has granted debtor Paradox
Enterprises, LLC, an extension until Feb. 22, 2021, of its deadline
to file an Amended Disclosure Statement.
The Debtor filed a Disclosure Statement and Plan on Nov. 3, 2020.
Three parties in interest objected to the Disclosure Statement, the
U.S. Trustee, CTB, and Saleh Shelley. CTB asserts a claim secured
by the Debtor's real estate [Proof of Claim No. 2] while Saleh
Shelley is an insider who asserts an unsecured claim [Proof of
Claim No. 8, as amended]. A hearing on the disclosure statement
was held on Dec. 21, 2020. The Debtor agreed to work with the
objecting parties to resolve their objections and file an Amended
Disclosure Statement. On Dec. 21, 2020, the Court entered an order
withholding approval of the Disclosure Statement and ordering the
Debtor to file an Amended Disclosure Statement by Jan. 11, 2021.
In seeking an extension of the deadline to Feb. 22, 2021, the
Debtor said that since the hearing on the Disclosure Statement, the
Debtor has been able to negotiate an acceptable term sheet for DIP
financing in the original principal amount of $2.5 million.
Use of the DIP Financing will result in substantial amendments to
the Plan and Disclosure Statement. Therefore, the Debtor needs
additional time before filing an Amended Disclosure Statement to
allow (i) the Debtor and the DIP Lender to negotiate and produce a
complete set of DIP Loan documents; and (ii) to obtain approval of
the credit agreement pursuant to Fed. R. Bankr P. 4001(c); and,
(iii) to prepare an Amended Plan and Disclosure Statement.
A full-text copy of the order entered Jan. 12, 2021, is available
at: https://bit.ly/3nPYcZh
Counsel for the Debtor:
KIOUS, RODGERS, BARGER, HOLDER & KING, PLLC
Jason N. King
503 North Maple Street
Murfreesboro, Tennessee 37130
Tel: (615) 895-5566
Fax: (615) 895-8452
E-mail: jking@krbhk.com
About Paradox Enterprises
Paradox Enterprises, LLC, based in Manchester, Tennessee, filed a
Chapter 11 petition (Bankr. E.D. Tenn. Case No. 19-12162) on May
24, 2019. In the petition signed by Eric Shelley, owner, the
Debtor was estimated to have $1 million to $10 million in both
assets and liabilities. The Hon. Shelley D. Rucker oversees the
case. Jason N. King, Esq., at Kious Rodgers Barger Holder & King,
PLLC, serves as bankruptcy counsel.
PARAMOUNT INVESTING: Unsecureds to Recover 50% in Plan
------------------------------------------------------
Paramount Investing, LLC, filed with the U.S. Bankruptcy Court for
the District of New Jersey a Plan of Reorganization and a
Disclosure Statement on January 12, 2021.
The Plan will provide for the Debtor to reorganize by continuing to
own and manage its property located at 8 Catalpa Lane, Willingboro,
New Jersey 08046 in Burlington County, by continuing to refine and
improve its operating practices and procedures, or a combination
thereof along with contributions of new value from the Debtor's
principal and/or Debtor principal's parents, to assist in the
creation of the necessary monthly cash flow requirements to fund
the plan.
This is a plan of reorganization whereby the Debtor seeks to
accomplish payments under the Plan by positive cash flow from the
following sources of income: tenant rents from continuing to own
and manage Debtor's real property, by continuing to refine and
improve its operating practices and procedures, or a combination
thereof along with contributions of new value from Debtor's
principal and Debtor principal's parents, to assist in the creation
of the necessary monthly cash flow requirements to fund the plan.
Since the filing of its petition, the Debtor has paid all post
petition real estate taxes (except the amount set forth as due as a
post-petition administrative claim) and property expenses by
collecting rents from its tenant, the Debtor's managing member,
sufficient to pay its creditors. The income generated by continuing
to operate in this manner, supplemented by the contribution of new
value from the Debtor's principal and Debtor principal's parents
coupled with improved performance monitoring and realistic,
pragmatic goal setting, will enable the Debtor to fund a plan to
its creditors which will enable them to receive a greater dividend
than they would otherwise receive in a Chapter 7 liquidation.
The Plan proposes to pay allowed, secured claims and priority
claims in full plus a dividend of $3,000 to allowed, unsecured,
non-priority claims. It is projected that the Debtor will have an
average cash flow, after paying operating expenses, of
approximately $1,505 each month. That amount will fund the
proposed Plan payments of administrative fees, secured claims,
priority claims plus a dividend payment of $3,000, pro rata, to the
allowed unsecured, non-priority creditors. The final Plan payment
is expected to be paid by the end of the 50th month following the
Plan's Effective Date (on or about May, 2025).
Class 2 consists of general, allowed, unsecured claims totaling
$5,935 (asserted by T-Mobile USA Inc.). This class will receive
pro rata portion from the base plan totaling $3,000 dividend equal
to 50% paid monthly, beginning 49 and completed in month 50.
Interest holder Brandon C. Rothwell will retain his equity
interests.
The Plan Proponent contends that Debtor's financial projections are
feasible in light of the conservative projections of income for the
anticipated, prospective economic future. The Debtor's average
annual cash flow, after paying expenses and post confirmation
taxes, during the bankruptcy case will average $18,057.
A full-text copy of the disclosure statement dated Jan. 12, 2021,
is available at https://bit.ly/35LdCId from PacerMonitor.com at no
charge.
Attorney for Debtor:
Law Offices of Scott E. Kaplan, LLC.
5 S. Main Street, P.O. Box 157,
Allentown, New Jersey 08501
(609) 259-1112
About Paramount Investing
Paramount Investing, LLC was formed as a New Jersey limited
liability company by Brandon C. Rothwell. Paramount was formed for
the purpose of acquiring title to, owning and managing the property
located at 8 Catalpa Lane, Willingboro, New Jersey 08046.
The Debtor sought Chapter 11 protection (Bankr. D.N.J. Case No.
20-18204) on July 1, 2020, listing less than $1 million in both
assets and liabilities. Scott E. Kaplan, Esq., LAW OFFICES OF
SCOTT E. KAPLAN, LLC, is the Debtor's counsel.
PETVET CARE: Moody's Completes Review, Retains B3 CFR
-----------------------------------------------------
Moody's Investors Service has completed a periodic review of the
ratings of PetVet Care Centers, LLC and other ratings that are
associated with the same analytical unit. The review was conducted
through a portfolio review discussion held on January 11, 2021 in
which Moody's reassessed the appropriateness of the ratings in the
context of the relevant principal methodology(ies), recent
developments, and a comparison of the financial and operating
profile to similarly rated peers. The review did not involve a
rating committee. Since January 1, 2019, Moody's practice has been
to issue a press release following each periodic review to announce
its completion.
This publication does not announce a credit rating action and is
not an indication of whether or not a credit rating action is
likely in the near future. Credit ratings and outlook/review status
cannot be changed in a portfolio review and hence are not impacted
by this announcement.
Key rating considerations.
PetVet Care Centers' B3 Corporate Family Rating reflects its high
financial leverage, largely due to its aggressive financial policy
which focuses on debt-funded acquisitions. Additionally, Moody's
expects increased competition for acquisitions from other
veterinary hospital aggregators to drive up acquisition multiples.
PetVet's rating is supported by its broad geographic footprints,
favorable market trends in the pet services industry, and a proven
ability to smoothly consolidate independent veterinary practices.
The principal methodology used for this review was Business and
Consumer Service Industry published in October 2016.
PHOENIX GUARANTOR: Moody's Completes Review, Retains B2 CFR
-----------------------------------------------------------
Moody's Investors Service has completed a periodic review of the
ratings of Phoenix Guarantor Inc. and other ratings that are
associated with the same analytical unit. The review was conducted
through a portfolio review discussion held on January 11, 2021 in
which Moody's reassessed the appropriateness of the ratings in the
context of the relevant principal methodology(ies), recent
developments, and a comparison of the financial and operating
profile to similarly rated peers. The review did not involve a
rating committee. Since January 1, 2019, Moody's practice has been
to issue a press release following each periodic review to announce
its completion.
This publication does not announce a credit rating action and is
not an indication of whether or not a credit rating action is
likely in the near future. Credit ratings and outlook/review status
cannot be changed in a portfolio review and hence are not impacted
by this announcement.
Key rating considerations.
Phoenix Guarantor Inc.'s ("PGI") B2 CFR is constrained by high
financial leverage, and heavy reliance on government payors. The
credit profile also reflects Moody's view that the company will
continue to use its free cash flow for acquisitions. Recent
acquisitions have been transitioning smoothly, but still represent
ongoing risk due to IT integration. The Company's credit profile
benefits from a strong competitive position in the market, good
diversification across services and geographies, as well as growth
and cost opportunities as a result of recent mergers.
The principal methodology used for this review was Business and
Consumer Service Industry published in October 2016.
PIKE CORP: Moody's Rates New $730MM Term Loans 'Ba3'
----------------------------------------------------
Moody's Investors Service has assigned a Ba3 rating to Pike
Corporation's proposed $730 million term loans. The proceeds from
the term loans will be used to retire the company's existing $315
million term loan B, to pay off the $315 million of borrowings used
to fund Lindsay Goldberg's acquisition of a 51% ownership interest
in Pike Corporation in December 2020, and to add to its liquidity
position. Pike Corporation's B2 corporate family rating, B2-PD
probability of default rating, the Ba3 rating on its revolving
credit facility and existing term loan, the B3 rating on its senior
unsecured notes, and its stable ratings outlook remain unchanged.
The rating on the existing term loan will be withdrawn once the
refinancing is completed.
Assignments:
Issuer: Pike Corporation
Gtd. Senior Secured 1st Lien Term Loan B, Assigned Ba3 (LGD3)
Gtd. Senior Secured 1st Lien Delayed Draw Term Loan, Assigned Ba3
(LGD3)
Adjustments:
Issuer: Pike Corporation
LGD Gtd Senior Secured Bank Credit Facility, Adjusted to (LGD3)
from (LGD2)
RATINGS RATIONALE
Pike Corporation's B2 corporate family rating reflects its limited
geographic and end market diversity since it mostly provides
engineering, maintenance, repair, replacement and upgrade work for
electric utilities. It also incorporates its customer
concentration, moderate scale and the competitive nature of the
utility and telecommunications services sectors. Pike's credit
profile is supported by its moderate pro forma leverage and ample
interest coverage, favorable industry fundamentals as utilities
continue to focus on replacing aging infrastructure, modernizing
and expanding the electricity grid and outsourcing more engineering
and construction services to third parties. The company's master
service agreements also support relative revenue stability.
Pike's operating performance was strong in 2020 supported by
utilities spending on grid modernization and expansion, resiliency
initiatives, and repair and maintenance of aging infrastructure
including electric distribution and transmission lines. The
company's work was considered an essential service and there was
limited impact on the demand for its services despite the
coronavirus outbreak as its utility and telecom customers completed
their capital spending programs. The company also benefitted from
extensive storm related work due to an active storm season.
Pike's cash flows were also strong and aided by a sizeable advance
payment on a large transmission project. The company did pay a
shareholder dividend of $60 million in August 2020, but used the
majority of the proceeds from the advance payment along with its
free cash flow to pay down debt. As a result, its credit metrics
will be supportive of its B2 rating on a pro forma basis including
the $415 million of incremental term loan debt. Moody's anticipates
its leverage ratio (debt/EBITDA) will be in the range of 4.5x --
5.0x assuming its operating performance remains relatively stable
and its cash flows turn moderately negative next year. Moody's
anticipate the company may achieve growth in its core business but
assume storm related revenues will return to a more normalized
level, and expect its cash flows to be negative due to cash
outflows on the large transmission project and potential
acquisitions. The company is more likely to pursue debt funded
acquisitive growth after the acquisition of 51% of the company by
Lindsay Goldberg.
Pike is expected to maintain a good liquidity profile. It had a
minimal cash balance and $179 million of availability on its
revolver which had $2 million of borrowings and $22 million of
outstanding standby letters of credit as of September 27, 2020. The
revolver matures in two stages with $33.3 million expiring in March
2022 and the remaining $169.7 million expiring in August 2025.
The stable ratings outlook reflects Moody's expectation that Pike
will continue to benefit from favorable industry dynamics and good
customer relationships. It also assumes the company will maintain
credit metrics that are commensurate with its B2 corporate family
rating.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Pike's ratings could be upgraded if the company increases its scale
and geographic diversity and strengthens its cash generating
ability as evidenced by FFO/debt sustained above 17.5%, while
maintaining good margins and a leverage ratio (debt/EBITDA) below
4.0x.
A downgrade could occur if deteriorating operating results,
debt-financed acquisitions or shareholder distributions result in
the company's leverage ratio being sustained above 5.5x, or
FFO/debt sustained below 12.5%. A weakening of its liquidity
profile could also result in downward pressure.
Headquartered in Mount Airy, North Carolina, Pike Corporation
provides installation, repair and maintenance and storm restoration
services for investor-owned, municipal, and cooperative electric
utilities and telecommunications companies in the United States.
The company provides engineering and design services and constructs
and maintains substations, underground and overhead distribution
networks and transmission lines. Pike's revenue for the twelve
months ended September 27, 2020 was approximately $1.7 billion. The
company is privately owned by Eric Pike and a significant customer
with Eric having majority ownership and voting control. Lindsay
Goldberg has an agreement to acquire a 51% ownership interest from
Eric who will maintain ownership of about 19% of the company after
this transaction.
The principal methodology used in these ratings was Construction
Industry published in March 2017.
PROFESSIONAL FINANCIAL: Affiliates Tap Donlin as Claims Agent
-------------------------------------------------------------
Professional Investors Security Fund I and 28 other affiliates of
Professional Financial Investors Inc. seek approval from the U.S.
Bankruptcy Court for the Northern District of California to employ
Donlin, Recano & Company, Inc. as claims, noticing and solicitation
agent and administrative advisor.
Donlin will oversee the distribution of notices and will assist
in the maintenance, processing and docketing of proofs of claim
filed in the Debtors' Chapter 11 cases. The firm will also provide
bankruptcy administrative services.
The hourly rates of Donlin Recano's professionals are:
Senior Bankruptcy Consultant $165 - $185
Case Manager $140 - $160
Consultant/Analyst $110 - $140
Technology/Programming Consultant $80 - $100
Clerical $35 - $45
In addition, Donlin Recano will seek reimbursement for expenses.
Nellwyn Voorhies, the executive director at Donlin Recano,
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:
Nellwyn Voorhies
Donlin, Recano & Company, Inc.
6201 15th Avenue
Brooklyn, NY 11219
Telephone: (212) 481-1411
About Professional Financial Investors
Professional Financial Investors, Inc. and Professional Investors
Security Fund, Inc. are both engaged in activities related to real
estate.
On July 16, 2020, a group of creditors filed an involuntary Chapter
11 petition (Bankr. N.D. Cal. Case No. 20-30579) against
Professional Investors Security Fund. On July 26, 2020,
Professional Financial Investors sought Chapter 11 protection
(Bankr. N.D. Cal. Case No. 20-30604). On Nov. 20, 2020,
Professional Financial Investors filed involuntary Chapter 11
petitions against Professional Investors Security Fund I, A
California Limited Partnership and 28 other affiliates. The cases
are jointly administered under Case No. 20-30604.
At the time of the filing, Professional Financial Investors
disclosed assets of between $100 million and $500 million and
liabilities of the same range.
Judge Dennis Montali oversees the cases.
The Debtors tapped Sheppard, Mullin, Richter & Hampton, LLP, as
their legal counsel; Trodella & Lapping LLP as conflicts counsel;
Ragghianti Freitas LLP, Weinstein & Numbers LLP, Wilson Elser
Moskowitz Edelman & Dicker LLP, Nardell Chitsaz & Associates, and
Kimball Tirey & St. John, LLP as special counsel; and Donlin,
Recano & Company, Inc. as claims, noticing, and solicitation agent
and administrative advisor.
Michael Hogan of Armanino LLP was appointed as the Debtors' chief
restructuring officer. FTI Consulting, Inc. is the financial
advisor.
On Aug. 19, 2020, the Office of the U.S. Trustee appointed a
committee of unsecured creditors. The committee is represented by
Pachulski Stang Ziehl & Jones, LLP.
PROFESSIONAL FINANCIAL: Affiliates Tap Kimball as Special Counsel
-----------------------------------------------------------------
Professional Investors Security Fund I and 28 other affiliates of
Professional Financial Investors Inc. seek approval from the U.S.
Bankruptcy Court for the Northern District of California to employ
Kimball, Tirey & St. John, LLP as special counsel.
The firm will render these legal services:
(a) advise the Debtors on issues that concern their
residential real estate properties;
(b) represent the Debtors in disputes with tenants;
(c) represent the Debtors in proceedings or hearings before
the bankruptcy court that concern disputes over their residential
real estate properties; and
(d) take such other action and perform such other services as
the Debtors may require in connection with their residential real
estate properties.
The hourly rates of the firm's attorneys who are most likely to
render services in the Debtors' Chapter 11 cases are:
Dana R. Wares, Partner $295
Rob Keitamo, Trial Attorney $295
Laurie Li, Associate Attorney $295
In addition, the firm will seek reimbursement for out-of-pocket
expenses.
Dana Wares, Esq., a partner at Kimball Tirey, 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 following information is also provided in response to the
request for additional information set forth in Paragraph D.1. of
the Revised U.S. Trustee Guidelines:
Question: Did you agree to any variation from, or alternatives
to, your standard or customary billing arrangements for this
engagement?
Answer: No.
Question: Do any of the professionals included in this
engagement vary their rate based on the geographic location of a
bankruptcy case?
Answer: No.
Question: If you represented the client in the 12 months
prepetition, disclose your billing rates and material financial
terms for the prepetition engagement, including any adjustments
during the 12 months prepetition. If your billing rates and
material financial terms have changed post-petition, explain the
difference and the reasons for the difference.
Answer: Kimball Tirey did not represent any of the Debtors
prior to the commencement of their bankruptcy cases.
Question: Has your client approved your prospective budget and
staffing plan, and, if so, for what budget period?
Answer: Kimball Tirey is in the process of developing a
prospective budget and staffing plan for the Debtors' review and
approval. The firm understands that the Debtors, the unsecured
creditors' committee and the U.S. Trustee will maintain active
oversight of the firm's billing practices.
The firm can be reached through:
Dana R. Wares, Esq.
Kimball, tirey & St. John, LLP
2300 Clayton Road, Suite 1350
Concord, CA 94520
Telephone: (800) 525-1690
Facsimile: (800) 281-1911
About Professional Financial Investors
Professional Financial Investors, Inc. and Professional Investors
Security Fund, Inc. are both engaged in activities related to real
estate.
On July 16, 2020, a group of creditors filed an involuntary Chapter
11 petition (Bankr. N.D. Cal. Case No. 20-30579) against
Professional Investors Security Fund. On July 26, 2020,
Professional Financial Investors sought Chapter 11 protection
(Bankr. N.D. Cal. Case No. 20-30604). On Nov. 20, 2020,
Professional Financial Investors filed involuntary Chapter 11
petitions against Professional Investors Security Fund I, A
California Limited Partnership and 28 other affiliates. The cases
are jointly administered under Case No. 20-30604.
At the time of the filing, Professional Financial Investors
disclosed assets of between $100 million and $500 million and
liabilities of the same range.
Judge Dennis Montali oversees the cases.
The Debtors tapped Sheppard, Mullin, Richter & Hampton, LLP, as
their legal counsel; Trodella & Lapping LLP as conflicts counsel;
Ragghianti Freitas LLP, Weinstein & Numbers LLP, Wilson Elser
Moskowitz Edelman & Dicker LLP, Nardell Chitsaz & Associates, and
Kimball Tirey & St. John, LLP as special counsel; and Donlin,
Recano & Company, Inc. as claims, noticing, and solicitation agent
and administrative advisor.
Michael Hogan of Armanino LLP was appointed as the Debtors' chief
restructuring officer. FTI Consulting, Inc. is the financial
advisor.
On Aug. 19, 2020, the Office of the U.S. Trustee appointed a
committee of unsecured creditors. The committee is represented by
Pachulski Stang Ziehl & Jones, LLP.
PROFESSIONAL FINANCIAL: Affiliates Tap Nardell as Special Counsel
-----------------------------------------------------------------
Professional Investors Security Fund I and 28 other affiliates of
Professional Financial Investors Inc. seek approval from the U.S.
Bankruptcy Court for the Northern District of California to employ
Nardell Chitsaz & Associates as special counsel.
The firm will render these legal services:
(a) advise the Debtors on issues that concern their commercial
real estate properties;
(b) represent the Debtors in disputes with tenants;
(c) represent the Debtors in disputes with other third parties
concerning their properties;
(d) represent the Debtors in proceedings or hearings before
the bankruptcy court that concern disputes over commercial real
estate properties; and
(e) perform such other services as the Debtors may require in
connection with their commercial real estate properties.
The hourly rates of the firm's attorneys who are most likely to
render services are:
J. Timothy Nardell, Partner $450
Houman Chitsaz, Partner $425
Aaron Davis, Of Counsel $350
In addition, the firm will seek reimbursement for its expenses.
J. Timothy Nardell, Esq., a partner at Nardell Chitsaz, 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 following information is also provided in response to the
request for additional information set forth in Paragraph D.1. of
the Revised U.S. Trustee Guidelines:
Question: Did you agree to any variation from, or alternatives
to, your standard or customary billing arrangements for this
engagement?
Answer: No.
Question: Do any of the professionals included in this
engagement vary their rate based on the geographic location of a
bankruptcy case?
Answer: No.
Question: If you represented the client in the 12 months
prepetition, disclose your billing rates and material financial
terms for the prepetition engagement, including any adjustments
during the 12 months prepetition. If your billing rates and
material financial terms have changed post-petition, explain the
difference and the reasons for the difference.
Answer: Nardell Chitsaz represented debtors Professional
Investors 23 LLC, Professional Investors 26 LLC, Professional
Investors 34 LLC, Professional Investors 37 LLC, and non-debtors
Professional Investors 39, LLC, Professional Investors 42, LLC,
Professional Investors 47, LLC, and Professional Investors 49, LLC
on matters prior to the commencement of the bankruptcy cases.
Question: Has your client approved your prospective budget and
staffing plan, and, if so, for what budget period?
Answer: Nardell Chitsaz is in the process of developing a
prospective budget and staffing plan for the Debtors' review and
approval. The firm understands that the Debtors, the unsecured
creditors' committee and the U.S. Trustee will maintain active
oversight of the firm's billing practices.
The firm can be reached through:
J. Timothy Nardell, Esq.
Nardell Chitsaz & Associates LLP
999 Fifth Avenue, Suite 230
San Rafael, CA 94901
Telephone: (415) 306-5560
Facsimile: (415) 455-9482
Email: tim@ncalegal.com
About Professional Financial Investors
Professional Financial Investors, Inc. and Professional Investors
Security Fund, Inc. are both engaged in activities related to real
estate.
On July 16, 2020, a group of creditors filed an involuntary Chapter
11 petition (Bankr. N.D. Cal. Case No. 20-30579) against
Professional Investors Security Fund. On July 26, 2020,
Professional Financial Investors sought Chapter 11 protection
(Bankr. N.D. Cal. Case No. 20-30604). On Nov. 20, 2020,
Professional Financial Investors filed involuntary Chapter 11
petitions against Professional Investors Security Fund I, A
California Limited Partnership and 28 other affiliates. The cases
are jointly administered under Case No. 20-30604.
At the time of the filing, Professional Financial Investors
disclosed assets of between $100 million and $500 million and
liabilities of the same range.
Judge Dennis Montali oversees the cases.
The Debtors tapped Sheppard, Mullin, Richter & Hampton, LLP, as
their legal counsel; Trodella & Lapping LLP as conflicts counsel;
Ragghianti Freitas LLP, Weinstein & Numbers LLP, Wilson Elser
Moskowitz Edelman & Dicker LLP, Nardell Chitsaz & Associates, and
Kimball Tirey & St. John, LLP as special counsel; and Donlin,
Recano & Company, Inc. as claims, noticing, and solicitation agent
and administrative advisor.
Michael Hogan of Armanino LLP was appointed as the Debtors' chief
restructuring officer. FTI Consulting, Inc. is the financial
advisor.
On Aug. 19, 2020, the Office of the U.S. Trustee appointed a
committee of unsecured creditors. The committee is represented by
Pachulski Stang Ziehl & Jones, LLP.
PROFESSIONAL FINANCIAL: Affiliates Tap Sheppard Mullin as Counsel
-----------------------------------------------------------------
Professional Investors Security Fund I and 28 other affiliates of
Professional Financial Investors Inc. seek approval from the U.S.
Bankruptcy Court for the Northern District of California to employ
Sheppard, Mullin, Richter & Hampton LLP as their bankruptcy
counsel.
The firm will render these legal services:
(a) Advise and assist the Debtors with respect to compliance
with the requirements of the United States Trustee;
(b) Advise the Debtors regarding matters of bankruptcy law;
(c) Prepare pleadings in connection with the Debtors' Chapter
11 cases;
(d) Represent the Debtors in any proceedings or hearings
before the bankruptcy court;
(e) Take all necessary actions to protect and preserve the
Debtors' estates;
(f) Attend meetings and negotiate with the representatives of
creditors and other parties-in-interest;
(g) Conduct examinations of witnesses, claimants or adverse
parties and prepare reports, accounts and pleadings;
(h) Assist the Debtors in the formulation and implementation
of a Chapter 11 plan and any auction or sale of their assets;
(i) Make any court appearances; and
(j) perform such other services as the Debtors may require in
their cases.
The hourly rates of the firm's attorneys which have been discounted
by 10 percent are as follows:
Ori Katz, Partner $1,060
J. Barrett Marum, Partner $880
Matt Klinger, Associate $745
Gianna Segretti, Associate $605
In addition, the firm will seek reimbursement for expenses.
Ori Katz, Esq., a partner at Sheppard Mullin, 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:
Ori Katz, Esq.
J. Barrett Marum, Esq.
Matt Klinger, Esq.
Gianna Segretti, Esq.
Sheppard, Mullin, Richter & Hampton LLP
Four Embarcadero Center, 17th Floor
San Francisco, CA 94111-4109
Telephone: (415) 434-9100
Facsimile: (415) 434-3947
Email: okatz@sheppardmullin.com
bmarum@sheppardmullin.com
mklinger@sheppardmullin.com
gsegretti@sheppardmullin.com
About Professional Financial Investors
Professional Financial Investors, Inc. and Professional Investors
Security Fund, Inc. are both engaged in activities related to real
estate.
On July 16, 2020, a group of creditors filed an involuntary Chapter
11 petition (Bankr. N.D. Cal. Case No. 20-30579) against
Professional Investors Security Fund. On July 26, 2020,
Professional Financial Investors sought Chapter 11 protection
(Bankr. N.D. Cal. Case No. 20-30604). On Nov. 20, 2020,
Professional Financial Investors filed involuntary Chapter 11
petitions against Professional Investors Security Fund I, A
California Limited Partnership and 28 other affiliates. The cases
are jointly administered under Case No. 20-30604.
At the time of the filing, Professional Financial Investors
disclosed assets of between $100 million and $500 million and
liabilities of the same range.
Judge Dennis Montali oversees the cases.
The Debtors tapped Sheppard, Mullin, Richter & Hampton, LLP, as
their legal counsel; Trodella & Lapping LLP as conflicts counsel;
Ragghianti Freitas LLP, Weinstein & Numbers LLP, Wilson Elser
Moskowitz Edelman & Dicker LLP, Nardell Chitsaz & Associates, and
Kimball Tirey & St. John, LLP as special counsel; and Donlin,
Recano & Company, Inc. as claims, noticing, and solicitation agent
and administrative advisor.
Michael Hogan of Armanino LLP was appointed as the Debtors' chief
restructuring officer. FTI Consulting, Inc. is the financial
advisor.
On Aug. 19, 2020, the Office of the U.S. Trustee appointed a
committee of unsecured creditors. The committee is represented by
Pachulski Stang Ziehl & Jones, LLP.
PROFESSIONAL FINANCIAL: Affiliates Tap Trodella as Legal Counsel
----------------------------------------------------------------
Professional Investors Security Fund I and 28 other affiliates of
Professional Financial Investors Inc. seek approval from the U.S.
Bankruptcy Court for the Northern District of California to employ
Trodella & Lapping LLP as conflicts counsel.
Trodella & Lapping will render these legal services:
(i) handle matters in the bankruptcy cases for the Debtors
that (a) involve JPMorgan Chase Bank, Tri Counties, Bank, Opus
Bank, First Foundation Bank, Poppy Bank or Heritage Bank of
Commerce, and (b) any other party with which Sheppard, Mullin
Richter & Hampton LLP, the Debtors' primary restructuring counsel,
may have a conflict of interest in connection with its
representation of the Debtors; and
(ii) perform such other discrete and non-duplicative duties
that may be identified by the Debtors or Sheppard from time to time
during the bankruptcy cases.
Richard Lapping, Esq., the primary attorney designated to represent
the Debtors, charged an hourly fee of $550 for services provided to
the Debtors before Jan. 1. He will be paid at the rate of $605 per
hour starting Jan. 1.
In addition, the firm will seek reimbursement for expenses.
Mr. Lapping disclosed in court filings that Trodella & Lapping is a
"disinterested person" as that term is defined in Section 101(14)
of the Bankruptcy Code.
The following information is also provided in response to the
request for additional information set forth in Paragraph D.1. of
the Revised U.S. Trustee Guidelines:
Question: Did you agree to any variation from, or alternatives
to, your standard or customary billing arrangements for this
engagement?
Answer: No.
Question: Do any of the professionals included in this
engagement vary their rate based on the geographic location of a
bankruptcy case?
Answer: No.
Question: If you represented the client in the 12 months
prepetition, disclose your billing rates and material financial
terms for the prepetition engagement, including any adjustments
during the 12 months prepetition. If your billing rates and
material financial terms have changed post-petition, explain the
difference and the reasons for the difference.
Answer: Trodella & Lapping did not represent the Debtors prior
to the commencement of the Bankruptcy Cases.
Question: Has your client approved your prospective budget and
staffing plan, and, if so, for what budget period?
Answer: Trodella & Lapping is in the process of developing a
prospective budget and staffing plan for the Debtors' review and
approval. The firmunderstands that the Debtors, the committee, and
the U.S. Trustee, will maintain active oversight of the firm's
billing practices.
The firm can be reached through:
Richard A. Lapping, Esq.
Trodella & Lapping LLP
540 Pacific Avenue
San Francisco, CA 94133
Telephone: (415) 200-9407
Email: Rich@TrodellaLapping.com
About Professional Financial Investors
Professional Financial Investors, Inc. and Professional Investors
Security Fund, Inc. are both engaged in activities related to real
estate.
On July 16, 2020, a group of creditors filed an involuntary Chapter
11 petition (Bankr. N.D. Cal. Case No. 20-30579) against
Professional Investors Security Fund. On July 26, 2020,
Professional Financial Investors sought Chapter 11 protection
(Bankr. N.D. Cal. Case No. 20-30604). On Nov. 20, 2020,
Professional Financial Investors filed involuntary Chapter 11
petitions against Professional Investors Security Fund I, A
California Limited Partnership and 28 other affiliates. The cases
are jointly administered under Case No. 20-30604.
At the time of the filing, Professional Financial Investors
disclosed assets of between $100 million and $500 million and
liabilities of the same range.
Judge Dennis Montali oversees the cases.
The Debtors tapped Sheppard, Mullin, Richter & Hampton, LLP, as
their legal counsel; Trodella & Lapping LLP as conflicts counsel;
Ragghianti Freitas LLP, Weinstein & Numbers LLP, Wilson Elser
Moskowitz Edelman & Dicker LLP, Nardell Chitsaz & Associates, and
Kimball Tirey & St. John, LLP as special counsel; and Donlin,
Recano & Company, Inc. as claims, noticing, and solicitation agent
and administrative advisor.
Michael Hogan of Armanino LLP was appointed as the Debtors' chief
restructuring officer. FTI Consulting, Inc. is the financial
advisor.
On Aug. 19, 2020, the Office of the U.S. Trustee appointed a
committee of unsecured creditors. The committee is represented by
Pachulski Stang Ziehl & Jones, LLP.
