/raid1/www/Hosts/bankrupt/TCR_Public/210319.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Friday, March 19, 2021, Vol. 25, No. 77
Headlines
3135 MACARTHUR: U.S. Trustee Unable to Appoint Committee
37 VENTURES: Case Summary & 2 Unsecured Creditors
AEMETIS INC: Incurs $36.7 Million Net Loss in 2020
ALIGHT SOLUTIONS: S&P Raises ICR to 'B+', Stays on Watch Positive
ALLIED EQUIPMENT: Case Summary & 20 Largest Unsecured Creditors
ALPHA MEDIA: To Seek Plan Confirmation on April 1
ALPHA METALLURGICAL: Incurs $446.9 Million Net Loss in 2020
AMERICAN BERBER: Examiner Gets OK to Hire Burr & Forman as Counsel
AMERICAN BERBER: Examiner Hires Resurgence as Forensic Accountant
BLACKRIDGE TECHNOLOGY: Seeks April 1 Plan Exclusivity Extension
BLITMAN SARATOGA: Gets OK to Hire Goldberg Weprin as Counsel
BLITMAN SARATOGA: Seeks to Extend Plan Exclusivity Until June 7
BOY SCOUTS: Abuse Claimants Say Plan a 'Road to Nowhere'
BOY SCOUTS: Judge Bemoans 'Staggering Legal Fees'
BOYD GAMING: S&P Upgrades ICR to 'B+', Outlook Stable
BRAZOS ELECTRIC: Sees Need for Bankruptcy Loan by April or May
BRILLIANT ENERGY: Files for Chapter 7 Liquidation
BRILLIANT ENERGY: Hits Chapter 7 Filing After Texas Winter Freeze
BRILLIANT ENERGY: Supplier Wants Ch. 11 to Keep Customer Contracts
CENTURY 21: Court Gives Go Signal to Solicit Bankruptcy Plan Votes
CHRISTINE SKANDIS: Trustee's Repocast.com Sale of Misc. Items OK'd
CLEVELAND-CLIFFS INC: S&P Alters Outlook to Pos., Affirms 'B-' ICR
COMCAR INDUSTRIES: Combined Plan & Disclosure Confirmed by Judge
CONFIDENCE TRUCKING: Case Summary & 17 Unsecured Creditors
CRED INC: Creditors Seek Jail Time for Former-CFO in Chapter 11
DEAN FOODS: Gets Court Approval for Chapter 11 Liquidation Plan
DIOCESE OF CAMDEN: Granite/Lexington Join in Insurers' Objection
DUPONT STREET: Case Summary & 7 Unsecured Creditors
DURRIDGE COMPANY: Seeks Cash Collateral Access Thru May 2021
E.Y. REALTY: Seeks Approval to Hire Bankruptcy Counsel
EDELMAN FINANCIAL: S&P Affirms 'B' ICR on Dividend Recapitalization
EMINENT BICYCLES: Hits Chapter 11 Bankruptcy Protection
ENERGIZER HOLDINGS: S&P Affirms 'BB-' ICR, Outlook Negative
EP ENERGY: Reviewing Options Just Months After Bankruptcy Exit
EVERI HOLDINGS: Fitch Raises IDR to 'B+' & Alters Outlook to Stable
EXTENDED STAY: S&P Places 'B+' ICR on Watch Neg. on Acquisition
FERRELLGAS LP: New Operating Debt Slides During 1st Day of Trading
FERRELLGAS PARTNERS: S&P Raises ICR to 'B-' on Recapitalization
FIELDWOOD ENERGY: Wants Plan Exclusivity Extended Thru May 31
FINANCIAL GRAVITY: Signs Merger Agreement With NCW Group
FIRST TO THE FINISH: Plan Exclusivity Extended Until April 5
FOXFIRE CONSOLIDATED: Kensington Buying 15 Condo Units for $850K
GREAT LAKES: Michigan Trucking Company Seeks Chapter 11
GREENPOINT TACTICAL: Seeks to Hire Bragança Law as Special Counsel
GRIDDY ENERGY: To Cancel Customers' Power Bills If They Don't Sue
GUADALUPE REGIONAL: Fitch Affirms 'BB' on Issuer Default Rating
HELIUS MEDICAL: Appoints Sherrie Perkins as Director
HENRY FORD VILLAGE: Seeks to Hire 'Ordinary Course' Professionals
HWY 24 LUMBER: Gets Cash Collateral Access Thru April 6
ICAN BENEFIT: Case Summary & 20 Largest Unsecured Creditors
ICAN HOLDING: Voluntary Chapter 11 Case Summary
INTELSAT SA: Equity Holders Lose Bid for Official Committee
INTERIOR LOGIC: S&P Affirms B Issuer Credit Rating, Outlook Stable
INVESTVIEW INC: Reports Highest Monthly Gross Revenue
JEFFERIES FINANCE: Fitch Alters Outlook on 'BB' LT IDR to Stable
KEIVANS HOSPITALITY: Unsecureds Unimpaired in Amended Plan
KNOW LABS: Closes $14.2 Million Financing Led by Existing Investors
LATAM AIRLINES: Aims to Conclude Restructuring by December
LE JARDIN HOUSE: $795K Sale of Condo Unit 404 to Edelkopfs Approved
LOUISIANA HIGHWAY: Gets OK to Hire Maestri-Murrell as Broker
MADDOX FOUNDRY: Court Extends Plan Exclusivity Thru April 5
MAIREC PRECIOUS: Trustee's Sale of Sample Containers Approved
MARINE BUILDERS: March 25 Hearing on Myron Auction of All Assets
MARINE BUILDERS: Proposes Myron Auction of Substantially All Assets
MARINE BUILDERS: Seeks to Shorten Notice Period on Sale of Assets
MCAFEE LLC: Fitch Affirms 'BB-' LongTerm IDR, Outlook Stable
MEDLEY LLC: U.S. Trustee Unable to Appoint Committee
METRONOMIC HOLDINGS: Plan Exclusivity Period Extended Until April 6
MICROVISION INC: General Counsel David Westgor Retires
MICROVISION INC: Incurs $13.6 Million Net Loss in 2020
MILLER BRANGUS: Seeks to Hire Luke Mobley as Auctioneer
MINNESOTA SCHOOL: Unsecured Creditors Will be Paid in Full
MOTORMAX FINANCIAL: Voluntary Chapter 11 Case Summary
MYCELL TECHNOLOGIES: Seeks to Hire A.Y. Strauss as Counsel
NATIONAL MEDICAL: Seeks to Extend Plan Exclusivity Thru July 7
NATIONAL RIFLE: Committee Seeks to Hire Norton Rose as Counsel
NATIONAL RIFLE: Committee Taps AlixPartners as Financial Advisor
NEOVASC INC: Incurs $28.7 Million Net Loss in 2020
NESCO HOLDINGS: S&P Raises ICR to 'B' on Custom Truck Acquisition
NESCO HOLDINGS: Unit to Offer $920 Million of Senior Secured Notes
NN INC: Widens Net Loss to $100.6 Million in 2020
NSITE VENTURES: Unsecured Creditors to Paid by October 2021
OBITX INC: Appoints Eric Jaffe as Chief Executive Officer
ON CALL ONLINE: Voluntary Chapter 11 Case Summary
ORGANIC POWER: Case Summary & 20 Largest Unsecured Creditors
PACIFICO NATIONAL: Unsecureds Will Recover 0.01% in Plan
PARKING MANAGEMENT: Unsecured Creditors Will Recover 85.9% in Plan
PENSKE AUTOMOTIVE: Moody's Completes Review, Retains Ba1 CFR
PLYMOUTH PLACE: Fitch Assigns 'BB+' IDR, Outlook Stable
POP GOURMET: Court Confirms Reorganization Plan
PURDUE PHARMA: Opioid Victims Each to Get Up to $48,000 in Plan
PURDUE PHARMA: Sacklers Hike Plan Funding to $4.5 Billion
PURE BIOSCIENCE: Incurs $595K Net Loss in Second Quarter
RAMEN CONCEPTS: Gets OK to Hire BGW CPA as Accountant
RAMEN CONCEPTS: Gets OK to Hire Shumaker Loop as Special Counsel
REGIONAL VALVE: April 21 Hearing on Disclosure Statement
RUBIE'S COSTUME: Debtor Wins Approval of Liquidating Plan
SC SJ HOLDINGS: DIP Loan, Cash Collateral Access OK'd
SC SJ HOLDINGS: Gets OK to Hire Stretto as Claims Agent
SEADRILL PARTNERS: Seeks to Extend Plan Exclusivity Until June 29
SENSATA TECHNOLOGIES: S&P Alters Outlook to Stable, Affirms BB+ ICR
SHD LLC: Gets OK to Hire Walker Commercial as Auctioneer
SIMPLE SITEWORK: To Seek Plan Confirmation on April 27
SOURCE HOTEL: Seeks to Hire Levene Neale as Legal Counsel
STA VENTURES: Bay Point Says Plan Still Unconfirmable
STURDIVANT TAYLOR: $770K Sale of All Assets to Rebecca Poe Approved
STURDIVANT TAYLOR: Modified Order Granting Sale of All Assets OK'd
SUNERGY CALIFORNIA: U.S. Trustee Appoints Creditors' Committee
SUPERIOR PLUS: DBRS Confirms BB(high) Rating on Sr. Unsecured Debt
TAILORED BRANDS: CEO Steps Down After $75M Lifeline
TENTLOGIX INC: Seeks to Extend Plan Exclusivity Until May 26
TEREX CORP: S&P Rates New First-Lien Credit Facility 'BB+'
TESTER DRILLING: Seeks to Hire Holmes Weddle as Special Counsel
TITAN INTERNATIONAL: Names Tony Eheli as Chief Accounting Officer
TPT GLOBAL: Allows Rennova Deal to Dissolve to Protect Shareholders
TPT GLOBAL: Welcomes Major General Wharton to Board of Advisors
TRIMAS CORP: S&P Rates New $350MM Senior Unsecured Notes 'BB-'
TRITON WATER: S&P Assigns 'B' Rating on $750MM Senior Secured Notes
TRUCKING & CONTRACTING: Unsecureds to $25K Per Month in Plan
TWO GUNS CONSULTING: Gets OK to Hire Jordan Holzer as Counsel
TWO GUNS: Seeks Cash Collateral Access
UGI INTERNATIONAL: Fitch Affirms 'BB+' LT IDR, Outlook Stable
VAC FUND: Unsecureds Could Get 1% to 2% in Committee-Backed Plan
VERRA MOBILITY: S&P Alters Outlook to Stable, Affirms 'B+' ICR
VI GROUP INVESTMENT: Hires 23 Realty as Real Estate Broker
VI GROUP INVESTMENT: Seeks to Hire Rountree Lietman as Counsel
VOYAGER AVIATION: DBRS Lowers Long-Term Issuer Rating to CC
WAND NEWCO 3: Moody's Completes Review, Retains B2 CFR
WASHINGTON PRIME: Inks Deal to Hold Off Debt as Bankruptcy Looms
WEINSTEIN CO: Emergency Stay Bid of Plan Objectors Denied
WEST VIRGINIA: April 7 Hearing on Sale of Canaan Valley Property
WESTERN MIDSTREAM: S&P Alters Outlook to Stable, Affirms 'BB' ICR
WHITE RIVER: Has Until June 15 to File Plan & Disclosures
WHITE STONE FOODS: Wants Plan Exclusivity Extended Thru March 31
WIRTA HOTELS: Seeks Cash Collateral Access
[^] BOOK REVIEW: Bankruptcy Crimes
*********
3135 MACARTHUR: U.S. Trustee Unable to Appoint Committee
--------------------------------------------------------
The U.S. Trustee for Region 7 on March 16 disclosed in a court
filing that no official committee of unsecured creditors has been
appointed in the Chapter 11 case of X.
About 3135 MacArthur Plaza
San Antonio, Texas-based 3135 MacArthur Plaza LLC is primarily
engaged in renting and leasing real estate properties. It is the
fee simple owner of a property located at 3135 Nacadoches Road San
Antonio, Texas, having an appraised value of $3 million.
3135 MacArthur Plaza filed a Chapter 11 petition (Bankr. W.D. Texas
Case No. 21-50045) on Jan. 13, 2021. In its petition, the Debtor
disclosed $3,577,969 in assets and $3,354,501 in liabilities.
Judge Craig A. Gargotta presides over the case. Malaise Law Firm
serves as the Debtor's bankruptcy counsel.
37 VENTURES: Case Summary & 2 Unsecured Creditors
-------------------------------------------------
Debtor: 37 Ventures, LLC
DBA 37Ventures, LLC
DBA F/K/A 37 Technology Ventures, LLC
365 E Avenida De Los Arboles
Thousand Oaks, CA 91360
Business Description: 37 Ventures, LLC classifies its business as
"Other Financial Investment Activities".
Chapter 11 Petition Date: March 18, 2021
Court: United States Bankruptcy Court
Central District of California
Case No.: 21-10261
Judge: Hon. Deborah J. Saltzman
Debtor's Counsel: Gary E. Klausner, Esq.
LEVENE, NEALE, BENDER, YOO & BRILL L.L.P.
10250 Constellation Blvd., Suite 1700
Los Angeles, CA 90067
Tel: (310) 229-1234
Email: gek@lnbyb.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $10 million to $50 million
The petition was signed by Yuri Pikover, managing member.
A copy of the petition containing, among other items, a list of the
Debtor's two unsecured creditors is available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/VBOUG6Q/37_Ventures_LLC__cacbke-21-10261__0001.0.pdf?mcid=tGE4TAMA
AEMETIS INC: Incurs $36.7 Million Net Loss in 2020
--------------------------------------------------
Aemetis Inc. filed with the Securities and Exchange Commission its
Annual Report on Form 10-K disclosing a net loss of $36.66 million
on $165.56 million of revenues for the year ended Dec. 31, 2020,
compared to a net loss of $39.48 million on $201.99 million of
revenues for the year ended Dec. 31, 2019.
As of Dec. 31, 2020, the Company had $125.14 million in total
assets, $102.23 million in total current liabilities, $207.65
million in total long term liabilities, and a total stockholders'
deficit of $184.74 million.
"As a result of negative capital and negative operating results,
and collateralization of substantially all of the company assets,
the Company has been reliant on its senior secured lender to
provide additional funding and has been required to remit
substantially all excess cash from operations to the senior secured
lender. This indicates substantial doubt about the ability of the
Company to continue as a going concern," Aemetis said in its Annual
Report.
A full-text copy of the Form 10-K is available for free at:
https://www.sec.gov/Archives/edgar/data/738214/000165495421002764/amtx_10k.htm
About Aemetis
Headquartered in Cupertino, California, Aemetis --
http://www.aemetis.com-- is an international renewable natural
gas, renewable fuels and byproducts company focused on the
acquisition, development and commercialization of innovative
technologies that replace traditional petroleum-based products.
The Company operates in two reportable geographic segments: "North
America" and "India."
ALIGHT SOLUTIONS: S&P Raises ICR to 'B+', Stays on Watch Positive
-----------------------------------------------------------------
S&P Global Ratings raised its issuer credit rating on Lincolnshire,
Ill.-based human capital management solutions provider Alight
Solutions LLC to 'B+' from 'B', and its senior secured
credit-facility issue-level rating to 'BB-' from 'B', and revise
its senior secured credit facility recovery rating to '2' from '3'.
Alternatively, if the company struggles to execute on its proposed
merger, the ratings could remain unchanged.
All its ratings on Alight remain on CreditWatch, where S&P placed
them with positive implications on Jan. 25, 2021.
S&P said, "We expect to raise our issuer credit rating on Alight to
'B+' upon the completion of the merger because the company's
adjusted debt to EBITDA (S&P Global Ratings-adjusted) will decline
to the mid-5x area (from over 9x) as of Dec. 31, 2020, and we
forecast its leverage will improve to the 5x area in 2021 due to
its improved operating leverage and a decline in its non-recurring
restructuring charges. Additionally, Alight will reduce its annual
interest expense by over $105 million on a pro forma basis and we
expect it to generate at least $200 million of reported free
operating cash flow in 2021, which supports the potential upgrade.
"We also expect the company's proposed repayment of $634 million of
first-lien term loan debt will improve the recovery prospects for
its secured lenders and support a two-notch improvement in our
issue-level rating on the first-lien facility to 'BB-'. We expect
to withdraw our ratings on the unsecured senior notes ($1,230
million) if they are repaid as proposed.
"Nevertheless, Alight's financial sponsor ownership and influence
may limit additional deleveraging. While the transaction will
improve the company's credit metrics and dilute its financial
sponsor ownership, its original financial sponsors will maintain a
42.1% ownership position and, we believe, the ability to dictate
Alight's strategy and cash flow. The company's financial-sponsor
owners have a track record of undertaking leveraging dividends and
acquisitions and the company does not have a clearly articulated
post-merger financial policy. Additionally, we believe there is
some risk that Alight's financial sponsor owners may further dilute
their stake in the company through share repurchases, which could
negatively affect its credit metrics. Although the Blackstone
Group's representation on the company's board of directors will be
reduced to three seats (from four) out of eight, the financial
sponsor's long operating track record with Mr. Bill Foley, Chairman
of Foley Trasimene, limits our assessment of the board's
independence from Blackstone. We expect the board of directors will
include three directors from Foley Trasimene including Mr. Foley as
Chairman.
"Alight remains well-positioned to capitalize on the expansion in
the human capital management solutions industry. Our ratings on the
company reflect its good revenue visibility from its strong client
retention (97%), long-term embedded contracts (three to five
years), tenured (15 years average with top clients) relationships
with a well-diversified base of predominantly mid- and up-market
clients, and the strong tailwinds in the human capital management
solutions industry. Offsetting these factors is Alight's dependance
on increasing demand for cloud installation services to support its
overall organic revenue growth, given the secular declines in
defined-benefit retirement plans, the expected run-off of its
hosted services revenue, and the high level of price-based
competition in the mature health benefits administration market."
CreditWatch
S&P intends to resolve its CreditWatch placement at transaction
close, which it expect in the second quarter of 2021.
S&P said, "If the transaction closes and Alight repays its debt as
proposed we expect to raise our issuer credit rating by one notch
to 'B+' and our issue-level rating on its senior secured first-lien
credit-facility by two notches to 'BB-' and revise our recovery
rating to '2' from '3' to reflect the reduction in its outstanding
first-lien debt under the proposed terms of the merger.
Alternatively, we could affirm our existing ratings if the merger
is cancelled or if debt repayment is materially less than our
expectations."
ALLIED EQUIPMENT: Case Summary & 20 Largest Unsecured Creditors
---------------------------------------------------------------
Debtor: Allied Equipment, Inc.
8000 N Golder
Odessa, TX 79764
Business Description: Allied Equipment, Inc. --
https://www.alliedeq.com -- designs and
manufactures oil & gas processing & treating
equipment.
Chapter 11 Petition Date: March 18, 2021
Court: United States Bankruptcy Court
Western District of Texas
Case No.: 21-70034
Judge: Hon. Tony M. Davis
Debtor's Counsel: R. Byrn Bass, Jr., Esq.
R. BYRN BASS, JR.
Wells Fargo Center
1500 Broadway, Suite 505
Lubbock, TX 79401
Tel: (806) 785-1250
Fax: (806) 771-1260
Email: bbass@bbasslaw.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Ron Worley, 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/3RUHDUY/Allied_Equipment_Inc__txwbke-21-70034__0001.0.pdf?mcid=tGE4TAMA
ALPHA MEDIA: To Seek Plan Confirmation on April 1
-------------------------------------------------
Judge Kevin R Huennekens on March 12, 2021, approved Alpha Media
Holdings LLC, et al.'s Disclosure Statement and set a hearing on
April 1, 2021, to consider confirmation of the Debtors' Plan.
The Court ruled that these dates are established (subject to
modification as necessary) with respect to the solicitation of
votes to accept, and voting on, the Amended Plan, as well as
filing objections to the Amended Plan and confirming the Amended
Plan (all times prevailing Eastern Time):
* March 3, 2021, as Voting Record Date.
* March 25, 2021, at 4:00 p.m., prevailing Eastern time, as the
Plan Objection Deadline.
* March 30, 2021, at 4:00 p.m., prevailing Eastern time, as the
Deadline to File Confirmation Brief.
* March 30, 2021, at 4:00 p.m., prevailing Eastern time, as the
Plan Objection Response Deadline.
* April 1, 2021, at 11:00 a.m., prevailing Eastern time, as the
Confirmation Hearing Date.
About Alpha Media Holdings
Alpha Media is a privately held radio broadcast and multimedia
company. Formed in 2009 by a veteran radio executive, Alpha Media
grew through acquisitions and now owns or operates more than 200
radio stations that provide local news, sports, music, and
entertainment to a weekly audience of more than 11 million
listeners in 44 communities across the United States.
In addition to its radio stations, Alpha Media provides digital
content through more than 200 websites and countless mobile
applications and digital streaming services.
Alpha Media and its affiliates sought Chapter 11 protection (Bankr.
E.D. Va. Lead Case No. 21-30209) on Jan. 25, 2021. John Grossi,
chief financial officer, signed the petitions. At the time of the
filing, Alpha Media disclosed estimated assets of $10 million to
$50 million and estimated liabilities of $50 million to $100
million.
Judge Kevin R. Huennekens oversees the cases.
The Debtors tapped Sheppard, Mullin, Richter & Hampton LLP as legal
counsel, Kutak Rock LLP as local counsel, Moelis & Company as a
financial advisor, and Ernst & Young LLP as restructuring advisor.
Stretto is the claims and noticing agent.
Wilmington Savings Fund Society, the administrative agent to the
first-lien lenders, is represented by Debevoise & Plimpton, LLP,
and Hunton Andrews Kurth, LLP.
The U.S. Trustee for Region 4 appointed an official committee of
unsecured creditors on Feb. 3, 2021.
The Committee tapped Hahn Loeser & Parks, LLP, as its bankruptcy
counsel, Hirschler Fleischer, P.C. as local counsel, Dundon
Advisers LLC as a financial advisor, and Miller Buckfire & Co., LLC
as an investment banker.
ALPHA METALLURGICAL: Incurs $446.9 Million Net Loss in 2020
-----------------------------------------------------------
Alpha Metallurgical Resources, Inc. filed with the Securities and
Exchange Commission its Annual Report on Form 10-K disclosing a net
loss of $446.90 million on $1.41 billion of total revenues for the
year ended Dec. 31, 2020, compared to a net loss of $316.32 million
on $2 billion of total revenues for the year ended Dec. 31, 2019.
As of Dec. 31, 2020, the Company had $1.68 billion in total assets,
$1.47 billion in total liabilities, and $200.10 million in total
stockholders' equity.
"Despite the numerous challenges of the last year, we are proud of
our accomplishments including significant operating cost
reductions, refreshed board composition, and our rebranding to
Alpha Metallurgical Resources, which reflects our strategic shift
and focus on metallurgical coal," said chairman and chief executive
officer, David Stetson. "We remain confident that in 2021 we can
take advantage of improved market conditions and met coal prices as
expected global infrastructure spending and stimulus actions come
to fruition."
Liquidity and Capital Resources
"In the fourth quarter, our teams continued their exceptional focus
on cost performance with another quarter of sub-$70 met costs, and
a full year average met cost of $70.19," said Andy Eidson, Alpha's
president and chief financial officer. "While the year as a whole
was challenging, both in terms of pricing and pandemic uncertainty,
Alpha made progress on a number of our stated strategic goals.
Divesting the Cumberland Mine has not only hastened our transition
to a pure metallurgical producer, but has also meaningfully reduced
our bonding and collateral requirements."
Cash provided by operating activities for the fourth quarter 2020
was $56.2 million, which includes the receipt of $66.1 million in
accelerated alternative minimum tax (AMT) credit monetization
refund, and capital expenditures for the fourth quarter were $35.1
million. In the prior period, the cash used in operating
activities was $5.9 million and capital expenditures were $27.8
million.
As of Dec. 31, 2020, Alpha had $139.2 million in unrestricted cash
and $157.4 million in restricted cash, deposits and investments.
Total long-term debt, including the current portion of long-term
debt as of Dec. 31, 2020, was $582.5 million, down approximately
$15 million from the prior quarter. At the end of the fourth
quarter, the company had total liquidity of $139.2 million,
including cash and cash equivalents of $139.2 million and no
remaining unused availability under the Asset-Based Revolving
Credit Facility (ABL). The future available capacity under the ABL
is subject to inventory and accounts receivable collateral
requirements and the maintenance of certain financial ratios. As
of Dec. 31, 2020, the company had $3.4 million in borrowings and
$123.1 million in letters of credit outstanding under the ABL. In
January 2021, subsequent to the quarter close, the company posted
$25.0 million in collateral to remain in compliance due to
fluctuations in the borrowing base, a portion of which was then
used to repay $3.4 million in borrowings under the ABL.
Operational and Strategic Update
As part of the ongoing strategic shift towards becoming a pure-play
met company, Alpha closed a transaction to divest the Cumberland
Mine and related assets on Dec. 10, 2020. The previously announced
transaction transferred the associated coal reserves, mining
permits and operations, infrastructure and equipment to Iron
Senergy LLC, releasing Alpha from all reclamation obligations,
totaling $169 million in undiscounted future cash flows. After the
Cumberland divestiture, the company operates only one remaining
thermal mine, which is expected to cease operation by the end of
2022.
As a result of this renewed focus on supplying metallurgical
products to the steel industry, the company also rebranded and
changed its name to Alpha Metallurgical Resources, Inc., effective
Feb. 1, 2021. The company's common stock began trading on the New
York Stock Exchange under a new symbol, AMR, shortly thereafter.
In addition, Alpha continued to enhance its board of directors by
adding Michael Quillen, the founder of Alpha Natural Resources and
an industry veteran, as lead independent director in November 2020.
Subsequent to the quarter end, Alpha appointed three new directors
to the board. Effective February 1, Kenneth Courtis, Elizabeth
Fessenden and Daniel Smith joined the board as independent
directors.
A full-text copy of the Form 10-K is available for free at:
https://www.sec.gov/ix?doc=/Archives/edgar/data/1704715/000170471521000026/amr-20201231.htm
About Alpha Metallurgical
Alpha Metallurgical Resources (NYSE: AMR) (f/k/a Contura Energy) --
www.AlphaMetResources.com -- is a Tennessee-based mining company
with operations across Virginia and West Virginia.
* * *
As reported by the TCR on Dec. 22, 2020, S&P Global Ratings
affirmed its 'CCC+' issuer credit rating on U.S.-based coal
producer Contura Energy Inc. and revised the liquidity assessment
to less than adequate. S&P said, "We view Contura's business as
vulnerable due to declining thermal demand and prices, which is
driving the company to exit these operations and begin reclamation
work at some of its mines."
In April 2020, Moody's Investors Service downgraded all long-term
ratings for Contura Energy, Inc., including the Corporate Family
Rating to Caa1 from B3. "Contura has idled the majority of its
mines due to weak market conditions. Moody's expects that demand
for metallurgical coal will weaken further in the near-term as
blast furnace steel producers adjust to reduced demand due to the
Coronavirus," said Ben Nelson, Moody's vice president -- senior
credit officer and lead analyst for Contura Energy, Inc. "The
rating action is entirely driven by macro-level concerns resulting
from the global outbreak of coronavirus."
AMERICAN BERBER: Examiner Gets OK to Hire Burr & Forman as Counsel
------------------------------------------------------------------
Gary Murphey, the examiner appointed in the Chapter 11 cases of
American Berber, Inc. and American Carpet Group, Inc., received
approval from the U.S. Bankruptcy Court for the Northern District
of Georgia to employ Burr & Forman LLP as legal counsel.
The firm will provide these services:
a. advise the examiner with respect to his rights, duties and
powers in the Debtors' cases;
b. represent the examiner at all hearings and other proceedings;
and
c. prepare legal papers and conduct examinations incidental to
the examiner's duties.
The firm will be paid at these rates:
Partners/Counsel $468 to $526 per hour
Associates $277 to $333 per hour
The firm will also be reimbursed for out-of-pocket expenses
incurred.
Erich Durlacher, Esq., a partner at Burr & Forman, disclosed in a
court filing that the firm is a "disinterested person" as the term
is defined in Section 101(14) of the Bankruptcy Code.
The firm can be reached at:
Erich N. Durlacher, Esq.
Adolyn C. Wyatt, Esq.
Burr & Forman LLP
Suite 1100, 171 17th Street, N.W.
Atlanta, GA 30363
Telephone: (404) 685-4313
Facsimile: (404) 214-7387
Email: edurlacher@burr.com
awyatt@burr.com
About American Berber and
American Carpet Group
American Berber, Inc. and American Carpet Group, Inc. -- Calhoun,
Ga.-based manufacturers of carpets and rugs -- sought protection
under Chapter 11 of the Bankruptcy Code (Bankr. N.D. Ga. Lead Case
No. 19-41154) on May 16, 2019. At the time of the filing, the
Debtors estimated assets of less than $50,000 and liabilities of $1
million to $10 million.
Judge Barbara Ellis-Monro oversees the cases.
Jones & Walden, LLC and Vaughn & Clements, PC serve as the Debtors'
bankruptcy counsel and special counsel, respectively.
Gary Murphey is the examiner appointed in the Debtors' Chapter 11
cases. The examiner tapped Burr & Forman LLP as legal counsel and
Resurgence Financial Services, LLC as forensic accountant.
AMERICAN BERBER: Examiner Hires Resurgence as Forensic Accountant
-----------------------------------------------------------------
Gary Murphey, the examiner appointed in the Chapter 11 cases of
American Berber, Inc. and American Carpet Group, Inc., received
approval from the U.S. Bankruptcy Court for the Northern District
of Georgia to employ Resurgence Financial Services, LLC as forensic
accountant.
The firm's services include:
a. analyzing records and financial information;
b. investigating the Debtors' acts, conduct, assets,
liabilities, financial condition and operation of their businesses,
and any other matter relevant to the cases or to the formulation of
a Chapter 11 plan;
c. investigating any fraud, dishonesty, incompetence,
misconduct, mismanagement or irregularity in the management of the
Debtors' affairs by current or former management;
d. providing testimony in court; and
e. providing such other support as may be reasonably requested
by the examiner that fall within the firm's expertise, experience
and capabilities that are mutually agreeable.
The firm will be paid at the rate of $300 per hour and will be
reimbursed for out-of-pocket expenses incurred.
Gary Murphey, a partner at Resurgence Financial Services, disclosed
in a court filing that the firm is a "disinterested person" as the
term is defined in Section 101(14) of the Bankruptcy Code.
The firm can be reached at:
Gary M. Murphey
Resurgence Financial Services, LLC
3330 Cumberland Blvd., Suite 500
Atlanta, GA 30339
Office: (770) 933-6855
Cell: (404) 886-9104
Email: Murphey@RFSLimited.com
About American Berber and
American Carpet Group
American Berber, Inc. and American Carpet Group, Inc. -- Calhoun,
Ga.-based manufacturers of carpets and rugs -- sought protection
under Chapter 11 of the Bankruptcy Code (Bankr. N.D. Ga. Lead Case
No. 19-41154) on May 16, 2019. At the time of the filing, the
Debtors estimated assets of less than $50,000 and liabilities of $1
million to $10 million.
Judge Barbara Ellis-Monro oversees the cases.
Jones & Walden, LLC and Vaughn & Clements, PC serve as the Debtors'
bankruptcy counsel and special counsel, respectively.
Gary Murphey is the examiner appointed in the Debtors' Chapter 11
cases. The examiner tapped Burr & Forman LLP as legal counsel and
Resurgence Financial Services, LLC as forensic accountant.
BLACKRIDGE TECHNOLOGY: Seeks April 1 Plan Exclusivity Extension
---------------------------------------------------------------
Debtors Blackridge Technology International Inc. and its affiliates
ask the U.S. Bankruptcy Court for the District of Nevada to extend
the Debtors' exclusive period to file a Chapter 11 plan and to
solicit acceptances to April 1, 2021. This is the fourth extension
of exclusivity that has been requested by the Debtors.
The Debtors and the Office of the United States Trustee stipulated
to continue the Debtors' plan confirmation hearing from February 2,
2021, at 2:00 p.m. to March 9, 2021, at 2:00 p.m. in order to allow
the Debtors to amend their Plan of Reorganization and resolve any
objections.
The extension that the Debtors seek is neither indefinite nor being
used to force any creditor to accept an undesirable plan. The
Debtors' creditors will not be prejudiced by extension of the
Exclusive Period. The Debtors have obtained Court approval of their
Disclosure Statement and have filed their amended Plan and noticed
same for confirmation.
The Debtors' Plan is feasible, and the Debtors do not anticipate
any significant objections to the Plan that would prevent
confirmation within a reasonable time period.
A copy of the Debtors' Motion to extend is available at
https://bit.ly/2OXP8pw from PacerMonitor.com.
About Blackridge Technology
Blackridge Technology International develops, markets, and supports
a family of products that provide a next-generation cyber-security
solution for protecting enterprise networks and cloud services.
Blackridge Technology International filed a voluntary Chapter 11
petition (Bankr. D. Nev. Case No. 20-50314) on March 13, 2020. In
the petition signed by Robert J. Graham, president, the Debtor was
estimated $10 million to $50 million in both assets and
liabilities.
Judge Bruce T. Beesley oversees the case. Stephen R. Harris, Esq.,
at Harris Law Practice LLC, is the Debtor's legal counsel. The
Debtor also tapped Patagonia Capital Advisors as their investment
banker.
BLITMAN SARATOGA: Gets OK to Hire Goldberg Weprin as Counsel
------------------------------------------------------------
Blitman Saratoga LLC received approval from the U.S. Bankruptcy
Court for the Southern District of New York to employ Goldberg
Weprin Finkel Goldstein, LLP as counsel to handle its Chapter 11
case.
Goldberg will be paid at these rates:
Partners $575 per hour
Associates $275 - $425 per hour
The firm will also be reimbursed for out-of-pocket expenses
incurred.
The firm received $20,000 as a retainer and $2,000 for the filing
fee and noticing expenses.
Kevin Nash, Esq., a partner at Goldberg, disclosed in a court
filing that the firm is a "disinterested person" as the term is
defined in Section 101(14) of the Bankruptcy Code.
The firm can be reached at:
Kevin J. Nash, Esq.
Goldberg Weprin Finkel Goldstein LLP
1501 Broadway 22nd Floor
New York, NY 10036
Tel: (212) 221-5700
Email: knash@gwfglaw.com
About Blitman Saratoga
Blitman Saratoga LLC was formed in 2012 to develop and build a
residential community consisting of at least 77 single-family homes
spread over approximately 149 acres on Geyser Road in Saratoga
County, N.Y.
Blitman Saratoga sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. S.D.N.Y. Case No. 20-23177) on Nov. 6,
2020. At the time of the filing, the Debtor disclosed $5,857,288 in
assets and $2,755,584 in liabilities.
Judge Robert D. Drain oversees the case.
Kevin J. Nash, Esq., at Goldberg Weprin Finkel Goldstein LLP, is
the Debtor's legal counsel.
BLITMAN SARATOGA: Seeks to Extend Plan Exclusivity Until June 7
---------------------------------------------------------------
Debtor Blitman Saratoga LLC requests the U.S. Bankruptcy Court for
the Southern District of New York to extend the exclusive periods
during which the Debtor may file a Chapter 11 plan until June 7,
2021, and to solicit acceptances until August 5, 2021.
The Debtor is a real estate development that is completing a
residential home community known as Beaver Pond Village, located in
Saratoga Springs, New York.
As of the Chapter 11 filing date, eight homes were under
construction pursuant to various signed purchase contracts. The
goal was and remains to complete home construction and closing on
the pending contracts.
Shortly after the Chapter 11 filing, the Debtor obtained interim
and final approval for DIP financing and has resumed construction.
Based upon available DIP financing, the Debtor is current with its
post-petition obligations, and eventually will be in a position to
file a formal plan of reorganization. For all of these reasons,
maintaining exclusivity will add to the overall stability of the
Chapter 11 case, and thus cause exists to grant the requested
extension.
Since the construction is ongoing, and until completed, the
magnitude of outstanding debt to be reorganized is not yet known.