PUERTO RICO ELECTRIC: Union Loses Benefits Appeal in 1st Circuit
----------------------------------------------------------------
Daniel Gill of Bloomberg Law reports that Union de Trabajadores de
la Industria Electrica y Riego, the representing employees of the
Puerto Rico Electric Power Authority, lost its bid to overturn a
federal court order dismissing its lawsuit against the board
overseeing Puerto Rico's financial rehabilitation over health-care
costs.
The Union de Trabajadores de la Industria Electrica y Riego didn't
show that its members had no other remedy than to seek a writ of
mandamus forcing PREPA to change its requirements for employee
health-care benefits contributions, the U.S. Court of Appeals for
the First Circuit ruled Friday, January 15, 2021.
"UTIER challenges the Title III court's conclusion that it failed
to meet its burden of showing there are no adequate alternative
remedies which would allow its use of mandamus. None of the
arguments advanced on appeal have merit," the U.S. Court of Appeals
for the First Circuit said in its opinion.
"The Title III court correctly dismissed the petition for writ of
mandamus because UTIER did not demonstrate that there was no
adequate alternative remedy available for its members to recover
from PREPA," the Appeals Court concluded.
A copy of the Opinion is available at:
http://media.ca1.uscourts.gov/pdf.opinions/20-1332P-01A.pdf
About Puerto Rico
Puerto Rico is a self-governing commonwealth in association with
the United States that's facing a massive bond debt of $70 billion,
a 68% debt-to-GDP ratio and negative economic growth in nine of the
last 10 years.
The Commonwealth of Puerto Rico has sought bankruptcy protection,
aiming to restructure its massive $74 billion debt-load and $49
billion in pension obligations.
The debt restructuring petition was filed by Puerto Rico's
financial oversight board in U.S. District Court in Puerto Rico
(Case No. 17-01578) on May 3, 2017, and was made under Title III of
2016's U.S. Congressional rescue law known as the Puerto Rico
Oversight, Management, and Economic Stability Act ('PROMESA').
The Financial Oversight and Management Board later commenced Title
III cases for the Puerto Rico Sales Tax Financing Corporation
(COFINA) on May 5, 2017, and the Employees Retirement System (ERS)
and the Puerto Rico Highways and Transportation Authority (HTA) on
May 21, 2017. On July 2, 2017, a Title III case was commenced for
the Puerto Rico Electric Power Authority ("PREPA").
U.S. Chief Justice John Roberts has appointed U.S. District Judge
Laura Taylor Swain to oversee the Title III cases. The Honorable
Judith Dein, a United States Magistrate Judge for the District of
Massachusetts, has been designated to preside over matters that may
be referred to her by Judge Swain, including discovery disputes,
and management of other pretrial proceedings.
Joint administration of the Title III cases, under Lead Case No.
17-3283, was granted on June 29, 2017.
The Oversight Board has hired as advisors, Proskauer Rose LLP and
O'Neill & Borges LLC as legal counsel, McKinsey & Co. as strategic
consultant, Citigroup Global Markets, as municipal investment
banker, and Ernst & Young, as financial advisor.
Martin J. Bienenstock, Esq., Scott K. Rutsky, Esq., and Philip M.
Abelson, Esq., of Proskauer Rose; and Hermann D. Bauer, Esq., at
O'Neill & Borges are on-board as attorneys.
McKinsey & Co. is the Board's strategic consultant, Ernst & Young
is the Board's financial advisor, and Citigroup Global Markets Inc.
is the Board's municipal investment banker.
Prime Clerk LLC is the claims and noticing agent. Prime Clerk
maintains a case web site at
https://cases.primeclerk.com/puertorico
Epiq Bankruptcy Solutions LLC is the service agent for ERS, HTA,
and PREPA.
O'Melveny & Myers LLP is counsel to the Commonwealth's Puerto Rico
Fiscal Agency and Financial Advisory Authority (AAFAF), the agency
responsible for negotiations with bondholders.
The Oversight Board named Professor Nancy B. Rapoport as fee
examiner and to chair a committee to review professionals' fees.
QUALITY PERFORATING: U.S. Trustee Unable to Appoint Committee
-------------------------------------------------------------
The U.S. Trustee for Region 3 disclosed in a court filing that no
official committee of unsecured creditors has been appointed in the
Chapter 11 case of Quality Perforating Inc.
About Quality Perforating
Quality Perforating, Inc., a manufacturer of perforated sheets,
coils and component parts, sought Chapter 11 protection (Bankr.
M.D. Pa. Case No. 20-03561) on Dec. 16, 2020. At the time of the
filing, the Debtor disclosed total assets of $3,608,042 and total
debt of $9,820,041.
Judge Robert N. Opel II oversees the case. The Debtor tapped Mark
J. Conway, Esq., at the Law Offices of Mark J. Conway, P.C., as its
counsel.
QUINCY STREET: Hires Miles & Stockbridge as Special Counsel
-----------------------------------------------------------
Quincy Street Townhomes I LLC has filed an amended application with
the U.S. Bankruptcy Court for the District of Columbia seeking
approval to hire Miles & Stockbridge P.C., as special litigation
counsel.
The Debtor owns an interest in certain real property known as 431
Quincy Street, NW, in the District of Columbia (the "Real
Property"). Unfortunately, there may be a cloud on Debtor's title
to the Real Property. Specifically, the Real Property was
previously owned by Carrie B. Tucker and Earl Roberson, Jr. Carrie
B. Tucker passed away in 2009 and thereafter Earl Roberson, Jr.
conveyed the Real Property to 431 Quincy Street, LLC, which on June
28, 2017, conveyed its interest in the Real Property to the Debtor.
There is a potential issue as to whether Mr. Robinson's Interest
in the Real Property included a right of survivorship, and
therefore, there is an issue regarding whether the estate of Carrie
B. Tucker has an interest in the Real Property (the "Title
Issue").
On Sept. 15, 2020, the Debtor filed a title claim with Fidelity
National Title Insurance Company ("Fidelity"), reflecting the Title
Issue. On Oct. 18, 2020, ACF Holding DE LLC, the Debtor's largest
secured and unsecured creditor, filed a proposed Chapter 11 plan
(the "Proposed Plan"), providing for the sale of the Real Property
free and clear of all liens, claims and encumbrances, and
resolution of the Title Issue as against the sale proceeds.
Quincy Street requires Miles & Stockbridge to assist the Debtor in
relation to the sale of the Real Property in the Chapter 11
bankruptcy proceedings.
Quincy Street will be paid at these hourly rates:
Principals $400 to $975
Intellectual Property $200 to $785
Special Tax Counsel $585 to $975
Associate $265 to $495
Staff Attorney/Of Counsel $295 to $875
Paralegal $190 to $385
Law Clerks & Law Graduates $190 to $340
Quincy Street will also be reimbursed for reasonable out-of-pocket
expenses incurred.
To the best of the Debtor's knowledge the firm is a "disinterested
person" as the term is defined in Section 101(14) of the Bankruptcy
Code and does not represent any interest adverse to the Debtor and
its estates.
Quincy Street can be reached at:
Miles & Stockbridge P.C.
1201 Pennsylvania Ave., NW, Suite 900
Washington, DC 20004
Tel: (202) 737-9600
About Quincy Street Townhomes
Washington, DC-based Quincy Street Townhomes I, LLC, is engaged in
activities related to real estate. It owns an interest in certain
real property known as 431 Quincy Street, NW, in the District of
Columbia.
Quincy Street Townhomes I and its affiliates, Quincy Street
Townhomes II, LLC and Potomac Construction Flats, LLC, sought
protection under Chapter 11 of the Bankruptcy Code (Bankr. D.D.C.
Case No. 19-00826) on Dec. 16, 2019. At the time of the filing,
Quincy Street Townhomes I disclosed assets of between $1 million
and $10 million and liabilities of the same range. Judge Martin S.
Teel, Jr. oversees the cases. Whiteford, Taylor & Preston L.L.P.
is the Debtors' legal counsel.
RADIOLOGY PARTNERS: Moody's Completes Review, Retains Caa1 CFR
--------------------------------------------------------------
Moody's Investors Service has completed a periodic review of the
ratings of Radiology Partners, Inc. and other ratings that are
associated with the same analytical unit. The review was conducted
through a portfolio review discussion held on January 11, 2021 in
which Moody's reassessed the appropriateness of the ratings in the
context of the relevant principal methodology(ies), recent
developments, and a comparison of the financial and operating
profile to similarly rated peers. The review did not involve a
rating committee. Since January 1, 2019, Moody's practice has been
to issue a press release following each periodic review to announce
its completion.
This publication does not announce a credit rating action and is
not an indication of whether or not a credit rating action is
likely in the near future. Credit ratings and outlook/review status
cannot be changed in a portfolio review and hence are not impacted
by this announcement.
Key rating considerations.
Radiology Partners' Caa1 Corporate Family Rating reflects its very
high financial leverage and significant execution risk associated
with integrating MEDNAX Radiology Solutions. The company has
increased its revenue by around 10-fold over the last five years
through acquisitions. The company will further increase its revenue
by up to ~40% with the MEDNAX Radiology Solutions acquisition. The
company's ratings benefit from an industry with stable business
prospects and favorable payor mix. The company also benefits from
its dominant position as the largest player in a highly fragmented
industry.
The principal methodology used for this review was Business and
Consumer Service Industry published in October 2016.
RFA FRONTINO: Seeks to Hire Meltzer Lippe as Bankruptcy Counsel
---------------------------------------------------------------
RFA Frontino, LLC seeks approval from the U.S. Bankruptcy Court for
the Eastern District of New York to employ Meltzer, Lippe,
Goldstein & Breitstone, LLP as its legal counsel.
The firm will render these legal services:
(a) advise the Debtor regarding its powers and duties;
(b) prepare legal documents;
(c) assist the Debtor in the development and implementation of
a plan of reorganization; and
(d) perform all other legal services for the Debtor that may
be necessary in connection with its Chapter 11 case.
Prior to the petition date, the firm received a retainer in the
amount of $25,000 from the Debtor.
Scott Steinberg, Esq., a partner at Meltzer Lippe, 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:
Scott A. Steinberg, Esq.
Meltzer, Lippe, Goldstein & Breitstone, LLP
190 Willis Avenue
Mineola, NY 11501
Telephone: (516) 747-0300
Email: ssteinberg@meltzerlippe.com
About RFA Frontino
RFA Frontino LLC -- https://rfafrontino.com/ -- provides
pre-construction, construction management and general contracting
services for various buildings in the New York City area.
RFA Frontino filed a voluntary petition for relief under Chapter 11
of the Bankruptcy Code (Bankr. E.D.N.Y. Case No. 20-73676) on Dec.
23, 2020. Anthony Frontino, vice president, signed the petition.
At the time of the filing, the Debtor disclosed total assets of
$5,454,152 and total liabilities of $2,508,159.
Meltzer, Lippe, Goldstein & Breitstone, LLP serves as the Debtor's
legal counsel.
RGV SMILES: State of Texas Suit Exempted From Automatic Stay
------------------------------------------------------------
In the case captioned IN RE: RGV SMILES BY ROCKY L. SALINAS D.D.S.
P.A., et al. ROCKY LAMAR SALINAS, D.D.S.; dba RGV SMILES BY ROCKY
L. SALINAS D.D.S. P.A.; aka COMPASSIONATE HEALTHCARE SERVICES,
Chapter 11, Debtors, Case Nos. 20-70209, 20-70210, Jointly
Administered Order (Bankr. S.D. Tex.), Judge Eduardo V. Rodriguez
of the United States Bankruptcy Court for the Southern District of
Texas, McAllen Division granted in part the expedited motion filed
by the State of Texas to determine the non-applicability of the
automatic stay pursuant to 11 U.S.C. Section 362(b)(4).
In 2014, the State of Texas commenced an action under the Texas
Medicaid Fraud Prevention Act (TMFPA) pursuant to Texas Human
Resources Code Sections 36.001-.132, styled State of Texas v. Dr.
Behzad Nazari, D.D.S. d/b/a Antoine Dental Center, et al., Cause
No. D-1-GN-14-005380, in the District Court of Travis County,
Texas, 53rd Judicial District. Both RGV Smiles by Rocky L.
Salinas, D.D.S. P.A. and Rocky Lamar Salinas were named defendants
in the action.
On June 30, 2020, both RGV Smiles and Dr. Salinas filed their
initial petitions and schedules under Chapter 11, Title 11 of the
United States Code. On July 20, 2020, the bankruptcy court entered
its order granting joint administration of the two bankruptcy
proceedings.
On October 13, 2020, the State of Texas filed an expedited motion
to determine nonapplicability of the automatic stay pursuant to 11
U.S.C. Section 362(b)(4).
In its Motion to Determine, the State of Texas asks the bankruptcy
court to enter an order confirming that:
(1) the State Court Action is excepted from the automatic stay
pursuant to 11 U.S.C. Section 362(b)(4); and
(2) the State of Texas is authorized to continue the prosecution of
the State Court Action in all respects.
The State of Texas acknowledged that "the provisions of Bankruptcy
Code section 362(a) generally operate as a stay of, among other
things, the commencement or continuation of an action or proceeding
against a debtor to recover a claim that arose prior to
bankruptcy." However, it argued, "the TMFPA action brought by the
State is an enforcement action, and thus the police and regulatory
exception found in 11 U.S.C. Section 362(b)(4) applies to except
the State Court Action from the automatic stay, which allows a
state trial court to hear a police or regulatory matter pending
before it."
Judge Rodriguez explained that for Section 362(b)(4) to apply, the
Court must determine that the entity invoking the exception is a
governmental unit pursuant to Section 101(27). If it is, then the
Court must find that the entity is seeking to enforce its police or
regulatory power. Since it is undisputed that the State of Texas
is a governmental unit, the judge stated that the Court must
determine whether the state court action is an act by the State of
Texas to enforce its police or regulartory power. This entailed
the application of two separate, but related tests: the pecuniary
interest test and the public policy test.
Applying the pecuniary interest test, Judge Rodriguez found that
the State of Texas is not acting in its pecuniary interest in
pursuing the state court action. The judge stated that "The Texas
Medicaid Fraud Prevention Act is what the title implies, an act to
prevent fraud. Fraud prevention is explicitly mentioned in the
legislative history of Section 362(b)(4), along with 'attempting to
fix damages for violation of such law.'"
As for the public policy test, Judge Rodriguez found that the state
court action is intended to effectuate a public policy -–
ensuring the integrity of the Texas Medicaid Program by preventing
fraud so the State can ensure financially vulnerable residents have
access to essential health care services -- not adjudicating
private rights.
Thus, Judge Rodriguez found that the state court action is excepted
from the automatic stay pursuant to Section 362(b)(4).
The State of Texas has also filed a proof of claim in the debtors'
underlying bankruptcy case in the amount of $15,000,000. The
debtors filed an objection to that proof of claim and argued in
their objection that by filing such a claim and an adversary
proceeding related to that claim, the State has participated in
debtors' bankruptcy case, thereby "recogniz[ing] that this Court is
a proper venue to decide [the issues pled in the State Court
Action] as they relate to the Debtors' bankruptcy cases."
However, Judge Rodriguez held that since it has already been
determined that the police and regulatory exception to the
automatic stay applies, the state court action, as it pertains to
the debtors, is not removable to the bankruptcy court under Section
1452(a) despite any consent to the bankruptcy court's
jurisdiction.
The debtors also urged the bankruptcy court to enjoin the State
from pursuing the state court action pursuant to 11 U.S.C. Section
105, in the event the bankrtupcy court finds it appropriate to lift
the automatic stay.
Denying the debtors' request, Judge Rodriguez held that Federal
Rule of Bankruptcy Procedure Rule 7001(7) is controlling and
requires the filing of an adversary proceeding for the bankrtuptcy
court to consider injunctive relief.
The State of Texas' Expedited Motion to Determine Nonapplicability
of the Automatic Stay Pursuant to 11 U.S.C. Section 362(b)(4) was
therefore granted in part. Judge Rodriguez concluded that the
claims and causes of action brought by the State of Texas in the
state court action are excepted from the automatic stay as to RGV
Smiles and Dr. Salinas pursuant to 11 U.S.C. Section 362(b)(4).
The judge also held that the State of Texas is authorized to take
all actions necessary to prosecute and liquidate its claims and
causes of action in the state court action. However, Judge
Rodriguez stated that, pursuant to 11 U.S.C. Section 362(a), the
State of Texas is precluded from taking any action to collect any
judgment entered in the state court action against RGV Smiles and
Dr. Salinas outside of the above-styled and numbered Chapter 11
bankruptcy case, unless such Chapter 11 case is closed or
dismissed. Lastly, the judge clarified that the automatic stay
under 11 U.S.C. Section 362(a) does not apply to any non-debtor
defendants in the state court action.
A full-text copy of Judge Rodriguez's memorandum opinion, dated
January 6, 2021, is available at https://tinyurl.com/y5ugwvku from
Leagle.com.
About RGV Smiles by Rocky L. Salinas
RGV Smiles by Rocky L. Salinas D.D.S. P.A., a dental services
provider in Pharr, Texas, sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. S.D. Tex. Case No. 20-70209) on June
30,2020. The petition was signed by Rocky L. Salinas DDS, its
director. At the time of the filing, the Debtor estimated assets
of $100,000 to $500,000 and liabilities of $10 million to $50
million. The Hon. Eduardo V. Rodriguez oversees the case. Joyce
W. Lindauer Attorney, PLLC is the Debtor's counsel.
ROCKIES EXPRESS: Fitch Lowers LongTerm IDR to 'BB+'
---------------------------------------------------
Fitch Ratings has downgraded Rockies Express Pipeline LLC's
(ROCKIE) Long-Term Issuer Default Rating (IDR) and senior unsecured
rating to 'BB+' from 'BBB-'and to 'BB+'/'RR4' from 'BBB-',
respectively. Fitch has placed ROCKIE on Rating Watch Negative.
The Downgrade of the IDR to 'BB+' from 'BBB-' reflects two factors,
shipper credit quality and re-contracting risk. In full, the
Downgrade first reflects shipper bankruptcies and the drop in
weighted average (WA) shipper credit quality of ROCKIE's shippers
with decade-plus contracts to 'B+'; and, secondly, ROCKIE's status
as a pipeline company that is expected to be frequently challenged
to re-market capacity that will have just came off contract.
ROCKIE benefits from long-term take-or-pay contracts to ship a
commodity necessary to fuel existing residential furnaces and power
the machines that fabricate a host of basic goods. Further, the
natural gas that ROCKIE ships is a product that underpins the U.S.
electric power sector historic move to reduce carbon emissions
while maintaining its virtual continualness of service. ROCKIE's
customer base and related contracts for the period 2017-2019
delivered for ROCKIE leverage that made ROCKIE strongly positioned
in its 'BBB-'-rating category.
However, by 2022 Fitch expects ROCKIE's leverage to be weakly
positioned for a 'BBB-' rating, and by 2024 Fitch expects the
company to have leverage commensurate with a 'BB+' rating, and,
specifically, higher than the leverage level of 4.5x that Fitch had
previously stated that an exceedance might be cause for a
Downgrade.
The Negative Watch relates to the bankruptcy of ROCKIE's fifth
largest customer (by total expected revenue), Gulfport Energy
Corporation (GPOR). Based on Fitch's analysis of current
fundamentals in the main pathways on which western Appalachia basin
natural gas is moved, Fitch expects the resolution of GPOR
bankruptcy to be material, but not very significant, to ROCKIE.
Fitch bases this measured view on both utilization and spot basis
differentials. ROCKIE's eastbound service, both before and after
the GPOR bankruptcy, has exhibited a very high utilization rate,
which is critically important to credit. Fitch has also reviewed
multiple spot basis differentials relating to ROCKIE and competing
pipelines serving the Appalachia basin.
Based on the review of these factors, Fitch forecasts that that
ROCKIE will not suffer a virtually complete loss of the revenues
that GPOR represented to ROCKIE in 2019. This judgement
notwithstanding, Fitch has placed the 'BB+' rating on Negative
Watch due to the possibility that the GPOR-ROCKIE outcome may be
more adverse than Fitch expects. From time to time, conditions in
the natural gas transportation market transition to significantly
different equilibrium prices. Moreover, bankruptcy processes are
highly complicated, including the GPOR bankruptcy. In the relevant
proceeding Fitch views that GPOR and its multiple pipeline service
providers, some of which are much larger and stronger companies
than ROCKIE, may bring into the fore decisive factors. Such factors
are hard to forecast.
Fitch's projection of the range of outcomes from the GPOR
bankruptcy provide the basis for further forecasting that if a
Downgrade occurs upon the conclusion of the review, that the
Downgrade will be limited to one notch.
KEY RATING DRIVERS
Appalachia Basin Production is Vulnerable: ROCKIE has very
long-term contracts for almost all capacity for its Westward
flowing service. In the long-term, given ROCKIE has only a small
degree of integration with local distribution company utilities,
ROCKIE will be significantly impacted by production volumes in
Appalachia basin. After rising in both 2018 and 2019, Utica
formation companies had flat production over the course of 2020.
The Marcellus production showed growth in 2020, but less than in
the previous two years. As ROCKIE approaches certain important
dates in the next three to five years (contracts across the ROCKIE
system ending, and ROCKIE's refinancings), ROCKIE may be downgraded
in that time horizon if the Utica and Marcellus formations are not
the source of rising production.
Customers Are Examples of Sector-wide Weakness: Of ROCKIE's top
five customers (by near-term annual basis), one is in bankruptcy,
and the other four were all downgraded in 2020. While the
coronavirus pandemic represents a rare event, it is reasonable to
note that the Downgrades of four solvent companies were, in part,
caused by a failure to maintain pristine liquidity (i.e., no debt
coming due for a few years, but for perhaps, a bond that could be
comfortably retired by a long-dated revolving credit facility).
This past circumstance is an example of how industries often move
together and converge at certain practices, which such industries
then can be significantly undercut by events. Currently, ROCKIE's
three top companies and (by long-term value) have a WA senior
unsecured rating of 'B+'. Taking a larger group which includes this
top three set, its entire westbound service customers have the same
average rating. The Appalachia basin region competes with other top
basins in North America, and ROCKIE's top three customers are
dedicated Appalachia basin producers (i.e., lack basin diversity).
Low Leverage: LTM Sept. 30, 2020 leverage was approximately 3.8x.
Leverage is now low, but it has risen. Contract expirations and
contract rejections in customer bankruptcies have been negative
factors in the past, which Fitch forecasts will continue to
pressure ROCKIE. Fitch forecasts 2022 leverage to be approximately
4.3x, and in 2024 significantly in excess of 4.5x. The forecast
addresses the possible outcomes for the ROCKIE-GPOR relationship
from GPOR's bankruptcy. Forecasts of bankruptcy actions are
challenging, and it is possible that the outcome will be worse than
what Fitch derives from a variety of assumptions about the
Appalachia region's pipeline industry.
The Policy and Power of the Owners: The ROCKIE joint venture's
majority (75%) owner, Tallgrass Energy Partners, LP (TEP;
BB-/Negative) seeks that ROCKIE will target investment-grade
metrics. In addition to investment-grade metrics, looming contract
expirations (from any cause) and shipper credit quality are two
elements that underpin the ROCKIE IDR. These factors of market
prices for pipeline service and customer credit quality are
business risks that, for at least the medium-term, are, practically
speaking, beyond ROCKIE's control. Fitch notes that the two owners
in the 2014-2015 time-frame were supportive of credit quality by
developing new and innovative business plans, and then in the
2016-2017 time-frame for executing the construction necessary to
bring these plans to fruition.
DERIVATION SUMMARY
Among the group of 'BB'-category midstream companies that enjoy
contracts that feature more than a decade of take or pay payment
terms, the best comparable for ROCKIE is Sunoco, LP (SUN; BB;
Positive). Almost all of ROCKIE's EBITDA is sourced from long-term
contracts where the customer bears take-or-pay obligations. ROCKIE
has, on average, a below-investment-grade customer profile. A
subsidiary of 7-Eleven, Inc. takes from SUN about 25% of SUN's
delivered gasoline volumes, also on a take-or-pay basis, for a
15-year contract term (over 10 years left to run).
Fitch expects SUN to have 2021 leverage in an approximate range of
4.0x-4.3x. ROCKIE will also have leverage in 2021 in this 4.0x-4.3x
area. Further, Fitch forecasts that by 2024 ROCKIE leverage will be
above 4.5x.
Though not as highly contracted as ROCKIE, SUN has showed good cash
flow stability from those volumes that are not under its top
contract with 7-Eleven, Inc. ROCKIE's higher contract coverage
compared with SUN explains why it is rated one-notch higher,
notwithstanding the higher leverage that ROCKIE is expected to post
in the out years, compared to Fitch's 2021 forecast for SUN.
KEY ASSUMPTIONS
Fitch's key assumptions within the agency's rating case for the
issuer include:
-- Fitch price deck of natural gas at $2.45/Mcf;
-- Minimal maintenance capital expenditures, and no material
growth projects;
-- ROCKIE's owners distribute all cash flow after funding
maintenance capital expenditures;
-- A generic small customer files for bankruptcy in the out
years;
-- Contract rates assumptions are: From westbound service
contracts that are ending (for whatever reason, including
amendments pressured on ROCKIE by bankruptcy proceedings),
replacement contracts (or similar) do not have rates that are
as high as the rates in the contracts going away. For
eastbound service, which has for a time had (and still
currently has) a lot of available capacity, ROCKIE signs some
small (by volume) contracts with rates similar to recently
signed contracts.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to a
positive rating action/upgrade:
-- The Outlook could be placed at Stable in the event that
Gulfport emerges from bankruptcy obligated to ROCKIE under a
contract that is not significantly less valuable to ROCKIE in
both the medium-term and long-term, compared to the original
contract (alternatively, in the event GPOR exits its
relationship, a similar positive development would be ROCKIE
immediately establishing a similar relationship with another
company).
-- Additional elements to resolve the Watch would be an
expectation of ROCKIE leverage sustained long-term total debt
to-adjusted EBITDA below 5.1x and an absence of distress among
many medium-to-large lowly-rated companies operating in the
Appalachia producing region.
-- While not expected in the medium-term, total debt-to-adjusted
EBITDA that is expected to be below 4.3x on a long-term basis;
-- While not expected in the medium-term, for the west-bound
service a weighted (by volume) average shipper credit rating
of 'BB'.
Factors that could, individually or collectively, lead to a
negative rating action/downgrade:
-- Total debt-to-adjusted EBITDA expected to be above 5.1x on a
sustained basis;
-- One of the top four customers approaching a distressed level
of weak access to the capital markets, or a collection of
smaller companies doing the same.
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
Ample Liquidity on a Long Runway: REX has a $150 million revolving
credit facility which it amended in 2019 and had $9.0 million
outstanding as of Sept. 30, 2020. The amendments, among other
things, extended the maturity date of the revolving credit facility
from Jan. 31, 2020 to Nov. 18, 2024 and reduced certain of the
applicable margins and commitment fee rates in the pricing grid
used to determine the interest rate and commitment fee. The
revolving credit facility includes a $75 million sublimit for LOC
and a $20 million sublimit for swing line loans and may be used for
working capital and general company purposes. The revolving credit
facility generally requires REX to comply with various affirmative
and negative covenants, including a limit on the leverage ratio (as
defined in the credit agreement) of REX of 4.5x. As of Sept. 30,
2020, Rockies Express was in compliance with the covenants required
under the revolving credit facility.
Earlier in 2020, REX redeemed its 5.625% senior notes due in April
2020, and there are no near-term debt maturities. The next debt
maturity is REX's $400 million senior notes due 2025.
SUMMARY OF FINANCIAL ADJUSTMENTS
2019 financial figures analysis was based on a treatment where
Fitch deemed as non-recurring revenues that portion ($13.9 million)
of the proceeds from the LOC drawn when EdgeMarc rejected the
transportation agreements during its bankruptcy proceedings.
Further, LTM Sept. 30, 2020 results exclude $6.7 million in
proceeds from the Ultra L/C draw.
Another type of financial adjustment was made to the Ovintiv
contract. This company several years ago reduced its rate from
approximately a level per unit rate schedule to one that varied.
Under accounting rules, ROCKIE is required to recognize an
approximately level amount of revenue from that new contract. In
the early years of that new contract, more revenue was booked than
cash was received. Now, and in the future, more cash is received
than revenue is booked. Accordingly, Fitch increases EBITDA in the
time periods cited above (and in the future) by the difference
between cash and revenue in this Ovintiv contract.
As to forecasts for periods after LTM Sept. 30, 2020, Fitch will
perform on GPOR LOC draws (which are expected) the same adjustment
similar as was done in the EdgeMarc and Ultra cases.
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.
RV RETAILER: S&P Assigns 'B' ICR on Acquisition Strategy
--------------------------------------------------------
S&P Global Ratings assigned its 'B' issuer credit rating to RV
Retailer Intermediate Holdings LLC (RV Retailer).
In addition, S&P is assigning its 'B+' issue-level rating and '2'
recovery rating to RVR Dealership Holdings LLC's proposed term loan
B. The '2' recovery rating indicates its expectation for
substantial (70%-90%; rounded estimate: 75%) recovery for lenders
in a hypothetical default scenario.
The outlook is stable, and reflects anticipated healthy retail
demand in 2021, adequate liquidity, cash flow generation, and a
leverage cushion that can mitigate potential spikes in financial
risk. These factors are partly offset by the company's highly
acquisitive strategy, potential integration risks, and the RV
industry's volatility over an economic cycle.
RV Retailer, through its borrower subsidiary RVR Dealership
Holdings LLC (OpCo), seeks to raise $420 million of term loan B due
2028 to refinance existing debt, pay a dividend to shareholders,
complete acquisitions of identified targets, and add liquidity for
potential future acquisitions. S&P estimates RV Retailer's
consolidated pro forma adjusted debt to EBITDA will be in the
low-3x area in 2021, incorporating the company's acquisition
strategy and high demand for recreational vehicles because
consumers perceive them as a safe and attractive way to spend
leisure time during the COVID-19 pandemic.
The 'B' rating reflects RV Retailer's highly acquisitive strategy,
integration risks associated with rapid expansion, and a financial
policy that could result in high leverage if large acquisitions are
inadvertently completed concurrent with or immediately before an RV
industry down cycle. RV Retailer has grown rapidly to 52 locations
across 15 states since its inception in January 2018, and S&P
expects the count will grow to 60 or more by the end of 2021 given
the company's ongoing aggressive strategy to increase its
geographic footprint.
S&P said, "The company has a robust pipeline of acquisitions that
we believe it will fund primarily with debt. We believe RV Retailer
is undertaking the proposed transaction to position its capital
structure for further expansion. Using cash balances and proceeds
from the proposed debt issuance, RV Retailer will refinance
existing term debt and mortgages, pay a dividend of $166 million to
shareholders, fund planned acquisitions, and enhance liquidity for
future acquisitions. In addition, RV Retailer will put into place a
new mortgage loan facility with maximum capacity of $130 million,
which we expect will be used to recapitalize existing assets and
acquire dealership real estate." The proposed transaction increases
leverage amid a retail RV surge that could correct starting later
this year or in 2022, and the company may sustain its policy level
of leverage over time for acquisitions, depending on the multiples
paid."
"We forecast consolidated pro forma adjusted gross debt to EBITDA
to be in the low-3x area in 2021. We do not net cash in our
leverage measure because of a high level of anticipated RV sector
volatility over the economic cycle, but we expect RV Retailer will
carry meaningful cash balances under our operating assumptions at
least over the next year and incorporating its aggressive
acquisition plan. It is our understanding that controlling owner
Redwood Capital Investments has a financial policy that could raise
adjusted gross debt to EBITDA at the OpCo level to a maximum of
3.5x, which translates to our measure of about 4x because we
consolidate mortgage debt at the company's property subsidiaries
(PropCo), which are a key part of the expansion strategy. We
believe the company would support its property subsidiaries as
evidenced by OpCo's lease payment to PropCo to service the mortgage
debt, and our view that business operations depend upon the real
estate assets. RV Retailer has indicated that it would plan to
reduce OpCo leverage to about 3x after levering up for
acquisitions, but volatility and execution could present risks to
such a plan."
"The RV industry is highly cyclical and volatile, and if a
contraction in retail demand coincides with RV Retailer sustaining
leverage at its financial policy maximum, our measure of adjusted
leverage could increase well above the company's 3.5x policy
maximum, depending upon the severity of a potential future
inventory correction or economic recession. Such a scenario could
partly reflect increased competition for dealership assets among RV
Retailer and its peers, which in our view could buoy purchase price
multiples during a period when RV demand is particularly strong."