Further, as homes are completed, the Debtor will also be in a
position to better understand the sources of available cash and
funding necessary for a plan. So, while construction is underway,
the Debtor is also in discussion with various home buyers and their
counsel regarding various options and anticipates being able to
resolve any disputes so that the vast majority of sales will go
forward.
The Debtor hereby seeks to maintain the status quo and is moving
for an extension of the exclusivity period to file a formal plan of
reorganization. An extension will enable the Debtor to make
substantial progress on finishing construction, whereupon the
Debtor will be in a better position to evaluate the scope of
remaining debt to be addressed.
A copy of the Debtor's Motion to extend is available at
https://bit.ly/3bzI0sc from PacerMonitor.com.
About Blitman Saratoga
Blitman Saratoga LLC was formed in 2012 to develop and build a
residential community consisting of at least 77 single-family homes
spread over approximately 149 acres on Geyser Road in Saratoga
County, N.Y.
Blitman Saratoga sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. S.D.N.Y. Case No. 20-23177) on November 6,
2020. At the time of the filing, the Debtor disclosed $5,857,288 in
assets and $2,755,584 in liabilities.
Judge Robert D. Drain oversees the case. Kevin J. Nash, Esq., at
Goldberg Weprin Finkel Goldstein LLP, is the Debtor's legal
counsel.
BOY SCOUTS: Abuse Claimants Say Plan a 'Road to Nowhere'
---------------------------------------------------------
Law360 reports that sexual abuse claimants in the Chapter 11 case
of the Boy Scouts of America told a Delaware bankruptcy judge
Wednesday, March 17, 2021, that the Scouts' proposed bankruptcy
plan has little hope of gaining confirmation, calling it a "road to
nowhere."
But the debtor said ongoing mediation was going well. During a
virtual hearing, representatives for the claimants had a less rosy
view of the plan, which calls for a disclosure statement hearing on
April 15, than the Boy Scouts. An attorney for the future claims
representative said his client does not support the plan and is
concerned that pursuing it will waste assets.
About Boy Scouts of America
The Boy Scouts of America -- https://www.scouting.org/ -- is a
federally chartered non-profit corporation under title 36 of the
United States Code. Founded in 1910 and chartered by an act of
Congress in 1916, the BSA's mission is to train youth in
responsible citizenship, character development, and self-reliance
through participation in a wide range of outdoor activities,
educational programs, and, at older age levels, career-oriented
programs in partnership with community organizations. Its national
headquarters is located in Irving, Texas.
The Boy Scouts of America and affiliate Delaware BSA, LLC sought
Chapter 11 protection (Bankr. D. Del. Lead Case No. 20-10343) on
Feb. 18, 2020, to deal with sexual abuse claims.
Boy Scouts of America was estimated to have $1 billion to $10
billion in assets and at least $500 million in liabilities as of
the bankruptcy filing.
The Debtors have tapped Sidley Austin LLP as their bankruptcy
counsel, Morris, Nichols, Arsht & Tunnell LLP as Delaware counsel,
and Alvarez & Marsal North America, LLC as financial advisor. Omni
Agent Solutions is the claims agent.
The U.S. Trustee for Region 3 appointed a tort claimants' committee
and an unsecured creditors' committee on March 5, 2020. The tort
claimants' committee is represented by Pachulski Stang Ziehl &
Jones, LLP while the unsecured creditors' committee is represented
by Kramer Levin Naftalis & Frankel, LLP.
BOY SCOUTS: Judge Bemoans 'Staggering Legal Fees'
-------------------------------------------------
Maria Chutchian of Reuters reports that the judge overseeing the
Boy Scouts of America's bankruptcy has urged lawyers involved in
the Chapter 11 case to resolve the remaining roadblocks to the
youth organization's emergence from bankruptcy and compensation of
sex abuse survivors as soon as possible, decrying the growing legal
fees that the group has incurred.
U.S. Bankruptcy Judge Laurie Selber Silverstein in Wilmington,
Delaware made her comments during a remote hearing on Wednesday,
March 17, 2021, in which the Boy Scouts' lawyers at White & Case
reiterated the need for the organization to exit Chapter 11 by the
end of the summer because funds are running low. Jessica Lauria of
White & Case told Silverstein that the Boy Scouts have racked up
nearly $100 million in professional fees since the bankruptcy began
in February 2020, a figure that will likely reach $150 million by
August, Ms. Lauria said.
About Boy Scouts of America
The Boy Scouts of America -- https://www.scouting.org/ -- is a
federally chartered non-profit corporation under title 36 of the
United States Code. Founded in 1910 and chartered by an act of
Congress in 1916, the BSA's mission is to train youth in
responsible citizenship, character development, and self-reliance
through participation in a wide range of outdoor activities,
educational programs, and, at older age levels, career-oriented
programs in partnership with community organizations. Its national
headquarters is located in Irving, Texas.
The Boy Scouts of America and affiliate Delaware BSA, LLC sought
Chapter 11 protection (Bankr. D. Del. Lead Case No. 20-10343) on
Feb. 18, 2020, to deal with sexual abuse claims.
Boy Scouts of America was estimated to have $1 billion to $10
billion in assets and at least $500 million in liabilities as of
the bankruptcy filing.
The Debtors have tapped Sidley Austin LLP as their bankruptcy
counsel, Morris, Nichols, Arsht & Tunnell LLP as Delaware counsel,
and Alvarez & Marsal North America, LLC as financial advisor. Omni
Agent Solutions is the claims agent.
The U.S. Trustee for Region 3 appointed a tort claimants' committee
and an unsecured creditors' committee on March 5, 2020. The tort
claimants' committee is represented by Pachulski Stang Ziehl &
Jones, LLP while the unsecured creditors' committee is represented
by Kramer Levin Naftalis & Frankel, LLP.
BOYD GAMING: S&P Upgrades ICR to 'B+', Outlook Stable
-----------------------------------------------------
S&P Global Ratings raised its issuer credit rating on U.S. casino
operator Boyd Gaming Corp. to 'B+' from 'B'. The outlook is stable.
S&P also raised all issue-level ratings on the company by one
notch.
S&P said, "The upgrade to 'B+' reflects our lower leverage
forecast, driven by strong EBITDA and cash flow generation despite
its casinos operating at lower capacity as a result of the
pandemic. Since reopening most of its casinos in the second quarter
of 2020, Boyd's cash flow has recovered faster than we previously
expected. Boyd reported strong margin improvement in the third and
fourth quarters of 2020 as S&P-adjusted EBITDA grew 4% despite
facing visitation pressures due to the COVID-19 pandemic that
resulted in a revenue decline of about 22% in the second half of
2020. Boyd is benefiting from the high flow through of gaming
revenue and cost cuts that management implemented during the
closures last year. In addition, Boyd generated good levels of free
operating cash flow. As a result, we now expect leverage to improve
to about 5x in 2021 from our previous forecast of the low-7x area.
We expect leverage will improve to the mid-4x area in 2022. This
provides Boyd ample cushion relative to our 6x leverage threshold
for the company at the current 'B+' rating to withstand some
potential further operating volatility."
Boyd's concentration in local and regional gaming markets is
supporting its good recovery. Boyd's portfolio of casinos is
heavily weighted toward local and regional gaming markets (Boyd
generated more than 90% of its total revenue and property level
EBITDAR from its Midwest and South properties and its Las Vegas
locals segment). Regional and local gaming markets are recovering
faster because they cater to customers who live in the local area
and can drive to the properties. These casinos are benefitting from
customers staying closer to home and limited other entertainment
and travel options. S&P said, "Capacity restrictions in most
markets have not impaired gaming revenue as much as we initially
expected because historical peak utilization rates were well below
these limits in most markets, except for those with the strictest
limitations. Regional gaming operators' cash flow is also
benefitting from cost cuts management implemented while the
properties were closed, particularly in labor and marketing. Since
reopening, casinos have operated at lower levels of labor and
marketing expense, given capacity limitations and closed amenities.
While we believe incremental costs may creep back as operations
normalize, some reductions are likely permanent." In addition, the
ongoing closure of many lower-margin or loss-leading amenities,
like buffets, for health and safety reasons is supporting margin
improvement, and these amenities may not reopen for some time, if
at all.
S&P said, "In our revised base case scenario, we assume Boyd's
Midwest and South properties and its Las Vegas locals properties
will continue to recover faster than its Downtown Las Vegas
segment. Boyd's Downtown Las Vegas segment, which represents less
than 10% of its revenue and property-level EBITDAR, is exposed to
air travel and travel restrictions, given that the majority of its
downtown casinos depend on fly-in visitation from Hawaii and to Las
Vegas.
"Until widespread vaccination is achieved, we assume that some
level of capacity restrictions will remain in place. As a result,
we believe Boyd's revenue will continue to be below 2019 levels and
that access to amenities will remain somewhat limited. As capacity
restrictions are relaxed, we believe Boyd will choose to slowly
bring back its cost structure as its visitation and revenue
increases. This includes taking a measured approach to labor and
marketing, which are two significant costs that gaming operators
can control. We also expect operators to be cautious with their
promotions and marketing, until the recovery path is more certain.
Although there remains a risk of incremental casino closures, we
believe these may be targeted and would not affect Boyd's entire
portfolio of casinos at the same time, particularly as states
continue to relax restrictions.
"We believe Boyd's financial policy will support continued good
liquidity and leverage improvement. Under our revised base case
forecast, we expect Boyd to generate good discretionary cash flow,
and we believe the company will prioritize maintaining a good
liquidity position and improving leverage because of the ongoing
pandemic. We expect Boyd's capital expenditures (capex) will be
weighted toward the second half of 2021, as casino operators
continue to preserve liquidity to address the uncertain operating
environment. In addition, we believe Boyd may prioritize
incremental voluntary debt reduction given its publicly stated
long-term leverage target of 4x-5x. (Boyd's financial policy range
does not incorporate a lease adjustment while we add operating
leases to our measure of debt.) We expect Boyd will continue
building cash and reducing leverage through 2021, stemming from
EBITDA growth compared with 2020 and debt repayment. We also expect
Boyd to maintain good levels of interest coverage of about 3x.
"The stable outlook reflects our expectation that Boyd will
continue generating good levels of discretionary cash flow over the
next two years, enabling it to further reduce debt balances and
improve leverage to about 5x in 2021 and possibly below 5x in 2022
(absent possible incremental investment and acquisition spending)
from 7x at the end of 2020 because of the closure of its casinos
for several months due to the COVID-19 pandemic. This provides good
cushion to our 6x leverage downgrade threshold for Boyd at the 'B+'
rating to absorb potential operating volatility. We also expect
Boyd to maintain lease-adjusted EBITDA interest coverage in the
low-3x area through 2022.
"While unlikely given our forecast for the company to have 1x-1.5x
of cushion relative to our downgrade threshold through 2022, we
could lower our ratings if we believed Boyd would sustain leverage
over 6x for an extended period of time. The most likely path, in
our view, would be if the company significantly underperformed our
base case forecast in 2021 because consumers pulled back on
discretionary spending at casinos and the company were unable to
sustain cost improvements it made or adopted a more aggressive
financial policy than we expected with regard to acquisitions,
growth spending, or shareholder returns.
"We could raise our rating on Boyd if the company outperformed our
forecast or repaid its debt at a faster-than-expected pace such
that we expected the company to maintain lease-adjusted debt to
EBITDA under 5x and funds from operations (FFO) to debt of more
than 12%, incorporating potential growth investments in its
portfolio. To raise the rating, we would also need to believe that
Boyd's recent margin improvement is largely sustainable."
BRAZOS ELECTRIC: Sees Need for Bankruptcy Loan by April or May
--------------------------------------------------------------
Jeremy Hill of Bloomberg News reports that Brazos Electric is
shopping for financing to fund its Chapter 11 case. Brazos
Electric Power Cooperative has executed non-disclosure agreements
with "a number of parties" interested in providing bankruptcy
financing, which it expects to need in April or May, Louis Strubeck
of Norton Rose Fulbright said in a Wednesday, March 17, 2021,
hearing.
The process appears to be "very competitive and robust," Strubeck
said.
Brazos entered bankruptcy with more than $240 million of cash on
hand.
About Brazos Electric Power Cooperative
Brazos Electric Power Cooperative Inc. is a 3,994-megawatt
transmission and generation cooperative which members' service
territory covers 68 counties from the Texas Panhandle to Houston.
It was organized in 1941 and the first cooperative formed in the
Lone Star state with the primary intent of generating and supplying
electrical power. At present, Brazos Electric is the largest
generation and transmission cooperative in the state and is the
wholesale power supplier for its 16 member-owner distribution
cooperatives and one municipal system.
Brazos Electric filed a voluntary petition for relief under Chapter
11 of the U.S. Bankruptcy Code (Bankr. S.D. Tex. Case No. 21-30725)
on March 1, 2021. At the time of the filing, the Debtor disclosed
assets of between $1 billion and $10 billion and liabilities of the
same range.
Judge David R. Jones oversees the case.
Brazos Electric hired Norton Rose Fulbright and Dallas partner
Louis Strubeck, to lead its restructuring effort. Lawyers say that
Foley & Lardner LLP bankruptcy partner Holland O'Neil is also
advising Brazos Electric. Stretto is the claims and noticing
agent.
BRILLIANT ENERGY: Files for Chapter 7 Liquidation
-------------------------------------------------
Brilliant Energy, LLC, filed a Chapter 7 bankruptcy petition
(Bankr. S.D. Tex. Case No. 21-30936) on March 16, 2021.
Brilliant Energy's bankruptcy filing adds to a growing list of
companies that have stumbled after power outages caused by a winter
freeze in February.
The Chapter 7 filing indicates the Company's intent to liquidate
the business rather than reorganize while under court protection.
Brilliant Energy is an electricity provider based in Houston and
has served Texans since 2007. It estimated liabilities of $50
million to $100 million compared with assets of $10 million to $50
million as of the bankruptcy filing.
At their peak, the unprecedented power outages in Texas left four
million homes and businesses without heat, light and in some cases
water as a rare and powerful winter storm gripped the region,
causing as much as $129 billion in economic losses.
Brilliant Energy is at least the fourth firm to seek bankruptcy
protection in the wake of the Texas freeze, underscoring the
crushing financial pressure the outages have put on power companies
in the state. The market faces a $3+ billion shortfall as over a
dozen companies can't pay their bills.
DTE Energy Trading, a creditor in the case, has filed a motion to
convert the case to a restructuring under Chapter 11 of the
Bankruptcy Code and for a Chapter 11 trustee to take over
management of the Debtor.
A Chapter 7 Trustee has been appointed in the case:
Randy W Williams
Byman & Associates PLLC
7924 Broadway, Suite 104
Pearland, TX 77581
The Debtor's counsel:
Matthew Scott Okin, Esq.
Okin & Adams LLP
Tel: 713-228-4100
E-mail: mokin@okinadams.com
BRILLIANT ENERGY: Hits Chapter 7 Filing After Texas Winter Freeze
-----------------------------------------------------------------
Jeremy Hill and Andrew Monahan of Bloomberg News reports that
Brilliant Energy LLC filed for bankruptcy in the Southern District
of Texas.
Brilliant Energy LLC filed for bankruptcy in the Southern District
of Texas, adding to a growing list of companies that have stumbled
after power outages caused by a winter freeze in February 2021.
The Chapter 7 filing signals an intent to liquidate the business
while under court protection. The electricity provider has
estimated liabilities of $50 million to $100 million compared with
assets of $10 million to $50 million, according to its bankruptcy
petition.
At their peak, the unprecedented power outages in Texas left four
million homes and businesses without heat, light and in some cases
water as a rare and powerful winter storm gripped the region,
causing as much as $129 billion in economic losses. Dozens of
people died in the cold.
Brilliant Energy is at least the fourth firm to seek bankruptcy
protection in the wake of the Texas freeze, underscoring the
crushing financial pressure the outages have put on power companies
in the state. The market faces a more-than $3 billion shortfall as
over a dozen companies can't pay their bills.
Valuable Assets
DTE Energy Trading, a creditor in the case, claims in court papers
that Brilliant has been in default on certain power contracts since
2017 and owed DTE about $15 million prior to last February 2021's
freeze. The wholesale electricity seller says it's now owed some
$60 million and has asked Brilliant’s bankruptcy judge to
intervene before "irreparable harm" befalls the company's most
valuable assets -- its customer contracts.
DTE is asking for a court-appointed trustee to take control of
Brilliant and sell the customer contracts. Without it, the state's
grid operator may transfer the contracts to another electricity
provider, destroying what value is left in the company and
potentially foisting higher power bills on consumers, DTE argues in
court papers.
The contracts may be worth as much as $12 million, according to
DTE. An emergency hearing is set for Wednesday afternoon.
About Brilliant Energy LLC
Brilliant Energy is an electricity provider based in Houston and
has served Texans since 2007. It services both residential and
commercial electricity customers.
It filed for bankruptcy in the Southern District of Texas. It has
estimated liabilities of $50 million to $100 million compared with
assets of $10 million to $50 million.
BRILLIANT ENERGY: Supplier Wants Ch. 11 to Keep Customer Contracts
------------------------------------------------------------------
DTE Energy Trading has filed a motion to convert Brilliant Energy's
Chapter 7 case to a restructuring case under Chapter 11 of the
Bankruptcy Code and for a Chapter 11 trustee to take over
management of the Debtor.
DTEET supplies electricity to the Debtor on credit and provides
ancillary services pursuant to (i) an Energy Marketing Agreement,
dated January 8, 2010, (ii) ISDA 2002 Master Agreement dated Jan.
8, 2020, and (iii) Credit Agreement, dated as of January 8, 2010.
The Debtor has been in default under the Transaction Documents
since at least July 2017. From that point through the March 16,
2021 petition date, DTEET says it has worked with the Debtor in an
attempt to preserve the value of the Debtor's business as a going
concern. Specifically, DTEET has allowed the Debtor to continue
using DTEET's cash collateral and has continued to supply power and
ancillary services notwithstanding the Debtor's default.
Prior to the extreme winter storm beginning on Feb. 13, 2021, the
outstanding balance due under the Transaction Documents was
approximately $15 million, not including interest and fees. Since
the recent Texas weather events, that balance has grown to north of
$60 million as a result of regulatory charges paid by DTEET and
passed to the Debtor in accordance with the terms of the
Transaction Documents.
According to DTEET, market indicators suggest that the customer
contracts have a value of approximately $6 million to $12 million.
The value of those customer contracts now is at risk of being lost
as a result of this chapter 7 filing and management's precipitous
actions during the period leading up to the chapter 7 filing.
"DTEET has worked tireless to give the Debtor an opportunity to
preserve the value of the customer contracts. DTEET essentially
funded the Debtor's operating losses for years while management
pursued opportunities to sell the contracts or obtain
capitalization to resolve outstanding defaults, however the Debtor
consistently refused to execute on opportunities that were
presented. More recently, DTEET and the Debtor were engaged in
negotiations over a transaction that would have permitted either a
secured party sale of the customer contracts, or other actions to
preserve the value of the customer contracts, but the Debtor's
management abruptly ended those negotiations and filed the instant
chapter 7 case," Gregory V. Staton, vice president at DTE Energy,
said in the court filing.
About Brilliant Energy
Brilliant Energy, LLC, is an electricity provider based in Houston
and has served Texans since 2007.
Brilliant Energy filed a Chapter 7 bankruptcy petition (Bankr. S.D.
Tex. Case No. 21-30936) on March 16, 2021, adding to a growing list
of companies that have stumbled after power outages caused by a
winter freeze in February.
Brilliant estimated liabilities of $50 million to $100 million
compared with assets of $10 million to $50 million as of the
bankruptcy filing.
Okin & Adams LLP, led by Matthew Scott Okin, is the Debtor's
counsel.
CENTURY 21: Court Gives Go Signal to Solicit Bankruptcy Plan Votes
------------------------------------------------------------------
Alex Wolf of Bloomberg Law reports that Century 21 Department
Stores LLC received court permission to solicit votes on its
bankruptcy wind-down plan that stems from sales of both its
intellectual property and legal claims against insurers.
The shuttered retail chain would repay about 30% to 40% of
unsecured claims totaling more than $200 million, according to plan
disclosures approved Tuesday, March 16, 2021.
The Century 21 plan proceeds derived from a $9 million sale of its
intellectual property and a $59 million sale of its outstanding
claims against insurers that didn't pay out on business
interruption policies.
About Century 21
Century 21 Department Stores LLC and its affiliates are pioneers in
off-price retail offering access to designer brands at amazing
prices. They opened their iconic flagship location in downtown
Manhattan in 1961. As of the petition date, the Debtors have 13
stores across New York, New Jersey, Pennsylvania and Florida and an
online retail presence, operate seasonal pop-ups, and employ other
innovative retail concepts. Visit http://www.c21stores.com/for
more information.
Century 21 Department Stores LLC and its affiliates sought Chapter
11 protection (Bankr. S.D.N.Y. Lead Case No. 20-12097 on Sept. 10,
2020).
Century 21 was estimated to have $100 million to $500 million in
assets and liabilities as of the bankruptcy filing.
The Hon. Shelley C. Chapman is the case judge.
The Debtors have tapped Proskauer Rose LLP as their legal counsel,
Berkeley Research Group LLC as financial advisor, and Hilco
Merchant Resources LLC as liquidation consultant. Stretto is the
Debtors' claims agent.
On Sept. 16, 2020, the U.S. Trustee for Region 2 appointed an
official committee of unsecured creditors. The committee is
represented by Lowenstein Sandler, LLP.
CHRISTINE SKANDIS: Trustee's Repocast.com Sale of Misc. Items OK'd
------------------------------------------------------------------
Judge John T. Gregg of the U.S. District Court for the Western
District of Michigan authorized Jeff A. Moyer, the Chapter 7
Trustee for the estate of Christine Skandis, to sell the various
miscellaneous items of non-exempt personal property owned by the
Debtor, including, but not limited to some or all of the following,
by internet auction or public sale through Repocast.com upon the
terms and conditions set forth in the Motion: vintage and modern
cars, Chinese artwork, jade carvings, antique wooden carved boats,
bronze statues, wine inventory, miscellaneous personal property.
A copy of the Order will be served upon the Debtor, the Trustee and
the Office of the U.S. Trustee.
The Trustee:
Jeff A. Moyer, Esq.
THE BANKRUPTCY GROUP, INC.
1547 Godfrey Ave. SW
Wyoming, MI 49509
Telephone: (616) 724-1890
The bankruptcy case is In re: Christine Skandis, Case No. GG
19-05319 (Bankr. W.D. Mich.).
CLEVELAND-CLIFFS INC: S&P Alters Outlook to Pos., Affirms 'B-' ICR
------------------------------------------------------------------
S&P Global Ratings affirmed its 'B-' issuer credit rating on
U.S.-based iron ore producer Cleveland-Cliffs Inc. and revised the
outlook to positive from negative.
S&P said, "We are affirming our 'B' issue-level rating on Cliffs'
senior secured debt and our 'CCC' issue-level rating on Cliffs'
guaranteed unsecured and nonguaranteed subordinated debt. The
recovery ratings remain '2' and '6', respectively.
"The positive outlook reflects our expectation that the company
could generate about $1 billion in free operating cash flow,
majority of which we anticipate the company will use for debt
repayment. We expect Cleveland-Cliffs will end 2021 with adjusted
leverage of 3x-4x.
The AK Steel and ArcelorMittal USA acquisitions transform Cliffs
from a pure commodity iron ore producer to an integrated producer
of steel. Cliffs is now the largest flat-rolled steel producer in
North America with an annual production capacity of about 23
million tons of raw steel. S&P said, "With about 40% of its steel
volumes geared toward the automotive end-market pro forma for the
acquisitions, we believe Cliffs' earnings will be more stable
relative to its closest peer, US Steel, which has about 20%
exposure to the auto sector. For example, through the last
commodity price cycle of 2015-2019, AK Steel's EBITDA margins
ranged 5%-9% (AK Steel had about 60% exposure to the auto sector on
a stand-alone basis), whereas US Steel's EBITDA margins swung
between -1% and 11%. We believe Cliffs' advanced high-strength
steel (AHSS) product lines and its downstream engineered steel
applications (Precision Partners) that target improved safety and
fuel efficiency of vehicles could strengthen its profitability in
the next couple of years."
Vertical integration of iron ore mining secures stable supply of
raw material. S&P said, "We assume Cliffs will produce
approximately 23 million long tons of iron ore pellets and consume
about 20 million in the steel operations. We assume the company
will sell the remaining 3 million tons to third parties at prices
that recently reached 10-year highs. We expect this will contribute
to healthy, 14%-15%, EBITDA margins in 2021. Although Cliffs' iron
ore cash costs before transportation ($65-$66/ton) are more than
four times higher than the cash costs of the largest iron ore
producers such as Vale S.A., BHP Group, Rio Tinto PLC, and
Fortescue Metals Group ($13-$15/ton), we believe the fully
integrated iron ore operations will partially mitigate the
steelmaking operations' exposure to volatile iron ore prices by
securing a stable raw material supply."
S&P believes the completion of the hot briquetted iron (HBI) direct
reduction plant will not meaningfully increase Cliffs' cash flows
because the majority of production (1.9 million tons of annual
capacity) will be consumed internally. However, due to the
high-purity iron content, HBI can replace iron ore and coking coke
in blast furnaces and partially substitute scrap metal in electric
arc furnaces, potentially producing higher quality and
premium-priced steel from electric arc furnaces.
High adjusted debt balance, including OPEB (other post-employment
benefit) and pension obligations require large cash service
payments. S&P said, "Our total adjusted debt estimate of $10.7
billion for 2021 includes approximately $4 billion in pension and
other postretirement benefit obligations, among other debt
adjustments. We expect about $400 million annual cash payments to
service these obligations. Our total adjusted EBITDA estimate of
$2.5 billion-$2.7 billion in 2021, after approximately $1.6 billion
in fixed charges, will leave about $1 billion of discretionary cash
flow for debt repayment. However, we consider the high adjusted
debt balance as a significant risk factor, limiting the upward
rating potential on Cliffs. For example, assuming a 30%-35% drop in
EBITDA if HRC drops to $600/ton, we would expect adjusted leverage
to increase by about two turns, potentially rising above 6x. Under
this scenario, Cliffs' discretionary cash flow would be minimal, if
not break-even. Therefore, we would expect the company to reduce
its absolute debt balance in order to sustain an adjusted leverage
below 4x."
The steelmaking segment is still susceptible to overcapacity and
imports that could reduce cash earnings. S&P views Cliffs' blast
furnace operations as having inherently higher fixed-costs and as
less flexible than electric arc furnace (EAF) operations. Given the
global overcapacity of steel and the prevailing EAF production
domestically, an increase in domestic production or potentially
higher imports could negatively affect Cliffs' profitability and
earnings. Therefore, key rating factors in the next 12 months
include reducing adjusted debt balance while successfully
integrating the AK Steel and ArcelorMittal USA assets.
S&P said, "The positive outlook reflects our expectation that
Cleveland-Cliffs' debt leverage will decline to 3x-4x in 2021 from
peak levels in 2020. We anticipate improving demand from automotive
end markets as well as gradual recovery of general industrial and
construction activity will result in 2021 steel volumes sold
returning to about 85% of pre-pandemic levels." In addition, robust
steel, and iron ore prices in the first quarter of 2021 should
result in strong free cash flow generation, which we expect the
company will use to reduce debt."
S&P could upgrade Cliffs in the next 12 months if the integration
of AK Steel and ArcelorMittal is successful and leads to improved
profitability and cash flow. This scenario would be supported by:
-- Positive discretionary cash flow (free operating cash flow
minus capital spending) applied toward debt reduction; and
-- S&P's expectation that the adjusted leverage can be sustained
below 4x even under lower HRC and iron ore price environment.
S&P could revise the outlook to stable in the next 12 months if its
earnings and cash flow expectations deteriorate because of weaker
markets or if the company encounters operational issues integrating
the ArcelorMittal USA assets. Indicators of this scenario include:
-- Adjusted leverage remains above 7x on sustained basis.
-- Free operating cash flow approaches breakeven levels.
-- Hot-rolled coil (HRC) prices dropped below $600/ton, while
volumes dropped below 12 million tons.
COMCAR INDUSTRIES: Combined Plan & Disclosure Confirmed by Judge
----------------------------------------------------------------
Judge Laurie Selber Silverstein has entered findings of fact,
conclusions of law and an order confirming the Amended Combined
Disclosure Statement and Chapter 11 Plan of Liquidation of Comcar
Industries, Inc., et al.
This Order constitutes the Court's finding and determination that
the Global Settlement embodied in the Plan is approved in all
respects, and such compromises and settlements are within the range
of reasonableness, in the best interests of the Debtors, their
Estates, their Creditors, and other parties-in interest, and fair
and equitable.
The Stipulation Resolving Second and Fifth Omnibus Objections to
Claims and 3018 Motion Filed by Travelers Casualty And Surety
Company Of America is approved in its entirety.
Except to the extent that Pennsylvania Department of Revenue
("PADOR") agrees to a less favorable treatment, in full and final
satisfaction, settlement, release, and discharge of each of its
Allowed Secured Claims, PADOR shall receive, as soon as reasonably
practicable after the Effective Date and the date on which its
claim becomes an Allowed Secured Claim, including any rights to
costs, fees and interest: payment in full in Cash; or retention of
any Lien securing any such Allowed Secured Claim until payment in
full in Cash or setoff.
Notwithstanding anything in the Plan or any Order confirming the
Plan to the contrary, Dakota Truck Underwriters ("DTU") may offset
or otherwise apply the balance of the Subscriber Savings Account
("SSA") securing DTU's Other Secured Claim not later than at the
times DTU would distribute SSA funds to a terminated subscriber in
the ordinary course and consistent with the guidelines, polices and
law applicable to the reciprocal insurance program.
Counsel to the Debtors:
Stuart M. Brown
DLA PIPER LLP (US)
1201 North Market Street, Suite 2100
Wilmington, Delaware 19801
Telephone: (302) 468-5700
Facsimile: (302) 394-2341
E-mail: stuart.brown@us.dlapiper.com
- and -
Jamila Justine Willis
DLA PIPER LLP (US)
1251 Avenue of the Americas
New York, New York 10020
Telephone: (212) 335-4500
Facsimile: (212) 335-4501
E-mail:jamila.willis@us.dlapiper.com
About Comcar Industries
Comcar Industries -- https://comcar.com/ -- is a transportation and
logistics company headquartered in Auburndale, Fla., with over 40
strategically-located terminal and satellite locations across the
United States.
On May 17, 2020, Comcar Industries and related entities sought
Chapter 11 protection (Bankr. D. Del. Lead Case No. 20-11120). In
the petitions signed by CRO Andrew Hinkelman, Comcar Industries was
estimated to have $50 million to $100 million in assets and
liabilities as of the bankruptcy filing.
The Hon. Laurie Selber Silverstein is the presiding judge.
The Debtors tapped DLA Piper LLP (US) as counsel, FTI Consulting,
Inc. as financial advisor; and Bluejay Advisors, LLC, as investment
banker. Donlin Recano & Company, Inc., is the claims agent.
* * *
On June 25, 2020, the Bankruptcy Court entered orders authorizing
the Debtors to (i) sell substantially all of the assets of CT to
Bulk Transport Company, East, Inc., (ii) sell substantially all of
the assets of CTL to Adams Resources & Energy, Inc., and Service
Transport Company, and (iii) sell the MCT assets to Contract
Freighters, Inc. On Sept. 4, 2020, the Court entered an order
authorizing the sale of substantially all of CCC's assets to Bulk
Transport Company East, Inc.
CONFIDENCE TRUCKING: Case Summary & 17 Unsecured Creditors
----------------------------------------------------------
Debtor: Confidence Trucking W/C LLC
5130 Broad St.
Brooksville, FL 34601
Chapter 11 Petition Date: March 18, 2021
Court: United States Bankruptcy Court
Middle District of Florida
Case No.: 21-01266
Debtor's Counsel: Herbert R. Donica, Esq.
DONICA LAW FIRM, PA
238 East Davis Blvd
Suite 209
Tampa, FL 33606
Tel: 813-878-9790
Fax: 813-878-9746
E-mail: herb@donicalaw.com
Estimated Assets: $500,000 to $1 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Daymis Rodriguez, managing member.
A copy of the petition containing, among other items, a list of the
Debtor's 17 unsecured creditors is available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/OUF2ZLA/Confidence_Trucking_WC_LLC__flmbke-21-01266__0001.0.pdf?mcid=tGE4TAMA
CRED INC: Creditors Seek Jail Time for Former-CFO in Chapter 11
---------------------------------------------------------------
Law360 reports that the creditors of cryptocurrency investment firm
Cred Inc. are seeking jail time for the company's former chief
financial officer in a Chapter 11 contempt proceeding, but will
have to take their fight to Delaware federal court after a
bankruptcy judge said Wednesday, March 17, 2021, he doesn't have
the authority to incarcerate people for actions taken outside the
bankruptcy court.
U.S. Bankruptcy Judge John T. Dorsey said during a virtual hearing
that the request for jail time presented a question about the
bankruptcy court's authority to issue a contempt order that would
result in Alexander's arrest.
About Cred Inc.
Cred Inc. is a cryptocurrency platform that accepts loans of
cryptocurrency from non-U.S. persons and pays interest on those
loans. Cred -- https://mycred.io/ -- is a global financial
services platform serving customers in over 100 countries. Cred is
a licensed lender and allows some borrowers to earn a yield on
cryptocurrency pledged as collateral.
Cred Inc. and its affiliates sought Chapter 11 protection (Bankr.
D. Del. Lead Case No. 20-12836) on Nov. 7, 2020. Cred was
estimated to have assets of $50 million to $100 million and
liabilities of $100 million to $500 million as of the bankruptcy
filing.
The Debtors tapped Paul Hastings LLP as their bankruptcy counsel,
Cousins Law LLC as local counsel, and MACCO Restructuring Group,
LLC, as financial advisor. Donlin, Recano & Company, Inc., is the
claims agent.
The U.S. Trustee for Region 3 appointed an official committee of
unsecured creditors in the Debtors' Chapter 11 cases on Dec. 3,
2020. The Committee tapped McDermott Will & Emery LLLP as counsel
and Dundon Advisers LLC as financial advisor.
DEAN FOODS: Gets Court Approval for Chapter 11 Liquidation Plan
---------------------------------------------------------------
Law360 reports that a Texas bankruptcy judge approved milk producer
Dean Foods' Chapter 11 liquidation plan Wednesday, March 17, 2021,
overriding arguments by the U.S. trustee's office that the plan's
legal releases went too far.
At a virtual hearing, U.S. Bankruptcy Judge David Jones approved
Dean Food's plan to distribute the proceeds of the sale of its
assets over the objections of the trustee's office, which had
argued Dean was not allowed to release legal claims against parties
that were not fiduciaries to the bankruptcy estate. Dean Foods, one
of the largest milk producers in the U.S., filed for Chapter 11 in
November 2019.
About Southern Foods Group
Southern Foods Group, LLC, which conducts business under the name
Dean Foods, is a food and beverage company and a processor and
direct-to-store distributor of fresh fluid milk and other dairy and
dairy case products in the United States.
Southern Foods and its affiliates filed for bankruptcy protection
on Nov. 12, 2019 (Bankr. S.D. Texas, Lead Case No. 19-36313). The
petitions were signed by Gary Rahlfs, senior vice president and
chief financial officer. Judge David Jones presides over the
cases.
Debtors posted estimated assets and liabilities of $1 billion to
$10 billion.
Debtors have tapped David Polk & Wardell LLP as general bankruptcy
counsel, Norton Rose Fulbright US LLP as local counsel, Alvarez
Marsal as financial advisor, Evercore Group LLC as investment
banker, and Epiq Corporate Restructuring LLC as notice and claims
agent.
The Office of the U.S. Trustee appointed creditors to serve on the
official committee of unsecured creditors on Nov. 22, 2019. The
committee is represented by Philip C. Dublin, Esq., at Akin Gump
Strauss Hauer & Feld LLP.