Moreover, the company was recently formed and has a limited
acquisition track record, and its expansion strategy could present
business and integration risks. RV Retailer is growing its
footprint concurrent with an expansion of its management resources
and product offerings. It is S&P's understanding that so far RV
Retailer has acquired local or regional dealerships and retained
their brands and some managers without overlaying a corporate
brand. RV Retailer could begin to build a corporate brand,
introduce branded service and product offerings, and streamline
certain parts of the organization over time, which may incur
one-time integration costs.
The company operates in a competitive and cyclical industry. RV
Retailer operates in a highly fragmented industry and relies on
sometimes volatile consumer discretionary spending. Vulnerability
to the economic cycle and the potential for declines in consumer
credit availability could hurt demand for new and used RVs. The
company's geographic footprint is somewhat concentrated, and its
manufacturing supplier relationships are highly concentrated, which
is typical for RV dealerships. In addition, the company's adjusted
EBITDA margin is low compared to most other rated leisure
companies.
These business risks are partly offset by less volatile demand for
vehicle parts and services, high margins from finance and insurance
products, and increasing scale. S&P estimates that RV Retailer's
market share in the fragmented RV dealership industry is about
6%-7%, placing the company second among peers behind market leader
Camping World. RV Retailer may increasingly benefit from scale
efficiencies as it expands, if scale enhances the company's ability
to manage inventory, extract cost savings, and raise capital to
attract acquisitions.
The stable outlook incorporates good demand for RVs and anticipated
EBITDA generation in 2021. Multiple participants in the RV
industry have commented on a substantial rise in product interest.
According to the RV Industry Association, a trade organization that
represents original equipment manufacturers (OEMs), industry
shipments could increase by 19.5% in 2021, which indicates healthy
retail demand for RVs and demand for inventory by dealers. Publicly
traded OEMs in the RV industry have reported significant
year-over-year increases in backlog as a result of both dealer and
consumer demand. While backlogs are an imperfect indicator and
subject to cancellation by dealers at any time without penalty,
they increase confidence in S&P's 2021 assumptions. The inventory
orders reflect dealers' gauge on consumer sentiment and the
perception that RV travel provides a safe value proposition while
competing travel options, such as air travel, may not become
attractive again until the second half of 2021 when vaccines could
be widely disseminated. S&P also believes the substantial demand
for inventory might not be satisfied by existing manufacturing
capacity until well into 2021, based on commentary by OEMs about
current backlog.
Key risks are the sustainability of retail demand, uncertainty
regarding the economy, and the potential for a mismatch between
shipments and retail sales.
S&P said, "Under our base-case forecast, we believe revenue in 2022
could continue to grow organically in the low-single-digit percent
area. However, we recognize that RV demand may soften following a
spike in 2020 and 2021 as customers return to other forms of
travel, and if the economic recovery is uneven or unemployment
remains high. Accordingly, we performed a sensitivity analysis that
assumes total 2022 revenue declining organically in the 5%-10%
range, which could result in our measure of adjusted leverage
rising above 5x if RV Retailer continues or accelerates its
acquisition strategy."
The RV industry is highly competitive and dealers vie for inventory
when consumer buying behavior is strong. In turn, RV OEMs compete
to manufacture and deliver inventory to satisfy dealers, which in
2019 caused wholesale shipments to outpace retail demand and
contributed to an industry-wide inventory correction. The result
was surplus inventory at the dealership level, which S&P believes
led to discounting activity and temporarily pressured dealer
margins. In the current environment, OEMs may compete for market
share when consumer demand is perceived to be strong and temporary,
which could cause inadvertent overproduction and excess inventory
in the channel. Such dynamics could introduce variability in
revenue, EBITDA margin, and working-capital uses of cash if the RV
industry does not efficiently produce to align with retail demand.
S&P said, "Our rating assumes a consolidated view of RV Retailer.
Our issuer credit rating reflects consolidated financial risk at RV
Retailer, the holding company that owns OpCo, the floor plan
restricted subsidiaries, and RV Retailer Intermediate Real Estate
Holdings LLC (PropCo). We take a consolidated view because it
reflects the full corporate debt obligations and cash flows of RV
Retailer. Through PropCo as the subsidiary borrower, RV Retailer
plans to put into place a new $130 million mortgage loan facility,
of which $105 million will be fully funded at closing and could be
used for acquisitions in the near term. Because acquired assets
often have underlying real estate, we expect a mix of OpCo's term
loan debt, balance sheet cash, and PropCo's mortgage debt capacity
could be used to complete acquisitions. The real estate of acquired
assets would be pledged to and owned by PropCo after
acquisitions."
"Our adjusted debt measure consolidates PropCo's mortgage debt, and
excludes floor plan liabilities because we view them as an
operating item akin to trade payables. Our adjusted EBITDA is
burdened by floor plan interest expense, and the periodic rents
paid by OpCo to PropCo are eliminated from EBITDA in
consolidation."
The stable outlook reflects healthy anticipated retail demand in
2021, adequate liquidity, cash flow generation, and a leverage
cushion that can mitigate potential spikes in financial risk. These
factors are partly offset by the company's highly acquisitive
strategy, potential integration risks, and the RV industry's
volatility over an economic cycle.
S&P said, "While unlikely at this time based on our forecast and
given the company's leverage cushion, we could lower the rating if
we expect the company to sustain leverage above 6.5x. Such a
scenario would likely result from leveraging acquisitions that
coincide with a contraction in RV retail demand."
"We could upgrade the company to 'B+' if it can sustain leverage
below 5x, incorporating leveraging acquisitions and a cushion for
RV demand volatility over an economic cycle."
RVR DEALERSHIP: Moody's Assigns First Time B2 Corp. Family Rating
-----------------------------------------------------------------
Moody's Investors Service assigned first time ratings RVR
Dealership Holdings, LLC ("RV Retailer", "RVR") including a B2
corporate family rating and a B2-PD probability of default rating.
In addition, Moody's assigned a B2 rating to RVR's proposed $420
million senior secured term loan. The outlook is stable.
Proceeds from the proposed senior secured bank facility will be
used in addition to existing balance sheet cash to fund RVR's near
term acquisition pipeline, pay a dividend to shareholders and
refinance existing debt. Moody's ratings and outlook are subject to
receipt and review of final documentation.
"Ratings reflect RV Retailer's solid credit metrics with Moody's
pro-forma leverage as of LTM September 30, 2020 of approximately
4.3 times, flexible business model with multiple sources of revenue
and significant portion of variability in the cost structure, a
revenue mix heavily-weighted towards lower-priced towables, with
the majority of gross profit from less cyclical product offerings,
strong presence in popular RV markets, and good liquidity," stated
Moody's Vice President Charlie O'Shea. "Ratings also reflect
governance considerations and financial strategy, particularly the
risks inherent in the company's acquisition-based growth strategy
given RV Retailer's significant pipeline of acquisitions planned
for next year, as well as its relatively small scale, geographic
concentration, and exposure to the cyclical recreational vehicle
industry," continued O'Shea.
Assignments:
Issuer: RVR Dealership Holdings, LLC
Probability of Default Rating, Assigned B2-PD
Corporate Family Rating, Assigned B2
Senior Secured Bank Credit Facility, Assigned B2 (LGD4)
Outlook Actions:
Issuer: RVR Dealership Holdings, LLC
Outlook, Assigned Stable
RATINGS RATIONALE
RV Retailer's B2 rating considers its credit metrics, with
debt/EBITDA on a pro forma basis for the proposed transaction and
dividend payment of well-under 5 times and EBIT/interest of around
3 times, the risks inherent in its acquisition-based growth
strategy, a presently-favorable operating environment spurred by a
shift in consumer spending, reasonable scale in a highly-fragment
segment, ownership by a family investment fund, and good liquidity.
Ratings are constrained by the company's limited scale, geographic
concentration, and the cyclicality of the RV industry. The B2
rating on the proposed Term Loan, which is at the corporate family
rating, recognizes its position in the capital structure and
follows application of Moody's Loss Given Default methodology,
which includes the floor plan facility as a secured obligation.
Moody's notes final terms for the proposed financing could contain
covenant flexibility for transactions that could adversely affect
creditors.
The stable outlook reflects Moody's view that the recent strong
industry cycle driven by shift in consumer spending will largely
continue into the first half of next year, after which more
normalized consumer spending patterns will return in the second
half of the year which may result in lower demand trends for RVs.
Moody's expects RV Retailer to maintain solid credit metrics over
the next 12-18 months as it closes and integrates the significant
M&A pipeline. The stable outlook also reflects that the company has
flexibility surrounding its revenue and profit streams as well as
significant variable portion of its cost structure which provides
flexibility when more normalized consumer demand returns.
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 was maintained around 4.0
times and EBIT/interest maintained around 3.0 times, while
preserving good liquidity, and an overall balanced financial
strategy that ensures maintenance of this profile no matter the
industry environment. Ratings could be downgraded if, due to either
delays or integration issues arising from the significant planned
acquisition pipeline or financial policy decisions, debt/EBITDA
trended towards 6.0 times or EBIT/interest sustained below 2.5
times, or if liquidity were to weaken.
RV Retailer, with headquarters in Florida, operates 38 dealerships
in 10 states under 8 different brand names with significant
presence in Texas and Florida. The company is among the top two RV
dealership groups in the country with annual revenues of
approximately $1.3 billion. The company is supported by Redwood
Capital, which is considered a "family office."
The principal methodology used in these ratings was Retail Industry
published in May 2018.
SALLY BEAUTY: S&P Raises Second-Lien Sr. Secured Rating to 'BB+'
----------------------------------------------------------------
S&P Global Ratings raised its issue-level rating on Denton,
Texas-based beauty supply retailer and distributor Sally Beauty
Holdings Inc.'s (SBH) $300 million senior secured second-lien notes
to 'BB+'. S&P revised the recovery rating on this debt to '1',
indicating its expectation for very high (90%-100%; rounded
estimate: 95%) recovery in the event of a payment default. The BB-
issuer credit rating and all other issue-level ratings are
unaffected.
The revised recovery rating and associated upgrade reflects the
company's recent paydown of the entire outstanding balance on its
fixed-rate term loan of $213 million with excess cash on the
balance sheet. Given the paydown, there is additional value
available for the second-lien lenders, resulting in a meaningful
improvement in recovery expectations for the $300 million
second-lien notes.
The negative outlook on SBH reflects its view that the coronavirus
pandemic will remain a pressure on the company's performance.
ISSUE RATINGS--RECOVERY ANALYSIS
Key analytical factors
-- S&P's simulated default scenario contemplates a hypothetical
default occurring in 2024 due to a combination of factors,
including a protracted economic decline that leads to reduced
consumer spending, increased competitive pressure, and the failure
of the company's merchandising strategies and store initiatives.
This would substantially erode its revenue and earnings.
-- S&P's simulated default scenario assumes that SBH would
reorganize as a going concern to maximize its lenders' recovery
prospects. S&P applies a 5.5x multiple to its projected
emergence-level EBITDA. This multiple is higher than the 5.0x
multiple S&P typically applies to its retail peers to reflect the
company's unique market position as the largest beauty supply
retailer and distributor with the largest private-label merchandise
offering in beauty supplies.
Simulated default assumptions
-- Simulated year of default: 2024
-- EBITDA at emergence: $220 million
-- Implied enterprise value multiple: 5.5x
-- Gross enterprise value at emergence: $1.2 billion
Simplified waterfall
-- Net enterprise value at default (after 5% administrative
costs): $1.16 billion
-- ABL revolver and FILO claims*: $350 million
-- Senior secured term loan B claims*: $410 million
-- Recovery expectations: 90%-100% (rounded estimate: 95%)
-- Senior secured second-lien note claims*: $310 million
-- Recovery expectations: 50%-70% (rounded estimate: 95%)
-- Senior unsecured note and other unsecured claims*: $900
million
-- Recovery expectations: 0%-10%; rounded estimate: 5%
*All debt claims include six months of prepetition interest.
SBA COMMUNICATIONS: S&P Rates New $1.5BB Sr. Unsecured Notes 'BB-'
------------------------------------------------------------------
S&P Global Ratings assigned its 'BB-' issue-level rating and '5'
recovery rating to Boca Raton, Fla.-based wireless tower operator
SBA Communications Corp.'s proposed $1.5 billion senior unsecured
notes due 2029. The '5' recovery rating indicates its expectation
of modest (10%-30%; rounded estimate: 10%) recovery in the event of
a payment default.
SBA will use the proceeds from these notes to repay the $750
million of its 4.0% senior unsecured notes due 2022 that remain
outstanding and the $380 million of outstanding borrowings under
its $1.25 billion revolving credit facility due in 2023, pay
related fees and expenses, and for general corporate purposes.
The 'BB-' issue-level rating and '5' recovery rating on the
company's senior unsecured debt is unchanged. Although the recovery
rating remains '5', the additional senior unsecured debt somewhat
reduces recovery prospects for unsecured creditors because of the
higher amount of debt outstanding. As a result, S&P expects to
revise its rounded recovery estimate for the senior unsecured debt
to about 10% once the transaction is complete.
S&P said, "Because the transaction will not materially affect the
company's credit metrics, our 'BB' issuer credit rating and stable
outlook on SBA are also unchanged. We expect SBA's adjusted
leverage to remain elevated in the 7.0x-8.0x area (including lease
obligations) over the next couple of years based on its financial
policy, which includes a stated net leverage target of 7.0x-7.5x."
SBW PROPERTIES: Seeks Court Approval to Hire Bankruptcy Counsel
---------------------------------------------------------------
SBW Properties, LLC seeks approval from the U.S. Bankruptcy Court
for the Northern District of Texas to employ Eric Liepins, Esq., an
attorney practicing in Dallas, to handle its Chapter 11 case.
Mr. Liepins and his firm will render these legal services:
(a) orderly liquidate the Debtor's assets;
(b) reorganize the claims of the estate; and
(c) determine the validity of claims asserted in the estate.
Mr. Liepins' firm has received a retainer of $5,000 plus the filing
fee.
The compensation to be paid to the firm will be based upon the
following hourly rates:
Eric A. Liepins $275
Paralegals and Legal Assistants $30 - $50
In addition, the firm will receive reimbursement for out-of-pocket
expenses.
Eric Liepins, Esq., disclosed in court filings that his firm is a
"disinterested person" as that term is defined in Section 101(14)
of the Bankruptcy Code.
The firm can be reached through:
Eric A. Liepins, Esq.
Eric A. Liepins, PC
12770 Coit Road, Suite 1100
Dallas, TX 75251
Telephone: (972) 991-5591
Facsimile: (972) 991-5788
Email: eric@ealpc.com
About SBW Properties
SBW Properties, LLC filed a voluntary petition for relief under
Chapter 11 of the Bankruptcy Code (Bankr. N.D. Tex. Case No.
21-30035) on Jan. 8, 2021. At the time of the filing, the Debtor
disclosed assets of between $100,001 and $500,000 and liabilities
of the same range.
Eric A. Liepins, Esq., serves as the Debtor's legal counsel.
SCIENCE APPLICATIONS: S&P Alters Outlook to Stable, Affirms BB+ ICR
-------------------------------------------------------------------
S&P Global Ratings revised the outlook on Reston, Va.-based
government services and information technology (IT) provider
Science Applications International Corp. (SAIC) to stable from
negative and affirmed its 'BB+' issuer credit rating on the
company.
At the same time, S&P is affirming its 'BB+' rating on the
company's first-lien credit facility. The '4' recovery rating is
unchanged.
The stable outlook reflects S&P's view that SAIC's leverage will
improve in fiscal 2022 and approach 3x by year-end.
The outlook revision reflects that SAIC's credit metrics are
improving and will be consistent with S&P's expectations for the
rating. In March 2020, the company acquired Unisys Federal from
Unisys Corp. for $1.2 billion, funded largely with debt. Since
then, SAIC will have repaid $400 million of debt by the end of
fiscal year 2021 (ending Jan. 31, 2021), and repayment remains a
priority.
S&P said, "We anticipate the company's revenue and earnings will
increase due to the strong federal defense budget, and its
successful integration of the Unisys unit, which enables SAIC to
pursue a larger set of business opportunities." The combination of
earnings growth and debt repayment in excess of required
amortization should reduce its debt to EBITDA to 3.2-3.4x at the
end of fiscal 2022 , down from a peak of 4.5x at the time of the
acquisition."
"The stable outlook on SAIC reflects our expectation that credit
ratios will remain moderate based on robust defense spending, new
business, and the contribution from acquisitions. We expect debt to
EBITDA to approach the 3x area and funds from operations (FFO) to
debt in the low-20% area in fiscal 2022. Although larger
acquisitions could raise leverage, we do not believe SAIC's debt to
EBITDA will stay above 4x for an extended period."
"We could lower the rating on SAIC if credit measures deteriorate
such that debt to EBITDA exceeds 4x without a clear path to
improvement. This could occur if government spending declines, the
company loses major contracts or engages in significant share
repurchases or acquisitions beyond our expectations."
"Although unlikely in the next 12 months, we could raise the rating
on SAIC if debt to EBITDA decreases below 3x and management commits
to maintaining it at that level. This could occur if margins exceed
our expectations, and the company uses discretionary cash flow to
repay more debt than the required amortization."
SCSG EA ACQUISITION: Moody's Completes Review, Retains B2 CFR
-------------------------------------------------------------
Moody's Investors Service has completed a periodic review of the
ratings of SCSG EA Acquisition Company, Inc. and other ratings that
are associated with the same analytical unit. The review was
conducted through a portfolio review discussion held on January 11,
2021 in which Moody's reassessed the appropriateness of the ratings
in the context of the relevant principal methodology(ies), recent
developments, and a comparison of the financial and operating
profile to similarly rated peers. The review did not involve a
rating committee. Since January 1, 2019, Moody's practice has been
to issue a press release following each periodic review to announce
its completion.
This publication does not announce a credit rating action and is
not an indication of whether or not a credit rating action is
likely in the near future. Credit ratings and outlook/review status
cannot be changed in a portfolio review and hence are not impacted
by this announcement.
Key rating considerations.
SCSG EA Acquisition Company, Inc's ("SpecialtyCare") B2 Corporate
Family Rating is constrained by elevated financial risk following
its leveraged buyout by Kohlberg. The rating is also constrained by
the company's modest absolute size, and niche service line
offering. Moody's expects SpecialtyCare's hospital customers will
continue to be pressured in terms of both volume and price, which
could translate to pressure on SpecialtyCare. The rating is
supported by SpecialtyCare's leading position in the perfusion and
intraoperative neuromonitoring markets, along with good geographic
and customer diversification. Additionally, SpecialtyCare stands to
benefit from opportunities to grow revenue by cross-selling its
services at existing customer hospitals.
The principal methodology used for this review was Business and
Consumer Service Industry published in October 2016.
SEMILEDS CORP: Files Form 10-Q for Quarter Ended Nov. 30
--------------------------------------------------------
SemiLEDs Corporation filed with the Securities and Exchange
Commission its Quarterly Report on Form 10-Q disclosing a net loss
of $707,000 on $719,000 of net revenues for the three months ended
Nov. 30, 2020, compared to a net loss of $322,000 on $1.56 million
of net revenues for the three months ended Nov. 30, 2019.
As of Nov. 30, 2020, the Company had $13.93 million in total
assets, $12.09 million in total liabilities, and $1.84 million in
total equity.
As of Nov. 30, 2020 and Aug. 31, 2020, the Company had cash and
cash equivalents of $2.7 million and $2.8 million, respectively,
which were predominately held in U.S. dollar denominated demand
deposits and/or money market funds.
As of Jan. 8, 2021, the Company had no available credit facility.
The Company suffered losses from operations of $2.1 million and
$3.7 million, and used net cash in operating activities of $1.0
million and $3.5 million for the years ended Aug. 31, 2020 and
2019, respectively. These facts and conditions have raised
substantial doubt about the Company's ability to continue as a
going concern, even though gross profit on product sales was $1.6
million for the year ended Aug. 31, 2020 compared to $452,000 for
the year ended Aug. 31, 2019. On Nov. 30, 2020, the Company's cash
and cash equivalents had increased to $2.7 million compared to
$688,000 on Nov. 30, 2019, mainly due to the issuance of
convertible notes and common stock in private placements. Further,
loss from operations and net cash provided by operating activities
for the three months ended Nov. 30, 2020 were $972,000 and $88,000,
respectively. However, Management believes that it has developed a
liquidity plan that, if executed successfully, should provide
sufficient liquidity to meet the Company's obligations as they
become due for a reasonable period of time, and allow the
development of its core business.
A full-text copy of the Form 10-Q is available for free at:
https://www.sec.gov/Archives/edgar/data/1333822/000156459021001212/leds-10q_20201130.htm
About SemiLEDs
Headquartered in Miao-Li County, Taiwan, R.O.C., SemiLEDs --
http://www.semileds.com-- develops and manufactures LED chips and
LED components for general lighting applications, including street
lights and commercial, industrial, system and residential lighting,
along with specialty industrial applications such as ultraviolet
(UV) curing, medical/cosmetic, counterfeit detection, horticulture,
architectural lighting and entertainment lighting.
SemiLEDs reported a net loss of $547,000 for the year ended Aug.
31, 2020, compared to a net loss of $3.56 million for the year
ended Aug. 31, 2019. As of Aug. 31, 2020, the Company had $14.58
million in total assets, $12.01 million in total liabilities, and
$2.57 million in total equity.
KCCW Accountancy Corp., in Diamond Bar, California, the Company's
auditor since 2019, issued a "going concern" qualification in its
report dated Nov. 17, 2020, citing that the Company incurred
recurring losses from operations and has an accumulated deficit,
which raises substantial doubt about its ability to continue as a
going concern.
SEP-PRO SYSTEMS: U.S. Trustee Unable to Appoint Committee
---------------------------------------------------------
The U.S. Trustee for Region 7 disclosed in a court filing that no
official committee of unsecured creditors has been appointed in the
Chapter 11 case of Sep-Pro Systems Inc.
About Sep-Pro Systems
Houston-based Sep-Pro Systems, Inc. is engaged in the design,
engineering and fabrication of oil and gas processing equipment.
Sep-Pro Systems filed a Chapter 11 petition (Bankr. S.D. Tex. Case
No. 20-35858) on Dec. 9, 2020. At the time of the filing, the
Debtor was estimated to have $500,000 to $1 million in assets and
$1 million to $10 million in liabilities.
Judge Jeffrey P. Norman oversees the case. The Law Office of
Nelson M. Jones III serves as the Debtor's counsel.
SGR WINDDOWN: Objection to N.Y. DOF's Claim No. 205 Sustained
-------------------------------------------------------------
Judge Mary F. Walrath of the United States Bankruptcy Court for the
District of Delaware sustained the objection of debtors SGR
Winddown, Inc. and its affiliates to Claim Number 205 of the New
York City Department of Finance (DOF).
DOF filed an amended reduced Proof of Claim, 205, in the debtors'
voluntary petitions for relief under Chapter 11 of the Bankruptcy
Code. DOF asserted that $26,532.14, due as Commercial Rent Taxes
(CRT) for the period from June 1, 2016 to May 31, 2018, was
entitled to priority status as an excise tax.
The debtors filed their second omnibus objection which disputed the
asserted priority status of the CRT portion of DOF's claim. The
debtors argued that CRT is a property tax, which did not fit within
the applicable period for priority under Section 507(a)(8)(B), and,
thus, must be classified as a general unsecured claim.
The priority of the CRT claim depends on whether under the
Bankruptcy Code it is an excise tax, as contended by DOF, or a
property tax, as argued by the debtors. Property taxes have
priority only for taxes that were last due within one year prior to
the Petition Date, while excise taxes have priority if they were
last due within three years prior to the Petition Date. The CRT
taxes in question were last due and payable within the three year
look-back period for excise taxes but beyond the one year look-back
period for property taxes.
DOF argued that CRT is an excise tax under section 507(a)(8)(E).
The debtors, on the other hand, responded that CRT is not an
excise tax, but is a personal property tax under Section
507(a)(8)(B) because it is based on the debtors' passive ownership
of a leasehold interest. The debtors argued that to be an excise
tax, it must be assessed on voluntary action that involves active
and actual use as opposed to mere passive possession of property.
According to the debtors, CRT is not an excise tax because it does
not tax any specific action but merely the ownership of a lease.
DOF agrees that an excise tax requires action and that priority
under section 507(a)(8)(E) expressly requires that the tax be
imposed on a "transaction." DOF argues nonetheless that entering
into a lease for the purpose of operating a business in the
designated area of Manhattan covered by CRT is the required
"transaction" that makes it an excise tax.
Agreeing with the debtors, Judge Walrath found that CRT is imposed
on the "intention to use" or right to use property, whether any
actual commercial use is ever made of the property. Under the
Administrative Code, CRT is owed so long as a tenant pays rent,
even before a tenant first makes use of the property and even after
a tenant ceases all operations on the premises.
Judge Walrath concluded that "intention to use" is insufficient to
make CRT an excise tax because an excise tax is imposed not on the
ownership of property but on its actual use or on an activity. The
judge explained that having the right or privilege to use the
property in a commercial manner is just an incident of the
ownership of a leasehold interest in that property, the taxation of
which is a property tax.
Judge Walrath disagreed with DOF's contention that the act of
signing a lease is sufficient to constitute the voluntary action
necessary to characterize CRT as an excise tax. Neither did the
judge agree that merely paying rent is a sufficient action to make
CRT an excise tax.
Thus, Judge Walrath concluded that CRT is not an excise tax on the
actual use of the lease for commercial purposes. Rather, the judge
agreed with the debtors that CRT is properly characterized as a
personal property tax on the debtors' ownership interest in the
lease.
The case is In re: SGR WINDDOWN, Inc., et al., Chapter 11, Debtors,
Case No. 19-11973 (MFW), Jointly Administered (Bankr. D. Del.).
A full-text copy of Judge Walrath's memorandum opinion dated
January 8, 2021 is available at https://tinyurl.com/y53eywol from
Leagle.com.
About SGR Winddown, Inc.
Sugarfina Inc. -- https://www.sugarfina.com/ -- operates an
"omnichannel" business involving design, assembly, marketing and
sale of confectionary items through a retail fleet of 44 "Candy
Boutiques", including 11 "shop in shops" within Nordstrom's
department stores, a wholesale channel, e-commerce, international
franchise, and a corporate and custom channel. Its offerings are
sourced from the finest candy makers in the world and include such
iconic varieties as Champagne Bears, Peach Bellini, Sugar Lips,
Green Juice Bears and Cold Brew Bears. The Debtors employ 335
people, including 71 individuals at their headquarters in El
Segundo, Calif.
Sugarfina, Inc. and two affiliates sought Chapter 11 protection
(Bankr. D. Del. Lead Case No.19-11973) on Sept. 6, 2019. At the
time of the filing, the Debtor disclosed assets of between $10
million and $50 million and liabilities of the same range.
The Hon. Mary F. Walrath is the case judge.
The Debtors tapped Morris James LLP as counsel, and Force Ten
Partners, LLC as financial advisor. BMC Group Inc. is the claims
agent.
Andrew Vara, acting U.S. trustee for Region 3, appointed a
committee of unsecured creditors on Sept. 17, 2019. The committee
tapped Bayard, P.A. as its legal counsel, and Province, Inc. as
its financial advisor.
On Oct. 31, 2019, Sugarfina Inc., et al., consummated the sale of
substantially all their assets to Sugarfina Acquisition Corp. The
Debtors changed their names to SGR Winddown, Inc., et al.,
following the sale.
SMITTY'S LAND: Voluntary Chapter 11 Case Summary
------------------------------------------------
Debtor: Smitty's Land III, LLC
4400 N Central Ave
Phoenix, AZ 85012
Business Description: Smitty's Land III, LLC is a Single Asset
Real Estate (as defined in 11 U.S.C.
Section 101(51B)).
Chapter 11 Petition Date: January 17, 2021
Court: United States Bankruptcy Court
District of Arizona
Case No.: 21-00315
Debtor's Counsel: Michael R. King, Esq.
GAMMAGE & BURNHAM, PC
40 N Central Ave, 20th Floor
Phoenix, AZ 85004
Tel: (602) 256-4405
E-mail: mking@gblaw.com
Estimated Assets:$1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Sloane McFarland, managing member.
The Debtor failed to include in the petition a list of its 20
largest unsecured creditors.
A copy of the petition is available for free at PacerMonitor.com
at:
https://www.pacermonitor.com/view/2SA4QYI/Smittys_Land_III_LLC__azbke-21-00315__0001.0.pdf?mcid=tGE4TAMA
SOTERA HEALTH: Moody's Completes Review, Retains B1 CFR
-------------------------------------------------------
Moody's Investors Service has completed a periodic review of the
ratings of Sotera Health Holdings LLC and other ratings that are
associated with the same analytical unit. The review was conducted
through a portfolio review discussion held on January 11, 2021 in
which Moody's reassessed the appropriateness of the ratings in the
context of the relevant principal methodology(ies), recent
developments, and a comparison of the financial and operating
profile to similarly rated peers. The review did not involve a
rating committee. Since January 1, 2019, Moody's practice has been
to issue a press release following each periodic review to announce
its completion.
This publication does not announce a credit rating action and is
not an indication of whether or not a credit rating action is
likely in the near future. Credit ratings and outlook/review status
cannot be changed in a portfolio review and hence are not impacted
by this announcement.
Key rating considerations.
Sotera Health Holdings LLC's B1 Corporate Family Rating reflects
its moderately high leverage and Moody's expectations the company
will maintain balanced financial policies following its initial
public offering. The company's ratings are also constrained by its
exposure to the device sterilization industry and the significant
environmental risks arising from the handling of toxic gases and
radioactive materials in its sterilization processes. Sotera's
ratings benefit from its leading market position in the contract
sterilization outsourcing market and its significant barriers to
entry. The company is reducing its reliance on device sterilization
through acquisitions into new categories, such as the lab services
sector. The company's ratings are also supported by its breadth of
operations with no meaningful customer concentrations, good
earnings growth outlook, a global footprint and a very good
liquidity profile.
The principal methodology used for this review was Business and
Consumer Service Industry published in October 2016.
SOUND INPATIENT: Moody's Completes Review, Retains B1 CFR
---------------------------------------------------------
Moody's Investors Service has completed a periodic review of the
ratings of Sound Inpatient Physicians, Inc. and other ratings that
are associated with the same analytical unit. The review was
conducted through a portfolio review discussion held on January 11,
2021 in which Moody's reassessed the appropriateness of the ratings
in the context of the relevant principal methodology(ies), recent
developments, and a comparison of the financial and operating
profile to similarly rated peers. The review did not involve a
rating committee. Since January 1, 2019, Moody's practice has been
to issue a press release following each periodic review to announce
its completion.
This publication does not announce a credit rating action and is
not an indication of whether or not a credit rating action is
likely in the near future. Credit ratings and outlook/review status
cannot be changed in a portfolio review and hence are not impacted
by this announcement.
Key rating considerations.
Sound Inpatient Physicians, Inc's B1 Corporate Family Rating
primarily reflects its high financial leverage and high business
concentration in hospital medicine. The rating is supported by
Moody's view that Sound's focus on value-based care programs better
aligns its incentives with hospitals and payors than many other
physician staffing/services companies that are primarily focused on
fee-for-service business. Sound is partially owned by OptumHealth,
which is also a key customer. It is Moody's expectation that over
time OptumHealth will acquire Sound, supporting the rating.
The principal methodology used for this review was Business and
Consumer Service Industry published in October 2016.
SSRE HOLDINGS: Case Summary & 20 Largest Unsecured Creditors
------------------------------------------------------------
Debtor: SSRE Holdings, LLC
DBA Signature Fresh
18901 Railroad Street
Rowland Heights, CA 91748
Chapter 11 Petition Date: January 15, 2021
Court: United States Bankruptcy Court
Central District of California
Case No.: 21-10327
Debtor's Counsel: Stephen R. Wade, Esq.
LAW OFFICES OF STEPHEN R. WADE, P.C.
405 N. Indian Hill Blvd.
Claremont, CA 91711
Tel: (909) 985-6500
Fax: (909) 912-8887
E-mail: srw@srwadelaw.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Stanley Wetch, manager.
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/MQUWYIY/SSRE_Holdings_LLC__cacbke-21-10327__0001.0.pdf?mcid=tGE4TAMA
STEAKHOUSE HOLDINGS: Hires McNair McLemore as Tax Preparer
----------------------------------------------------------
Steakhouse Holdings LLC, seeks authority from the U.S. Bankruptcy
Court for the Northern District of Georgia to employ McNair
McLemore Middlebrooks & Co, Certified Public Accountants as tax
preparer.
Steakhouse Holdings requires McNair McLemore to assist the Debtor
in the preparation of the 2019 and 2020 federal and state income
tax returns.
McNair McLemore will be paid based upon its normal and usual hourly
billing rates. The firm will also be reimbursed for reasonable
out-of-pocket expenses incurred.
To the best of the Debtor's knowledge the firm is a "disinterested
person" as the term is defined in Section 101(14) of the Bankruptcy
Code and does not represent any interest adverse to the Debtor and
its estates.
McNair McLemore can be reached at:
McNair McLemore Middlebrooks & Co,
Certified Public Accountants
389 Mulberry St.
Macon, GA 31201
Tel: (478) 746-6277
About Steakhouse Holdings
Steakhouse Holdings, LLC, filed a voluntary Chapter 11 petition
(Bankr. N.D. Ga. Case No. 19-68250) on Nov. 12, 2019, and is
represented by Garrett A. Nail, Esq., at Portnoy Garner & Nail,
LLC. The Debtor reported under $1 million in both assets and
liabilities.
STUDIO MOVIE GRILL: Withdraws Plans to Open in Citrus Heights, CA
-----------------------------------------------------------------
Sonya Sorich of Sacramento Business Journal reports that Studio
Movie Grill, which filed for bankruptcy in October 2020, has called
off its planned location in Citrus Heights, CA.
Lynne McQuaker, the company's senior director of public relations
and outreach, told the Business Journal on Wednesday that
Dallas-based Studio Movie Grill does not plan to open in Citrus
Heights. The project "will not be moving forward," McQuaker said
in an email. The company is known for its dine-in movie theaters.
The planned Citrus Heights theater, in a redeveloped strip mall at
8501 Auburn Blvd., had faced a variety of setbacks. Construction
came to a halt this past spring, initially due to stay-at-home
orders implemented in March. It remained stalled as contractors
waited to resolve $4.5 million in mechanic's liens on the project.
In July, the general contractor on the project, Construct and
Maintain Corp., filed a lawsuit against Studio Movie Grill and
Santa Ana-based retail property redevelopment company Red Mountain
Group to resolve the liens. Several subcontractors were waiting on
payments as well, the Business Journal reported in September.
The mechanic's lien case is still active, though the court issued a
stay on the case in mid-December as Studio Movie Grill navigated
its bankruptcy. Some, but not all, of the mechanic's liens have
been released. The largest mechanic's lien, which was filed by
Construct and Maintain Corp., still appears to be active.
A representative from the city of Citrus Heights did not
immediately respond to an email inquiry about the future of the
planned theater space. An application for the project was filed in
2017.
Studio Movie Grill filed for Chapter 11 bankruptcy in October 2020,
as movie theaters across the country struggled due to the
pandemic.
in the third week of January 2021, Studio Movie Grill announced it
filed its reorganization plan, which could allow the company to
emerge from bankruptcy in less than five months, the Dallas
Business Journal reported. Out of the chain's 34 locations
operating in 10 states before bankruptcy, about 20 to 22 will
remain, the article says.
Studio Movie Grill also has a location in Rocklin, which opened in
2014. That site "will reopen as soon as mandates allow," McQuaker
said.
About Studio Movie Grill
Studio Movie Grill and its affiliates operate a chain of movie
theatres that include full-service dining during the show. Studio
Movie Grill is based in Dallas and runs 33 theater-restaurants.
Studio Movie Grill Holdings, LLC, and its affiliates sought Chapter
11 protection (Bankr. N.D. Tex. Case No. 20-32633) on Oct. 23,
2020. 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 Law Offices of Frank J. Wright, PLLC, is the Debtors' counsel.
SYSTEMS INTEGRATORS: Hires Pro Business as Appraiser
----------------------------------------------------
Systems Integrators, LLC, and its debtor-affiliates seek authority
from the U.S. Bankruptcy Court for the District of Arizona to
employ Pro Business Valuation & Equipment Appraisal, as appraiser
to the Debtors.
Systems Integrators requires Pro Business to appraise the Debtors'
production and manufacturing equipment used in their manufacturing
process.
Pro Business will be paid a flat fee of $3,200.
Grant E. Estep, a member of Pro Business Valuation & Equipment
Appraisal, assured the Court that the firm is a "disinterested
person" as the term is defined in Section 101(14) of the Bankruptcy
Code and does not represent any interest adverse to the Debtors and
their estates.
Pro Business can be reached at:
Grant E. Estep
Pro Business Valuation & Equipment Appraisal
18444 N 25th Ave., Suite 420
Phoenix, AZ 85023
Tel: (602) 529-1002
About Systems Integrators
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.
TEA OLIVE: Stock+Field's Going-Out-of-Business Sales Underway
-------------------------------------------------------------
According to a Jan. 14, 2021 announcement, going-out-of-business
sales are underway at all 25 Stock+Field stores across the Midwest
-- an opportunity for enthusiasts of the rural lifestyle to find
bargains on thousands of premier items in categories such as farm
supplies, outdoor power equipment, lawn and garden, hardware/tools,
home, sporting goods, and apparel/footwear.
A joint venture of Tiger Capital Group and B. Riley Retail
Solutions (a B. Riley Financial company) is conducting the
liquidation sales in Illinois, Indiana, Ohio, Michigan and
Wisconsin on behalf of Tea Olive I, LLC (d/b/a Stock+Field).
Founded in 1964 as BigR stores, Stock+Field filed for Chapter 11
bankruptcy protection on January 10, 2021 in the U.S. Bankruptcy
Court for the District of Minnesota.
"Midwesterners are well aware of Stock+Field's robust selections of
virtually anything you could need for work and hobbies associated
with the rural lifestyle," said Michael McGrail, COO of Tiger
Capital Group. "We anticipate that Stock+Field's highly desirable
inventory will liquidate very quickly."
Liquidation discounts will only be offered in-stores. The 'Order
Online/Pickup In-Store' program has been discontinued. In addition
to outdoor categories such as camping, boating and fishing,
Stock+Field carries firearms and related merchandise for
hunting/shooting. Firearms are available for purchase but will not
be sold at GOB discounts.
A full list of the locations now being closed is available at
https://www.tigergroup.com/stock-field-store-locations/ Masking,
social-distancing and other safety protocols are firmly in place at
all 25 locations.
"The sales coincide with a major resurgence of interest in many of
the categories for which Stock+Field is well known," said Scott
Carpenter, CEO of B. Riley Retail Solutions, formerly known as
Great American Group.
"In part because of behavioral shifts caused by the pandemic, we're
seeing strong consumer demand in sporting goods, lawn and garden,
pets, and home and outdoor living," Carpenter noted. "Stock+Field
also carries diverse SKUs ranging from automotive, toys and
apparel, to footwear, tools and hardware. This is inventory with
enduring utility and value."
Available apparel, footwear and/or accessories brands include
Oakley, Under Armour, Wolverine, Wrangler, Lee, Justin Boots,
Dickies, Cherokee and Carhartt, to name just a few.
Other inventory includes:
* farm equipment, livestock, feed, beekeeping, fencing and
gates;
* grills and accessories, coolers, household essentials, pool
and spa, seasonal décor;
* landscaping, pots and planters, bulbs and seeds, garden plants
and flowers, trees and shrubs; and
* lawnmowers, riding mowers, outdoor power equipment and
accessories, and snow and ice removal equipment/products.
Furniture, fixtures and equipment will also be available for sale
at the stores. Gift cards and Ag Plus Rebate Points will be honored
until February 8, 2021.
About Tea Olive I
Tea Olive I, LLC d/b/a Stock+Field --
https://www.stockandfield.com/ -- is a Minnesota limited liability
company formed in 2018 and headquartered in Eagan, Minnesota. It
is a farm, home, and outdoor retailer, currently operating 25
Stock+Field stores across Illinois, Indiana, Ohio, Wisconsin, and
Michigan. Owner Matthew F. Whebbe purchased Big R in 2018, later
changing the name of the stores to Stock + Field.
Tea Olive I, LLC, filed a Chapter 11 petition (Bankr. D. Minn. Case
No. 21-30037) on Jan. 10, 2021. The Debtor estimated $50 million
to $100 million in assets and liabilities as of the bankruptcy
filing.
The Hon. William J. Fisher is the case judge.
The Debtor tapped FREDRIKSON & BYRON, P.A., as counsel; and
STEEPLECHASE ADVISORS, LLC, as investment banker. DONLIN, RECANO &
COMPANY, INC., is the claims agent.
TEAM HEALTH: Moody's Completes Review, Retains Caa2 CFR
-------------------------------------------------------
Moody's Investors Service has completed a periodic review of the
ratings of Team Health Holdings, Inc. and other ratings that are
associated with the same analytical unit. The review was conducted
through a portfolio review discussion held on January 11, 2021 in
which Moody's reassessed the appropriateness of the ratings in the
context of the relevant principal methodology(ies), recent
developments, and a comparison of the financial and operating
profile to similarly rated peers. The review did not involve a
rating committee. Since January 1, 2019, Moody's practice has been
to issue a press release following each periodic review to announce
its completion.
This publication does not announce a credit rating action and is
not an indication of whether or not a credit rating action is
likely in the near future. Credit ratings and outlook/review status
cannot be changed in a portfolio review and hence are not impacted
by this announcement.
Key rating considerations.
Team Health's Caa2 CFR is constrained by its very high leverage,
coupled with intensifying operating challenges. The impact of
coronavirus pandemic paired with ongoing pressures related to its
payment dispute with UnitedHealth Group Incorporated (A3 stable)
will hurt the company's earnings over the near term. The company's
ratings are supported by an adequate liquidity profile, which will
help to sustain operations despite a weakening in near-term
operating performance. The CFR is also supported by Team Health's
large scale and strong competitive position in the highly
fragmented physician staffing industry.
The principal methodology used for this review was Business and
Consumer Service Industry published in October 2016.
THOMAS PATRICK SWEENEY: Selling 50% Interest in Bethesda Property
-----------------------------------------------------------------
Thomas Patrick Sweeney asks the U.S. Bankruptcy Court for the
District of Columbia to authorize the sale of the improved real
property described among the land records of Montgomery County,
Maryland, as Lot 1, in Block 6, Section One, Westmoreland Hills,
located at 4514 Wetherhill Road, in Bethesda, Maryland, to his
spouse, Lara M. Sweeney, for $1,504,000, in cash.
The Debtor and Ms. Sweeney, each owns an undivided 50% interest as
tenants by the entirety in the Property that has an appraised fair
market value of $1.6 million. The appraisal will be filed as an
exhibit to the Motion and is otherwise available upon request.
The Property is subject to the lien of a deed of trust securing a
note held by Wesbanco having an approximate unpaid balance of
$935,000 and four Maryland State joint income tax liens totaling
approximately $155,000. The Debtor's undivided 50% interest is
further subject to a federal income tax lien of $310,620 for 2009.
In accordance with the parties' separation agreement, the Debtor
and Ms. Sweeney desire to sell the Property to Ms. Sweeney for the
sum of $1,504,000, in cash, subject to approval by the Court, with
settlement to occur by Feb. 5, 2021.
The sales price is greater than the aggregate value of all liens on
the Property. It is fair and reasonable under the circumstances.
The sale does not involve a real estate broker or agent and is free
of any commission; had a broker procured a sale at the appraised
value of $1.6 million, the Debtor and Ms. Sweeny would have had to
pay a 6% commission of $96,000, reducing the net sales proceeds to
be realized from the sale by that amount.
The sale will be free and clear of all liens, encumbrances, and
interests, with all valid liens to be transferred to the proceeds
of such sale.
The settlement agent (i) will satisfy all valid joint liens of
record and pay all costs and expenses in connection with the
settlement from the proceeds of sale; and (ii) satisfy the Debtor's
federal tax liens to the extent attached to the proceeds
remaining.
The sale is in the best interests of the Debtor and his estate
because after satisfaction of all joint liens and payment of
settlement costs the sale will generate approximately $200,000 in
satisfaction of the federal income tax lien on his 50% ownership
interest in the Property.
Counsel for Debtor:
Kermit A. Rosenberg, Esq.
WASHINGTON GLOBAL LAW GROUP, PLLC
1701 Pennsylvania Avenue, N.W., Suite 200
Washington, DC 20006
Telephone: (202) 248-5454
Facsimile: (202) 580-6559
E-mail: krosenberg@washglobal-law.com
Thomas Patrick Sweeney sought Chapter 11 protection (Bankr. D. D.C.
Case No. 20-00070) on Feb. 7, 2020. The Debtor tapped Kermit
Rosenberg, Esq., as counsel.
TOPP'S MECHANICAL: Case Summary & 20 Largest Unsecured Creditors
----------------------------------------------------------------
Debtor: Topp's Mechanical, Inc.
1255 Lincoln Street
P.O. Box 449
Tecumseh NE 68450
Chapter 11 Petition Date: January 15, 2021
Court: United States Bankruptcy Court
District of Nebraska
Case No.: 21-40038
Judge: Hon. Thomas L. Saladino
Debtor's Counsel: Justin D. Eichmann, Esq.
HOUGHTON BRADFORD WHITTED PC, LLO
6457 Frances Street, Suite 100
Omaha, NE 68106
Tel: (402) 344-4000
E-mail: jeichmann@houghtonbradford.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Luke G. Topp, 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/NV5AXVI/Topps_Mechanical_Inc__nebke-21-40038__0001.0.pdf?mcid=tGE4TAMA
TOWNHOUSE HOTEL: Seeks Continuation of Jan. 23 Hotel Sale Hearing
-----------------------------------------------------------------
Townhouse Hotel, LLC, asks the U.S. Bankruptcy Court for the
Southern District of Florida (i) to continue the hearings set for
Jan. 13, 2021, on its proposed sale of its leasehold interests and
FF&E ("Hotel") to Ten Five Hospitality, LLC; and (ii) to reimpose a
stay or reconsider the scope of the prior relief from stay.
The Debtor and the Buyer have extensively negotiated a contract for
the sale the Hotel. They are prepared to execute same, but for the
Landlord's demand for lease modifications which the Buyer is still
working through.
The Buyer, via counsel, has advised the Debtor that it needs
additional time to work through the issues with the Landlord, and
asks to normalize the Landlord-Tenant relationship. It is
prepared, upon these conditions to invest approximately $5.1
million in: (i) acquisition, which includes sufficient funds to
cure all potential amounts (max $955,000) demanded by the Landlord
or such lesser amount awarded by the state court at a hearing on
Jan. 19, 2021; (ii) renovation; (iii) closing costs; (iv) initial
operations; and (v) security deposit.
The secured creditor holding a UCC and security interest in the
leasehold and FF&E, etc., has approved the sale despite not being
paid in full. It has further agreed to a carve out for unsecured
creditors for 60% of all allowed claims (not otherwise covered by
insurance).
Due to the time crunch, the parties have been unable to finalize
the contract, the lease modifications and the terms of cure. In
order to proceed in an orderly fashion, given the situation and the
prior relief from stay, the Debtor suggests that:
a. The state court proceeding commences on Jan. 19, 2021 and
continues until complete with a determination of the pre-petition
cure amount (unless otherwise resolved by negotiation);
b. Upon the entry of the state court order, the stay be
temporarily reimposed for a period to allow: (i) final
consideration of the motion to sell, assume and assign; (ii)
closing of the proposed sale; and (iii) liquidation or resolution
of the Landlord's attorneys' fee claim (part of cure).
c. The Court grants an extension, for cause, of the time to
assume and assign the leasehold, to a reasonable time after the
cure amount resolution or determination, not to exceed 90 days from
Jan. 13, 2021.
The relief is necessary to preserve the estate for the benefit of
all creditors and to allow an orderly sale process to continue.
The reimposition of a stay or reconsideration of the prior order
for relief would be similar to the relief sometimes offered whereby
a creditor with a lien on real property is granted relief to go to
judgment but not sale. It is necessary as state law (technically)
provides a window of one day to pay the cure amount--which can be
extended in the state court's equitable discretion. Uncertainty
over how much time would be allowed creates unnecessary confusion
and endangers the deal with the Buyer.
The Debtor is hopeful that with the extremely short time periods
and some of the uncertainty removed, the parties may be able to
resolve some or all of the remaining issues or to streamline the
presentations and process.
About Townhouse Hotel
Townhouse Hotel, LLC sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. S.D. Fla. Case No. 20-19997) on September
16, 2020. The petition was signed by Abraham Kramer, manager of G
&
A Miami LLC, manager of Townhouse Hotel LLC. At the time of the
filing, the Debtor disclosed estimated assets of $1 million to $10
million and estimated liabilities of $500,000 to $1 million. Judge
Robert A. Mark oversees the case. Scott Alan Orth, Esq., at Law
Offices of Scott Alan Orth, P.A. serves as the Debtor's counsel.
TRANSDIGM INC: Moody's Rates New Sr. Subordinated Notes 'B3'
------------------------------------------------------------
Moody's Investors Service assigned B3 ratings to TransDigm Inc.'s
new senior subordinated notes. All other ratings, including the B1
Corporate Family Rating and the B1-PD Probability of Default
Rating, are unchanged. Proceeds from the new notes will be used to
refinance the existing $1.2 billion senior subordinated notes due
2024. Ratings on the existing notes due 2024 will be withdrawn upon
close. The ratings outlook remains negative.
RATINGS RATIONALE
The B1 corporate family rating balances TransDigm's aggressive
financial policy defined by its sustained high funded debt and
financial leverage and recurring substantial distributions to
shareholders, against its strong business profile. TransDigm
garners very strong margins from its sole-source provider position
across a majority of its products as well as its proprietary
designs reflected in its significant patent portfolio. The ratings
anticipate that the amount of distributions to shareholders will be
tempered, particularly in the near-term, while the coronavirus
continues to weigh on demand from the company's commercial
aerospace customers.
In the aftermath of the coronavirus, Moody's anticipates a
pronounced downturn in commercial aerospace markets that is likely
to be measured in years. Revenue pressures are expected to be
particularly weighted towards commercial aerospace aftermarkets,
which have historically been a key driver of TransDigm's earnings.
This will result in an across-the-board weakening of credit metrics
with diminished free cash flow, albeit still comfortably positive,
and Moody's adjusted debt-to-EBITDA anticipated to be at or above
10x over the next 18 to 24 months.
Moody's recognizes TransDigm's robust business model as evidenced
by industry leading margins that are anticipated to remain near or
above 40% through a combination of cost-cutting measures and a
strong operating strategy involving price increases and the
development of profitable new products. Moody's also considers that
the propriety and sole-source nature of the majority of the
company's products will support the continued growth of TransDigm
over the intermediate term. Furthermore, notwithstanding
considerable earnings headwinds, Moody's expects TransDigm to
maintain very good liquidity and sufficient financial flexibility,
with significant cash balances, continued free cash generation and
near-full availability under the revolving credit facility.
The Ba3 ratings for TransDigm's senior secured term debt and senior
secured bonds are one notch above the CFR, reflecting their
seniority and first lien security interest in substantially all
assets of the company on an aggregate basis. The B3 rating for the
company's senior subordinated notes is two notches below the CFR
and reflects the subordination of this debt relative to the
aforementioned first lien debt. Both the bank credit facilities and
the subordinated notes are guaranteed by all of TransDigm's
existing and future domestic subsidiaries, as well as the company's
holding company parent TransDigm Group Incorporated (TDG).
The negative outlook reflects the potential for the impacts of the
coronavirus on Transdigm's aerospace customer base to further
constrain demand for its products, which would lead to sustained
pressure on revenues, earnings and cash flow generation with a
corresponding weakening of credit metrics and increasing financial
leverage.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Factors that could lead to a downgrade include a deterioration of
TransDigm's liquidity, such as a decline in cash balances over the
near-term, expectations of negative free cash flow, or a greater
reliance on the revolving credit facility. Any dividend
distributions made to shareholders in the near-term or made prior
to a more stable operating environment in commercial aerospace
markets could also lead to a downgrade. A meaningful diminishment
of interest coverage metrics or expectations of EBITDA margins
sustained towards 35% could also result in downward ratings
pressure. An inability to continue to make regular price increases,
expectations of pricing pressure or a weakening of demand in
military end markets could also result in a downgrade.
Factors that could lead to an upgrade include debt-to-EBITDA
sustained below 5x on a Moody's-adjusted basis, coupled with
maintenance of the company's industry leading margins and
continuation of a strong liquidity profile.
The following ratings were assigned:
Issuer: TransDigm, Inc.
Senior Subordinated Regular Bond/Debenture, Assigned B3 (LGD5)
TransDigm Inc., headquartered in Cleveland, Ohio, is a manufacturer
of engineered aerospace components for commercial airlines,
aircraft maintenance facilities, original equipment manufacturers
and various agencies of the US Government. TransDigm Inc. is the
wholly-owned subsidiary of TransDigm Group Incorporated (TDG).
Revenues for the last twelve-month period ending September 30, 2020
were approximately $5.1 billion.
The principal methodology used in this rating was Aerospace and
Defense Methodology published in July 2020.
UNITED AIRLINES: Brashear, et al's Bid for Reconsideration Denied
-----------------------------------------------------------------
Chief Judge Eleni M. Roumel of the United States Court of Federal
Claims denied the motion for reconsideration jointly filed by
Plaintiffs William Brashear and William Koopmann in the case
captioned WILLIAM KOOPMANN, et al., Plaintiffs, v. THE UNITED
STATES, Defendant, Case No. 09-cv-333 T (Fed. Cl.).
The Federal Insurance Contributions Act (FICA), I.R.C. Section
3101-3128, establishes a tax that is assessed by the Government
based on wages paid to workers. The wages, and subsequent taxes,
at issue concern a special timing rule. Pursuant to the special
timing rule, Plaintiffs paid a one-time tax on their deferred
compensation plans at retirement. United Airlines paid the FICA
taxes on behalf of Plaintiffs and subsequently recouped the amounts
by deducting them from Plaintiffs' nonqualified plan benefits. At
the time of Mr. Koopmann's retirement in 2001, United paid
$6,017.88 in FICA taxes on Mr. Koopmann's behalf. At the time of
Mr. Brashear's retirement in 2000, United paid $5,047.98 in FICA
taxes on Mr. Brashear's behalf.
On December 9, 2002, after Plaintiffs' retirement, United Airlines
filed a Chapter 11 bankruptcy petition. As a result of United's
bankruptcy proceedings, United's obligation to pay Plaintiffs'
deferred compensation was discharged, with a portion of Plaintiffs'
benefits never having been paid. Specifically, Mr. Koopmann paid
FICA taxes on $415,025.91 worth of non-qualified deferred
compensation, of which he only received $248,393. Likewise, Mr.
Brashear paid the tax on $348,136.83 worth of non-qualified
deferred compensation, of which he only received $166,657.17.
In 2007, Plaintiffs filed administrative claims for refunds. Both
refund claims were unsuccessful. On May 26, 2009, Mr. Koopmann,
filed a lawsuit in the United States Court of Federal Claims
against the United States seeking, inter alia, a refund of a
portion of the FICA taxes paid relating to his nonqualified
deferred compensation plan benefits.
On September 30, 2020, the Court dismissed both Mr. Brashear and
Mr. Koopmann's complaints. On October 30, 2020, Plaintiffs filed a
joint motion for reconsideration of this Court's two decisions
dismissing their complaints.
First, Plaintiffs alleged that the Court did not recognize that
Plaintiffs were seeking a "straight refund of taxes paid that were
more than the law required" and that the Court relied only on
Defendant's evidence. However, Judge Roumel held that, contrary to
Plaintiffs assertions, the Court considered all evidence before it
and fully recognized that Plaintiffs were seeking a tax refund.
Second, Plaintiffs alleged that their cases are distinguishable
from Balestra v. United States, 803 F.3d 1363, 1366 (Fed. Cir.
2015). Judge Roumel noted that the Federal Circuit's holding in
Balestra –- that the Treasury's interpretation of the special
timing rule does not provide an adjustment for subsequent
bankruptcies – closes any avenue for Plaintiffs to succeed on the
merits.
Third, Plaintiffs alleged that Defendant's arguments related to the
statute of limitations were untimely. Judge Roumel also found this
argument to be without merit. The judge pointed out that
Plaintiffs could have, but did not, bring this argument in their
responses to Defendant's motions to dismiss, and a motion for
reconsideration is not the place for a movant to bring a new
argument previously available to be made. Further, Judge Roumel
found that Defendant timely filed both of its motions to dismiss
pursuant to Rule 12(a).
Fourth, Plaintiffs alleged that the Court, in its orders dismissing
Plaintiffs, misapplied the special timing rule at 26 C.F.R. Section
31.3121(v)(2)-1(a)(1). Judge Roumel found that Plaintiffs
misunderstood how the special timing rule operates. The judge
explained as follows: "The special timing rule applies to wages
received from a non-qualified deferred compensation plan, such as
the plan at issue in this present action. Under the 'special
timing rule,' FICA tax is assessed only once -— at the later of
either: (A) the date services are performed or (B) the date when
there is no substantial risk of forfeiture of the rights to such
amount. In other words, the rule attempts to estimate the total
value of the compensation plan; and, consequently, the taxpayer
only pays the tax once and does not pay a tax on the amount the
taxpayer receives each year."
Lastly, Judge Roumel added that the relevant statute of limitations
requires that a federal tax refund claim must be filed either
within three years of filing the return or within two years of
paying the tax, whichever is later. Here, Mr. Brashear paid the
present value of his FICA taxes in 2000 when he retired, and Mr.
Koopmann paid the present value of his FICA taxes when he retired
in 2001, and both were not required to pay further taxes on this
compensation plan. The judge thus held that the Court correctly
applied the statute of limitations for tax refunds, I.R.C. Section
6511(a), to both Plaintiffs' claims.
A full-text copy of Judge Roumel's order, dated January 8, 2021, is
available at https://tinyurl.com/y2axm9fa from Leagle.com.
About UAL Corp.
Based in Chicago, Illinois, UAL Corporation (NASDAQ: UAUA) --
http://www.united.com/-- is the holding company for United
Airlines, Inc. United Airlines is the world's second largest air
carrier. The airline flies to Brazil, Korea and Germany.
The company filed for Chapter 11 protection on Dec. 9, 2002(Bankr.
N.D. Ill. Case No. 02-48191). James H.M. Sprayregen, Esq., Marc
Kieselstein, Esq., David R. Seligman, Esq., and Steven R. Kotarba,
Esq., at Kirkland & Ellis, represented the Debtors in their
restructuring efforts. Fruman Jacobson, Esq., at Sonnenschein Nath
& Rosenthal LLP represented the Official Committee of Unsecured
Creditors before the Committee was dissolved when the Debtors
emerged from bankruptcy.
Judge Eugene R. Wedoff confirmed the Debtors' Second Amended Plan
on Jan. 20, 2006. The company emerged from bankruptcy protection
on Feb. 1, 2006.
* * *
The Troubled Company Reporter, on Aug. 24, 2014, reported that
Standard & Poor's Ratings Services assigned its 'A- (sf)' rating to
United Airlines Inc.'s series 2014-2 class A pass-through
certificates (with an expected maturity of Sept. 3, 2026). At the
same time, S&P assigned its 'BB+ (sf)' rating to the company's
series 2014-2 class B pass-through certificates (with an expected
maturity of Sept. 3, 2022).
The TCR, on July 30, 2014, reported that S&P assigned its
preliminary 'A-(sf)' rating to United Airlines Inc.'s series 2014-2
class A pass-through certificates (with an expected maturity of
Sept. 3, 2026). At the same time, S&P assigned its preliminary
'BB+ (sf)' rating to the company's series 2014-2 class B pass-
through certificates (with an expected maturity of Sept. 3, 2022).
On the same date, the TCR reported that Fitch Ratings assigned the
following expected ratings to United Airlines' (UAL, rated 'B';
Outlook Positive by Fitch) proposed Pass Through Trusts Series
2014-2: (i) $823,071,000 Class A certificates due in September 2026
'A(EXP)'; and (ii) $238,418,000 Class B certificates due in
September 2022 'BB+(EXP)'.
The TCR, on July 29, 2014, reported that S&P assigned its 'BB-'
issue rating and '1' recovery rating to United Airlines Inc.'s new
$500 million senior secured term loan B due 2021. The '1' recovery
rating indicates S&P's expectation for very high recovery
(90%-100%) in a payment default scenario. At the same, the 'BB-'
issue level rating and '1' recovery rating on the upsized $1.35
billion revolving credit facility due 2019 remain unchanged.
On July 28, 2014, the TCR reported that Moody's Investors Service
assigned a Ba2 rating to the $500 million incremental term loan
facility due 2021 that United Airlines, Inc. ("United") announced
it plans to arrange. The Corporate Family rating of UAL is B2.
US ANESTHESIA: Moody's Completes Review, Retains B3 CFR
-------------------------------------------------------
Moody's Investors Service has completed a periodic review of the
ratings of U.S. Anesthesia Partners, Inc. and other ratings that
are associated with the same analytical unit. The review was
conducted through a portfolio review discussion held on January 11,
2021 in which Moody's reassessed the appropriateness of the ratings
in the context of the relevant principal methodology(ies), recent
developments, and a comparison of the financial and operating
profile to similarly rated peers. The review did not involve a
rating committee. Since January 1, 2019, Moody's practice has been
to issue a press release following each periodic review to announce
its completion.
This publication does not announce a credit rating action and is
not an indication of whether or not a credit rating action is
likely in the near future. Credit ratings and outlook/review status
cannot be changed in a portfolio review and hence are not impacted
by this announcement.
Key rating considerations.
U.S. Anesthesia Partners, Inc.'s B3 Corporate Family Rating
reflects our expectations that the company's leverage will remain
high due to the coronavirus pandemic and its dispute with United
Health Group Incorporated (A3 long-term issuer rating). Given that
a material portion of the company is owned by physicians whose
compensation have a large variable element, Moody's believes that
the company will be better positioned than some other staffing
companies to cut expenses amidst a temporary but sharp decline in
demand for the company's services.
The principal methodology used for this review was Business and
Consumer Service Industry published in October 2016.
VETCOR PROFESSIONAL: Moody's Completes Review, Retains B3 CFR
-------------------------------------------------------------
Moody's Investors Service has completed a periodic review of the
ratings of VetCor Professional Practices LLC and other ratings that
are associated with the same analytical unit. The review was
conducted through a portfolio review discussion held on January 11,
2021 in which Moody's reassessed the appropriateness of the ratings
in the context of the relevant principal methodology(ies), recent
developments, and a comparison of the financial and operating
profile to similarly rated peers. The review did not involve a
rating committee. Since January 1, 2019, Moody's practice has been
to issue a press release following each periodic review to announce
its completion.
This publication does not announce a credit rating action and is
not an indication of whether or not a credit rating action is
likely in the near future. Credit ratings and outlook/review status
cannot be changed in a portfolio review and hence are not impacted
by this announcement.
Key rating considerations.
VetCor Professional Practices LLC's B3 Corporate Family Rating
reflects its high financial leverage, aggressive roll-up strategy
and increasing acquisition multiples due to market competition.
However, VetCor's credit profile benefits from its broad national
footprint, positive outlook in the pet services industry, strong
recurring revenue and a proven ability to smoothly consolidate
independent veterinary practices.
The principal methodology used for this review was Business and
Consumer Service Industry published in October 2016.
VIDEO DISPLAY: Posts $1.88 Million Net Income in Third Quarter
--------------------------------------------------------------
Video Display Corporation filed with the Securities and Exchange
Commission its Quarterly Report on Form 10-Q disclosing net income
of $1.88 million on $2.86 million of net sales for the three months
ended Nov. 30, 2020, compared to a net loss of $628,000 on $1.47
million of net sales for the three months ended Nov. 30, 2019.
For the nine months ended Nov. 30, 2020, the Company reported net
income of $872,000 on $8.86 million of net sales compared to a net
loss of $1.39 million on $7.40 million of net sales for the same
period during the prior year.