DIOCESE OF CAMDEN: Granite/Lexington Join in Insurers' Objection
----------------------------------------------------------------
Granite State Insurance Company and Lexington Insurance Company
(together, the "Companies"), submitted a supplemental objection to
the Disclosure Statement and Joinder to certain of the objections
of Certain Underwriters at Lloyd's, London and Certain London
Market Companies (collectively, the "London Market Insurers") to
the Disclosure Statement of Diocese of Camden, New Jersey.
On October 21, 2020, the Debtor commenced an adversary proceeding
against the Companies and against a number of other insurers,
seeking, among other things, a declaratory judgment with respect to
the rights, duties and liabilities of the defendant insurers under
various insurance policies as they relate to insurance coverage for
the survivor and tort claims.
While they are currently confirming issuance of relevant insurance
policies, at this time it appears that Granite State Insurance
Company and Lexington Insurance Company each issued one or more
excess liability policies to the Debtor, which were effective at
various times between 1985 and 2002 (the "Policies").
The Companies support and join in many of both of LMI's objections,
as set forth in the LMI Disclosure Statement Objection, and
Century's objections, as set forth in the Century Disclosure
Statement Objection, regarding, among other things: (i) the fact
that the plan confirmation process is premature and should not go
forward at the present time, (ii) the fact that the Disclosure
Statement lacks adequate information, and (iii) the patent
unconfirmability of the Plan.
The Companies also support and join in certain of the objections
set forth in the Century Solicitation Objection regarding the
unnecessarily-expedited solicitation and confirmation schedule set
forth by the Debtor in the Solicitation Motion, particularly when,
again, the plan confirmation process is premature and should not go
forward at the present time.
Counsel to Granite State Insurance and Lexington:
RIKER DANZIG SCHERER HYLAND & PERRETTI LLP
Joseph L. Schwartz, Esq.
Michael J. Rossignol, Esq.
Headquarters Plaza, One Speedwell Avenue
Morristown, New Jersey 07962-1981
Telephone: (973) 538-0800
Facsimile: (973) 538-1984
E-mail: jschwartz@riker.com
mrossignol@riker.com
About The Diocese of Camden, NJ
The Diocese of Camden, New Jersey is a nonprofit religious
corporation organized pursuant to Title 16 of the Revised Statutes
of New Jersey. The Diocese is the secular legal embodiment of the
Roman Catholic Diocese of Camden, a juridic person recognized under
Canon Law.
The Diocese of Camden sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. D.N.J. Case No. 20-21257) on Oct. 1, 2020.
The petition was signed by Reverend Robert E. Hughes, vicar General
and vice president. At the time of the filing, the Debtor had
total assets of $53,575,365 and liabilities of $25,727,209. Judge
Jerrold N. Poslusny Jr. oversees the case. McManimon, Scotland &
Baumann, LLC, is the Debtor's legal counsel.
DUPONT STREET: Case Summary & 7 Unsecured Creditors
---------------------------------------------------
Debtor: Dupont Street Developers LLC
49-55 Dupont Street
Brooklyn, NY 11222
Business Description: Dupont Street Developers is engaged in
activities related to real estate. The
Company owns premises at 49-55 Dupont
Street, Brooklyn, NY having a current value
of $57.12 million (value subject to
appraisal by a Court of competent
jurisdiction, based upon current contract of
sale).
Chapter 11 Petition Date: March 17, 2021
Court: United States Bankruptcy Court
Eastern District of New York
Case No.: 21-40664
Judge: Hon. Elizabeth S. Stong
Debtor's Counsel: Mitchell A. Greene, Esq.
ROBINSON BROG LEINWAND GREENE GENOVESE & GLUCK
P.C.
875 Third Avenue
New York, NY 10022
Tel: (212) 603-6300
E-mail: amg@robinsonbrog.com
Total Assets: $57,125,000
Total Liabilities: $58,925,731
The petition was signed by Bo Jin Zhu, 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/6YYULTY/DUPONT_STREET_DEVELOPERS_LLC__nyebke-21-40664__0001.0.pdf?mcid=tGE4TAMA
List of Debtor's Seven Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
1. Baker & Hostetler $7,500
45 Rockefeller Plaza
New York, NY 10111
2. Becker, Glynn, $113,857
Muffly,Chassin & Hosinski LLP
299 Park Ave
New York, NY 10171
3. DuPont Realty NY LLC Deposit for $3,000,000
199 Lee Avenue Contract of
PO Box 693 Sale
Brooklyn, NY 11211
4. Haley & Aldrich of NY $87,637
237 West 35th Street
16th Floor
New York, NY 10123
5. Interior Development $650,000
Consulting LLC
92 Eagle St., #2R
Brooklyn, NY 11222
6. Jeffrey P. Sharkey PLLC $123,194
2564 Aster Place
South Westbury, NY 11590
7. NYC Dept. of Finance $23,558
345 Adams Street, 3rd FL
Attn: Legal Affairs
Brooklyn, NY 11201
DURRIDGE COMPANY: Seeks Cash Collateral Access Thru May 2021
------------------------------------------------------------
Durridge Company Inc. asks the U.S. Bankruptcy Court for the
District of Massachusetts for authority to use cash and non-cash
collateral on an interim and emergency basis as is necessary for
the continuation of its business operations during the course of
these Chapter 11 proceedings.
The Debtor needs to use approximately $286,353 in accordance with
the proposed cash flow budget through May 2021 with a continued and
final hearing within a reasonable time thereafter. The sums
requested are based upon historical and projected income and
expenses for the company.
In the course of its operations, the Debtor requests the use of the
prepetition cash and non-cash collateral to continue to operate its
business which is to develop and distribute its RAD7 continuous
radon monitors. In accordance with the requirements of 11 U.S.C.
Section 363(c)(4), the cash proceeds of the Debtor's operations
will be segregated in a separate bank account until such time as
the Debtor is authorized to utilize same.
The Debtor's financial distress commenced on the acquisition of the
company which was formerly known as Durridge Company Inc. and now
known as Smith Air Inc. The Debtor acquired the assets of Smith Air
on April 6, 2016, for the purchase price of $2,000,000. At the
closing on the sale, Smith Air was paid $1,000,000 and Durridge
executed a promissory note for the balance of the purchase price in
the sum of $1,000,000. The obligation was secured by a security
agreement granting Smith Air a lien that is junior to Enterprise
Bank and Trust Company's.
Initially, Durridge was able to pay Smith Air but due to cash flow
constraints, it became unable to continue to do so in or about
March 2018. At that time, a restructured payment agreement was
entered, and the payment recommenced.
At the time of the acquisition, Durridge obtained a secured loan
from Enterprise Bank, which obligations are secured by a first
priority security interest in the assets of Durridge.
Thereafter, Durridge operated and made payments to Smith Air
through January 2020, when it lacked sufficient cash flow to
continue to make the payments and began to fall behind on payments
to its vendors. Durridge commenced discussions with Smith Air in an
effort to further restructure the purchase money financing
obligation in an effort to avoid a chapter 11 filing.
Notwithstanding multiple efforts and proposals with restructured
payment terms, Smith Air declined to enter into a further
modification and commenced litigation in the Middlesex Superior
Court in February 2020.
Efforts continued to be expended seeking a non-bankruptcy solution,
but again were unsuccessful and on or about August 11, 2020, Smith
Air requested entry of a Default Judgment in connection with
recovery upon the obligation and in February 2021, Judgement
entered. After the entry of the Judgement, Durridge again sought to
reach a restructuring arrangement but was unsuccessful.
The Debtor has cash on hand in the sum of $160,680 (inclusive of
sums received as part of the PPP loan which are segregated for use
solely as prescribed by the Small Business Agency) and accounts
receivable of $84,094 for a total of $244,774.
In addition, during efforts to reach a resolution with Smith Air,
in 2020, the Debtor engaged Paul E. Saperstein Company to obtain a
valuation of the assets. PESCO's report reflects that the physical
assets would generate in the range of $30,000 if sold through
"forced liquidation" (by an auction) and in the range of $90,000
for "continued use in place." There has been no diminution in the
value, there being only slight wear and tear due to the COVID-19
pandemic and the company having been remotely operated for a number
of months.
The Debtor is the 100% owner of Durridge UK and the holder of two
provisional patents, neither of which have cash value but are the
basis for the radon technology utilized by the Debtor in the
conduct of its business. The estimated value of the technology is
uncertain due to the age of the technology and competitive
alternative technologies.
Based upon the information available at the State of Delaware,
Office of the Secretary of State, and subject to confirmation
through a review of loan documents, the companies holding liens on
all assets of the Debtor are:
-- Enterprise Bank
There are presently 3 loans outstanding to the Enterprise
Bank: Loan 5328 with an outstanding balance in the approximate sum
of $20,889.72; Loan 4346 with an outstanding balance of
approximately $6,102.03 and Loan 4952 dated May 8, 2017 with an
outstanding balance of approximately $83,232.38 for a total of
approximately $110,224.13.
-- Smith Air Inc.
Pursuant to the Judgement entered, the sums due to Smith
Air total $1,258,141.22.
The total sums due to creditors holding security interests in "all
assets" of the Debtor is $1,347,475.63.
The Debtor proposes to provide adequate protection to its secured
creditors as they are entitled to under section 363(e) of the
Bankruptcy Code, of their interest in the respective prepetition
collateral by granting adequate protection liens, effective and
perfected as of the Petition Date and without the necessity of the
execution by the Debtor of security agreements, pledge agreements,
financing statements or other agreements, a valid and perfected
replacement security interest in, and lien on the Collateral which
Adequate Protection Liens will a replacement lien on the
post-petition Collateral to the same extent, validity,
enforceability and priority as its lien on the Debtor's prepetition
assets.
* * *
The Debtor requested an emergency and preliminary hearing on the
Motion on March 17, 2021, in order to be able to (i) purchase
inventory and supplies, and (ii) to pay its employees' wages which
are to paid for the period February 20, 2021 through March 6, 2021
with the ACH deduction by the payroll service of the funds on March
19 for payroll and payroll related taxes.
Following the March 17 hearing, the Court granted the Debtor's
request. The Court also directed the Debtor to submit a revised
form of order.
A copy of the Debtor's request is available at
https://bit.ly/3qSrCaU from PacerMonitor.com.
About Durridge Company Inc.
Durridge Company Inc. is a Delaware corporation organized on April
11, 2016 under the name of Sensory Acquisition Company. The name
was changed on that date to Durridge Company Inc. and is registered
to do business in Massachusetts. The location of the principal
office is 900 Technology Park, Billerica, Massachusetts 01821.
Durridge is a provider of professional radon detection equipment
and provides services including radon detection solutions for
businesses, universities, and governments worldwide. Durridge also
provides a wide range of accessories for their proprietary
technology known as RAD7, as well as software for performing
sophisticated radon data analysis, and expert calibration and
maintenance services.
Durridge sought protection under Chapter 11 of the U.S. Bankruptcy
Code (Bankr. D. Mass. Case No. 21-40187) on March 15, 2021. In the
petition signed by Wendell Clough, president, the Debtor disclosed
$354,112 in assets and $2,182,277 in liabilities.
The Honorable Christopher J. Panos is the case judge.
Nina M. Parker, Esq. at PARKER & ASSOCIATES LLC represents the
Debtor as counsel.
E.Y. REALTY: Seeks Approval to Hire Bankruptcy Counsel
------------------------------------------------------
E.Y. Realty, LLC seeks approval from the U.S. Bankruptcy Court for
the Eastern District of Massachusetts to employ Gary Cruickshank,
Esq., an attorney practicing in Boston, to handle its Chapter 11
case.
The attorney will provide these services:
a. assist the Debtor in the formulation and presentation of a
plan of reorganization and disclosure statement;
b. advise the Debtor as to its duties and responsibilities;
C. other legal services as may be required during the course of
the Debtor's bankruptcy case.
Mr. Cruickshank will be paid at the rate of $425 per hour for his
services. The rate for the services of paraprofessionals assisting
him is $175 per hour.
The retainer fee is $10,000.
Mr. Cruickshank disclosed in a court filing that he is a
"disinterested person" as the term is defined in Section 101(14) of
the Bankruptcy Code.
Mr. Cruickshank can be reached at:
Gary W. Cruickshank, Esq.
21 Custom House Street, Suite 920
Boston, MA 02110
Tel: (617) 330-1960
Email: gwc@cruickshank-law.com
About E.Y. Realty
E.Y. Realty, LLC sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. D. Mass. Case No. 21-10267) on March 2,
2021. Yim Kun Yu, manager, signed the petition.
At the time of the filing, the Debtor disclosed assets of between
$1 million and $10 million and liabilities of the same range.
Gary W. Cruickshank, Esq., is the Debtor's legal counsel.
EDELMAN FINANCIAL: S&P Affirms 'B' ICR on Dividend Recapitalization
-------------------------------------------------------------------
S&P Global Ratings affirmed its 'B' issuer credit rating on Edelman
Financial Engines Center LLC. The outlook remains stable. At the
same time, S&P affirmed its 'B' rating on its first-lien term loan
and 'CCC+' rating on its second-lien term loan. S&P revised the
recovery rating of the first-lien term loan to '4', indicating an
average (45%) recovery in the event of default, from '3' (55%)
indicating a meaningful recovery; the recovery rating on the
second-lien term loan remains '6', indicating a negligible (0%)
recovery.
Edelman is issuing an incremental $800 million add on to its $1.426
billion existing first-lien term loan and $100 million add on to
its $475 million existing second-lien term loan. The company is
also extending the tenor of the first-lien term loan to seven years
and the revolving credit facility to five years. Concurrent with
this transaction, Warburg Pincus will acquire a minority ownership
in Edelman from Hellman & Friedman and will also have one seat on
Edelman's board. Hellman & Friedman will remain the majority
shareholder.
The company will use proceeds from the transaction, along with
excess cash, to fund a distribution to shareholders. The
transaction boosts Edelman's outstanding first- and second-lien
debt to $2.226 billion and $575 million, respectively. S&P said,
"Pro forma for the transaction, we expect Edelman to operate with
adjusted debt to EBITDA of 6.0x-6.5x and EBITDA interest coverage
of 3.0x-3.4x on a weighted average basis over the next 12 months.
While pro forma leverage is above our previous expectation of
5.0x-6.0x for 2021, we believe Edelman will continue to operate
with leverage well below our downside trigger of 8.0x. We expect
earnings growth supported by continued strong organic assets under
management (AUM) growth and lower expenses following the completion
of the Financial Engines integration in 2020."
Edelman has demonstrated strong cash flow generation and AUM growth
over the past several years. It has garnered net inflows throughout
the early-2020 market volatility. S&P thinks the company's
workplace and retail segments are complementary to each other, and
that Edelman will able to drive further retail growth from existing
workplace clients. These positive trends underpin S&P's expectation
that the company will be able to deleverage through earnings growth
over the next few years.
Edelman intends to supplement the distribution with excess cash.
While this lowers liquidity in the near term, S&P expects sources
of liquidity (including cash of at least $50 million, funds from
operations of $190 million-$250 million, and the undrawn $150
million revolver) to continue to exceed uses (including debt
amortization of about $22 million, as well as capital expenses of
roughly $20 million) by well above 1.2x over the next 12 months.
The stable outlook on Edelman reflects the expectation for leverage
of 6.0x-6.5x over the next 12 months, while net inflows continue in
both the retail and workplace segment, and market appreciation is
neutral or supports AUM growth.
S&P could lower the ratings if leverage increases to near 8.0x due
to weakening earnings or rising debt or if the company's business
materially weakens as shown by sustained net outflows or an
increase in planner departures or sponsor cancellations.
S&P could raise the ratings if leverage declines sustainably below
5.0x.
EMINENT BICYCLES: Hits Chapter 11 Bankruptcy Protection
-------------------------------------------------------
Bicycle Retailer reports that Mountain bike brand Eminent Cycles
has filed for Chapter 11 bankruptcy protection.
The company lists debts of $1.4 million and assets of $139,000.
The secured debt includes $320,000 that company founder and
president Jeffrey Soncrant loaned his business in 2018; $640,000
invested by Humberto Zavaleta, a Philadephia man described in court
documents as Soncrant's father-in-law; and $448,000 owed to Stella
Mondo, LLC. Stella Mondo is a San Diego company formed by Kevin
Sigismondo, an industry veteran whose LinkedIn profile says was a
founder of Eminent and of Valiant Components.
According to court filings, Stella Mondo also is suing Eminent in a
collections case.
The only unsecured creditor listed is a $3,000 SBA loan.
The company's Chapter 11 filing includes a restructuring plan with
cash flow and sales projections for the business through 2023. The
document shows total 2020 sales of $681,000. The 2021 sales
projection is $943,000, a 40% growth rate. The document also
forecasts a 40% growth rate in 2023.
The document shows a 2020 net loss of $127,000, with a projected
2021 loss of $49,000 and a projected 2023 net income of $93,000.
About Eminent Cycles
Based in San Marcos, California, Eminent Bicycles LLC, doing
business as Eminent Cycles, sells mountain bikes. Its factory is
in San Diego, California. It sells bikes via dealers and direct
through its Web site https://www.eminentcycles.com/
Eminent Bicycles LLC filed a Chapter 11 petition (Bankr. S.D. Cal.
Case No. 21-01006) on March 16, 2021.
The company lists debts of $1.4 million and assets of $139,000.
Gupta, Evans And Associates, PC, led by Ajay Gupta, is the Debtor's
counsel.
ENERGIZER HOLDINGS: S&P Affirms 'BB-' ICR, Outlook Negative
-----------------------------------------------------------
S&P Global Ratings affirmed its 'BB-' issuer credit rating on
U.S.-based Energizer Holdings Inc. and maintained its negative
outlook. At the same time, S&P affirmed its 'BB+' issue-level
rating on its senior secured debt and 'B+' issue-level rating on
its senior unsecured notes. The recovery ratings remain '1' and
'5', respectively.
Despite strong topline growth, the company has failed to deliver on
profit and deleveraging expectations. In general, the pandemic
provided Energizer with strong tailwinds, as battery demand
increased substantially, and consumption has remained high as
consumers have spent more time at home using battery-powered
devices. However, while Energizer generated strong organic sales
growth, it struggled to meet the surge in demand and has incurred
higher-than-expected costs, including air freight expenses,
customer fines, and increased third-party sourcing. Changes in
consumer-purchasing behavior also contributed to weaker profit
margins, as sales mix shifted to less profitable purchase channels
(e-commerce and club) and pack sizes. Separately, the company was
also hurt by more restrictive shelter-in-place orders in many
international markets (where the lockdowns included closures of
retail outlets), and weak performance from its auto-care business
in the early stages of the pandemic due to mobility restrictions.
S&P said, "These challenges have caused the company to miss our
previous profit expectations and delayed its path to deleveraging
to 5x. The company has taken actions that we believe will help it
meet the increased battery demand and reduce costs, including
acquiring a battery production plant in Indonesia. Consequently,
COVID-19 costs have been moderating and we expect they will be
contained in fiscal 2021. We also believe the company will benefit
from better performance in international markets and in auto care
given mobility restrictions have eased. Given these factors,
combined with the remaining synergies to be achieved from its
battery and auto care acquisitions, we believe the company can
de-lever to 5x within the next 12 months.
"Management's financial policy decisions could be a determining
factor if we lower our ratings. Over the past six months, the
company has transacted acquisitions totaling about $70 million,
bought back $28 million of stock, and refreshed its share
repurchase program. Management has said the company will take a
balanced approach to capital allocation without clearly
communicating a leverage target. We believe the company will
continue to allocate modest cash flow to share repurchases to
offset share dilution and remain open to bolt-on acquisition
opportunities. However, if management prioritizes material mergers
and acquisitions (M&A) and opportunistic share repurchases ahead of
debt reduction, this would result in a lower rating.
"Other risks could delay the company's deleveraging plan, including
input cost volatility and increased competitive pressures. Our
forecast assumes a modest decline in battery demand in the second
half of the year as vaccines are widely distributed, mobility
restrictions are loosened, and consumers become more comfortable
with social activity. At the same time, we still assume consumption
will remain elevated compared to 2019 levels as consumers generally
spend more time at home with devices than before the pandemic. The
category has historically been subject to fierce competition,
including from private label. We believe this was driven in part by
secular category declines prior to the pandemic, so the potential
for sustained higher battery usage in the coming years could
moderate promotional activity. However, if demand declines at a
steeper rate than we expect or secular battery demand declines
resume, this could lead to more aggressive discounting and
promotional activity, which could hurt profits. Input cost
inflation is also a risk to our forecast. While we expect the
impact from transportation costs to moderate over the next year
because the company will use less air freight, it could experience
higher costs associated with commodity inflation, as well as higher
tariffs. We believe the company enters into forward contracts on a
meaningful portion of its raw material inputs, partially mitigating
this risk.
"The negative outlook reflects the potential for a lower rating at
any time over the next 12 months if we do not believe Energizer
will improve and sustain leverage below 5x due to more aggressive
financial policies or weaker than expected operating performance.
Our rating has no room for further operating missteps or material
shareholder returns by the company.
"We could lower the ratings at any time within the next 12 months
if we do not believe the company will deleverage to the 5x area,
which could occur if it continues to transact material M&A and
share repurchases. This could also occur if the company does not
manage increasing input and transportation costs (including air
freight), if it fails to execute on remaining acquisition
integration, if profitability is further pressured by changes in
channel and product mix, or if competitive pressures in the battery
category increase due to declining demand as vaccines become widely
distributed.
"We could revise the outlook to stable if the company reduces
leverage to below 5x. This could occur if the company successfully
completes its integration of its battery and auto-care
acquisitions, it reduces air freight costs and customer fines, and
it prioritizes debt reduction over share repurchases and M&A over
the next year or so."
EP ENERGY: Reviewing Options Just Months After Bankruptcy Exit
--------------------------------------------------------------
Olivia Pulsinelli of the Houston Business Journal reports that
Houston-based EP Energy Corp. is reviewing strategic alternatives
less than a year after emerging from Chapter 11 bankruptcy
protection.
The upstream company tapped Credit Suisse Securities (USA) LLC and
Jefferies LLC as financial advisers to assist with the review. The
board of directors plans to evaluate a range of options, including
a corporate sale, merger or other business combination as well as
other transactions.
However, the company cannot guarantee that the review will result
in a deal or other outcome, and there is no timetable for the
review to conclude.
"With the completion of our Southern Midland Basin asset sale, the
management team and our board believe now is an opportune time to
evaluate alternatives to bring value forward for our shareholders,"
said Russell Park, EP Energy's president and CEO. "The company now
has minimal leverage and a strong oil-weighted asset base in the
Eagle Ford and northeastern Utah that generates attractive returns
and significant EBITDAX and free cash flow. I am extremely proud of
our team's performance, and we will remain highly focused on
executing our business plan throughout this process."
Although numerous oil and gas companies filed for bankruptcy
protection amid Covid-19, EP Energy filed its case in October 2019,
several months before the pandemic. The company listed $4.975
billion in debt and $4.19 billion in assets at the time. Later that
month, EP reached a debt-to-equity deal that would have turned 99%
of the company’s equity over to a group of creditors in exchange
for the termination of $3.3 billion in debt. But that deal fell
apart shortly after the coronavirus pandemic and OPEC price war
caused oil prices to fall in March 2020.
Eventually, the company reached a deal that eliminated roughly 90%
of its pre-bankruptcy borrowings and emerged from its restructuring
on Oct. 1, 2020, almost exactly a year after entering bankruptcy
court.
In December 2020, EP Energy announced a deal to sell off some of
its Texas assets in the Southern Midland Basin portion of the
Permian Basin. Although neither the buyer nor the specific
financial terms of the deal were disclosed, EP Energy said the deal
would leave the company with about $100 million in debt, down from
the approximately $400 million in net debt it had when it emerged
from bankruptcy in October. The deal closed in late February 2021,
leaving the company with approximately 270,000 net acres in Utah
and the Eagle Ford.
EP Energy is among the largest Houston-based oil producers and
largest Houston-based natural gas producers in Texas, according to
2020 production data from the Texas Railroad Commission.
About EP Energy Corp.
EP Energy Corporation and its direct and indirect subsidiaries(OTC
Pink: EPEG) -- http://www.epenergy.com/-- are a North American oil
and natural gas exploration and production company headquartered in
Houston, Texas. The Debtors operate through a diverse base of
producing assets and are focused on the development of drilling
inventory located in three areas: the Eagle Ford shale in South
Texas, the Permian Basin in West Texas, and Northeastern Utah.
EP Energy originated as the exploration and production arm of El
Paso Corp. and was purchased by a private equity group in 2012 for
$7.15 billion. In 2014, it held a $704 million initial public
offering, but the company's stock was delisted in May 2019.
EP Energy Corporation and its subsidiaries sought Chapter 11
protection on Oct. 3, 2019, after reaching a deal with Elliott
Management Corporation, Apollo Global Management, LLC, and certain
other noteholders on a bankruptcy exit plan that would reduce debt
by 3.3 billion. The lead case is In re EP Energy Corporation
(Bankr. S.D. Tex. Lead Case No. 19-35654).
EP Energy was estimated to have $1 billion to $10 billion in assets
and liabilities as of the bankruptcy filing.
Judge Marvin Isgur oversaw the case.
The Debtors tapped Weil, Gotshal & Manges LLP as legal counsel;
Evercore Group L.L.C. as investment banker; and FTI Consulting,
Inc. as financial advisor. Prime Clerk LLC is the claims agent.
* * *
In August 2020, the company won approval from the bankruptcy court
of its amended reorganization plan that reduced its debt by $4.4
billion and transferred ownership of the company to its
bondholders. The Company emerged from bankruptcy in October 2020.
EVERI HOLDINGS: Fitch Raises IDR to 'B+' & Alters Outlook to Stable
-------------------------------------------------------------------
Fitch Ratings has upgraded Everi Holdings Inc.'s and Everi Payments
Inc.'s (collectively, Everi) Issuer Default Rating (IDR) to 'B+'
from 'B'. Fitch also upgraded Everi's senior secured debt to
'BB+'/'RR1' from 'BB'/'RR1' and Everi's unsecured debt to
'B-'/'RR6' from 'CCC+'/'RR6'. The Rating Outlook has been revised
to Stable from Negative.
The upgrade to 'B+' reflects Fitch having greater clarity around
Everi's de-levering path toward its net leverage target of
3.0x-3.5x, supported by U.S. regional gaming's stronger recovery
through the coronavirus pandemic relative to other heavily affected
leisure and entertainment sectors. As a result, Fitch expects
Everi's EBITDA to recover toward pre-pandemic levels by year-end
2021, aided in part by the company's cost cutting initiatives
during the pandemic. Everi's FCF generation during second-half 2020
was stronger than initially expected at the onset of the pandemic
and will support an accelerated de-levering path following its
incremental debt raise in April 2020, which drove the previous
downgrade to 'B' from 'B+'.
KEY RATING DRIVERS
Leverage Improving: Everi's gross leverage was 6.6x as of Dec. 31,
2020, following the incremental debt issued to weather the early
stages of the pandemic. Fitch expects this to decline toward 4.0x
in the medium-term as EBITDA recovers and benefits from cost
savings instituted during 2020. De-levering could be accelerated
with voluntary debt paydown, which the company has a track record
of doing. As cash builds from healthy FCF generation, net leverage
will be 0.5x-1.0x lower relative to gross leverage.
Management has a net leverage target of 3.0x-3.5x, which there is a
clear path toward and is more indicative of a 'B+' IDR. Everi's
5.5x net secured leverage maintenance covenant resumes in 1Q21, but
the company will be within this in part due to amendments to EBITDA
calculations for covenant purposes.
Good Business Mix: About 54% of Everi's EBITDA comes from gaming
and 46% from FinTech. About two-thirds of the gaming revenue is
generated on a participation basis, whereby Everi earns fees based
on games performance. FinTech revenues mostly come from ATM and
cash advance service fees, which are tied to contracts with
generally three- and five-year terms and high renewal rates.
Although revenue in both segments depends on the gaming sector's
health, Everi is less dependent on replacement sales and new casino
openings, relative to other gaming suppliers.
Solid EGM Strategy Execution: Everi has been investing heavily in
its electronic gaming machine (EGM) content and hardware with good
results to date. Everi has been able to grow its participation EGM
footprint steadily and had 15,745 participation games at YE 2020,
6,478 of which were premium units. The premium unit installed base
has more than tripled since 2016 with healthy average daily win
growth.
Coronavirus impact notwithstanding, Fitch expects the premium
segment to continue to grow, albeit at a decelerating rate, given
the intense competition in this segment. During 2019, Everi sold
nearly 5,000 EGMs and has established itself as a roughly 6% ship
share supplier (according to Eilers & Krejcik Gaming). Machine
sales were down over 50% during 2020 due to operators' conserving
cash by reducing capex, but this should begin to improve going
forward given the recovery in regional gaming and operators' strong
cash positions.
Technology Related Risks: New, cashless technologies employed by
other participants in the gaming and FinTech industries represent a
long-term risk to disintermediate Everi's cash access services
(roughly one-third of total revenues). However, the company's
diverse FinTech product portfolio, investments made in new
technologies and its own cashless solutions (including maintenance
of money transmitter licenses) reduces this risk.
The gaming industry is highly regulated on a state-by-state basis
and has been slow to adopt new technologies on the casino floor,
where cash remains prevalent. The pandemic has increased operators'
interest in cashless technologies with Nevada and Native American
gaming jurisdictions being the most notable early adopters. Greater
adoption of digital wallets in the long term should not materially
disrupt the meaningful fee revenues casino operators and their
supplier partners generate from ATM transactions, as digital wallet
economics tend to be similar.
DERIVATION SUMMARY
Everi's 'B+' IDR reflects the company's good diversification;
strong momentum in growing its class III slots business; and solid
market position in cash access systems and class II slots. Negative
credit considerations include Everi's niche position within the
slots segment relative to the larger suppliers and the long-term
disintermediation risk associated with its FinTech business.
Everi's gaming peers include International Game Technology plc
(IGT), Scientific Games Corp. (SGMS), and Aristocrat Leisure (ALL);
all of which have similar-to-stronger credit profiles due to
greater scale, higher ship share, international diversification,
product diversification (ex. lottery, table games) and/or lower
leverage. Scientific Games maintains higher leverage than Everi but
also generates a healthy FCF margin.
IGT's and SGMS' lottery businesses are positive from a cash flow
stability perspective; however, they require meaningful recurring
capex payments when contracts are won or renewed, which are often
debt-funded.
KEY ASSUMPTIONS
-- Total revenues decline by high single-digits in 2021 relative
to 2019, following a roughly 30% declines in 2020 relative to
2019. Fitch expects revenues to reach pre-pandemic levels by
2022 given the relative outperformance of regional gaming
compared to other heavily impacted sectors. Low single-digit
growth is expected thereafter, supported by Everi's portfolio
of for-sale and premium slot products and the FinTech
segment's cashless and loyalty products;
-- EBITDA margins rebound slightly faster than revenues due to
cost savings implemented during the 2020 shutdowns, which add
modestly to long-term margins relative to 2019 levels;
-- FCF exceeds $60 million in 2021 and approaches $100 million by
2023 in part due to manageable capex in the range of low 20%
of revenues and reduced interest expense. Fitch assumes
settlement receivables and liabilities are cash flow neutral
in its forecast;
-- Everi utilizes its healthy FCF generation and excess cash
balances to de-lever toward its target of 3.0x-3.5x net
debt/EBITDA, which Everi achieves by YE2022 per Fitch's
assumptions.
RECOVERY ASSUMPTIONS
The recovery analysis assumes that Everi would be reorganized as a
going-concern in bankruptcy rather than liquidated. Fitch has
assumed a 10% administrative claim, and has assumed the $35 million
revolver to be fully drawn at the time of recovery.
Going-concern EBITDA of $185 million assumes a recessionary
environment where Everi's EGM business loses market share and the
overall operating environment deteriorates with a slower
replacement cycle and a slowdown in regional gaming revenues
occurs. The scenario also assumes weakness in Everi's FinTech
business, possibly from technological disruption or the company
losing major enterprise-wide payments contacts. While Everi has
cashless processing solutions, the revenue from these solutions may
not offset the loss of revenues from cash processing. The
going-concern EBITDA due to the environment described above is
roughly 25% lower than 2019 EBITDA. During the previous recession,
Everi's FinTech revenue declined 19% peak-to-trough, while its
games segment declined by a similar amount.
Fitch used an EV/EBITDA multiple of 5.5x, which is on the lower
side of the range Fitch uses for larger and/or more diversified
gaming technology companies and payment processors. The lower
multiple takes into account Everi's smaller size, more niche slots
business and the longer-term risk relative to possible
disintermediation of the core of its FinTech business. Everi
diversifying its slots business further from its legacy class II
segment and its FinTech segment away from payments could lead to
Fitch using a higher EV/EBITDA multiple in the recovery analysis.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
-- Gross debt/EBITDA sustaining below 3.5x;
-- Continued market share in the U.S. gaming equipment industry,
in particular with respect to its class III business;
-- Continued diversification away from payment processing.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
-- Debt/EBITDA sustaining above 4.5x;
-- Significant deterioration and/or loss of market share in the
gaming and FinTech segments;
-- A decrease in FCF margin to the mid-single digit range;
-- Adoption of a more aggressive financial policy, either toward
target leverage or approach to shareholder returns at the
detriment to the credit profile.
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
Liquidity as of Dec. 31, 2020 is ample and includes excess cash of
$139 million (net of cash related to FinTech segment) and full
availability of its $35 million revolver. Liquidity was bolstered
by positive FCF during the second half of 2020 and the increment
debt raise in early 2020. FCF is forecast to exceed $60 million in
2021. Fitch expects Everi to focus its cash position and FCF
primarily on de-levering, particularly targeting the high-interest
$125 million incremental term loan (subject to call premiums until
April 2022). Other uses of liquidity include more manageable capex,
relative to the last several years, and tuck-in acquisitions. Everi
will be within its senior secured net leverage financial covenant
when it resumes for the period ending March 31, 2021 (5.5x
initially, declining 0.5x quarterly to 4.5x by Dec. 31, 2021).
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.
EXTENDED STAY: S&P Places 'B+' ICR on Watch Neg. on Acquisition
---------------------------------------------------------------
S&P Global Ratings placed all ratings on Extended Stay America
Inc., including the 'B+' issuer credit rating and issue-level
ratings, on CreditWatch with negative implications.
Extended Stay America Inc. and its paired-share REIT, ESH
Hospitality Inc., announced that they have signed a definitive
agreement to be acquired by a 50/50 joint venture between funds
managed by Blackstone Real Estate Partners and Starwood Capital
Group in an all-cash transaction valued at approximately $6
billion.
The CreditWatch placement follows Extended Stay's announcement that
it will be acquired by a joint venture between funds managed by
Blackstone Real Estate Partners and Starwood Capital Group.
Extended Stay expects the transaction to close in the second
quarter of 2021, and it is contingent upon customary closing
conditions including approval of the company's stockholders. Close
of the transaction is not contingent on receipt of financing. While
the company's debt agreements contain change-of-control provisions
that may result in the refinancing of all outstanding debt, the
financing plan has not yet been disclosed. S&P said, "We will
review the proposed new capital structure and the effect it could
have on credit measures. Our recently revised base case assumes a
recovery in Extended Stay's business in 2021 compared to 2020, and
an improvement in our measure of lease-adjusted net debt to EBITDA
to the low- to mid-5x range in 2021. Although this is a good
anticipated cushion compared to our 6x downgrade threshold to
accommodate operating volatility over the near term, the terms of
the planned financing are unknown at this time and may include
incremental debt to complete the acquisition."
S&P said, "A key part of our credit story is that Extended Stay
continues to outperform many rated lodging sector peers through the
pandemic, and this may be what attracts Blackstone and Starwood
Capital. Extended Stay's hotels have large, residential-like rooms
with kitchens that enable longer-term stays than the typical hotel
room. Despite the widespread travel downturn, construction and
health care professionals, for example, continued to travel and
favored the extended stay segment. As a result, demand and
occupancy at Extended Stay's hotels were much higher than other
segments of lodging. Additionally, the company's economy-priced
hotels compared favorably to the midscale extended stay segment
where revenue per available room (RevPAR) declined 26% in 2020. We
believe this reflects Extended Stay's recognized brand and price
advantage within the extended stay segment. Following widespread
immunization, it is highly likely that other types of lodging will
become more attractive as the pandemic-related drivers that caused
travelers to favor extended stay hotels recede, but we still
believe the company's RevPAR and EBITDA will recover in 2021.