As of Nov. 30, 2020, the Company had $10.61 million in total
assets, $6.28 million in total liabilities, and $4.33 million in
total shareholders' equity.
The Company has sustained losses for the last four of five fiscal
years and has seen overall a decline in working capital and liquid
assets during this five year period. Annual losses over this time
are due to a combination of decreasing revenues across certain
divisions without a commensurate reduction of expenses. The
Company has seen a rise in revenues this year and increased
activity within the markets it serves. The Company expanded its
revenues and markets with an acquisition in January, 2020 of a
small display company.
Video Display said, "Management has implemented a plan to improve
the liquidity of the Company. The Company has been implementing a
plan to increase revenues at all the divisions, each structured to
the particular division. The fiscal year ended February 29, 2020
was a transition year for the Company. Many of the legacy programs
the Company serviced were heading into new phases or the next
generation of the product line. This caused delays in the normal
flow of the orders for these programs. The Company is working with
these customers and has received orders for one of these programs
and expects other programs to be placing orders to be fulfilled in
the next fiscal year. Also, the Company completed the transfer of
its remaining CRT operations to its Lexel Imaging facility in
Lexington, KY in fiscal 2021 which will reduce expenses in the CRT
operation by having that business all under one roof. The Company
also moved the corporate accounting functions to the Cocoa, Florida
location in fiscal 2020 which allows the Company to become more
efficient and save money on reducing redundant operations.
Management continues to explore options to increase the liquidity
of the Company. If additional and more permanent capital is
required to fund the operations of the Company, no assurance can be
given that the Company will be able to obtain the capital on terms
favorable to the Company, if at all.
"The ability of the Company to continue as a going concern is
dependent upon the success of management's plans to improve
revenues, the operational effectiveness of continuing operations,
the procurement of suitable financing, or a combination of these.
The uncertainty regarding the potential success of management's
plan create substantial doubt about the ability of the Company to
continue as a going concern."
A full-text copy of the Form 10-Q is available for free at:
https://www.sec.gov/Archives/edgar/data/758743/000119312521008791/d14436d10q.htm
About Video Display
Headquartered in Tucker, Georgia, Video Display Corporation
manufactures and distributes a wide range of display devices,
encompassing, among others, industrial, military, medical, and
simulation display solutions.
Hancock Askew & Co., LLP, in Peachtree Corners, Georgia, the
Company's auditor since 2017, issued a "going concern"
qualification in its report dated May 29, 2020, citing that the
Company has historically reported net losses or breakeven results
along with reporting low levels of working capital. These
conditions raise substantial doubt about the Company's ability to
continue as a going concern.
VIRTUS INVESTMENT: S&P Alters Outlook to Positive, Affirms 'BB' ICR
-------------------------------------------------------------------
S&P Global Ratings revised its outlook on Virtus Investment
Partners to positive from stable. At the same time, S&P affirmed
its 'BB' issuer credit rating on the company and its 'BB' rating on
its senior secured term loan. The recovery rating on the senior
secured term loan remains '3'.
The outlook revision reflects S&P's view that leverage will be
lower than it previously forecasted as a result of further debt
repayments and higher EBITDA.
Virtus Investment Partners repaid $63 million in debt through
third-quarter 2020, while a strong rebound in markets from lows in
March 2020, along with about $2.5 billion in net inflows through
Sept. 30, 2020, have supported assets under management (AUM).
The combination of debt repayments and EBITDA strength has improved
Virtus' credit profile beyond our initial expectations. Moreover,
the partnership with Allianz will continue to bolster AUM, albeit
at lower fee levels.
S&P said, "Despite a challenging 2020, Virtus performed well,
exceeding our previous expectations. The company repaid $63 million
in debt through third-quarter 2020, entered into a partnership with
Allianz (which will add $25 billion-$30 billion in AUM once it
closes), and had positive net inflows. Altogether, Virtus' credit
profile is substantially improved. We measure that debt to EBITDA
is trending below 2.0x on a weighted basis (we don't net cash
because we assess the company's business risk as weak)."
"Absent another market drawdown, which is not our base case, we
think Virtus will continue to deleverage through a combination of
debt repayments and EBITDA growth. The latter will be driven by two
forces, in our view. First, the additional AUM brought on by the
Allianz partnership, albeit at a lower overall fee rate, provides
greater EBITDA support. Second, given the market drawdowns at the
end of 2018 into early 2019 and in March 2020, average AUM has
consistently lagged ending period balances. We expect average AUM
to increase, providing a natural tailwind to revenues and EBITDA
even if markets stay flat."
"That said, we believe there is the risk that Virtus undergoes a
debt-fueled acquisition, pushing leverage higher. Although the
probability of this is low given its recent partnership with
Allianz, in our view, the multi-boutique business model has
historically been highly acquisitive, with peers engaging in more
aggressive acquisition strategies. Nevertheless, it remains a risk,
in our opinion, and is a minor offset to an otherwise positive
trajectory."
"The positive outlook indicates our expectation that leverage, as
measured by debt to EBITDA, will continue to trend lower than 2.0x
over the next year through a combination of debt repayment and
EBITDA growth. Furthermore, we expect the Allianz Partnership to
finalize and investment performance to remain strong, as well as
roughly stable net flows."
"If leverage increases above 3.0x on an absolute basis, we could
take a negative rating action. A highly leveraged acquisition could
likewise lead to a negative rating action, as could deterioration
in operating performance."
"An upgrade is contingent on leverage remaining sustainably below
2.0x. We would also expect to see solid investment performance with
positive net inflows."
VOYA INT'L HIGH DIVIDEND FUND: Board OKs Termination of Fund
------------------------------------------------------------
Voya Financial (NYSE:VOYA) announced Jan. 14, 2021 that the Board
of Trustees ("the Board") of Voya International High Dividend
Equity Income Fund (the "Fund") (NYSE: IID) has approved a Plan of
Liquidation and Termination for the Fund. The Plan of Liquidation
and Termination is expected to take effect on or about March 31,
2021.
Subsequent to the effectiveness of the Fund's Plan of Liquidation
and Termination, the Fund will determine and pay, or set aside in
cash or cash equivalents, in an amount that it estimates is
necessary to discharge any unpaid liabilities and obligations of
the Fund, and make one or more liquidating distributions to the
Fund's common shareholders. Leading up to the final distribution
date, as the Fund begins to transition its portfolio in
anticipation of making its liquidating distributions, the Fund may
deviate from its investment objectives and policies.
The Fund has fixed the close of business on March 31, 2021 as the
effective date for determining the common shareholders of the Fund
entitled to receive liquidating distributions. As of that time, the
share transfer books of the Fund will be closed. The trading of the
Fund's shares on the New York Stock Exchange will be suspended
effective before the open of business on April 1, 2021. The
Fund’s liquidating distributions will be paid in cash. The Fund
expects to make one or more liquidating or other distributions to
common stockholders on or about April 5, 2021. Additional details
with respect to the Fund’s liquidation will be provided as they
become available.
The Fund is a closed-end U.S.-registered management investment
company advised by Voya Investments, LLC and sub-advised by Voya
Investment Management Co. LLC.
About Voya(R) Investment Management
A leading, active asset management firm, Voya Investment Management
manages, as of September 30, 2020, approximately $247 billion for
affiliated and external institutions as well as individual
investors. With more than 40 years of history in asset management,
Voya Investment Management has the experience and resources to
provide clients with investment solutions with an emphasis on
equities, fixed income, and multi-asset strategies and solutions.
Voya Investment Management was named in 2015, 2016, 2017, 2018,
2019, and 2020 as a "Best Places to Work" by Pensions and
Investments magazine. For more information, visit
http://www.voyainvestments.com/
VTES INC: Seeks to Hire Griffin Hamersky as Counsel
---------------------------------------------------
VTES, Inc., and its debtor-affiliates seek authority from the U.S.
Bankruptcy Court for the Southern District of New York to employ
Griffin Hamersky LLP, as counsel to the Debtors.
VTES, Inc. requires Rock Creek to:
a. advise the Debtors regarding their powers and duties as
debtors in possession in the continued management,
administration, sale and eventual wind down of their
business operations;
b. attend meetings and negotiate with representatives of
creditors and other parties in interest;
c. take all necessary actions to protect and preserve the
Debtors' estates, including the prosecution of actions on
the Debtors' behalf, the defense of actions commenced
against the Debtors' estates, negotiations concerning
litigation in which the Debtors may be involved, and
objections to claims filed against the Debtors' estates;
d. prepare on behalf of the Debtors all motions, applications,
answers, orders, reports, and papers necessary to the
administration of the estates;
e. advise the Debtors in conjunction with a sale of their
assets under the Bankruptcy Code and prepare on behalf of
the Debtors all motions, orders, and other related
documents and pleadings in connection with such sale;
f. negotiate and prepare on the Debtors' behalf a chapter 11
plan and all related agreements and/or documents and take
any necessary action on behalf of the Debtors to obtain
confirmation of such plan;
g. appear before this Court, any appellate courts, and protect
the interests of the Debtors' estates before such courts;
and
h. perform all other necessary legal services and provide all
other necessary legal advice to the Debtors in connection
with these Chapter 11 Cases.
Griffin Hamersky will be paid at these hourly rates:
Partners $630 to $770
Counsel $670
Associates $295 to $435
Paraprofessionals $295
Prior to the Petition Date, the Debtors paid a retainer to Griffin
Hamersky in the amount of $105,214.
Griffin Hamersky will also be reimbursed for reasonable
out-of-pocket expenses incurred.
Scott A. Griffin, partner of Griffin Hamersky LLP, assured the
Court that the firm is a "disinterested person" as the term is
defined in Section 101(14) of the Bankruptcy Code and does not
represent any interest adverse to the Debtors and their estates.
Griffin Hamersky can be reached at:
Scott A. Griffin, Esq.
Michael D. Hamersky, Esq.
GRIFFIN HAMERSKY LLP
420 Lexington Avenue, Suite 400
New York, NY 10170
Tel: (646) 998-5580
Fax: (646) 998-8284
About VTES, Inc.
Savari -- https://savari.net/ -- builds software and hardware
sensor solutions for OEM automotive car manufacturers, the
automotive aftermarket, smart cities, and pedestrians with the
vision of making transportation predictive, safer and more
efficient.
VTES, Inc., Savari, Inc., and Savari Systems Pvt. Ltd. filed
voluntary petitions for relief under Chapter 11 of the Bankruptcy
Code (Bankr. S.D.N.Y. Case No. 20-12941) on Dec. 27, 2020. The
petitions were signed by Ravi Puvvala, the CEO. At the time of the
filing, each Debtor was estimated to have $1 million to $10 million
in both assets and liabilities.
The Debtors tapped Griffin Hamersky LLP as counsel, Rock Creek
Advisors LLC as financial advisor, and Stretto as claims agent and
administrative advisor.
VTES INC: Seeks to Hire Ordinary Course Professionals
-----------------------------------------------------
VTES, Inc., and its debtor-affiliates seek authority from the U.S.
Bankruptcy Court for the Southern District of New York to employ
ordinary course professionals.
The following are the ordinary course professionals:
Professional Service
Harvey H. Rosen, Esq. Corporate Counsel –
U.S.
A Professional Corporation
4265 Marina City Dr., Unit 1117
Marina del Rey, CA 90292
Tel: (310) 527-1792
E-mail: hhr.law@gmail.com
Babk Akhlaghi, Esq. IP Counsel – U.S.
NovoTech IP International PLLC Patents)
1717 Pennsylvania Ave. NW, Suite 1025
Washington, DC 20006
Tel: (202) 559-9159
E-mail: akhlaghi@novotechip.com
Michael J. Williams, Esq. IP Counsel - U.S.
1811 Newcastle Drive (Trademarks, Copyright
Los Altos, CA 94024 and Related Contracts)
Tel: (408) 858-3552
E-mail: mike@savari.net
Ranganath Poornima, Esq. Corporate Counsel-India
Law-Assist
No. 187, 2nd Floor, 37th Cross,
18th main, 4th–T Block,
Jayanagar, Bengaluru – 560 041
Tel: (080) 265-33604
E-mail poornmimar@law-assist.in
To the best of the Debtor's knowledge the firms are a
"disinterested person" as the term is defined in Section 101(14) of
the Bankruptcy Code and does not represent any interest adverse to
the Debtors and their estates.
About VTES, Inc.
Savari -- https://savari.net/ -- builds software and hardware
sensor solutions for OEM automotive car manufacturers, the
automotive aftermarket, smart cities, and pedestrians with the
vision of making transportation predictive, safer and more
efficient.
VTES, Inc., Savari, Inc., and Savari Systems Pvt. Ltd. filed
voluntary petitions for relief under Chapter 11 of the Bankruptcy
Code (Bankr. S.D.N.Y. Case No. 20-12941) on Dec. 27, 2020. The
petitions were signed by Ravi Puvvala, the CEO. At the time of the
filing, each Debtor was estimated to have $1 million to $10 million
in both assets and liabilities.
The Debtors tapped Griffin Hamersky LLP as counsel, Rock Creek
Advisors LLC as financial advisor, and Stretto as claims agent and
administrative advisor.
VTES INC: Seeks to Hire Rock Creek as Financial Advisor
-------------------------------------------------------
VTES, Inc., and its debtor-affiliates, seek authority from the U.S.
Bankruptcy Court for the Southern District of New York to employ
Rock Creek Advisors, LLC, as financial advisor to the Debtors.
VTES, Inc. requires Rock Creek to:
a. assist the Debtors with the preparation of the Statement of
Financial Affairs and the Statement of Assets and
Liabilities;
b. assist the Debtors with cash and liquidity management;
c. assist the Debtors with the preparation of monthly
operating reports;
d. assist the Debtors with the reporting requirements of the
DIP lender;
e. assist the Debtors and counsel with the preparation of data
to prepare pleadings and related fiduciary filings;
f. assist the Debtors with reconciling filed proofs of claims;
and
g. assist the Debtors and counsel to provide the court any
necessary information necessary to approve a chapter 11
plan in these cases.
Rock Creek will be paid at these hourly rates:
Managing Directors $450 to $595
Managers/Senior Managers $325 to $450
Associates and Staffs $200 to $325
Rock Creek will be paid a retainer in the amount of $10,000.
Rock Creek will also be reimbursed for reasonable out-of-pocket
expenses incurred.
Brian Ayers, partner of managing director of Rock Creek Advisors,
LLC, assured the Court that the firm is a "disinterested person" as
the term is defined in Section 101(14) of the Bankruptcy Code and
does not represent any interest adverse to the Debtors and their
estates.
Rock Creek can be reached at:
Brian Ayers
Rock Creek Advisors, LLC
1738 Belmar Blvd.
Belmar, NJ 07719
Tel: (201) 315-2521
About VTES, Inc.
Savari -- https://savari.net/ -- builds software and hardware
sensor solutions for OEM automotive car manufacturers, the
automotive aftermarket, smart cities, and pedestrians with the
vision of making transportation predictive, safer and more
efficient.
VTES, Inc., Savari, Inc., and Savari Systems Pvt. Ltd. filed
voluntary petitions for relief under Chapter 11 of the Bankruptcy
Code (Bankr. S.D.N.Y. Case No. 20-12941) on Dec. 27, 2020. The
petitions were signed by Ravi Puvvala, the CEO. At the time of the
filing, each Debtor was estimated to have $1 million to $10 million
in both assets and liabilities.
The Debtors tapped Griffin Hamersky LLP as counsel, Rock Creek
Advisors LLC as financial advisor, and Stretto as claims agent and
administrative advisor.
VTES INC: Seeks to Hire Stretto as Administrative Advisor
---------------------------------------------------------
VTES, Inc., and its debtor-affiliates seek authority from the U.S.
Bankruptcy Court for the Southern District of New York to employ
Stretto, as administrative advisor to the Debtors.
VTES, Inc. requires Stretto to:
a. assist with, among other things, solicitation, balloting,
and tabulation of votes, and prepare any related reports,
as required in support of confirmation of a chapter 11
plan, and in connection with such services, process
requests for documents from parties in interest, including,
if applicable, brokerage firms, bank back-offices, and
institutional holders;
b. prepare an official ballot certification and, if necessary,
testify in support of the ballot tabulation results;
c. assist with the preparation of the Debtors' schedules of
assets and liabilities and statements of financial affairs
and gather data in conjunction therewith;
d. provide a confidential data room, if requested;
e. manage and coordinate any distributions pursuant to a
chapter 11 plan; and
f. provide such other processing, solicitation, balloting, and
other administrative services described in the Engagement
Agreement, but not covered by the Section 156(c) Order, as
may be requested from time to time by the Debtors, the
Court, or the Office of the Clerk of the Bankruptcy Court
(the "Clerk").
Stretto will be paid at these hourly rates:
Director of Solicitation $230
Solicitation Associate $209
Director $192-$230
Associate/Senior Associate $65-$182
Analyst $30-$60
Stretto will be paid a retainer in the amount of $10,000.
Stretto will also be reimbursed for reasonable out-of-pocket
expenses incurred.
Sheryl Betance, managing director of Stretto, assured the Court
that the firm is a "disinterested person" as the term is defined in
Section 101(14) of the Bankruptcy Code and does not represent any
interest adverse to the Debtors and their estates.
Stretto can be reached at:
Sheryl Betance
STRETTO
410 Exchange, Ste. 100
Irvine, CA 92602
Tel: (714) 716-1872
E-mail: sheryl.betance@stretto.com
About VTES, Inc.
Savari -- https://savari.net/ -- builds software and hardware
sensor solutions for OEM automotive car manufacturers, the
automotive aftermarket, smart cities, and pedestrians with the
vision of making transportation predictive, safer and more
efficient.
VTES, Inc., Savari, Inc., and Savari Systems Pvt. Ltd. filed
voluntary petitions for relief under Chapter 11 of the Bankruptcy
Code (Bankr. S.D.N.Y. Case No. 20-12941) on Dec. 27, 2020. The
petitions were signed by Ravi Puvvala, the CEO. At the time of the
filing, each Debtor was estimated to have $1 million to $10 million
in both assets and liabilities.
The Debtors tapped Griffin Hamersky LLP as counsel, Rock Creek
Advisors LLC as financial advisor, and Stretto as claims agent and
administrative advisor.
WALL010 LLC: Seeks to Hire Joyce W. Lindauer as Counsel
-------------------------------------------------------
WALL010, LLC, seeks authority from the U.S. Bankruptcy Court for
the Northern District of Texas to employ Joyce W. Lindauer
Attorney, PLLC, as counsel to the Debtor.
WALL010, LLC, requires Joyce W. Lindauer to represent and provide
legal services to the Debtor in the Chapter 11 bankruptcy
proceedings.
Joyce W. Lindauer will be paid at these hourly rates:
Attorneys $205 to $395
Paralegal $65 to $125
Joyce W. Lindauer received a retainer of $2,000 paid by Bryan
Huddleston, inclusive of the filing fee of $1,717.
Joyce W. Lindauer will also be reimbursed for reasonable
out-of-pocket expenses incurred.
Joyce W. Lindauer, a partner of Joyce W. Lindauer Attorney, PLLC,
assured the Court that the firm is a "disinterested person" as the
term is defined in Section 101(14) of the Bankruptcy Code and does
not represent any interest adverse to the Debtor and its estates.
Joyce W. Lindauer can be reached at:
Joyce W. Lindauer, Esq.
Kerry S. Alleyne, Esq.
Guy H. Holman, Esq.
JOYCE W. LINDAUER ATTORNEY, PLLC
1412 Main Street, Suite 500
Dallas, TX 75202
Tel: (972) 503-4033
Fax: (972) 503-4034
About WALL010 LLC
WALL010, LLC, based in Dallas, TX, filed a Chapter 11 petition
(Bankr. N.D. Tex. Case No. 21-30016) on Jan. 4, 2020. In the
petition signed by Tim Barton, president, the Debtor estimated $1
million to $10 million in both assets and liabilities. The Hon.
Harlin Dewayne Hale presides over the case. JOYCE W. LINDAUER
ATTORNEY, PLLC, serves as bankruptcy counsel to the Debtor.
WANSDOWN PROPERTIES: Court Partly Reconsiders Wansdown Suit
-----------------------------------------------------------
Judge Stuart M. Bernstein of the United States Bankruptcy Court for
the Southern District of New York granted in part and denied in
part the motion for reconsideration filed by 29 Beekman Corp. in
the case captioned re: WANSDOWN PROPERTIES CORPORATION N.V.,
Chapter 11, Debtor. WANSDOWN PROPERTIES CORPORATION N.V.,
Plaintiff, v. 29 BEEKMAN CORP., Defendant, Case No. 19-13223 (SMB),
Adv. Pro. No. 20-01056 (SMB) (Bankr. S.D.N.Y.).
The adversary proceeding concerns a dispute over the right to the
downpayment given by 29 Beekman Corp. to Wansdown Properties
Corporation in connection with an unconsummated Purchase Agreement
to buy real property owned by Wansdown. In Wansdown Props. Corp.
N.V. v. 29 Beekman Corp., the Court denied the parties'
cross-motions for summary judgment and identified two factual
issues:
First, the Purchase Agreement stated that "Seller represents that
the net proceeds of a sale under this Contract would be sufficient
to satisfy all claims against Seller and, as reasonably projected,
Seller's contemplated estate in bankruptcy." The proceeds
representation had to be true and correct at closing, which had
been adjourned to February 10, 2020. The closing never occurred
due to Beekman's breach, subject, however, to the proviso that
Beekman's obligation to close was not excused by the failure of the
condition, to wit, the truth of the proceeds representation at the
time of closing. In this regard, the Court ruled that the phrase
"as reasonably projected" in the proceeds representation was
inherently ambiguous.
Second, if Wansdown could not satisfy the proceeds representation
at closing, "would the enforcement of the condition cause a
disproportionate forfeiture to the Debtor." On the one hand, if
the condition was not excused, Wansdown and its creditors would
forfeit the downpayment. On the other hand, Wansdown sold the
property to another buyer following Beekman's breach for
significantly more than Beekman had agreed to pay. On a related
point, the Court also questioned the materiality of the proceeds
representation. Thus, the extent of the forfeiture raised a
factual question. The parties made a host of other arguments, but
the Court concluded that they are without merit.
Beekman moved for reconsideration. Wansdown opposed. The Motion
identified numerous purported errors in the Decision that required
reconsideration.
For the reasons that follow, the Court grants reconsideration in
connection with the issue concerning disproportionate forfeiture
and otherwise denies the Motion.
Several of the arguments raised by Beekman center on purported
admissions by Wansdown that the Court supposedly ignored. Beekman
argued at various points that Wansdown judicially admitted that the
sufficiency of proceeds was a material condition precedent when it
failed to properly respond to 29 Beekman's Statement of Undisputed
Facts in Support of Its Cross-Motion for Summary Judgment (SOF),
dated May 7, 2020. However, Judge Bernstein pointed out that, even
if all of the facts stated in the SOF were deemed admitted, the
cross-motions were denied for a different, unrelated reason -–
the ambuguity of the phrase "as reasonably projected" in the
proceeds representation -– and the "deemed admissions" are no
longer part of the case.
Several of the other arguments raised in the Motion concern issues
that were either not properly raised at the summary judgment stage
or were briefed, argued, and decided in connection with the summary
judgment motions.
Beekman also argued that the phrase "as reasonably projected" in
the proceeds representation only modifies the phrase that follows
-- "seller's contemplated estate in bankruptcy." Judge Bernstein,
however, stated that this argument was never made by Wansdown or
properly raised by Beekman. This new argument was only made for
the first time in a footnote in a supplemental letter brief ordered
by the Court on different issues, so the judge did not consider
this argument raised.
Beekman further argued that a statement signed by Gholam Reza
Golsorkhi, Wansdown's managing director and president, regarding
the 45-day closing deadline was a judicial admission
notwithstanding the different outside closing deadline stated in
the Purchase Agreement. The declaration signed by Golsorkhi stated
that the parties had 45 days after the Confirmation Order, a term
that included the Sale Order, to close on the Purchase Agreement.
The Purchase Agreement actually stated that the Closing Date was
set to take place no later than 45 days after the Confirmation
Order became final and non-appealable, "provided, however, that in
no event shall the Closing take place later than January 31, 2020,
subject to extension of the Final Date." On this matter, Judge
Bernstein agreed with Wansdown, concluding that Golsorkhi's
statement was his interpretation of the closing deadline under the
Purchase and was not, therefore, a judicial admission.
Beekman also argued that the parties did not have the opportunity
to brief the Court's sua sponte decision that the parties
contracted that the Confirmation Order would be final and
non-appealable before they were required to close. However, Judge
Bernstein found that the Court had expedited the sale hearing to
allow Wansdown to obtain a final, non-appealable order by the
January 31 contractual deadline, and Beekman never argued that
expedition was unnecessary because the parties were obligated to
close under a non-final order.
Beekman argued that parties to a real estate contract may not
unilaterally impose a time-of-the-essence closing date after a
mutually agreed adjournment, because doing so would alter the
agreement between the parties without the consent or fault of the
other party. Judge Bernstein still concluded that Beekman had
committed a material breach by failing to close by February 10,
2020 subject to Wansdown's ability to show that it was ready,
willing, and able to close.
Judge Bernstein also found no sense in Beekman's argument that the
debtor, Wansdown, had an obligation to tell the Court that it could
not meet the condition. The judge explained that the sale order
did not relieve Wansdown of any obligation under the purchase
agreement. To the contrary, it authorized and directed the debtor
to assume the purchase agreement and comply with its terms.
Whatever rights and obligations the parties had they retained.
As to the Court's second, factual question concerning
disproportionate forfeiture, Beekman's motion maintained that
Wansdown never raised this issue. Beekman argued that it was
manifestly unfair for the Court to raise it sua sponte and rest a
part of the Decision on the doctrine, and most important, the
doctrine of disproportionate forfeiture does not apply in this case
as a matter of law.
On this matter, Judge Bernstein agreed with Beekman that the debtor
never argued that returning the downpayment would result in a
diproportionate forfeiture. The judge also found that Beekman's
motion discusses authority supporting the proposition that neither
materiality nor risk of forfeiture are relevant where the condition
is expressed in the contract and the debtor has not suffered a
forfeiture or undue hardship. Accordingly, Judge Bernstein granted
reconsideration solely with respect to the issue of whether, as a
matter of law, the doctrine of disproportionate forfeiture as
discussed in the Decision does or does not apply in this case.
A full-text copy of Judge Bernstein's memorandum decision and
order, dated January 6, 2021, is available at
https://tinyurl.com/y4vaaejc from Leagle.com.
Plaintiff is represented by:
Ira L. Herman, Esq.
Evan J. Zucker, Esq.
BLANK ROME LLP
1271 Avenue of the Americas
New York, NY 10020
Tel: (212)885-5000
Email: iherman@blankrome.com
ezucker@blankrome.com
Defendant is represented by:
Christopher Serbagi, Esq.
THE SERBAGI LAW FIRM
488 Madison Avenue, Suite 1120
New York, NY 10022
Tel: (215) 593-2112
Email: christopher@serbagilaw.com
About Wansdown Properties
Wansdown Properties Corporation, N.V.'s primary asset is a
seven-story townhouse located at 29 Beekman Place, New York, New
York. It was incorporated in 1979 under the laws of Curacao,in
accordance with Article 38 of the Commercial Code of the
Netherlands Antilles and continues to exist under the laws of the
Netherland Antilles. Wansdown Properties was formed as a holding
company to own and manage the Property for an affluent individual
who deceased in January 2016.
Wansdown Properties Corporation sought protection under Chapter 11
of the Bankruptcy Code (Bankr. S.D.N.Y. Case No. 19-13223) on Oct.
8, 2019. At the time of the filing, the Debtor was estimated to
have assets of between $10 million and $50 million and liabilities
of the same range. The case is assigned to Judge Stuart M.
Bernstein.
Counsel for the Debtor:
Paul A. Rubin
Hanh V. Huynh
RUBIN LLC
345 Seventh Avenue, 21st Floor
New York, New York 10001
Tel: 212.390.8054
Fax: 212.390.8064
E-mail: prubin@rubinlawllc.com
hhuynh@rubinlawllc.com
WAYNE P. BURICK: Keybank's Bid to Vacate Property Sale Order Voided
-------------------------------------------------------------------
Judge Carlota M. Bohm of the U.S. Bankruptcy Court for the Western
District of Pennsylvania granted the request of KeyBank, N.A., a
creditor of Wayne P. Burick and Virginia Sue Burick, to withdraw
without prejudice its request to vacate the order confirming the
Debtors' sale of the real property located at 4547 State Route 158,
in New Wilmington, Pennsylvania, to Michael E. Nagel, Jr. and
Monique R. Nagel for $500,000.
The Movant's Motion to Vacate Confirmation Order and Order
Confirming Chapter 11 Sale of Property Free and Divested of Liens
is withdrawn.
The hearing scheduled on Jan. 26, 2021, at 10:00 a.m., is
cancelled.
Wayne P. Burick and Virginia Sue Burick sought Chapter 11
protection (Bankr. W.D. Pa. Case No. 18-24608) on Nov. 29, 2018.
The Debtor tapped Edgardo D. Santillan, Esq., at Santillan Law,
P.C. as counsel.
WESTERN HERITAGE: Seeks to Tap Martelle Gordon & Assoc. as Counsel
------------------------------------------------------------------
Western Heritage Investments, LLC seeks approval from the U.S.
Bankruptcy Court for the District of Idaho to employ Martelle,
Gordon & Associates as its legal counsel.
The firm will render these legal services:
(a) take all necessary action to protect and preserve the
estate of the Debtor;
(b) prepare legal documents;
(c) prosecute a plan of reorganization and all related
transactions; and
(d) perform all other necessary legal services in connection
with the Debtor's Chapter 11 case.
The hourly rates of the firm's principal attorneys and paralegals
presently designated to represent the Debtor are:
Martin J. Martelle $350
Luke Gordon $250
Melody L. Haile, Paralegal $150
In addition, the firm will receive reimbursement for out-of-pocket
expenses.
Martin Martelle, Esq., an attorney at Martelle Gordon, disclosed in
court filings that he and the firm are "disinterested persons" as
that term is defined in Section 101(14) of the Bankruptcy Code.
The firm can be reached through:
Martin J. Martelle, Esq.
Luke Gordon, Esq.
Martelle, Gordon & Associates
5995 W. State St., Ste. A
Boise, ID 83703
Telephone: (208) 938-8500
Facsimile: (208) 938-8503
Email: attorney@martellelaw.com
About Western Heritage Investments
Western Heritage Investments, LLC is the owner of fee simple title
to a property located in Vale, Ore., valued at $1.2 million.
Western Heritage Investments filed a voluntary petition for relief
under Chapter 11 of the Bankruptcy Code (Bankr. D. Idaho Case No.
20-01051) on Dec. 10, 2020. Baljit Nanda, managing member, signed
the petition.
At the time of the filing, the Debtor disclosed $1,200,000 in total
assets and $560,142 in total liabilities.
Judge Joseph M. Meier oversees the case. Martelle, Gordon &
Associates, led by Martin J. Martelle, Esq., serves as the Debtor's
legal counsel.
WESTINGHOUSE ELECTRIC: SCANA, Fluor Not Liable Under WARN Act
-------------------------------------------------------------
Judge J. Michelle Childs of the United States District Court for
the District of South Carolina, Rock Hill Division granted the
Motions for Summary Judgment filed by Fluor and SCANA in the case
captioned Lawrence Butler, Lakeisha Darwish, and Jimi Che Sutton,
Plaintiffs, v. Fluor Corporation and Fluor Enterprises, Inc.,
Defendants. Harry Pennington, III and Timothy Lorentz, individually
and on behalf of all those similarly situated, Plaintiffs, v. Fluor
Corporation, Fluor Enterprises, Inc., Fluor Daniel Maintenance
Services, Inc., SCANA Corporation, and South Carolina Electric &
Gas Company, Defendants, Civil Action Nos. 0:17-cv-02201-JMC,
0:17-cv-02094-JMC (D.S.C.).
The judge also denied the plaintiffs' Motion for Summary Judgment
as well as their Request for Supplement, and dismissed the case
with prejudice.