"We plan to resolve the CreditWatch placements over the next
several months after we review additional disclosures and the terms
of the financing plan. We could lower the rating by at least one
notch if the final capital structure causes Extended Stay to
sustain leverage above our 6x downgrade threshold. We could also
withdraw ratings on the company's debt without lowering them if the
debt is refinanced."
FERRELLGAS LP: New Operating Debt Slides During 1st Day of Trading
------------------------------------------------------------------
Allison McNeely of Bloomberg News reports that bonds Ferrellgas LP
recently issued as part of its efforts to clean up its balance
sheet slid in their first day of trading. The propane retailer's
5.375% notes due 2026 fell to 98.5 cents on the dollar at 9:45 a.m.
on Wednesday, March 17, 2021, in New York, according to Trace. The
debt was sold Tuesday at 100 cents. Its 5.875% bonds due 2029
slipped to 98.25 cents on the dollar, from par.
Ferrellgas sold notes to redeem existing debt at its operating
company as part of a restructuring plan proposed in the bankruptcy
of its holding company, Ferrellgas Partners LP.
About Ferrellgas LP
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.
FERRELLGAS PARTNERS: S&P Raises ICR to 'B-' on Recapitalization
---------------------------------------------------------------
S&P Global Ratings raised its issuer credit rating (ICR) on
Overland Park, Kan.-based propane distributor Ferrellgas L.P. (FGL)
to 'B-' from 'D', and its ICR on (FGL) to 'B-' from 'CC'. S&P also
assigned a 'B-' rating to FGL's $1.475 billion notes due in 2026
and 2029. The recovery rating of '4' indicates average recovery
prospects (30%-50%; rounded estimate: 45%).
S&P raised its rating on Ferrellgas to reflect the partnership's
restructuring and revised capital structure. FGP is undergoing a
recapitalization, which includes the conversion of its $357 million
MLP notes into class B common equity, refinancing of its $700
million first-lien secured notes with preferred units, and the
refinancing of its existing notes with $1.475 billion senior
unsecured notes due 2026 and 2029.
The partnership's new capital structure will consists of:
-- $350 million secured revolving credit facility (RCF), expiring
in 2025 (unrated). The facility will include a $200 million fixed
component and $150 million borrowing base, which will be determined
by a percentage of receivable and inventory balances
-- Senior unsecured notes of $1.475 billion due 2026 and 2029
issued by the partnership's operating subsidiary, FGL
-- $357 million of FGP's class B common equity
-- $700 million of preferred equity which S&P views as debt in its
financial ratios
S&P said, "In our view, the restructuring provides a more
sustainable capital structure by eliminating $357 million of debt
through equity conversion, as well as reducing interest costs. On a
post-transaction basis, we would view the partnership's liquidity
as adequate, primarily in light of no near-term debt maturities as
well as availability under the RCF. This provides the partnership
with financial flexibility." S&P considers the preferred shares to
be debt under our criteria for the following reasons:
-- The securities have a 10-year maturity, which, by definition,
after issuance will result in a time to maturity of less than 10
years
-- The issue is redeemable at any time
-- The securities have material step ups in the distribution rate
-- Although the payment –in-kind (PIK) feature could create some
deferability, S&P believes that with the premiums applicable the
issuer would not have an incentive to use the feature, including
the fact that no distributions are payable on the common units
while the PIK shares are outstanding
-- Accordingly, in S&P's calculation of the key ratios, it treats
the entire preferred issuance amount as debt, and the entire
dividend as interest expense.
S&P said, "We consider Ferrellgas to be highly leveraged. On a pro
forma basis for the revised capital structure, we expect leverage
will be in the mid-7x area throughout our forecast period, however,
our forecasted ratios compare favorably with pre-transaction
leverage of 9.5x which was viewed as unsustainable.
"The partnership is taking action to enhance margins, primarily
through cost-saving initiatives. We have incorporated these
optimizations into our forecast to a certain extent; however, we
acknowledge that FGP might not be able to fully achieve the
envisioned savings. We estimate adjusted EBITDA of $300
million-$320 million through 2023, which translates into margins of
about 20%."
The retail propane industry is highly fragmented and cyclical.
Although Ferrellgas is one of the leading players in the propane
business, the industry is marked by significant competition and
fragmentation. In addition, S&P's assessment of the partnership's
business risk reflects the volumetric risk from the seasonal nature
of the retail propane business and correlation of volumes with
weather, lack of long-term commitments in the contract portfolio,
and exposure to propane price volatility. Because of these factors,
credit metrics could be less predictable.
S&P said, "The stable outlook on FGP reflects our expectation that
the partnership will maintain leverage of 7.0x-7.5x during our
forecast period. We also believe that the partnership will have no
imminent liquidity issues and will likely pursue growth
opportunities, while focusing on operational improvements.
"We would consider a negative rating action if the partnership's
financial performance is weaker than expected, leading to an
unsustainable capital structure and less than adequate liquidity.
This could result from unfavorable business conditions such as
warmer-than-expected weather, or below-average margins.
"We would consider a positive rating action if we believed the
partnership could achieve leverage below 7.0x on a sustained basis.
This could be accomplished by improved financial performance or
deleveraging."
FIELDWOOD ENERGY: Wants Plan Exclusivity Extended Thru May 31
-------------------------------------------------------------
Debtors Fieldwood Energy LLC and its affiliates ask the U.S.
Bankruptcy Court for the Southern District of Texas, Houston
Division to extend by 90 days the Debtor's exclusive period to file
a Chapter 11 Plan through and including May 31, 2021, and to
solicit acceptances through and including July 29, 2021.
Over the past two months, the Debtors have been focused on:
(i) finalizing several key plan transaction documents and exhibits
to their Disclosure Statement with the Consenting Creditors and
Apache Corporation; and
(ii) advancing discussions with their other key stakeholders.
The Debtors have made significant progress towards finalizing the
terms of their proposed recapitalization of the Debtors' deepwater
E&P business into a more streamlined efficient enterprise that
would preserve the jobs of over 1,000 employees and contractors. In
summary, the Debtors have also made significant progress with their
other key stakeholders, including:
(i) the Bureau of Ocean Energy Management ("BOEM"), Bureau of
Safety and Environmental Enforcement ("BSEE"), the Department of
Interior ("DOI") and the Department of Justice ("DOJ"),
(ii) predecessors in interest,
(iii) co-working interest owners,
(iv) surety providers,
(v) the Creditors' Committee; and
(vi) trade vendors and many more.
In addition to the considerable progress made with each of their
stakeholder groups, the Debtors have recently made a number of
other major achievements in these chapter 11 cases, including:
(i) obtaining entry of an order from this Court compelling a
counterparty to perform under pre-petition agreements to allow the
Debtors to bring the Genevosa wells online in a timely manner and
thereby avoid forfeiting valuable estate assets; and
(ii) resolving certain criminal and civil violations alleged by the
United States Attorney's Office for the Eastern District of
Louisiana by executing a non-prosecution agreement.
The complex issues present in these cases evidence the need for
additional time for the Debtors to consult and negotiate with their
stakeholders. The Debtors believe that no party in interest is
prejudiced by the requested extension of the Exclusive Periods
because all stakeholders will benefit from the continued stability
and predictability that comes with the Debtors being the sole plan
proponents.
The Debtors intend to use the additional time to continue to
advance those discussions with the aim of negotiating as many
consensual arrangements as possible and maximizing support for the
Plan. Also, the Debtors continue to monitor their liquidity closely
and are confident that sufficient funding will be available to
satisfy their post-petition payment obligations during the
requested extension of the Exclusive Periods.
A copy of the Debtors' Motion to extend is available at
https://bit.ly/3bwa3c9 from primeclerk.com.
About Fieldwood Energy
Fieldwood Energy -- https://www.fieldwoodenergy.com -- is a
portfolio company of Riverstone Holdings focused on acquiring and
developing conventional assets, primarily in the Gulf of Mexico
region. It is the largest operator in the Gulf of Mexico owning an
interest in approximately 500 leases covering over two million
gross acres with 1,000 wells and 750 employees.
Fieldwood Energy and its 13 affiliates previously sought Chapter 11
protection (Bankr. S.D. Texas Lead Case No. 18-30648) on February
15, 2018, with a prepackaged plan that would deleverage $3.286
billion of funded by $1.626 billion.
On August 3, 2020, Fieldwood Energy and its 13 affiliates again
filed voluntary Chapter 11 petitions (Bankr. S.D. Tex. Lead Case
No. 20-33948). Mike Dane, senior vice president, and chief
financial officer signed the petitions.
At the time of the filing, Debtors disclosed $1 billion to $10
billion in both assets and liabilities.
Judge David R. Jones oversees the cases. The Debtors tapped Weil,
Gotshal & Manges LLP as their legal counsel, Houlihan Lokey
Capital, Inc. as an investment banker, and AlixPartners, LLP as
financial advisor. Prime Clerk LLC is the claims, noticing, and
solicitation agent.
The first-lien group employed O'Melveny & Myers LLP as its legal
counsel and Houlihan Lokey Capital, Inc. as its financial advisor.
The RBL lenders employed Willkie Farr & Gallagher LLP as their
legal counsel and RPA Advisors, LLC as their financial advisor.
Meanwhile, the cross-holder group tapped Davis Polk & Wardwell LLP
and PJT Partners LP as its legal counsel and financial advisor,
respectively.
On August 18, 2020, the Office of the U.S. Trustee appointed a
committee of unsecured creditors. Stroock & Stroock & Lavan,
LLPand Conway MacKenzie, LLC serve as the committee's legal counsel
and financial advisor, respectively.
FINANCIAL GRAVITY: Signs Merger Agreement With NCW Group
--------------------------------------------------------
Financial Gravity Companies, Inc. and NCW Group, Inc., a California
corporation, a registered investment advisor, entered into a
definitive Agreement and Plan of Merger.
Under the Merger Agreement, Financial Gravity will acquire NCW in
an all-stock transaction, and NCW will be merged into Financial
Gravity's subsidiary, Forta Financial Group, Inc., with Forta being
the surviving company. Under the terms of the Merger Agreement,
which has been unanimously approved by the Board of Directors at
both firms, existing Financial Gravity shareholders will have
approximately 90% ownership stake in the combined company, and
existing NCW shareholders will have approximately 10% ownership
stake in the combined company, on a fully diluted basis. A
majority of the shareholders of Financial Gravity approved the
transaction and all of the shareholders of NCW approved the
transaction.
The transaction will formerly close when the California Secretary
of State accepts the Certificate of Merger and the California
Agreement of Merger that will be filed. At that time, an existing
NCW shareholder will be appointed a member of the Board of
Directors of Financial Gravity, pursuant to a Voting Agreement.
The Voting Agreement provides that a person designated by the NCW
shareholders will serve on the Board of Directors of Financial
Gravity for a period of five years.
A copy of the Merger Agreement is available for free at:
https://www.sec.gov/Archives/edgar/data/1377167/000168316821000941/financialgravity_ex0201.htm
About Financial Gravity
Headquartered in Austin Texas, Financial Gravity Companies, Inc. is
a parent company of stock brokerage, investment advisory, asset
management, tax planning for business and personal, and financial
advisor services companies.
Financial Gravity reported a net loss of $791,675 for the year
ended Sept. 30, 2020, compared to a net loss of $623,485 for the
year ended Sept. 30, 2019. As of Dec. 31, 2020, the Company had
$9.77 million in total assets, $1.53 million in total current
liabilities, $934,893 in total non-current liabilities, and $7.31
million in total stockholders' equity.
Whitley Penn LLP, the Company's auditor since 2019 issued a "going
concern" qualification in its report dated Jan. 13, 2020, citing
that the Company has suffered recurring losses from operations and
has a net capital deficiency that raises substantial doubt about
its ability to continue as a going concern.
FIRST TO THE FINISH: Plan Exclusivity Extended Until April 5
------------------------------------------------------------
Judge Laura K. Grandy of the U.S. Bankruptcy Court for the Southern
District of Illinois extended the periods within which First to the
Finish Kim and Mike Viano Sports Inc. has the exclusive right to
file a Plan of Reorganization to and including April 5, 2021, and
to obtain acceptances of the plan to and including June 4, 2021.
Given the pending status of the Motion to Dismiss Debtor's Chapter
11 Case and potential settlement with its creditors, Debtor is
hopeful that the relief requested herein will not be necessary.
However, out of an abundance of caution, Debtor seeks an extension
and submits it would be reasonable to allow Debtor an extension of
the Plan Filing Deadline and Plan Filing Exclusive Period.
The Debtor is continuing to operate its business as a
debtor-in-possession. No trustee or examiner has been appointed,
and no official committee of creditors has been established in this
Chapter 11.
A copy of the Debtor's Motion to extend is available at
https://bit.ly/3cuYVeZ from PacerMonitor.com.
A copy of the Court's Extension Order is available at
https://bit.ly/3tlqv55 from PacerMonitor.com.
About First to the Finish Kim
and Mike Viano Sports Inc.
First to the Finish Kim and Mike Viano Sports Inc. sells sporting
goods, hobbies, and musical instruments.
First to the Finish Kim and Mike Viano Sports filed its voluntary
petition for relief under Chapter 11 of the Bankruptcy Code (Bankr.
S.D. Ill. Case No. 20-30955) on October 7, 2020. The petition was
signed by Mike Viano, president. At the time of filing, the Debtor
estimated $1 million to $10 million in both assets and
liabilities.
Judge Laura K. Grandy oversees the case. The Debtor is represented
by Carmody MacDonald P.C.
FOXFIRE CONSOLIDATED: Kensington Buying 15 Condo Units for $850K
----------------------------------------------------------------
Foxfire Consolidated Owners Association, Inc., asks the U.S.
Bankruptcy Court for the Eastern District of North Carolina to
authorize the private sale of 15 condominium units in Phases I
through IV of Foxkroft Villas Condominiums, which condominiums are
located on Foxkroft Drive in Foxfire Village, Sandhills Township,
Moore County, North Carolina, to Kensington Court II LLC for
$850,000, subject to overbid.
The Debtor is a North Carolina non-profit corporation with its
registered office address in Raleigh, North Carolina. It is an
Interval Ownership Association organized under the provisions of
Article 4 of Chapter 93A of the North Carolina General Statutes and
Chapter 47A of the North Carolina General Statutes.
The Debtor manages and partially owns the Subject Units. Each of
the Subject Units is divided into individually or corporately owned
deeded timeshare weeks, together with an undivided percentage
interest in the common areas of Foxkroft Villas. Each of the
Subject Units is also subject to the Declaration of Unit Ownership
for the Foxkroft Condominium, originally recorded in Book 414, Page
178 in the Moore County, North Carolina Register of Deeds, and
accordingly, the Debtor is a member of the Foxkroft Condominium
Association, Inc. ("FCAI").
The Debtor owns certain fractional timeshare interests in common
with other unit owners in the Subject Units, which units are spread
across 8 of the buildings in Foxkroft Villas. In total, the Debtor
owns 486 of the 780 weeks in the Subject Units.
Since the Petition Date, the Debtor has not been operational and
has received no income. The confirmed Plan authorizes the sale of
the Property consistent with the terms of the Plan.
Consistent with the confirmed Plan, the Debtor has filed 15
Adversary Proceedings in the Court against owners of fractional
timeshare interests in the Subject Units in order to clear title to
the Property, and is pursuing judgments in those Adversary
Proceedings authorizing the Debtor to sell both its interest and
the various timeshare co-owners’ interests in the Property.
With the assistance of Great Neck Realty Company and its principal
broker, Robert Tramantano, the Debtor has ultimately determined
that the highest and best offer received was a non-contingent offer
to purchase the Property, submitted by the Stalking Horse Bidder in
the amount of $850,000.
Following negotiations, the Debtor and Stalking Horse Bidder
entered into an Asset Purchase Agreement, which is expressly
subject to Court approval in all respects.
The salient terms of the APA are:
a. Purchase Price: $850,000
b. Earnest Money Deposit: 2.5% of the Purchase Price,
delivered upon full execution of the Purchase Agreement and an
additional 2.5% due upon Court approval of a Sale Procedures Order
c. Closing will occur within 10 days after entry by the Court
of a non-appealable Order approving the sale of the Property to
Stalking Horse Bidder
d. Closing Costs Paid by the Debtor: (i) prorated ad valorem
taxes for current year; (ii) unpaid ad valorem taxes for prior
years
e. Closing Costs Paid by Purchaser: (i) recording fees; (ii)
prorated ad valorem taxes for current year
f. Break-Up Fee: 2% of the approved sales price of the highest
bidder
Each party is responsible for its own attorneys' fees incurred in
connection with the Purchase Agreement, the Bankruptcy Case and the
transactions or other matters contemplated hereby or thereby.
The Debtor, through the Motion, now wishes to establish a procedure
for the orderly sale of the Property to further maximize the
recovery for the estate. Pursuant to the Motion, the Debtor wishes
to allow for the sale of the Property on the terms proposed, and
according to the proposed Bidding Procedures set forth.
The salient terms of the Bidding Procedures are:
a. Bid Deadline: 60-day overbid period following the Court's
entry of an Order approving Stalking Horse Bidder as the stalking
horse, to allow Qualified Bidders to submit a qualifying bid
b. Initial Bid: $892,500
c. Deposit: 5% of the bid amount
d. Auction: To be determined by the Court
e. Bid Increments: To be determined
f. Sale Hearing: The Sale Hearing will be held in the Court
following the conclusion of the Auction.
The sale will be free and clear of liens, claims, encumbrances, and
interests with such liens, claims, encumbrances, and interests to
attach to the proceeds of sale.
In addition, the Debtor asks that the Court establishes a Final
Hearing Date whereby the Property will be auctioned if one or more
Qualified Bidders submit a qualifying overbid and that, following
the auction, the Court conducts a hearing to approve the proposed
sale and enter a final sale Order.