In 2008, SCANA contracted with Westinghouse Electric Company LLC
(WEC) to build two nuclear reactors at the V.C. Summer Nuclear
Station in Jenkinsville, South Carolina. SCANA owned the project
site and facilities. WEC was generally responsible for the design,
manufacture, and procurement of the nuclear reactor, steam
turbines, and generators. In January of 2016, WEC hired Fluor as a
subcontractor to "employ craft employees on the [P]roject and
t[a]ke responsibility for management of on-site construction while
[WEC] remained responsible for designing, engineering,
construction, and project management."
Subsequently, the financial health of WEC deteriorated to the point
that, on March 29, 2017, WEC filed for bankruptcy protection under
Chapter 11 of Title 11 of the United States Bankruptcy Code in the
Southern District of New York.
On July 31, 2017, SCANA stopped all construction at the project.
As a result of this decision, it appears that approximately 5,000
workers were impacted who had been working and/or receiving
assignments at the project. It is undisputed that SCANA alone
ordered the project's closure and gave no advanced warning to
Fluor.
As a result, Plaintiffs filed a putative class action Complaint in
the district court against Defendants in August 2017, alleging a
violation of the WARN Act. Plaintiffs contended SCANA, WEC, and
Fluor, which comprise a total of six different entities,
essentially all acted as a single employer under the WARN Act and
knowingly failed to give their employees at least 60 days' prior
notice of termination of their employment as required by the WARN
Act. Plaintiffs further argued Fluor should not escape liability
under the WARN Act because the shutdown was reasonably
foreseeable.
Judge Childs analyzed whether SCANA and its contractors amounted to
a single employer under the WARN Act's DOL Factors:
(1) common ownership,
(2) common directors and/or officers,
(3) de facto exercise of control,
(4) unity of personnel policies emanating from a common
source, and
(5) the dependency of operations.
After a thorough review of the record, and even in the light most
favorable to Plaintiffs, Judge Childs concluded that all five
factors either weigh in favor of Defendants or do not favor
Plaintiffs.
Judge Childs observed there are no allegations in the Amended
Complaint that SCANA has a direct ownership interest in WEC or
Fluor, or that these companies shared common officers. The judge
also found that the de facto control of operations, unity of
personnel policies, and dependency of operations factors all favor
Defendants. Judge Childs found no genuine dispute that SCANA's
control of Fluor and WEC was largely within the expected bounds of
a principal client's relationship with its hired contractor or
subcontractor. Even assuming the employment practice giving rise
to the instant litigation was SCANA's project closure, the judge
found this closure alone is insufficient to establish de facto
control over an otherwise independent Fluor. Judge Childs also
found that the personnel policies of both SCANA and its contractors
were not sufficiently unified to constitute a WARN single employer.
Lastly, the judge found the minimal connections between the
companies are insufficient to show any significant dependency of
operations.
As to Fluor's liability under the WARN Act, it appeared to Judge
Childs that Plaintiffs concede that Fluor did not close the project
nor conduct a mass layoff necessary to sustain a WARN Act violation
as a separate employer. Plaintiffs spent considerable time
throughout their briefs articulating that the illegal employment
practice at issue was SCANA's plant closure, and not Fluor's
subsequent lack of WARN notice. Plaintiffs also did not argue
Fluor was a separate WARN employer in their Motion for Summary
Judgment, nor in their response to Fluor's Motion for Summary
Judgment. Accordingly, Judge Childs concluded that this theory of
liability has in all likelihood been waived.
Even assuming Plaintiffs have not waived this theory of liability,
Judge Childs found the Project's abrupt closure amounted to
unforeseeable business circumstances to Fluor, which relieved Fluor
of WARN liability for failing to send a 60-day notice to its direct
employees.
Lastly, Judge Childs found that Fluor provided WARN notice after
the project's closure as soon as practicable. It appeared Fluor
distributed a non-WARN notice FAQ document to all employees at the
job site on the date of the project's closure. Fluor then mailed
its craft employees WARN notice on August 4, 2017, and sent updated
information on August 16, 2017. Fluor relatedly sent WARN notice
to its salaried employees between August 9-10, 2017. The judge
found that such notice was reasonable given the magnitude of the
project, the presence of thousands of workers at the job site, and
the abrupt nature of the shutdown. Judge Childs thus concluded
that Fluor is not liable under the WARN Act.
A full-text copy of Judge Childs' order and opinion dated January
6, 2021 is available at https://tinyurl.com/y2mmm9cb from
Leagle.com.
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.
WILLIAM BURCH: 5th Cir. Dismisses Appeals v. Homeward, Ocwen
------------------------------------------------------------
The United States Court of Appeals, Fifth Circuit dismissed the
appeals filed by William Paul Burch against Homeward Residential,
Inc. and Ocwen Loan Servicing Corp. for lack of subject-matter
jurisdiction.
The 5th Circuit also affirmed the district court's dismissal over
the remaining appeals.
The case is In the Matter of: William Paul Burch Debtor, William
Paul Burch, Appellant, v. Freedom Mortgage Corporation, Appellee,
In the Matter of: William Paul Burch Debtor, William Paul Burch,
Appellant, v. JP Morgan Chase Bank National Association, Appellee,
In the matter of: William Paul Burch Debtor, William Paul Burch,
Appellant, v. Hughes Waters Askanase; Michael Weems; Specialized
Loan Servicing, L.L.C.; Padfield; Stout, L.L.P.; Mark W. Stout,
Appellees, In the Matter of: William Paul Burch Debtor, William
Paul Burch, Appellant, v. Homeward Residential, Incorporated,
Appellee, In the Matter of: William Paul Burch Debtor, William Paul
Burch, Appellant, v. Homeward Residential, Incorporated, Appellee,
In the Matter of: William Paul Burch Debtor, William Paul Burch,
Appellant, v. Ocwen Loan Servicing Company, Appellee, Case No. No.
20-10498, Summary Calendar (5th Cir.).
On December 1, 2008, Burch and his wife, Juanita Burch filed for
Chapter 11 bankruptcy to prevent foreclosure on several properties
in Texas. The Bankruptcy Court for the Northern District of Texas
confirmed a plan of reorganization on December 9, 2009. The order
accompanying the plan included provisions calling for the Burches
and the mortgagees to "enter into a New [] Note" for each of the
properties, and the order set the payment terms for these new
notes.
Burch later filed a second bankruptcy petition on December 8, 2012
in the same bankruptcy court. The petition was filed under Chapter
13 but was converted to Chapter 11 on December 23, 2013. The
defendant-appellees filed proofs of claims in the 2012 bankruptcy
case, which the bankruptcy court recognized. The 2012 bankruptcy
case was converted to chapter 7 on January 30, 2018, based on,
among other things, Burch's defaults under the 2012 bankruptcy
case's chapter 11 plan. The 2012 bankruptcy case is still pending.
In 2018, Burch filed claims in Texas state courts against the
defendant-appellants, alleging that the defendant-appellees failed
to timely comply with the 2009 Chapter 11 Plan's requirement of new
notes and mortgages on each of the properties, thus invalidating
the original notes and liens. The defendants in each proceeding
removed those claims either directly to the Bankruptcy Court for
the Northern District of Texas, or to the District Court for the
Northern District of Texas, which referred those cases to the
Bankruptcy Court for the Northern District of Texas under 28 U.S.C.
Section 157(a).
The bankruptcy court denied Burch's motions to remand each of the
cases and dismissed some of the cases under Rules 12(b)(6) or
12(c). Burch appealed each of those decisions to the district
court, including in some cases where the bankruptcy court had yet
to rule on the merits. The district court denied Burch's request to
proceed in forma pauperis (IFP) and warned Burch that failure to
pay the filing fee would result in dismissal. When Burch did not
timely pay the filing fee, the district court dismissed his
appeals.
Burch then appealed to the Court of Appeals, arguing that the
bankruptcy court lacked subject-matter jurisdiction over the
removed state-law claims. At the time Burch appealed, the
bankruptcy court had not entered final judgments in Burch's cases
against defendant-appellees Homeward and Ocwen, leading the two
defendant-appellees to seek dismissal for lack of subject matter
jurisdiction. However, the bankruptcy court has since dismissed
each of Burch's underlying cases.
The appeals court explained that its jurisdiction over appeals from
cases arising in bankruptcy court extends to all "final judgments,
orders and decrees" entered by the district courts. In Burch's
case, however, the notices of appeal in three of the cases below
involving Homeward and Ocwen were from the bankruptcy court's
denial of Burch's motion for remand, and so, when the district
court dismissed those appeals, the underlying proceedings were
still live, with significant motions pending before the bankruptcy
court. The 5th Circuit stated that "The district court's order [in
those cases] is therefore not a final order, and as such, it is not
appealable to this Court."
Turning to the remaining cases, the 5th Circuit found that Burch's
arguments are frivolous.
Burch argued that the bankruptcy court lacked subject-matter
jurisdiction over Burch's removed state-law claims. The 5th
Circuit explained that subject-matter jurisdiction remains in the
bankruptcy court, even after a bankruptcy case is closed, to assure
that the rights afforded to a debtor by the Bankruptcy Code are
fully vindicated. The appeals court further explained that, with
regards to a district court's transfer of a proceeding to a
bankruptcy court, 28 U.S.C. Section 157(a) provides that "each
district court may provide that proceedings arising under title 11
as core proceedings or arising in or related to a case under title
11, shall be referred to the bankruptcy judges for the district."
The appeals court pointed out that each of Burch's state-court
claims is premised on his interpretation of a Chapter 11 bankruptcy
order, and so each arises from or is related to his Title 11
bankruptcy proceedings. Thus, the 5th Circuit concluded that the
district court properly transferred the removed cases to the
bankruptcy court.
Burch also argued that the bankruptcy court's rule 12 dismissals
violate his Seventh Amendment rights. However, the appeals court
held that a bankruptcy court's dismissal of claims pursuant to a
valid 12(b)(6) motion does not violate a plaintiff's right to a
jury trial under the Seventh Amendment.
Burch was also deemed a vexatious litigant and was warned that
should he make any further frivolous or abusive filings in the
appeals court, the district court, or the bankruptcy court, he may
be imposed sanctions, including dismissal, monetary sanctions,
and/or restrictions on his ability to file pleadings in the appeals
court and any court subject to the appeals court's jurisdiction.
A full-text copy of the 5th Circuit's decision, dated January 8,
2021, is available at https://tinyurl.com/y6pn6oyf from
Leagle.com.
About William and Juanita Burch
The spouses William and Juanita Burch filed a Chapter 11 bankruptcy
petition (Bankr. N.D. Tex., Case No. 08-45761) on December 1, 2008.
Judge Russell F. Nelms is the case judge.
At the time of filing, the debtors estimated $1,000,001 to
$10,000,000 in assets and $1,000,001 to $10,000,000 in debts.
Eric A. Liepins, Esq. of Eric A. Liepins, P.C. Serves as bankruptcy
counsel.
WP CITYMD: Moody's Completes Review, Retains B2 CFR
---------------------------------------------------
Moody's Investors Service has completed a periodic review of the
ratings of WP CityMD Bidco LLC and other ratings that are
associated with the same analytical unit. The review was conducted
through a portfolio review discussion held on January 11, 2021 in
which Moody's reassessed the appropriateness of the ratings in the
context of the relevant principal methodology(ies), recent
developments, and a comparison of the financial and operating
profile to similarly rated peers. The review did not involve a
rating committee. Since January 1, 2019, Moody's practice has been
to issue a press release following each periodic review to announce
its completion.
This publication does not announce a credit rating action and is
not an indication of whether or not a credit rating action is
likely in the near future. Credit ratings and outlook/review status
cannot be changed in a portfolio review and hence are not impacted
by this announcement.
Key rating considerations.
WP CityMD Bidco LLC's B2 stable CFR is constrained by its high
financial leverage and limited geographic diversification (highly
concentrated in New York and New Jersey). The credit profile
benefits from CityMD's high brand awareness and focus on urgent
care services, which has relatively stable demand, and is
anticipated to grow as patients use urgent care services in order
to avoid hospitals during and after the pandemic.
The principal methodology used for this review was Business and
Consumer Service Industry published in October 2016.
YS GARMENTS: S&P Alters Outlook to Positive, Affirms 'B-' ICR
-------------------------------------------------------------
S&P Global Ratings revised its outlook on YS Garments LLC (doing
business as Next Level Apparel) to positive from negative because
it no longer believes there is a high risk that the company's
capital structure will become unsustainable in the next 12 months
and the rating agency forecasts a significant improvement in the
company's leverage in 2021.
At the same time, S&P is affirming all of its ratings on the
company, including its 'B-' issuer credit rating.
The positive outlook reflects the possibility S&P could raise its
rating on Next Level to 'B' if it continues to increase its sales
and generate positive discretionary cash flow such that it believes
it will sustain leverage of less than 5x and a covenant cushion of
at least 15%.
Next Level, which provides undecorated fashion basics to the U.S.
wearable promotional products industry, increased its sales by 10%
year-over-year in the third quarter. This is a significant
improvement from the 46% decline it reported the first half of the
year due to the coronavirus pandemic. Next Level also generated
positive discretionary cash flow despite its significant volume
declines in the first half.
Next Level has demonstrated positive sales momentum so far in the
second half of the year despite its severe decline in the first
half. The coronavirus pandemic led many organizations to cancel
their events and promotions in early 2020, which significantly
reduced the demand for wearable promotional products and the blank
apparel Next Level supplies to the industry. The company's sales
dropped by 36% in the first quarter and 56% in the second quarter.
However, Next Level quickly returned to sales growth and posted a
10% year-over-year gain in the third quarter as it increased its
direct sales to decorators, won new customers, and its distributor
customers replenished their inventory to meet rising demand. The
positive momentum continued into the fourth quarter as its October
and November sales were both up more than 20% year-over-year, which
reflects the continued positive point-of-sale trends at its
distributors.
The company's cash flow generation remained positive despite its
significant volume declines in the first half. Next Level cut its
costs considerably at the outset of the pandemic to preserve
liquidity and minimize its margin deterioration. Despite the 46%
plummet in revenue in the first half and its leverage spiking to
about 6x, the company still generated about $35 million of
discretionary cash flow (DCF). Next Level's strong cash flow
generation was supported by its aggressive cost cutting and good
working capital management. As of the end of November, Next Level
had generated more than $60 million of DCF, primarily due to $48
million of working capital inflows.
S&P said, "We forecast that much of this working capital inflow
will reverse in 2021 as the company builds inventory to support its
growth, though we still forecast it will generate positive
discretionary cash flow in 2021. In addition, we expect Next
Level's cash flow generation will normalize above $50 million in
2022 as the pandemic subsides."
"We forecast the company will remain in compliance with its
leverage covenant, though its covenant cushion could be relatively
tight in 2021.Near the onset of the pandemic, Next Level's lenders
agreed to waive its covenants in the second and third quarters of
2020 and reset its covenant levels to 6.5x in the fourth quarter of
2020 and 6.0x in the first quarter of 2021. The company's covenant
will revert back to 4.5x in the second quarter of 2021 before
stepping down to 4.25x in the third quarter and 4.0x in the fourth
quarter. We forecast that Next Level will remain in compliance with
these covenants, although its cushion could be relatively tight
(under 15%) depending on the trajectory of its sales and EBITDA
growth. Nevertheless, the company already demonstrated its ability
to obtain temporary covenant relief from its lenders and we believe
its lenders would grant additional temporary relief if needed as
long as it continues to perform well."
"The positive outlook reflects our forecast that the current demand
trends for Next Level's products will continue into 2021 and the
company will sustain its good cost control such that its leverage
improves below 5x and it generates positive discretionary cash
flow."
"We could raise our rating on Next Level to 'B' if it maintains its
current performance such that we believe it will generate positive
discretionary cash flow and sustain leverage of less than 5x. We
would also need to be confident that the company will maintain
adequate covenant cushion (about 15% or better)."
S&P could revise its outlook on Next Level to stable if the company
is unable to increase its sales as anticipated, the company's cash
flow is materially lower than the rating agency expects in 2021, or
the rating agency believes the company's covenant cushion will
contract to the single-digit percent area. This could occur if:
-- Current demand trends do not continue or competitors exhibit
aggressive pricing behavior leading to sales recovering slower than
it expects; or
-- Higher-than-expected input cost inflation impairs the company's
margins and cash flow.
ZAANA-17 LLC: $752K Sale of Pelham Property to White, Others OK'd
-----------------------------------------------------------------
Judge Christopher J. Panos of the U.S. Bankruptcy Court for the
District of Massachusetts authorized Zaana-17, LLC's sale of the
real property known as Lot 2 or 16 Chardonnay Road, in Pelham, New
Hampshire, to Stephen White, Pamela White, Melissa White, and Scott
J. Audy, Jr. for $752,000, on the terms of their Purchase and Sale
Agreement.
A hearing on the Motion was held on Jan. 12, 2021.
The sale is free and clear of all claims and interests, with all
such claims and interests not be enforceable against the Buyer.
Notwithstanding any provision in the Bankruptcy Rules to the
contrary, the Court expressly finds there is no reason for delay in
the implementation of the Order and, accordingly: (i) the terms of
the Order will be immediately effective and enforceable upon its
entry; (ii) the Debtor is not subject to any stay in the
implementation, enforcement or realization of the relief granted in
the Order; and (iii) the Debtor may, in its discretion and without
further delay, take any action and perform any act authorized under
the Order.
The Closing will take place and payment of the Purchase Price will
take place following entry of a Final Order of the Court approving
the sale and as otherwise extended in writing as set forth in the
Sale Agreement.
The Debtor is authorized to execute all documents necessary to
consummate the sale.
About Zaana-17
Zaana-17 LLC, based in Dracut, MA, filed a Chapter 11 petition
(Bankr. D. Mass. Case No. 20-41170) on Dec. 16, 2020. In the
petition signed by Frank J. Gorman, Sr., manager, the Debtor was
estimated to have $1 million to $10 million in both assets and
liabilities. The Hon. Christopher J. Panos presides over the
case.
PARKER & LIPTON, serves as bankruptcy counsel to the Debtor.
ZELIS PAYMENTS: Moody's Completes Review, Retains B2 CFR
--------------------------------------------------------
Moody's Investors Service has completed a periodic review of the
ratings of Zelis Payments Buyer, Inc. and other ratings that are
associated with the same analytical unit. The review was conducted
through a portfolio review discussion held on January 11, 2021 in
which Moody's reassessed the appropriateness of the ratings in the
context of the relevant principal methodology(ies), recent
developments, and a comparison of the financial and operating
profile to similarly rated peers. The review did not involve a
rating committee. Since January 1, 2019, Moody's practice has been
to issue a press release following each periodic review to announce
its completion.
This publication does not announce a credit rating action and is
not an indication of whether or not a credit rating action is
likely in the near future. Credit ratings and outlook/review status
cannot be changed in a portfolio review and hence are not impacted
by this announcement.
Key rating considerations.
Zelis' B2 CFR reflects the company's high financial leverage,
modest but improving scale, and moderate customer concentration.
The credit profile is supported by Zelis' track record of strong
revenue and earnings growth. Given the company's strong profit
margins and modest capital requirements (mostly IT and systems
investments), Moody's expects the company to generate solid free
cash flow and have very good liquidity.
The principal methodology used for this review was Business and
Consumer Service Industry published in October 2016.
[*] AIRA Announces 8 CIRA Certification Awards
----------------------------------------------
Rendering financial advisory services in the business turnaround,
restructuring and bankruptcy practice areas requires both special
knowledge and extensive relevant experience. In 1992, the
Association of Insolvency and Restructuring Advisors (AIRA)
established the Certified Insolvency and Restructuring Advisor
(CIRA) program to recognize by public awareness and certification
those individuals who possess a high degree of knowledge and
proficiency across a spectrum of functions related to serving
clients in situations involving distressed and/or insolvent
entities. Such expertise includes accounting, operations,
strategic, taxation, and finance issues related to business
bankruptcy and insolvency.
The Association of Insolvency and Restructuring Advisors announced
Jan. 18, 2021 statement having completed the requirements for
certification, the following AIRA members are awarded the CIRA
certification:
-- Evan Bookstaff / FTI Consulting, Dallas, TX
-- William Andrew Costello / Alvarez & Marsal, Dallas, TX
-- Andrew George / High Ridge Partners, Chicago, IL
-- Robert Molina / FTI Consulting, Dallas, TX
-- Joseph Pattaphongse / Center Street LLC, Newport Beach, CA
-- Guillermo Saldana / Mackinac Partners, Dallas, TX
-- David Samikkannu / AlixPartners, New York, NY
-- Ryan Sublett / AlixPartners, New York, NY
The Association of Insolvency and Restructuring Advisors (AIRA) --
https://aira.org/ -- is a nonprofit professional association
serving financial advisors, accountants, crisis managers, business
turnaround consultants, lenders, investment bankers, attorneys,
trustees, and other individuals involved in the fields of business
turnaround, restructuring, bankruptcy and insolvency. AIRA's
mission is to (i) Unite and support professionals providing
business turnaround, restructuring and bankruptcy services, and
(ii) Develop, promote and maintain professional standards of
practice, including a professional certification through its CIRA
and CDBV programs. For additional conference and program
information, visit https://aira.org/conference.
[*] Bankruptcy Relief for Small Business Under Latest Stimulus Bill
-------------------------------------------------------------------
Taruna Garg, Jonathan Horne and Robert Kaelin of Murtha Cullina
wrote an article on JDSupra titled "Bankruptcy Relief for Small
Businesses Under Latest Stimulus Bill."
The Consolidated Appropriation Act of 2021 ("CAA") enacted on
December 27, 2020 bolsters the bankruptcy relief available to small
businesses in several key ways. In June 2020, we outlined here ways
in which the Small Business Restructuring Act of 2020 ("SBRA")
offered small businesses having aggregate debts up to $7.5 million
a less costly and more streamlined alternative to restructuring
under chapter 11 of the United States Bankruptcy Code. The CAA
furthers those benefits in several important ways for two years
until December 27, 2022:
* PPP Loan Eligibility: After the passage of the CARES Act in
March 2020, the Small Business Administration and several
bankruptcy courts rejected efforts by small business debtors from
receiving loans under the Paycheck Protection Program ("PPP")
administered by the Small Business Administration. The CAA remedies
that issue by amending section 364 of the Bankruptcy Code to
authorize small business debtors to obtain PPP loans. A PPP loan
obtained by a small business debtor after bankruptcy is granted
administrative expense priority, and thus must be repaid before
most other unsecured debts. The CAA does not address the question
of how PPP loans obtained before the bankruptcy filing should be
treated in the chapter 11 bankruptcy case.
* Lease Performance Extension: Section 365(d)(3) of the Bankruptcy
Code requires debtors to "timely perform" all obligations under a
lease of non-residential real property within 60 days after the
filing, thus forcing debtors to make full lease payments shortly
after its bankruptcy filing. The CAA now authorizes bankruptcy
courts to grant solely to small business debtors an additional
60-day extension to perform under a lease if the debtor has
experienced material hardship directly or indirectly due to
COVID-19. For all debtors, including small businesses, the CAA
lengthens from 210 days to 300 days the maximum extended deadline
the debtor may obtain to assume or reject a lease of nonresidential
real property.
* Preference Protection to Landlords and Suppliers: The Bankruptcy
Code allows debtors and trustees to avoid and recover payments to
creditors made within 90 days of the bankruptcy filing, subject to
certain limited defenses. The CAA amends section 547 of the
Bankruptcy Code to prohibit avoidance of preferential payments made
by a debtor to landlords or suppliers under agreements to defer or
postpone payments entered into with a debtor after March 12, 2020.
This protection affords greater flexibility to landlords and
suppliers to work with struggling debtors without fear that
extending a payment deadline will result in having to disgorge the
payment.
* Other Amendments: In addition to the aforementioned amendments
specifically dealing with small businesses, there are several other
amendments impacting bankruptcy. For example, the CAA amends
section 366 of the Bankruptcy Code to prohibit a utility from
discontinuing utility services to an individual debtor because of
failure to provide adequate assurance of payment during the
bankruptcy case, so long as the individual debtor pays the utility
company for
services supplied in the 20 day post-filing period and continues to
make all other post-petition utility payments.
[*] SSG Advised Green's Natural in Sale to Hudson Equity
--------------------------------------------------------
SSG Capital Advisors, LLC ("SSG") acted as the investment banker to
Green's Natural Foods, Inc. in the sale of its equity interests to
Hudson Equity Partners, LLC (Hudson or the Buyer). The transaction
closed in December 2020.
Green's is a branded lifestyle chain of organic and natural grocery
stores in Westchester County, New York. Through its four unique
supermarkets, the Company caters to the public's growing interest
in eating and living healthier. Health-conscious and mainstream
consumers are equally attracted to the Company's curated assortment
of high-quality, organic, and natural products. Green's combines
carefully selected organic food, high-quality dietary supplements,
exceptional customer service, and community outreach to create a
neighborhood grocery destination.
Founded in the early 1990s, the Company has successfully operated
for decades by staying true to its commitment to organic and
all-natural products. In 2020, the Company launched a new, small
store, portable format designed for grab-and-go convenience. After
proving the concept's broad appeal, Green's sought a capital
partner to strengthen its capital base and provide operational
support to facilitate future growth.
SSG was retained to conduct a comprehensive marketing process to
facilitate an exit for the existing owners and align the Company
with a growth-oriented strategic partner. Leveraging its
significant food and beverage experience, SSG canvassed a wide
range of investors and attracted interest from multiple parties.
The sale to Hudson proved to be the best solution as it provided
Green's with the capital and operational expertise to execute on
its long-term objectives.
Other professionals who worked on the transaction include:
Robert Wexler of The Tron Group, financial advisor to Green's
Natural Foods, Inc.;
Jonathan T. Fitzsimons and Ashley P. Keenan of Brown Rudnick LLP,
counsel to Green's Natural Foods, Inc.; and
Nate Blackburn and Tucker Thomas of Blackwell, Blackburn, Herring &
Singer LLP, counsel to Hudson Equity Partners, LLC.
[^] Large Companies with Insolvent Balance Sheet
------------------------------------------------
Total
Share- Total
Total Holders' Working
Assets Equity Capital
Company Ticker ($MM) ($MM) ($MM)
------- ------ ------ -------- -------
ABSOLUTE SOFTWRE ABST CN 136.7 (40.5) (9.7)
ABSOLUTE SOFTWRE OU1 GR 136.7 (40.5) (9.7)
ABSOLUTE SOFTWRE ABST US 136.7 (40.5) (9.7)
ABSOLUTE SOFTWRE ABT2EUR EU 136.7 (40.5) (9.7)
ACCELERATE DIAGN 1A8 GR 104.2 (49.7) 85.0
ACCELERATE DIAGN AXDX US 104.2 (49.7) 85.0
ACCELERATE DIAGN 1A8 SW 104.2 (49.7) 85.0
ACCELERATE DIAGN AXDX* MM 104.2 (49.7) 85.0
ADAPTHEALTH CORP AHCO US 1,548.8 439.7 169.6
ADVANZ PHARMA CO CXRXF US 1,537.9 (68.1) 178.1
AGENUS INC AGEN US 204.5 (179.4) (21.4)
AGILITI INC AGLY US 745.0 (67.7) 17.3
AMC ENTERTAINMEN AMC* MM 10,876.2 (2,335.4) (979.6)
AMER RESTAUR-LP ICTPU US 33.5 (4.0) (6.2)
AMERICAN AIR-BDR AALL34 BZ 62,773.0 (5,528.0) (4,244.0)
AMERICAN AIRLINE AAL US 62,773.0 (5,528.0) (4,244.0)
AMERICAN AIRLINE AAL* MM 62,773.0 (5,528.0) (4,244.0)
AMERICAN AIRLINE A1G GR 62,773.0 (5,528.0) (4,244.0)
AMERICAN AIRLINE A1G TH 62,773.0 (5,528.0) (4,244.0)
AMERICAN AIRLINE AAL11EUR EU 62,773.0 (5,528.0) (4,244.0)
AMERICAN AIRLINE AAL AV 62,773.0 (5,528.0) (4,244.0)
AMERICAN AIRLINE AAL TE 62,773.0 (5,528.0) (4,244.0)
AMERICAN AIRLINE A1G SW 62,773.0 (5,528.0) (4,244.0)
AMERICAN AIRLINE A1G GZ 62,773.0 (5,528.0) (4,244.0)
AMERICAN AIRLINE A1G QT 62,773.0 (5,528.0) (4,244.0)
AMERISOURCEB-BDR A1MB34 BZ 44,274.8 (839.6) (797.4)
AMERISOURCEBERGE ABG TH 44,274.8 (839.6) (797.4)
AMERISOURCEBERGE ABG GR 44,274.8 (839.6) (797.4)
AMERISOURCEBERGE ABC US 44,274.8 (839.6) (797.4)
AMERISOURCEBERGE ABC2EUR EU 44,274.8 (839.6) (797.4)
AMERISOURCEBERGE ABG QT 44,274.8 (839.6) (797.4)
AMERISOURCEBERGE ABG GZ 44,274.8 (839.6) (797.4)
AMYRIS INC AMRS US 205.9 (78.7) 27.7
AMYRIS INC 3A01 GR 205.9 (78.7) 27.7
AMYRIS INC 3A01 TH 205.9 (78.7) 27.7
AMYRIS INC 3A01 SW 205.9 (78.7) 27.7
AMYRIS INC AMRSEUR EU 205.9 (78.7) 27.7
AMYRIS INC 3A01 QT 205.9 (78.7) 27.7
APACHE CORP APA* MM 12,875.0 (37.0) 337.0
APACHE CORP APA TH 12,875.0 (37.0) 337.0
APACHE CORP APA GR 12,875.0 (37.0) 337.0
APACHE CORP APA US 12,875.0 (37.0) 337.0
APACHE CORP APA GZ 12,875.0 (37.0) 337.0
APACHE CORP APA1 SW 12,875.0 (37.0) 337.0
APACHE CORP APAEUR EU 12,875.0 (37.0) 337.0
APACHE CORP APA QT 12,875.0 (37.0) 337.0
APACHE CORP- BDR A1PA34 BZ 12,875.0 (37.0) 337.0
AQUESTIVE THERAP AQST US 50.4 (36.5) 13.3
AUTOZONE INC AZ5 GR 14,568.6 (1,027.0) 380.1
AUTOZONE INC AZ5 TH 14,568.6 (1,027.0) 380.1
AUTOZONE INC AZO US 14,568.6 (1,027.0) 380.1
AUTOZONE INC AZ5 GZ 14,568.6 (1,027.0) 380.1
AUTOZONE INC AZOEUR EU 14,568.6 (1,027.0) 380.1
AUTOZONE INC AZ5 QT 14,568.6 (1,027.0) 380.1
AUTOZONE INC AZO AV 14,568.6 (1,027.0) 380.1
AUTOZONE INC AZ5 TE 14,568.6 (1,027.0) 380.1
AUTOZONE INC AZO* MM 14,568.6 (1,027.0) 380.1
AUTOZONE INC-BDR AZOI34 BZ 14,568.6 (1,027.0) 380.1
AVID TECHNOLOGY AVID US 261.4 (144.2) 11.7
AVID TECHNOLOGY AVD GR 261.4 (144.2) 11.7
AVIS BUD-CEDEAR CAR AR 19,596.0 (76.0) 469.0
AVIS BUDGET GROU CAR US 19,596.0 (76.0) 469.0
AVIS BUDGET GROU CUCA GR 19,596.0 (76.0) 469.0
AVIS BUDGET GROU CAR* MM 19,596.0 (76.0) 469.0
AVIS BUDGET GROU CUCA TH 19,596.0 (76.0) 469.0
AVIS BUDGET GROU CUCA QT 19,596.0 (76.0) 469.0
AVIS BUDGET GROU CAR2EUR EU 19,596.0 (76.0) 469.0
AZIYO BIOLOGIC-A AZYO US 46.1 (18.3) (3.4)
BABCOCK & WILCOX BWEUR EU 605.8 (320.8) 116.9
BABCOCK & WILCOX UBW1 GR 605.8 (320.8) 116.9
BABCOCK & WILCOX BW US 605.8 (320.8) 116.9
BBTV HOLDINGS IN BBTV CN 1.0 (1.2) (0.7)
BBTV HOLDINGS IN BBVTF US 1.0 (1.2) (0.7)
BELLRING BRAND-A BR6 GR 653.5 (161.0) 137.1
BELLRING BRAND-A BRBR1EUR EU 653.5 (161.0) 137.1
BELLRING BRAND-A BR6 GZ 653.5 (161.0) 137.1
BELLRING BRAND-A BRBR US 653.5 (161.0) 137.1
BELLRING BRAND-A BR6 TH 653.5 (161.0) 137.1
BIGCOMMERCE-1 BIGC US 235.5 158.5 160.4
BIGCOMMERCE-1 BI1 GR 235.5 158.5 160.4
BIGCOMMERCE-1 BI1 GZ 235.5 158.5 160.4
BIGCOMMERCE-1 BI1 TH 235.5 158.5 160.4
BIGCOMMERCE-1 BIGCEUR EU 235.5 158.5 160.4
BIGCOMMERCE-1 BI1 QT 235.5 158.5 160.4
BIODESIX INC BDSX US 46.5 (61.2) (38.4)
BIOHAVEN PHARMAC BHVN US 782.0 (153.8) 491.2
BIOHAVEN PHARMAC 2VN GR 782.0 (153.8) 491.2
BIOHAVEN PHARMAC BHVNEUR EU 782.0 (153.8) 491.2
BIOHAVEN PHARMAC 2VN TH 782.0 (153.8) 491.2
BIONOVATE TECHNO BIIO US - (0.4) (0.4)
BLACK IRON INC BKIN MM 2.3 (1.3) 1.6
BLUE BIRD CORP BLBD US 317.4 (53.2) 5.2
BLUE BIRD CORP 4RB GR 317.4 (53.2) 5.2
BLUE BIRD CORP BLBDEUR EU 317.4 (53.2) 5.2
BLUE BIRD CORP 4RB GZ 317.4 (53.2) 5.2
BOEING CO-BDR BOEI34 BZ 161,261.0 (11,553.0) 38,705.0
BOEING CO-CED BA AR 161,261.0 (11,553.0) 38,705.0
BOEING CO-CED BAD AR 161,261.0 (11,553.0) 38,705.0
BOEING CO/THE BCO GR 161,261.0 (11,553.0) 38,705.0
BOEING CO/THE BAEUR EU 161,261.0 (11,553.0) 38,705.0
BOEING CO/THE BA EU 161,261.0 (11,553.0) 38,705.0
BOEING CO/THE BOE LN 161,261.0 (11,553.0) 38,705.0
BOEING CO/THE BCO TH 161,261.0 (11,553.0) 38,705.0
BOEING CO/THE BA PE 161,261.0 (11,553.0) 38,705.0
BOEING CO/THE BOEI BB 161,261.0 (11,553.0) 38,705.0
BOEING CO/THE BA US 161,261.0 (11,553.0) 38,705.0
BOEING CO/THE BA SW 161,261.0 (11,553.0) 38,705.0
BOEING CO/THE BA* MM 161,261.0 (11,553.0) 38,705.0
BOEING CO/THE BA TE 161,261.0 (11,553.0) 38,705.0
BOEING CO/THE BA CI 161,261.0 (11,553.0) 38,705.0
BOEING CO/THE BA AV 161,261.0 (11,553.0) 38,705.0
BOEING CO/THE BAUSD SW 161,261.0 (11,553.0) 38,705.0
BOEING CO/THE BCO GZ 161,261.0 (11,553.0) 38,705.0
BOEING CO/THE BCO QT 161,261.0 (11,553.0) 38,705.0
BOEING CO/THE TR TCXBOE AU 161,261.0 (11,553.0) 38,705.0
BOMBARDIER INC-B BBDBN MM 24,109.0 (6,448.0) 791.0
BONE BIOLOGICS C BBLG US 0.0 (11.9) (0.5)
BRINKER INTL EAT US 2,335.3 (465.1) (269.9)
BRINKER INTL BKJ GR 2,335.3 (465.1) (269.9)
BRINKER INTL EAT2EUR EU 2,335.3 (465.1) (269.9)
BRINKER INTL BKJ QT 2,335.3 (465.1) (269.9)
BRINKER INTL BKJ TH 2,335.3 (465.1) (269.9)
BRP INC/CA-SUB V DOO CN 4,240.0 (666.0) 759.8
BRP INC/CA-SUB V B15A GR 4,240.0 (666.0) 759.8
BRP INC/CA-SUB V DOOO US 4,240.0 (666.0) 759.8
BRP INC/CA-SUB V DOOEUR EU 4,240.0 (666.0) 759.8
BRP INC/CA-SUB V B15A GZ 4,240.0 (666.0) 759.8
CADIZ INC CDZI US 73.4 (22.5) 5.1
CADIZ INC 2ZC GR 73.4 (22.5) 5.1
CADIZ INC CDZIEUR EU 73.4 (22.5) 5.1
CALFRAC WELL SER CFW CN 954.2 (81.0) 128.0
CALIFORNIA RESOU CRC US 4,856.0 (1,581.0) (774.0)
CALIFORNIA RESOU 1CLD GR 4,856.0 (1,581.0) (774.0)
CALIFORNIA RESOU 1CLD QT 4,856.0 (1,581.0) (774.0)
CALIFORNIA RESOU CRC1EUR EU 4,856.0 (1,581.0) (774.0)
CALUMET SPECIALT CLMT US 1,807.5 (44.8) 69.3
CAP SENIOR LIVIN CSU2EUR EU 740.5 (259.0) (305.6)
CDK GLOBAL INC CDK US 2,915.7 (514.5) (88.2)
CDK GLOBAL INC C2G QT 2,915.7 (514.5) (88.2)
CDK GLOBAL INC C2G TH 2,915.7 (514.5) (88.2)
CDK GLOBAL INC CDKEUR EU 2,915.7 (514.5) (88.2)
CDK GLOBAL INC C2G GR 2,915.7 (514.5) (88.2)
CDK GLOBAL INC CDK* MM 2,915.7 (514.5) (88.2)
CEDAR FAIR LP FUN US 2,501.5 (551.3) 43.1
CENGAGE LEARNING CNGO US 2,849.9 (153.0) 161.4
CENTRUS ENERGY-A 4CU GR 468.2 (275.6) 70.5
CENTRUS ENERGY-A LEU US 468.2 (275.6) 70.5
CENTRUS ENERGY-A LEUEUR EU 468.2 (275.6) 70.5
CEREVEL THERAPEU CERE US 150.5 142.6 (1.7)
CHEWY INC- CL A CHWY US 1,643.2 (56.4) (182.2)
CHEWY INC- CL A CHWY* MM 1,643.2 (56.4) (182.2)
CHOICE HOTELS CZH GR 1,570.1 (21.4) 163.2
CHOICE HOTELS CHH US 1,570.1 (21.4) 163.2
CHUN CAN CAPITAL CNCN US - (0.0) (0.0)
CINCINNATI BELL CBBEUR EU 2,563.8 (204.5) (88.5)
CINCINNATI BELL CBB US 2,563.8 (204.5) (88.5)
CINCINNATI BELL CIB1 GR 2,563.8 (204.5) (88.5)
CLOVER HEALTH IN CLOV US 828.7 797.9 (1.2)
CLOVIS ONCOLOGY C6O GR 593.1 (163.4) 165.3
CLOVIS ONCOLOGY CLVS US 593.1 (163.4) 165.3
CLOVIS ONCOLOGY C6O QT 593.1 (163.4) 165.3
CLOVIS ONCOLOGY CLVSEUR EU 593.1 (163.4) 165.3
CLOVIS ONCOLOGY C6O TH 593.1 (163.4) 165.3
CLOVIS ONCOLOGY C6O GZ 593.1 (163.4) 165.3
CODIAK BIOSCIENC CDAK US 110.4 (44.0) 18.0
CODIAK BIOSCIENC 32W TH 110.4 (44.0) 18.0
CODIAK BIOSCIENC 32W GR 110.4 (44.0) 18.0
CODIAK BIOSCIENC CDAKEUR EU 110.4 (44.0) 18.0
CODIAK BIOSCIENC 32W QT 110.4 (44.0) 18.0
COGENT COMMUNICA OGM1 GR 1,000.9 (260.7) 380.1
COGENT COMMUNICA CCOI US 1,000.9 (260.7) 380.1
COGENT COMMUNICA CCOIEUR EU 1,000.9 (260.7) 380.1
COGENT COMMUNICA CCOI* MM 1,000.9 (260.7) 380.1
COMMUNITY HEALTH CYH US 16,516.0 (1,476.0) 1,063.0
COMMUNITY HEALTH CG5 GR 16,516.0 (1,476.0) 1,063.0
COMMUNITY HEALTH CG5 QT 16,516.0 (1,476.0) 1,063.0
COMMUNITY HEALTH CYH1EUR EU 16,516.0 (1,476.0) 1,063.0
COMMUNITY HEALTH CG5 TH 16,516.0 (1,476.0) 1,063.0
CONTANGO OIL & G MCF US 192.8 (21.5) (44.1)
CONVERGE TECHNOL CTS CN 493.1 48.3 (105.8)
CONVERGE TECHNOL CTS2EUR EU 493.1 48.3 (105.8)
CONVERGE TECHNOL 0ZB GZ 493.1 48.3 (105.8)
CONVERGE TECHNOL 0ZB GR 493.1 48.3 (105.8)
CONVERGE TECHNOL CTSDF US 493.1 48.3 (105.8)
CURIS INC CUSA GR 45.7 (28.6) 19.2
CURIS INC CRIS US 45.7 (28.6) 19.2
CURIS INC CRISEUR EU 45.7 (28.6) 19.2
CURIS INC CUSA TH 45.7 (28.6) 19.2
CYTODYN INC CYDY US 143.8 (6.5) 15.1
CYTODYN INC 296 GR 143.8 (6.5) 15.1
CYTODYN INC CYDYEUR EU 143.8 (6.5) 15.1
CYTODYN INC 296 GZ 143.8 (6.5) 15.1
DELEK LOGISTICS DKL US 957.6 (111.5) 11.7
DENNY'S CORP DENN US 450.8 (138.4) (15.3)
DENNY'S CORP DENNEUR EU 450.8 (138.4) (15.3)
DENNY'S CORP DE8 GR 450.8 (138.4) (15.3)
DENNY'S CORP DE8 TH 450.8 (138.4) (15.3)
DIEBOLD NIXDORF DBD GR 3,627.8 (811.7) 391.4
DIEBOLD NIXDORF DBD US 3,627.8 (811.7) 391.4
DIEBOLD NIXDORF DBD SW 3,627.8 (811.7) 391.4
DIEBOLD NIXDORF DBDEUR EU 3,627.8 (811.7) 391.4
DIEBOLD NIXDORF DBD TH 3,627.8 (811.7) 391.4
DIEBOLD NIXDORF DBD QT 3,627.8 (811.7) 391.4
DIEBOLD NIXDORF DBD GZ 3,627.8 (811.7) 391.4
DINE BRANDS GLOB DIN US 2,070.9 (356.4) 203.3
DINE BRANDS GLOB IHP GR 2,070.9 (356.4) 203.3
DINE BRANDS GLOB IHP TH 2,070.9 (356.4) 203.3
DOMINO'S PIZZA EZV GR 1,620.9 (3,211.5) 468.0
DOMINO'S PIZZA DPZ US 1,620.9 (3,211.5) 468.0
DOMINO'S PIZZA EZV TH 1,620.9 (3,211.5) 468.0
DOMINO'S PIZZA DPZEUR EU 1,620.9 (3,211.5) 468.0
DOMINO'S PIZZA EZV GZ 1,620.9 (3,211.5) 468.0
DOMINO'S PIZZA EZV QT 1,620.9 (3,211.5) 468.0
DOMINO'S PIZZA DPZ AV 1,620.9 (3,211.5) 468.0
DOMINO'S PIZZA DPZ* MM 1,620.9 (3,211.5) 468.0
DOMO INC- CL B DOMO US 193.1 (78.5) (14.2)
DOMO INC- CL B 1ON GR 193.1 (78.5) (14.2)
DOMO INC- CL B 1ON GZ 193.1 (78.5) (14.2)
DOMO INC- CL B DOMOEUR EU 193.1 (78.5) (14.2)
DOMO INC- CL B 1ON TH 193.1 (78.5) (14.2)
DYE & DURHAM LTD DND CN 271.9 112.3 0.8
DYE & DURHAM LTD DYNDF US 271.9 112.3 0.8
EOS ENERGY ENTER EOSE US 177.3 175.5 (1.3)
EVERI HOLDINGS I EVRI US 1,458.2 (15.4) 89.9
EVERI HOLDINGS I G2C GR 1,458.2 (15.4) 89.9
EVERI HOLDINGS I G2C TH 1,458.2 (15.4) 89.9
EVERI HOLDINGS I EVRIEUR EU 1,458.2 (15.4) 89.9
FATHOM HOLDINGS FTHM US 35.2 30.3 29.7
FLEXION THERAPEU FLXN US 263.4 (3.1) 186.2
FLEXION THERAPEU F02 GR 263.4 (3.1) 186.2
FLEXION THERAPEU F02 TH 263.4 (3.1) 186.2
FLEXION THERAPEU FLXNEUR EU 263.4 (3.1) 186.2
FLEXION THERAPEU F02 QT 263.4 (3.1) 186.2
FRONTDOOR IN FTDR US 1,407.0 (71.0) 211.0
FRONTDOOR IN 3I5 GR 1,407.0 (71.0) 211.0
FRONTDOOR IN FTDREUR EU 1,407.0 (71.0) 211.0
FTS INTERNAT-A FTSI US 452.2 (84.0) 187.2
FTS INTERNAT-A FT5 GR 452.2 (84.0) 187.2
FTS INTERNAT-A FTSI1EUR EU 452.2 (84.0) 187.2
GCM GROSVENOR-A GCMG US - - -
GODADDY INC-A GDDY US 6,207.8 (163.8) (1,101.8)
GODADDY INC-A 38D TH 6,207.8 (163.8) (1,101.8)
GODADDY INC-A 38D GR 6,207.8 (163.8) (1,101.8)
GODADDY INC-A 38D QT 6,207.8 (163.8) (1,101.8)
GODADDY INC-A GDDY* MM 6,207.8 (163.8) (1,101.8)
GOGO INC GOGO US 984.5 (647.2) 363.1
GOGO INC G0G TH 984.5 (647.2) 363.1
GOGO INC GOGOEUR EU 984.5 (647.2) 363.1
GOGO INC G0G GR 984.5 (647.2) 363.1
GOGO INC G0G QT 984.5 (647.2) 363.1
GOGO INC G0G GZ 984.5 (647.2) 363.1
GOOSEHEAD INSU-A 2OX GR 120.0 (49.4) 25.2
GOOSEHEAD INSU-A GSHDEUR EU 120.0 (49.4) 25.2
GOOSEHEAD INSU-A GSHD US 120.0 (49.4) 25.2
GRAFTECH INTERNA EAF US 1,467.6 (472.1) 445.4
GRAFTECH INTERNA G6G GR 1,467.6 (472.1) 445.4
GRAFTECH INTERNA EAFEUR EU 1,467.6 (472.1) 445.4
GRAFTECH INTERNA G6G TH 1,467.6 (472.1) 445.4
GRAFTECH INTERNA G6G QT 1,467.6 (472.1) 445.4
GRAFTECH INTERNA G6G GZ 1,467.6 (472.1) 445.4
GREEN PLAINS PAR GPP US 103.9 (61.6) (37.0)
GREENSKY INC-A GSKY US 1,461.9 (205.9) 784.2
GURU ORGANIC ENE GURU CN 0.0 (0.0) (0.0)
GURU ORGANIC ENE GUROF US 0.0 (0.0) (0.0)
H&R BLOCK - BDR H1RB34 BZ 2,556.4 (280.0) 40.3
H&R BLOCK INC HRB US 2,556.4 (280.0) 40.3
H&R BLOCK INC HRB GR 2,556.4 (280.0) 40.3
H&R BLOCK INC HRB TH 2,556.4 (280.0) 40.3
H&R BLOCK INC HRBCHF SW 2,556.4 (280.0) 40.3
H&R BLOCK INC HRBEUR EU 2,556.4 (280.0) 40.3
H&R BLOCK INC HRB QT 2,556.4 (280.0) 40.3
HERBALIFE NUTRIT HOO GR 2,921.2 (912.9) 639.4
HERBALIFE NUTRIT HLF US 2,921.2 (912.9) 639.4
HERBALIFE NUTRIT HOO GZ 2,921.2 (912.9) 639.4
HERBALIFE NUTRIT HOO TH 2,921.2 (912.9) 639.4
HERBALIFE NUTRIT HLFEUR EU 2,921.2 (912.9) 639.4
HERBALIFE NUTRIT HOO QT 2,921.2 (912.9) 639.4
HEWLETT-CEDEAR HPQ AR 34,681.0 (2,228.0) (5,572.0)
HEWLETT-CEDEAR HPQD AR 34,681.0 (2,228.0) (5,572.0)
HEWLETT-CEDEAR HPQC AR 34,681.0 (2,228.0) (5,572.0)
HILTON WORLD-BDR H1LT34 BZ 17,129.0 (1,319.0) 2,285.0
HILTON WORLDWIDE HI91 TH 17,129.0 (1,319.0) 2,285.0
HILTON WORLDWIDE HI91 GR 17,129.0 (1,319.0) 2,285.0
HILTON WORLDWIDE HLT* MM 17,129.0 (1,319.0) 2,285.0
HILTON WORLDWIDE HLTEUR EU 17,129.0 (1,319.0) 2,285.0
HILTON WORLDWIDE HLT US 17,129.0 (1,319.0) 2,285.0
HILTON WORLDWIDE HLTW AV 17,129.0 (1,319.0) 2,285.0
HILTON WORLDWIDE HI91 QT 17,129.0 (1,319.0) 2,285.0
HILTON WORLDWIDE HI91 TE 17,129.0 (1,319.0) 2,285.0
HILTON WORLDWIDE HI91 GZ 17,129.0 (1,319.0) 2,285.0
HORIZON GLOBAL HZN US 458.0 (22.1) 91.8
HORIZON GLOBAL 2H6 GR 458.0 (22.1) 91.8
HORIZON GLOBAL HZN1EUR EU 458.0 (22.1) 91.8
HOVNANIAN ENT-A HO3A GR 1,827.3 (436.1) 829.0
HOVNANIAN ENT-A HOV US 1,827.3 (436.1) 829.0
HOVNANIAN ENT-A HOVEUR EU 1,827.3 (436.1) 829.0
HP COMPANY-BDR HPQB34 BZ 34,681.0 (2,228.0) (5,572.0)
HP INC HPQ TE 34,681.0 (2,228.0) (5,572.0)
HP INC HPQ US 34,681.0 (2,228.0) (5,572.0)
HP INC 7HP TH 34,681.0 (2,228.0) (5,572.0)
HP INC 7HP GR 34,681.0 (2,228.0) (5,572.0)
HP INC HPQ* MM 34,681.0 (2,228.0) (5,572.0)
HP INC HPQ CI 34,681.0 (2,228.0) (5,572.0)
HP INC HPQUSD SW 34,681.0 (2,228.0) (5,572.0)
HP INC 7HP GZ 34,681.0 (2,228.0) (5,572.0)
HP INC HPQEUR EU 34,681.0 (2,228.0) (5,572.0)
HP INC HPQ SW 34,681.0 (2,228.0) (5,572.0)
HP INC 7HP QT 34,681.0 (2,228.0) (5,572.0)
HP INC HPQ AV 34,681.0 (2,228.0) (5,572.0)
IAA INC IAA US 2,388.8 (3.6) 352.4
IAA INC 3NI GR 2,388.8 (3.6) 352.4
IAA INC IAA-WEUR EU 2,388.8 (3.6) 352.4
IDERA PHARMACEUT IDRA US 32.3 (32.4) 24.4
IMMUNOGEN INC IMU TH 248.0 (42.9) 119.5
IMMUNOGEN INC IMU GR 248.0 (42.9) 119.5
IMMUNOGEN INC IMGN US 248.0 (42.9) 119.5
IMMUNOGEN INC IMU SW 248.0 (42.9) 119.5
IMMUNOGEN INC IMGNEUR EU 248.0 (42.9) 119.5
IMMUNOGEN INC IMU GZ 248.0 (42.9) 119.5
IMMUNOGEN INC IMU QT 248.0 (42.9) 119.5
IMMUNOGEN INC IMGN* MM 248.0 (42.9) 119.5
INFINITY PHARMAC INFI US 47.0 (14.1) 33.6
INFRASTRUCTURE A IEA US 722.4 (72.1) 97.1
INFRASTRUCTURE A IEAEUR EU 722.4 (72.1) 97.1
INFRASTRUCTURE A 5YF GR 722.4 (72.1) 97.1
INHIBRX INC INBX US 143.6 91.7 97.1
INHIBRX INC 1RK GR 143.6 91.7 97.1
INHIBRX INC INBXEUR EU 143.6 91.7 97.1
INHIBRX INC 1RK TH 143.6 91.7 97.1
INHIBRX INC 1RK QT 143.6 91.7 97.1
INSEEGO CORP INO TH 223.7 (27.2) 40.7
INSEEGO CORP INO QT 223.7 (27.2) 40.7
INSEEGO CORP INSG US 223.7 (27.2) 40.7
INSEEGO CORP INO GR 223.7 (27.2) 40.7
INSEEGO CORP INSGEUR EU 223.7 (27.2) 40.7
INSEEGO CORP INO GZ 223.7 (27.2) 40.7
INSPIRED ENTERTA INSE US 320.3 (95.0) 10.3
INTERCEPT PHARMA I4P TH 591.4 (130.3) 398.0
INTERCEPT PHARMA ICPT US 591.4 (130.3) 398.0
INTERCEPT PHARMA I4P GR 591.4 (130.3) 398.0
INTERCEPT PHARMA ICPT* MM 591.4 (130.3) 398.0
INTERCEPT PHARMA I4P GZ 591.4 (130.3) 398.0
JACK IN THE BOX JBX GR 1,906.5 (793.4) (4.8)
JACK IN THE BOX JACK US 1,906.5 (793.4) (4.8)
JACK IN THE BOX JBX GZ 1,906.5 (793.4) (4.8)
JACK IN THE BOX JBX QT 1,906.5 (793.4) (4.8)
JACK IN THE BOX JACK1EUR EU 1,906.5 (793.4) (4.8)
JOSEMARIA RESOUR JOSE SS 28.8 (9.4) (18.4)
JOSEMARIA RESOUR NGQSEK EU 28.8 (9.4) (18.4)
JOSEMARIA RESOUR JOSES IX 28.8 (9.4) (18.4)
JOSEMARIA RESOUR JOSES EB 28.8 (9.4) (18.4)
JOSEMARIA RESOUR JOSES I2 28.8 (9.4) (18.4)
JUST ENERGY GROU JE US 1,137.7 (170.7) (33.8)
JUST ENERGY GROU JE CN 1,137.7 (170.7) (33.8)
JUST ENERGY GROU 1JE GR 1,137.7 (170.7) (33.8)
JUST ENERGY GROU 1JE1 TH 1,137.7 (170.7) (33.8)
L BRANDS INC LTD GR 11,161.0 (1,564.0) 1,597.0
L BRANDS INC LB US 11,161.0 (1,564.0) 1,597.0
L BRANDS INC LTD TH 11,161.0 (1,564.0) 1,597.0
L BRANDS INC LTD SW 11,161.0 (1,564.0) 1,597.0
L BRANDS INC LB* MM 11,161.0 (1,564.0) 1,597.0
L BRANDS INC LTD QT 11,161.0 (1,564.0) 1,597.0
L BRANDS INC LBEUR EU 11,161.0 (1,564.0) 1,597.0
L BRANDS INC LBRA AV 11,161.0 (1,564.0) 1,597.0
L BRANDS INC-BDR LBRN34 BZ 11,161.0 (1,564.0) 1,597.0
LENNOX INTL INC LXI GR 1,981.2 (115.7) 353.0
LENNOX INTL INC LII US 1,981.2 (115.7) 353.0
LENNOX INTL INC LII* MM 1,981.2 (115.7) 353.0
LENNOX INTL INC LXI TH 1,981.2 (115.7) 353.0
LENNOX INTL INC LII1EUR EU 1,981.2 (115.7) 353.0
LESLIE'S INC LESL US 746.4 (827.0) 113.9
LESLIE'S INC LE3 GR 746.4 (827.0) 113.9
LESLIE'S INC LESLEUR EU 746.4 (827.0) 113.9
LESLIE'S INC LE3 TH 746.4 (827.0) 113.9
LESLIE'S INC LE3 QT 746.4 (827.0) 113.9
MADISON SQUARE G MS8 GR 1,219.4 (239.9) (216.3)
MADISON SQUARE G MSG1EUR EU 1,219.4 (239.9) (216.3)
MADISON SQUARE G MSGS US 1,219.4 (239.9) (216.3)
MANNKIND CORP MNKD US 95.7 (186.4) (39.8)
MANNKIND CORP NNFN SW 95.7 (186.4) (39.8)
MCAFEE CORP - A MCFE US 5,553.0 (2,323.0) (1,182.0)
MCAFEE CORP - A MC7 GR 5,553.0 (2,323.0) (1,182.0)
MCAFEE CORP - A MCFEEUR EU 5,553.0 (2,323.0) (1,182.0)
MCDONALD'S CORP TCXMCD AU 50,699.3 (8,472.1) 455.9
MCDONALDS - BDR MCDC34 BZ 50,699.3 (8,472.1) 455.9
MCDONALDS CORP MDO TH 50,699.3 (8,472.1) 455.9
MCDONALDS CORP MCD US 50,699.3 (8,472.1) 455.9
MCDONALDS CORP MCD SW 50,699.3 (8,472.1) 455.9
MCDONALDS CORP MDO GR 50,699.3 (8,472.1) 455.9
MCDONALDS CORP MCD* MM 50,699.3 (8,472.1) 455.9
MCDONALDS CORP MCD TE 50,699.3 (8,472.1) 455.9
MCDONALDS CORP MCD CI 50,699.3 (8,472.1) 455.9
MCDONALDS CORP MCD AV 50,699.3 (8,472.1) 455.9
MCDONALDS CORP MCDUSD SW 50,699.3 (8,472.1) 455.9
MCDONALDS CORP MCDEUR EU 50,699.3 (8,472.1) 455.9
MCDONALDS CORP MDO GZ 50,699.3 (8,472.1) 455.9
MCDONALDS CORP 0R16 LN 50,699.3 (8,472.1) 455.9
MCDONALDS CORP MDO QT 50,699.3 (8,472.1) 455.9
MCDONALDS CORP MCD PE 50,699.3 (8,472.1) 455.9
MCDONALDS-CEDEAR MCD AR 50,699.3 (8,472.1) 455.9
MCDONALDS-CEDEAR MCDC AR 50,699.3 (8,472.1) 455.9
MCDONALDS-CEDEAR MCDD AR 50,699.3 (8,472.1) 455.9
MEDIAALPHA INC-A MAX US 133.8 (146.6) (4.0)
MEDLEY MANAGE-A MDLY US 38.7 (132.0) (15.2)
MEDLEY MANAGE-A 731 GR 38.7 (132.0) (15.2)
MERCER PARK BR-A BRND/A/U CN 411.4 (7.6) 2.7
MERCER PARK BR-A MRCQF US 411.4 (7.6) 2.7
MICHAELS COS INC MIK US 4,263.3 (1,389.9) 381.9
MICHAELS COS INC MIM GR 4,263.3 (1,389.9) 381.9
MICHAELS COS INC MIM TH 4,263.3 (1,389.9) 381.9
MICHAELS COS INC MIKEUR EU 4,263.3 (1,389.9) 381.9
MICHAELS COS INC MIM QT 4,263.3 (1,389.9) 381.9
MICHAELS COS INC MIM GZ 4,263.3 (1,389.9) 381.9
MICROVISION INC MVIN TH 9.0 (4.2) (5.8)
MICROVISION INC MVIN GR 9.0 (4.2) (5.8)
MICROVISION INC MVIS US 9.0 (4.2) (5.8)
MICROVISION INC MVISEUR EU 9.0 (4.2) (5.8)
MICROVISION INC MVIN GZ 9.0 (4.2) (5.8)
MICROVISION INC MVIN QT 9.0 (4.2) (5.8)
MILESTONE MEDICA MMDPLN EU 1.0 (16.3) (16.3)
MILESTONE MEDICA MMD PW 1.0 (16.3) (16.3)
MOGO INC MOGO CN 101.5 (3.3) -
MOGO INC MOGO US 101.5 (3.3) -
MONEYGRAM INTERN MGI US 4,494.0 (249.1) (94.5)
MONEYGRAM INTERN 9M1N GR 4,494.0 (249.1) (94.5)
MONEYGRAM INTERN 9M1N TH 4,494.0 (249.1) (94.5)
MONEYGRAM INTERN MGIEUR EU 4,494.0 (249.1) (94.5)
MONEYGRAM INTERN 9M1N QT 4,494.0 (249.1) (94.5)
MONTES ARCHIM-A MAAC US 0.5 (0.0) (0.5)
MONTES ARCHIMEDE MAACU US 0.5 (0.0) (0.5)
MOTOROLA SOL-BDR M1SI34 BZ 10,361.0 (740.0) 659.0
MOTOROLA SOL-CED MSI AR 10,361.0 (740.0) 659.0
MOTOROLA SOLUTIO MOT TE 10,361.0 (740.0) 659.0
MOTOROLA SOLUTIO MSI US 10,361.0 (740.0) 659.0
MOTOROLA SOLUTIO MTLA TH 10,361.0 (740.0) 659.0
MOTOROLA SOLUTIO MTLA GR 10,361.0 (740.0) 659.0
MOTOROLA SOLUTIO MSI1EUR EU 10,361.0 (740.0) 659.0
MOTOROLA SOLUTIO MTLA GZ 10,361.0 (740.0) 659.0
MOTOROLA SOLUTIO MOSI AV 10,361.0 (740.0) 659.0
MOTOROLA SOLUTIO MTLA QT 10,361.0 (740.0) 659.0
MSCI INC MSCI US 4,111.7 (386.6) 1,008.2
MSCI INC 3HM GR 4,111.7 (386.6) 1,008.2
MSCI INC 3HM SW 4,111.7 (386.6) 1,008.2
MSCI INC 3HM QT 4,111.7 (386.6) 1,008.2
MSCI INC 3HM GZ 4,111.7 (386.6) 1,008.2
MSCI INC MSCI* MM 4,111.7 (386.6) 1,008.2
MSCI INC 3HM TH 4,111.7 (386.6) 1,008.2
MSCI INC-BDR M1SC34 BZ 4,111.7 (386.6) 1,008.2
MSG NETWORKS- A MSGN US 893.6 (515.7) 294.3
MSG NETWORKS- A 1M4 GR 893.6 (515.7) 294.3
MSG NETWORKS- A 1M4 QT 893.6 (515.7) 294.3
MSG NETWORKS- A MSGNEUR EU 893.6 (515.7) 294.3
MSG NETWORKS- A 1M4 TH 893.6 (515.7) 294.3
NANTHEALTH INC NH US 209.0 (92.3) 10.2
NATHANS FAMOUS NATH US 106.3 (63.1) 79.0
NATHANS FAMOUS NFA GR 106.3 (63.1) 79.0
NATHANS FAMOUS NATHEUR EU 106.3 (63.1) 79.0
NATIONAL CINEMED NCMI US 1,097.8 (210.4) 183.0
NATIONAL CINEMED XWM GR 1,097.8 (210.4) 183.0
NATIONAL CINEMED NCMIEUR EU 1,097.8 (210.4) 183.0
NAVISTAR INTL IHR TH 6,637.0 (3,822.0) 1,206.0
NAVISTAR INTL IHR GR 6,637.0 (3,822.0) 1,206.0
NAVISTAR INTL NAV US 6,637.0 (3,822.0) 1,206.0
NAVISTAR INTL NAVEUR EU 6,637.0 (3,822.0) 1,206.0
NAVISTAR INTL IHR QT 6,637.0 (3,822.0) 1,206.0
NAVISTAR INTL IHR GZ 6,637.0 (3,822.0) 1,206.0
NESCO HOLDINGS I NSCO US 769.5 (24.4) 54.0
NEW ENG RLTY-LP NEN US 293.1 (39.3) -
NORTHERN OIL AND 4LT1 GR 1,025.5 (83.7) 13.3
NORTHERN OIL AND NOG US 1,025.5 (83.7) 13.3
NORTHERN OIL AND NOG1EUR EU 1,025.5 (83.7) 13.3
NORTONLIFEL- BDR S1YM34 BZ 6,313.0 (476.0) 44.0
NORTONLIFELOCK I SYM TH 6,313.0 (476.0) 44.0
NORTONLIFELOCK I SYM GR 6,313.0 (476.0) 44.0
NORTONLIFELOCK I SYMC TE 6,313.0 (476.0) 44.0
NORTONLIFELOCK I NLOK US 6,313.0 (476.0) 44.0
NORTONLIFELOCK I SYMC AV 6,313.0 (476.0) 44.0
NORTONLIFELOCK I NLOK* MM 6,313.0 (476.0) 44.0
NORTONLIFELOCK I SYMCEUR EU 6,313.0 (476.0) 44.0
NORTONLIFELOCK I SYM GZ 6,313.0 (476.0) 44.0
NORTONLIFELOCK I SYM QT 6,313.0 (476.0) 44.0
NUNZIA PHARMACEU NUNZ US 0.1 (3.2) (2.5)
NUTANIX INC - A 0NU SW 2,315.9 (557.4) 854.5
NUTANIX INC - A 0NU GZ 2,315.9 (557.4) 854.5
NUTANIX INC - A 0NU GR 2,315.9 (557.4) 854.5
NUTANIX INC - A NTNXEUR EU 2,315.9 (557.4) 854.5
NUTANIX INC - A 0NU TH 2,315.9 (557.4) 854.5
NUTANIX INC - A 0NU QT 2,315.9 (557.4) 854.5
NUTANIX INC - A NTNX US 2,315.9 (557.4) 854.5
OASIS PETROLEUM OAS US 2,506.8 (638.2) (235.9)
OASIS PETROLEUM OS70 GR 2,506.8 (638.2) (235.9)
OASIS PETROLEUM OAS1EUR EU 2,506.8 (638.2) (235.9)
OCULAR THERAPEUT OCUL US 98.2 (4.1) 59.0
OCULAR THERAPEUT 0OT TH 98.2 (4.1) 59.0
OCULAR THERAPEUT OCULEUR EU 98.2 (4.1) 59.0
OCULAR THERAPEUT 0OT GZ 98.2 (4.1) 59.0
OCULAR THERAPEUT 0OT GR 98.2 (4.1) 59.0
OLEMA PHARMACEUT OLMA US 0.1 (1.2) (1.3)
OMEROS CORP OMER US 227.1 (87.3) 148.3
OMEROS CORP 3O8 GR 227.1 (87.3) 148.3
OMEROS CORP 3O8 QT 227.1 (87.3) 148.3
OMEROS CORP 3O8 TH 227.1 (87.3) 148.3
OMEROS CORP OMEREUR EU 227.1 (87.3) 148.3
ONDAS HOLDINGS I ONDS US 2.6 (16.4) (16.3)
OPENDOOR TECHNOL OPEN US 414.7 394.7 (4.9)
OPTIVA INC OPT CN 84.2 (82.4) 3.3
OPTIVA INC RKNEF US 84.2 (82.4) 3.3
OTIS WORLDWI OTIS US 10,473.0 (3,383.0) (20.0)
OTIS WORLDWI 4PG GR 10,473.0 (3,383.0) (20.0)
OTIS WORLDWI OTISEUR EU 10,473.0 (3,383.0) (20.0)
OTIS WORLDWI 4PG GZ 10,473.0 (3,383.0) (20.0)
OTIS WORLDWI OTIS* MM 10,473.0 (3,383.0) (20.0)
OTIS WORLDWI 4PG TH 10,473.0 (3,383.0) (20.0)
OTIS WORLDWI 4PG QT 10,473.0 (3,383.0) (20.0)
OTIS WORLDWI-BDR O1TI34 BZ 10,473.0 (3,383.0) (20.0)
PAPA JOHN'S INTL PZZA US 816.7 (14.1) 19.4
PAPA JOHN'S INTL PP1 GR 816.7 (14.1) 19.4
PAPA JOHN'S INTL PZZAEUR EU 816.7 (14.1) 19.4
PAPA JOHN'S INTL PP1 GZ 816.7 (14.1) 19.4
PAPA JOHN'S INTL PP1 TH 816.7 (14.1) 19.4
PAPA JOHN'S INTL PP1 QT 816.7 (14.1) 19.4
PARATEK PHARMACE PRTK US 198.7 (79.9) 172.1
PARATEK PHARMACE N4CN GR 198.7 (79.9) 172.1
PARATEK PHARMACE N4CN TH 198.7 (79.9) 172.1
PHILIP MORRI-BDR PHMO34 BZ 39,129.0 (10,245.0) 1,928.0
PHILIP MORRIS IN 4I1 GR 39,129.0 (10,245.0) 1,928.0
PHILIP MORRIS IN PM US 39,129.0 (10,245.0) 1,928.0
PHILIP MORRIS IN PM1CHF EU 39,129.0 (10,245.0) 1,928.0
PHILIP MORRIS IN PM1 TE 39,129.0 (10,245.0) 1,928.0
PHILIP MORRIS IN 4I1 TH 39,129.0 (10,245.0) 1,928.0
PHILIP MORRIS IN PM1EUR EU 39,129.0 (10,245.0) 1,928.0
PHILIP MORRIS IN PMI SW 39,129.0 (10,245.0) 1,928.0
PHILIP MORRIS IN PMOR AV 39,129.0 (10,245.0) 1,928.0
PHILIP MORRIS IN 0M8V LN 39,129.0 (10,245.0) 1,928.0
PHILIP MORRIS IN 4I1 GZ 39,129.0 (10,245.0) 1,928.0
PHILIP MORRIS IN PMIZ IX 39,129.0 (10,245.0) 1,928.0
PHILIP MORRIS IN PMIZ EB 39,129.0 (10,245.0) 1,928.0
PHILIP MORRIS IN 4I1 QT 39,129.0 (10,245.0) 1,928.0
PHILIP MORRIS IN PM* MM 39,129.0 (10,245.0) 1,928.0
PLANET FITNESS-A 3PL QT 1,801.6 (722.9) 440.8
PLANET FITNESS-A PLNT1EUR EU 1,801.6 (722.9) 440.8
PLANET FITNESS-A PLNT US 1,801.6 (722.9) 440.8
PLANET FITNESS-A 3PL TH 1,801.6 (722.9) 440.8
PLANET FITNESS-A 3PL GR 1,801.6 (722.9) 440.8
PLANET FITNESS-A 3PL GZ 1,801.6 (722.9) 440.8
PLANTRONICS INC PLT US 2,201.5 (145.0) 193.1
PLANTRONICS INC PTM GR 2,201.5 (145.0) 193.1
PLANTRONICS INC PLTEUR EU 2,201.5 (145.0) 193.1
PLANTRONICS INC PTM GZ 2,201.5 (145.0) 193.1
PLANTRONICS INC PTM TH 2,201.5 (145.0) 193.1
PLANTRONICS INC PTM QT 2,201.5 (145.0) 193.1
PPD INC PPD US 6,041.5 (915.2) 203.0
PRIORITY TECHNOL PRTH US 380.4 (98.3) 3.6
PRIORITY TECHNOL PRTHEUR EU 380.4 (98.3) 3.6
PRIORITY TECHNOL 60W GR 380.4 (98.3) 3.6
PROGENITY INC 4ZU TH 119.6 (60.4) 5.7
PROGENITY INC 4ZU GR 119.6 (60.4) 5.7
PROGENITY INC 4ZU QT 119.6 (60.4) 5.7
PROGENITY INC PROGEUR EU 119.6 (60.4) 5.7
PROGENITY INC 4ZU GZ 119.6 (60.4) 5.7
PROGENITY INC PROG US 119.6 (60.4) 5.7
PSOMAGEN INC-KDR 950200 KS 49.5 36.8 25.3
PUMA BIOTECHNOLO PBYI US 261.7 (0.5) 41.6
PUMA BIOTECHNOLO 0PB GR 261.7 (0.5) 41.6
PUMA BIOTECHNOLO 0PB TH 261.7 (0.5) 41.6
PUMA BIOTECHNOLO PBYIEUR EU 261.7 (0.5) 41.6
QUANTUM CORP QMCO US 173.3 (196.2) (1.5)
QUANTUM CORP QNT2 GR 173.3 (196.2) (1.5)
QUANTUM CORP QTM1EUR EU 173.3 (196.2) (1.5)
QUANTUM CORP QNT2 TH 173.3 (196.2) (1.5)
RADIUS HEALTH IN RDUS US 196.0 (108.6) 101.7
RADIUS HEALTH IN 1R8 GR 196.0 (108.6) 101.7
RADIUS HEALTH IN 1R8 TH 196.0 (108.6) 101.7
RADIUS HEALTH IN RDUSEUR EU 196.0 (108.6) 101.7
RADIUS HEALTH IN 1R8 QT 196.0 (108.6) 101.7
REC SILICON ASA RECSIO IX 258.4 (19.2) 47.9
REC SILICON ASA REC SS 258.4 (19.2) 47.9
REC SILICON ASA RECSIO S1 258.4 (19.2) 47.9
REC SILICON ASA RECSIO TQ 258.4 (19.2) 47.9
REC SILICON ASA RECSIO EB 258.4 (19.2) 47.9
REC SILICON ASA REC EU 258.4 (19.2) 47.9
REC SILICON ASA REC NO 258.4 (19.2) 47.9
REC SILICON ASA RECSIO QX 258.4 (19.2) 47.9
REC SILICON ASA RECSIO PO 258.4 (19.2) 47.9
REC SILICON ASA RECSIO B3 258.4 (19.2) 47.9
REC SILICON ASA RECSIO S2 258.4 (19.2) 47.9
REC SILICON ASA RECSIO QE 258.4 (19.2) 47.9
REC SILICON ASA RECSIO T1 258.4 (19.2) 47.9
REC SILICON ASA RECSIO I2 258.4 (19.2) 47.9
REVLON INC-A RVL1 GR 2,973.3 (1,582.9) (38.9)
REVLON INC-A REV US 2,973.3 (1,582.9) (38.9)
REVLON INC-A REVEUR EU 2,973.3 (1,582.9) (38.9)
REVLON INC-A RVL1 TH 2,973.3 (1,582.9) (38.9)
REVLON INC-A REV* MM 2,973.3 (1,582.9) (38.9)
RICE ACQUISIT- A RICE US 0.4 (0.1) 0.0
RICE ACQUISITION RICE/U US 0.4 (0.1) 0.0
RIMINI STREET IN RMNI US 220.3 (61.5) (64.7)
SBA COMM CORP SBAC US 9,034.7 (4,471.2) (92.7)
SBA COMM CORP 4SB GR 9,034.7 (4,471.2) (92.7)
SBA COMM CORP 4SB TH 9,034.7 (4,471.2) (92.7)
SBA COMM CORP 4SB GZ 9,034.7 (4,471.2) (92.7)
SBA COMM CORP 4SB QT 9,034.7 (4,471.2) (92.7)
SBA COMM CORP SBACEUR EU 9,034.7 (4,471.2) (92.7)
SBA COMM CORP SBAC* MM 9,034.7 (4,471.2) (92.7)
SBA COMMUN - BDR S1BA34 BZ 9,034.7 (4,471.2) (92.7)
SCIENTIFIC GAMES TJW TH 8,102.0 (2,541.0) 1,424.0
SCIENTIFIC GAMES TJW GZ 8,102.0 (2,541.0) 1,424.0
SCIENTIFIC GAMES SGMS US 8,102.0 (2,541.0) 1,424.0
SCIENTIFIC GAMES TJW GR 8,102.0 (2,541.0) 1,424.0
SCOPUS BIOPHARMA SCPS US 1.0 0.6 0.6
SEAWORLD ENTERTA SEAS US 2,650.2 (66.5) 211.5
SEAWORLD ENTERTA W2L GR 2,650.2 (66.5) 211.5
SEAWORLD ENTERTA W2L TH 2,650.2 (66.5) 211.5
SEAWORLD ENTERTA SEASEUR EU 2,650.2 (66.5) 211.5
SELECTA BIOSCIEN SELB US 181.0 (7.4) 89.5
SELECTA BIOSCIEN 1S7 TH 181.0 (7.4) 89.5
SHELL MIDSTREAM SHLX US 2,394.0 (414.0) 311.0
SIGNAL ADVANCE I SIGL US 0.0 (0.1) (0.1)
SINCLAIR BROAD-A SBGIEUR EU 12,483.0 (1,483.0) 1,567.0
SINCLAIR BROAD-A SBTA GZ 12,483.0 (1,483.0) 1,567.0
SINCLAIR BROAD-A SBGI US 12,483.0 (1,483.0) 1,567.0
SINCLAIR BROAD-A SBTA GR 12,483.0 (1,483.0) 1,567.0
SINCLAIR BROAD-A SBTA TH 12,483.0 (1,483.0) 1,567.0
SINCLAIR BROAD-A SBTA QT 12,483.0 (1,483.0) 1,567.0
SIRIUS XM HO-BDR SRXM34 BZ 10,702.0 (911.0) (2,185.0)
SIRIUS XM HOLDIN RDO GR 10,702.0 (911.0) (2,185.0)
SIRIUS XM HOLDIN RDO TH 10,702.0 (911.0) (2,185.0)
SIRIUS XM HOLDIN SIRI US 10,702.0 (911.0) (2,185.0)
SIRIUS XM HOLDIN SIRI AV 10,702.0 (911.0) (2,185.0)
SIRIUS XM HOLDIN RDO GZ 10,702.0 (911.0) (2,185.0)
SIRIUS XM HOLDIN SIRIEUR EU 10,702.0 (911.0) (2,185.0)
SIRIUS XM HOLDIN RDO QT 10,702.0 (911.0) (2,185.0)
SIX FLAGS ENTERT 6FE GR 2,865.0 (532.7) (46.8)
SIX FLAGS ENTERT SIXEUR EU 2,865.0 (532.7) (46.8)
SIX FLAGS ENTERT SIX US 2,865.0 (532.7) (46.8)
SIX FLAGS ENTERT 6FE QT 2,865.0 (532.7) (46.8)
SIX FLAGS ENTERT 6FE TH 2,865.0 (532.7) (46.8)
SLEEP NUMBER COR SL2 GR 780.1 (102.8) (348.2)
SLEEP NUMBER COR SNBR US 780.1 (102.8) (348.2)
SLEEP NUMBER COR SNBREUR EU 780.1 (102.8) (348.2)
SOCIAL CAPITAL IPOC/U US 828.7 797.9 (1.2)
SOTERA HEALTH CO SHC US 2,580.7 (627.5) 128.4
SOTERA HEALTH CO SH5 GR 2,580.7 (627.5) 128.4
SOTERA HEALTH CO SHCEUR EU 2,580.7 (627.5) 128.4
STARBUCKS CORP SBUX* MM 29,374.5 (7,799.4) 459.6
STARBUCKS CORP SRB GR 29,374.5 (7,799.4) 459.6
STARBUCKS CORP SRB TH 29,374.5 (7,799.4) 459.6
STARBUCKS CORP SBUX CI 29,374.5 (7,799.4) 459.6
STARBUCKS CORP SBUX AV 29,374.5 (7,799.4) 459.6
STARBUCKS CORP SBUXEUR EU 29,374.5 (7,799.4) 459.6
STARBUCKS CORP SBUX TE 29,374.5 (7,799.4) 459.6
STARBUCKS CORP SBUX IM 29,374.5 (7,799.4) 459.6
STARBUCKS CORP SBUX US 29,374.5 (7,799.4) 459.6
STARBUCKS CORP SBUXUSD SW 29,374.5 (7,799.4) 459.6
STARBUCKS CORP SRB GZ 29,374.5 (7,799.4) 459.6
STARBUCKS CORP TCXSBU AU 29,374.5 (7,799.4) 459.6
STARBUCKS CORP USSBUX KZ 29,374.5 (7,799.4) 459.6
STARBUCKS CORP 0QZH LI 29,374.5 (7,799.4) 459.6
STARBUCKS CORP SBUX SW 29,374.5 (7,799.4) 459.6
STARBUCKS CORP SRB QT 29,374.5 (7,799.4) 459.6
STARBUCKS CORP SBUXCL CI 29,374.5 (7,799.4) 459.6
STARBUCKS-BDR SBUB34 BZ 29,374.5 (7,799.4) 459.6
STARBUCKS-CEDEAR SBUX AR 29,374.5 (7,799.4) 459.6
STARBUCKS-CEDEAR SBUXD AR 29,374.5 (7,799.4) 459.6
STONEMOR INC STON US 1,626.4 (87.2) 95.7
SUNPOWER CORP S9P2 GR 1,449.3 (7.1) 107.0
SUNPOWER CORP SPWR US 1,449.3 (7.1) 107.0
SUNPOWER CORP S9P2 TH 1,449.3 (7.1) 107.0
SUNPOWER CORP SPWREUR EU 1,449.3 (7.1) 107.0
SUNPOWER CORP S9P2 GZ 1,449.3 (7.1) 107.0
SUNPOWER CORP S9P2 QT 1,449.3 (7.1) 107.0
SUNPOWER CORP S9P2 SW 1,449.3 (7.1) 107.0
TELOS CORP TLS US 74.5 (132.1) 2.1
TELOS CORP 1C3 GR 74.5 (132.1) 2.1
TELOS CORP TLS2EUR EU 74.5 (132.1) 2.1
TENNECO INC-A TNN GR 11,811.0 (43.0) 1,258.0
TENNECO INC-A TEN US 11,811.0 (43.0) 1,258.0
TENNECO INC-A TEN1EUR EU 11,811.0 (43.0) 1,258.0
TENNECO INC-A TNN GZ 11,811.0 (43.0) 1,258.0
TENNECO INC-A TNN TH 11,811.0 (43.0) 1,258.0
TRANSDIGM - BDR T1DG34 BZ 18,395.0 (3,968.0) 5,344.0
TRANSDIGM GROUP TDG US 18,395.0 (3,968.0) 5,344.0
TRANSDIGM GROUP T7D GR 18,395.0 (3,968.0) 5,344.0
TRANSDIGM GROUP TDG* MM 18,395.0 (3,968.0) 5,344.0
TRANSDIGM GROUP T7D TH 18,395.0 (3,968.0) 5,344.0
TRANSDIGM GROUP TDGEUR EU 18,395.0 (3,968.0) 5,344.0
TRANSDIGM GROUP T7D QT 18,395.0 (3,968.0) 5,344.0
TRIUMPH GROUP TG7 GR 2,533.4 (1,064.4) 790.5
TRIUMPH GROUP TGI US 2,533.4 (1,064.4) 790.5
TRIUMPH GROUP TG7 TH 2,533.4 (1,064.4) 790.5
TRIUMPH GROUP TGIEUR EU 2,533.4 (1,064.4) 790.5
TUPPERWARE BRAND TUP GR 1,191.4 (244.0) (655.5)
TUPPERWARE BRAND TUP US 1,191.4 (244.0) (655.5)
TUPPERWARE BRAND TUP SW 1,191.4 (244.0) (655.5)
TUPPERWARE BRAND TUP TH 1,191.4 (244.0) (655.5)
TUPPERWARE BRAND TUP1EUR EU 1,191.4 (244.0) (655.5)
TUPPERWARE BRAND TUP GZ 1,191.4 (244.0) (655.5)
TUPPERWARE BRAND TUP QT 1,191.4 (244.0) (655.5)
UBIQUITI INC UI US 751.9 (261.9) 334.9
UBIQUITI INC 3UB GR 751.9 (261.9) 334.9
UBIQUITI INC UBNTEUR EU 751.9 (261.9) 334.9
UBIQUITI INC 3UB GZ 751.9 (261.9) 334.9
UNISYS CORP USY1 TH 2,407.4 (200.3) 549.4
UNISYS CORP USY1 GR 2,407.4 (200.3) 549.4
UNISYS CORP UIS US 2,407.4 (200.3) 549.4
UNISYS CORP UIS1 SW 2,407.4 (200.3) 549.4
UNISYS CORP UISEUR EU 2,407.4 (200.3) 549.4
UNISYS CORP UISCHF EU 2,407.4 (200.3) 549.4
UNISYS CORP USY1 GZ 2,407.4 (200.3) 549.4
UNISYS CORP USY1 QT 2,407.4 (200.3) 549.4
UNITI GROUP INC 8XC SW 4,838.0 (1,995.1) -
UNITI GROUP INC 8XC GR 4,838.0 (1,995.1) -
UNITI GROUP INC UNIT US 4,838.0 (1,995.1) -
UNITI GROUP INC 8XC TH 4,838.0 (1,995.1) -
VALVOLINE INC 0V4 GR 3,051.0 (76.0) 994.0
VALVOLINE INC VVVEUR EU 3,051.0 (76.0) 994.0
VALVOLINE INC 0V4 QT 3,051.0 (76.0) 994.0
VALVOLINE INC VVV US 3,051.0 (76.0) 994.0
VECTOR GROUP LTD VGR US 1,443.0 (662.1) 360.6
VECTOR GROUP LTD VGR GR 1,443.0 (662.1) 360.6
VECTOR GROUP LTD VGREUR EU 1,443.0 (662.1) 360.6
VECTOR GROUP LTD VGR TH 1,443.0 (662.1) 360.6
VECTOR GROUP LTD VGR QT 1,443.0 (662.1) 360.6
VECTOR GROUP LTD VGR GZ 1,443.0 (662.1) 360.6
VERISIGN INC VRS TH 1,764.3 (1,386.2) 228.1
VERISIGN INC VRS GR 1,764.3 (1,386.2) 228.1
VERISIGN INC VRSN US 1,764.3 (1,386.2) 228.1
VERISIGN INC VRSN* MM 1,764.3 (1,386.2) 228.1
VERISIGN INC VRS GZ 1,764.3 (1,386.2) 228.1
VERISIGN INC VRSNEUR EU 1,764.3 (1,386.2) 228.1
VERISIGN INC VRS QT 1,764.3 (1,386.2) 228.1
VERISIGN INC-BDR VRSN34 BZ 1,764.3 (1,386.2) 228.1
VERISIGN-CEDEAR VRSN AR 1,764.3 (1,386.2) 228.1
VERY GOOD FOOD C VERY CN 15.8 9.1 8.1
VERY GOOD FOOD C 0SI GR 15.8 9.1 8.1
VERY GOOD FOOD C VERY1EUR EU 15.8 9.1 8.1
VERY GOOD FOOD C VRYYF US 15.8 9.1 8.1
VERY GOOD FOOD C 0SI TH 15.8 9.1 8.1
VERY GOOD FOOD C 0SI GZ 15.8 9.1 8.1
VERY GOOD FOOD C 0SI QT 15.8 9.1 8.1
VITASPRING BIOME VSBC US 0.0 (0.1) (0.1)
VIVINT SMART HOM VVNT US 2,924.7 (1,437.3) (300.3)
WARNER MUSIC-A WMG US 6,410.0 (45.0) (1,042.0)
WARNER MUSIC-A WA4 GR 6,410.0 (45.0) (1,042.0)
WARNER MUSIC-A WMGEUR EU 6,410.0 (45.0) (1,042.0)
WARNER MUSIC-A WA4 GZ 6,410.0 (45.0) (1,042.0)
WARNER MUSIC-A WMG AV 6,410.0 (45.0) (1,042.0)
WARNER MUSIC-A WA4 TH 6,410.0 (45.0) (1,042.0)
WARNER MUSIC-BDR W1MG34 BZ 6,410.0 (45.0) (1,042.0)
WATERS CORP WAZ TH 2,679.3 (41.6) 569.5
WATERS CORP WAT US 2,679.3 (41.6) 569.5
WATERS CORP WAZ GR 2,679.3 (41.6) 569.5
WATERS CORP WAZ QT 2,679.3 (41.6) 569.5
WATERS CORP WATEUR EU 2,679.3 (41.6) 569.5
WATERS CORP WAT* MM 2,679.3 (41.6) 569.5
WATERS CORP-BDR WATC34 BZ 2,679.3 (41.6) 569.5
WAYFAIR INC- A W US 4,558.4 (1,459.6) 826.1
WAYFAIR INC- A W* MM 4,558.4 (1,459.6) 826.1
WAYFAIR INC- A 1WF QT 4,558.4 (1,459.6) 826.1
WAYFAIR INC- A 1WF GZ 4,558.4 (1,459.6) 826.1
WAYFAIR INC- A 1WF GR 4,558.4 (1,459.6) 826.1
WAYFAIR INC- A 1WF TH 4,558.4 (1,459.6) 826.1
WAYFAIR INC- A WEUR EU 4,558.4 (1,459.6) 826.1
WIDEOPENWEST INC WOW US 2,499.3 (222.5) (100.6)
WIDEOPENWEST INC WOW1EUR EU 2,499.3 (222.5) (100.6)
WIDEOPENWEST INC WU5 QT 2,499.3 (222.5) (100.6)
WIDEOPENWEST INC WU5 TH 2,499.3 (222.5) (100.6)
WIDEOPENWEST INC WU5 GR 2,499.3 (222.5) (100.6)
WINGSTOP INC WING1EUR EU 219.7 (183.5) 24.9
WINGSTOP INC WING US 219.7 (183.5) 24.9
WINGSTOP INC EWG GR 219.7 (183.5) 24.9
WINGSTOP INC EWG GZ 219.7 (183.5) 24.9
WINMARK CORP WINA US 35.8 (8.8) 10.4
WINMARK CORP GBZ GR 35.8 (8.8) 10.4
WORKHORSE GROUP WKHSEUR EU 120.4 (12.2) (32.4)
WORKHORSE GROUP WKHS US 120.4 (12.2) (32.4)
WORKHORSE GROUP 1WO GR 120.4 (12.2) (32.4)
WORKHORSE GROUP 1WO TH 120.4 (12.2) (32.4)
WORKHORSE GROUP 1WO GZ 120.4 (12.2) (32.4)
WORKHORSE GROUP 1WO QT 120.4 (12.2) (32.4)
WW INTERNATIONAL WW US 1,503.0 (581.2) (42.9)
WW INTERNATIONAL WW6 GR 1,503.0 (581.2) (42.9)
WW INTERNATIONAL WW6 TH 1,503.0 (581.2) (42.9)
WW INTERNATIONAL WW6 GZ 1,503.0 (581.2) (42.9)
WW INTERNATIONAL WTWEUR EU 1,503.0 (581.2) (42.9)
WW INTERNATIONAL WW6 QT 1,503.0 (581.2) (42.9)
WW INTERNATIONAL WTW AV 1,503.0 (581.2) (42.9)
WYNDHAM DESTINAT WD5 GR 7,822.0 (993.0) 1,562.0
WYNDHAM DESTINAT WD5 TH 7,822.0 (993.0) 1,562.0
WYNDHAM DESTINAT WYNEUR EU 7,822.0 (993.0) 1,562.0
WYNDHAM DESTINAT WD5 QT 7,822.0 (993.0) 1,562.0
WYNDHAM DESTINAT WYND US 7,822.0 (993.0) 1,562.0
WYNN RESORTS LTD WYR GR 13,967.1 (546.6) 2,180.8
WYNN RESORTS LTD WYR TH 13,967.1 (546.6) 2,180.8
WYNN RESORTS LTD WYNN* MM 13,967.1 (546.6) 2,180.8
WYNN RESORTS LTD WYNN US 13,967.1 (546.6) 2,180.8
WYNN RESORTS LTD WYNNEUR EU 13,967.1 (546.6) 2,180.8
WYNN RESORTS LTD WYR GZ 13,967.1 (546.6) 2,180.8
WYNN RESORTS LTD WYNN SW 13,967.1 (546.6) 2,180.8
WYNN RESORTS LTD WYR QT 13,967.1 (546.6) 2,180.8
WYNN RESORTS-BDR W1YN34 BZ 13,967.1 (546.6) 2,180.8
YRC WORLDWIDE IN YEL1 GR 2,108.3 (323.1) 321.6
YRC WORLDWIDE IN YEL1 TH 2,108.3 (323.1) 321.6
YRC WORLDWIDE IN YRCW US 2,108.3 (323.1) 321.6
YRC WORLDWIDE IN YEL1 SW 2,108.3 (323.1) 321.6
YRC WORLDWIDE IN YEL1 QT 2,108.3 (323.1) 321.6
YRC WORLDWIDE IN YRCWEUR EU 2,108.3 (323.1) 321.6
YUBO INTERNATION YBGJ US - (1.5) (1.5)
YUM! BRANDS -BDR YUMR34 BZ 6,061.0 (7,919.0) 477.0
YUM! BRANDS INC TGR TH 6,061.0 (7,919.0) 477.0
YUM! BRANDS INC TGR GR 6,061.0 (7,919.0) 477.0
YUM! BRANDS INC YUM* MM 6,061.0 (7,919.0) 477.0
YUM! BRANDS INC YUM US 6,061.0 (7,919.0) 477.0
YUM! BRANDS INC YUMUSD SW 6,061.0 (7,919.0) 477.0
YUM! BRANDS INC TGR GZ 6,061.0 (7,919.0) 477.0
YUM! BRANDS INC YUMEUR EU 6,061.0 (7,919.0) 477.0
YUM! BRANDS INC TGR QT 6,061.0 (7,919.0) 477.0
YUM! BRANDS INC YUM SW 6,061.0 (7,919.0) 477.0
YUM! BRANDS INC YUM AV 6,061.0 (7,919.0) 477.0
YUM! BRANDS INC TGR TE 6,061.0 (7,919.0) 477.0
*********
Monday's edition of the TCR delivers a list of indicative prices
for bond issues that reportedly trade well below par. Prices are
obtained by TCR editors from a variety of outside sources during
the prior week we think are reliable. Those sources may not,
however, be complete or accurate. The Monday Bond Pricing table
is compiled on the Friday prior to publication. Prices reported
are not intended to reflect actual trades. Prices for actual
trades are probably different. Our objective is to share
information, not make markets in publicly traded securities.
Nothing in the TCR constitutes an offer or solicitation to buy or
sell any security of any kind. It is likely that some entity
affiliated with a TCR editor holds some position in the issuers
public debt and equity securities about which we report.
Each Tuesday edition of the TCR contains a list of companies with
insolvent balance sheets whose shares trade higher than $3 per
share in public markets. At first glance, this list may look like
the definitive compilation of stocks that are ideal to sell short.
Don't be fooled. Assets, for example, reported at historical cost
net of depreciation may understate the true value of a firm's
assets. A company may establish reserves on its balance sheet for
liabilities that may never materialize. The prices at which
equity securities trade in public market are determined by more
than a balance sheet solvency test.
On Thursdays, the TCR delivers a list of recently filed
Chapter 11 cases involving less than $1,000,000 in assets and
liabilities delivered to nation's bankruptcy courts. The list
includes links to freely downloadable images of these small-dollar
petitions in Acrobat PDF format.
Each Friday's edition of the TCR includes a review about a book of
interest to troubled company professionals. All titles are
available at your local bookstore or through Amazon.com. Go to
http://www.bankrupt.com/books/to order any title today.
Monthly Operating Reports are summarized in every Saturday edition
of the TCR.
The Sunday TCR delivers securitization rating news from the week
then-ending.
TCR subscribers have free access to our on-line news archive.
Point your Web browser to http://TCRresources.bankrupt.com/and use
the e-mail address to which your TCR is delivered to login.
*********
S U B S C R I P T I O N I N F O R M A T I O N
Troubled Company Reporter is a daily newsletter co-published
by Bankruptcy Creditors Service, Inc., Fairless Hills,
Pennsylvania, USA, and Beard Group, Inc., Washington, D.C., USA.
Jhonas Dampog, Marites Claro, Joy Agravante, Rousel Elaine
Tumanda, Valerie Udtuhan, Howard C. Tolentino, Carmel Paderog,
Meriam Fernandez, Joel Anthony G. Lopez, Cecil R. Villacampa,
Sheryl Joy P. Olano, Psyche A. Castillon, Ivy B. Magdadaro, Carlo
Fernandez, Christopher G. Patalinghug, and Peter A. Chapman, Editors.
Copyright 2021. All rights reserved. ISSN: 1520-9474.
This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without prior
written permission of the publishers. Information contained
herein is obtained from sources believed to be reliable, but is
not guaranteed.
The TCR subscription rate is $975 for 6 months delivered via
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are $25 each. For subscription information, contact Peter A.
Chapman at 215-945-7000.
*** End of Transmission ***