Lastly, based upon the amount of the Purchase Price set forth in
the Purchase Agreement, the Debtor respectfully asks authorization
to pay the commission of GNRC pursuant to the Order Authorizing
Employment from the sales proceeds at closing without separate
application to the Court.
Upon completion of the sale of the Property, the Debtor's counsel
will file a subsequent Motion for authority to disburse the closing
proceeds, except for the items specifically authorized herein or by
prior orders of the Court.
Objections, if any, must be filed within 21 days from the date of
the Notice.
A copy of the Bidding Procedures and APA is available at
https://tinyurl.com/hjuve6ps from PacerMonitor.com free of charge.
The Purchaser:
KENSINGTON COURT II LLC
511 N Reilly Rd.
Fayetteville, NC 28303
Attn: Jean N. Dorleus
About Foxfire Consolidated Owners Association
Foxfire Consolidated Owners Association, Inc., sought protection
for relief under Chapter 11 of the Bankruptcy Code (Bankr.
E.D.N.C.
Case No. 20-02784) on Aug. 7, 2020, listing $1 million in both
assets and liabilities. Judge David M. Warren oversees the case.
The Debtor tapped Hendren, Redwine & Malone, PLLC as its
bankruptcy
counsel and Jordan Price Wall Gray Jones & Carlton, PLLC as its
special counsel.
On Jan. 7, 2021 the Court confirmed the Debtor's Plan of
Reorganization.
On Oct. 9, 2020, the Court appointed Great Neck Realty Company and
its principal broker, Robert Tramantano, as the Debtor's broker.
GREAT LAKES: Michigan Trucking Company Seeks Chapter 11
-------------------------------------------------------
Clarissa Hawes of FreightWaves reports that a Michigan trucking
company that hauls crude oil filed for Chapter 11 bankruptcy
protection late last second week of March 2021, citing dropping
freight revenue, which is down 54% in the first two months of 2021
compared with the same time frame in 2020.
Great Lakes Petroleum Transportation, headquartered in Alma,
Michigan, filed its petition in the U.S. Bankruptcy Court for the
Eastern District of Michigan. In its filing, Great Lakes lists its
assets as between $50,000 and $1 million and its liabilities as
between $1 million and $10 million. It states it has up to 99
creditors.
Among the crude oil carrier's top 20 unsecured creditors -- which
are last in line for payment in Chapter 11 cases -- include Mack
Financial Services of Philadelphia, which is owed nearly $3.8
million; Comdata of Charlotte, North Carolina, owed more than
$227,000; and Tank Truck Service and Sales of Warren, Michigan,
owed $18,000.
The company estimates that funds will be available for distribution
to unsecured creditors.
The carrier has 59 power units and 49 drivers, according to the
Federal Motor Carrier Safety Administration SAFER website.
According to the crude hauler's bankruptcy petition, one of the
company's largest unsecured creditors is Union Bank in Lake Odessa,
Michigan, which is owed $1.1 million after the trucking company
received a loan to stay afloat during the COVID-19 pandemic through
the U.S. Small Business Administration’s Paycheck Protection
Program (PPP).
Forgivable loans through the PPP started out with $350 billion in
the CARES Act, signed into law by former President Donald Trump
last March and replenished in April with an additional $320
billion. The SBA released the third round of about $284 billion in
coronavirus funds in January 2021.
A creditors' meeting is set for April 8, 2021.
About Great Lakes Petroleum Transportation
Great Lakes Petroleum is an oil and energy company specializing in
fuel storage tanks. It provides quality fuels and fuel management
services to customers.
Great Lakes Petroleum Transportation, LLC, Great Lakes Holdings,
LLC, and Great Lakes Petroleum Corporation sought Chapter 11
protection (Bankr. E.D. Mich. Case Nos. 21-20285 to 21-20287).
Great Lakes Petroleum Transportation listed assets between $50,000
and $1 million and liabilities between $1 million and $10 million
as of the bankruptcy filing.
GOLD, LANGE, MAJOROS & SMALARZ, PC, led by John C. Lange, is the
Debtors' counsel.
GREENPOINT TACTICAL: Seeks to Hire Bragança Law as Special Counsel
-------------------------------------------------------------------
Greenpoint Tactical Income Fund LLC seeks approval from the U.S.
Bankruptcy Court for the Eastern District of Wisconsin to employ
Bragança Law, LLC as special counsel.
The Debtor needs the firm's legal assistance in connection with a
securities litigation case (Case No. 19-cv-809) filed in the U.S.
District Court for the Western District of Wisconsin.
Bragança Law will be paid at the rate of $600, and a retainer in
the amount of $250,000. The firm will also be reimbursed for
reasonable out-of-pocket expenses incurred.
Celiza Bragança, Esq., a partner at Bragança Law, disclosed in a
court filing that the firm is a "disinterested person" as the term
is defined in Section 101(14) of the Bankruptcy Code.
The firm can be reached at:
Celiza P. Bragança, Esq.
Bragança Law LLC
5250 Old Orchard Rd.
Skokie, IL 60077
Tel: (847) 495-7156
About Greenpoint Tactical Income Fund
Madison, Wisc.-based Greenpoint Tactical Income Fund LLC is a
private investment fund. Its wholly owned subsidiary, GP Rare
Earth Trading Account LLC, is the entity that holds the gems and
minerals.
Greenpoint and GP Rare Earth sought protection under Chapter 11 of
the Bankruptcy Code (Bankr. E.D. Wis. Lead Case No. 19-29613) on
Oct. 4, 2019.
At the time of filing, Greenpoint estimated assets of $100 million
to $500 million and liabilities of $10 million to $50 million. GP
Rare Earth estimated assets of $100 million to $500 million and
liabilities of $10 million to $50 million.
Steinhilber Swanson, LLP and Bragança Law, LLC serve as the
Debtor's bankruptcy counsel and special counsel, respectively.
CliftonLarsonAllen, LLP is the Debtor's accountant.
On Dec. 5, 2019, the U.S. Trustee for Region 11 appointed an
official committee of equity security holders in the Debtors'
Chapter 11 cases. The equity committee tapped Shelly A. DeRousse,
Esq., at Freeborn & Peters LLP, as its legal counsel and Phoenix
Management Services, LLC as its financial advisor.
GRIDDY ENERGY: To Cancel Customers' Power Bills If They Don't Sue
-----------------------------------------------------------------
Steven Church of Bloomberg News reports that Griddy Energy LLC has
one final deal for Texans before the power seller shuts down for
good: if its 29,000 former customers agree not to sue, the company
will cancel electric bills that were about 300 times normal amid
last February 2021's winter storm.
On its first day in bankruptcy court, Griddy lawyers outlined a
plan to liquidate, settle with customers and, possibly, arrange
lawsuits against those that the company blames for its collapse.
The company also won court permission to pay its remaining
employees and other routine bills while the Chapter 11 case goes
forward.
About Griddy Energy
California startup Griddy Energy is an American power retailer that
formerly sold energy to people in the state of Texas at wholesale
prices for a $9.99 monthly membership fee and had approximately
29,000 members. Griddy was a feature of Texas' unusual,
deregulated system for electric power. The vast majority of Texans
-- and Americans -- pay a fixed rate for electric power and get
predictable monthly bills. However, Griddy works by connecting
customers to the wholesale market for electricity, which can change
by the minute and is more volatile, for a monthly fee of $9.99.
During February 2021's winter storm in Texas, power generators
failed and demand for heating shot up. In response, ERCOT raised
the price of electricity to the legal limit of $9 per kilowatt-hour
and kept it there for several days. Griddy customers who didn't
lose power were hit with massive electric bills that were
auto-debited from their bank accounts.
State grid operator ERCOT at the end of February 2020 cut off the
Griddy's access to customers for unpaid bills following the Texas
freeze. The Texas attorney general also said it is suing Griddy,
saying it engaged in deceptive trade practices by issuing excessive
bills.
Griddy Energy filed a chapter 11 bankruptcy petition (Bankr. S.D.
Tex. Case No. 21-30923) on March 15, 2021.
Griddy estimated $1 million to $10 million in assets and $10
million to $50 million in liabilities as of the bankruptcy filing.
Griddy is represented by Baker Botts LLP as legal counsel. Griddy
is represented by Crestline Solutions, LLC and Scott Pllc as public
affairs advisors. Stretto is the claims agent.
GUADALUPE REGIONAL: Fitch Affirms 'BB' on Issuer Default Rating
---------------------------------------------------------------
Fitch Ratings has affirmed the 'BB' Issuer Default Rating (IDR) for
Guadalupe Regional Medical Center and the 'BB' rating on the
following bonds issued by the Board of Managers, Joint Guadalupe
County - City of Seguin, TX Hospital, d/b/a Guadalupe Regional
Medical Center (GRMC):
-- $109.6 million hospital mortgage revenue, refunding and
improvement bonds, series 2015.
The Rating Outlook is Stable.
SECURITY
The bonds are secured by a mortgage on hospital property, pledge of
gross revenues and a debt service reserve fund.
ANALYTICAL CONCLUSION
The 'BB' IDR and revenue bond rating reflect GRMC's weak balance
sheet and liquidity position, although the latter was bolstered
over the past year by stimulus funding from the Coronavirus Aid,
Relief, and Economic Security (CARES) Act. While the combination of
'bbb' revenue defensibility and an operating risk assessment of 'a'
suggests a higher rating category, Fitch believes the 'BB' rating
reflects the risk associated with GRMC's relatively small revenue
base, competition from larger systems, narrow service area and
dependence on supplemental funding that can bring revenue
volatility over the long run.
The Stable Outlook reflects Fitch's expectation that net leverage
metrics will remain stable despite capital spending that is
projected to be above depreciation for the next few years as a
result of GRMC's solid cash flow.
KEY RATING DRIVERS
Revenue Defensibility: 'bbb'
Stable Payor Mix; Growing but Competitive Service Area
GRMC's operations are centered in a rapidly growing region about 35
miles east of San Antonio, TX. GRMC's gross patient revenues in
fiscal 2020 were derived primarily from Medicare (51.8%) and
commercial (24.1%) payors, with lesser exposure to self-payors
(12.7%) and Medicaid payors (9.6%). Net patient revenues of $213.2
million in fiscal 2020 consisted of GRMC health system operations
(49.8%) and largely pass-through revenues from 13 nursing homes
(50.2%).
In its capacity as a non-state, government-owned facility, GRMC
qualifies for nursing facility supplemental support and shares the
benefit through its lease terms with the nursing facilities. GRMC
recognized $8.4 million of revenue related to the Quality Incentive
Payment Program (QIPP) in support of its nursing home operations,
$3.4 million in uncompensated care (UC) and $3.7 million in
Delivery System Reform Incentive Payments (DSRIP) in fiscal 2020.
Changes or volatility related to supplemental payments are a risk,
but this is somewhat mitigated by a stable payor mix and growing
local service area.
Though local demographic trends are favorable and GRMC has a
leading primary service area (PSA) market share of 20.6%,
competition is significant as there are multiple competitors
scattered within a 46-mile radius from GRMC, and three of these are
within 20 miles from the hospital. Major competitors include Tenet
Healthcare's Resolute Health Hospital (17.6% PSA market share) that
opened in New Braunfels, TX in 2014 and CHRISTUS' Santa Rosa Health
System that has five full-service hospitals in the San Antonio/New
Braunfels area. Despite the strong competitors, GRMC remains
focused on recruiting physicians with the right long-term fit for
the community and extending its reach through outpatient clinics.
Fitch believes these efforts will help solidify GRMC's presence in
the region and produce growing volumes over time.
Operating Risk: 'a'
Good Cost Management; Limited Routine Capital Needs
Excluding nursing home operations, GRMC was able to produce a
strong 10.2% EBITDA margin in fiscal 2020 despite considerable
volume pressures from restrictions related to the coronavirus
pandemic. From fiscal 2019 to fiscal 2020, inpatient surgeries,
outpatient surgeries and emergency department visits declined 2.5%,
13.4% and 13%, respectively, contributing to a net patient revenue
decline of approximately 5%. Revenue losses were offset by expense
management and government stimulus funds, which totaled about $22.3
million with $6.8 million recognized in fiscal 2020. The remaining
$15.5 million of stimulus funds are expected to be recognized in
fiscal 2021.
GRMC's capital spending has averaged a healthy 143.6% of
depreciation over the past four fiscal years. Projects have
included a renovation of GRMC's women's imaging center and opening
a new urgent care center in a rapidly growing neighborhood north of
the medical center. Given the region's growing need for healthcare
services, management expects to continue spending above
depreciation over the next few years to purchase additional
equipment, remodel GRMC's lab space and build out a new medical
office building to provide additional outpatient specialty
coverage.
Financial Profile: 'bb'
Weak Financial Profile
Despite pandemic related operating challenges, GRMC's unrestricted
cash and investments increased to about $62.5 million at FYE 2020
from $51.3 million at FYE 2019. The increase in liquidity and
significant improvement in GRMC's pension plan fiduciary net
position through $15.6 million in net investment income resulted in
cash to adjusted debt improving to 57.5% as of FYE 2020 from 43.4%
at FYE 2019.
Under Fitch's criteria, adjusted debt includes Fitch's adjusted net
pension liability (estimated at $5.9 million based on a 6% discount
rate, instead of the $5 million surplus reported by the district,
which is based on a 7% discount rate). Net adjusted debt to
adjusted EBITDA, which is a proxy for how many years of cash flow
is needed to repay net outstanding long-term debt, was 2.7x at
Sept. 30, 2020. The system did not apply for funds under the
Medicare advance payment program. Fitch's forward look, which
models stable revenue growth and operating margins, shows GRMC
incrementally improving leverage metrics that support rating
stability through the cycle.
ASYMMETRIC ADDITIONAL RISK CONSIDERATIONS
No asymmetric additional risk considerations were applied in this
rating determination.
RATING SENSITIVITIES
Factor that could, individually or collectively, lead to positive
rating action/upgrade:
-- GRMC's liquidity position and net leverage position improve
significantly to levels that offset concerns over its small
revenue/volume base and dependency on supplemental funding.
These levels may be achieved in cash to adjusted debt that is
consistently above 60%.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
-- If liquidity levels significantly deteriorate and GRMC's net
leverage position weakens to levels that no longer support the
rating;
-- If GRMC's margins and profitability significantly weaken to
levels around 7% operating EBITDA on a consistent basis, which
would no longer support a strong operating risk profile.
BEST/WORST CASE RATING SCENARIO
International scale credit ratings of Sovereigns, Public Finance
and Infrastructure issuers have a best-case rating upgrade scenario
(defined as the 99th percentile of rating transitions, measured in
a positive direction) of three notches over a three-year rating
horizon; and a worst-case rating downgrade scenario (defined as the
99th percentile of rating transitions, measured in a negative
direction) of three notches over three years. The complete span of
best- and worst-case scenario credit ratings for all rating
categories ranges from 'AAA' to 'D'. Best- and worst-case scenario
credit ratings are based on historical performance.
GRMC's 153-bed medical center is located in Seguin, TX, about 35
miles east of San Antonio, TX. The hospital serves the counties of
Guadalupe, Caldwell, Comal, DeWitt, Gonzales, Hays, Karnes and
Wilson, with the city of Seguin as its primary service area. GRMC
estimates the cost of charity care provided under its charity care
policy in fiscal 2020 as $3.6 million. It received $2.1 million in
payments from Guadalupe County and city of Seguin sponsors in
fiscal 2020 to help offset the cost of charity care.
The original GRMC hospital was built in 1965 and underwent
significant renovation and expansion in 2010. GRMC is the sole
member of Guadalupe Regional Medical Group, which has grown to have
employed physicians spanning a variety of specialties. GRMC offers
additional specialty services through affiliations with regional
providers.
In addition to the sources of information identified in Fitch's
applicable criteria specified below, this action was informed by
information from Lumesis.
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.
HELIUS MEDICAL: Appoints Sherrie Perkins as Director
----------------------------------------------------
The Board of Directors of Helius Medical Technologies, Inc.
approved an increase in the size of the Board from five to six
directors and the appointment of Sherrie Perkins to fill the
vacancy created by such increase effective as of March 15, 2021.
Ms. Perkins has served in the University of Texas MD Anderson
Cancer Center's Venture Mentoring Service since 2017 providing
guidance and perspective on commercialization-related topics that
are important and relevant to the progression of various ventures.
She also served as an independent member of the board of directors
of eNeura, Inc., a privately held medical technology company
providing therapy for both acute treatment and prevention of
migraines, from 2018 to 2020.
Ms. Perkins served as a consultant to LivaNova, PLC (NASDAQ: LIVN),
a publicly-held global medical technology company that creates
innovative and meaningful medical solutions for the benefit of
patients, healthcare professionals, and healthcare systems, from
January 2017 to June 2019, and served as vice president in the
sleep apnea, new ventures space within LivaNova from October 2015
to January 2017. She previously served as vice president of
Marketing and New Business Development of Cyberonics, Inc., an
affiliate of LivaNova, from November 2011 to October 2015. Ms.
Perkins received a B.S. in Medical Technology from Mississippi
State University and an M.A. in Management from Central Michigan
University.
The Board has determined that Ms. Perkins satisfies the
independence criteria set forth in the Nasdaq rules and is
"independent" for purposes of serving on the Board. The Board is
considering potential committee appointments of Ms. Perkins in
connection with her appointment to the Board, and the Company will
file an amendment to this Current Report on Form 8-K to disclose
any such appointments. Ms. Perkins will be compensated in
accordance with the Company's non-employee director compensation
program. In connection with Ms. Perkins' appointment to the Board,
the Company will enter into its standard form of indemnification
agreement for directors and officers. Pursuant to the terms of the
indemnification agreement, the Company may be required, among other
things, to indemnify Ms. Perkins for some expenses, including
attorneys' fees, judgments, fines and settlement amounts incurred
by her in any action or proceeding arising out of her service to
the Board.
About Helius Medical
Helius Medical Technologies -- http://www.heliusmedical.com-- is a
neurotech company focused on neurological wellness. Its purpose is
to develop, license or acquire non-invasive technologies targeted
at reducing symptoms of neurological disease or trauma.
Helius Medical reported a net loss of $14.13 million for the year
ended Dec. 31, 2020, compared to a net loss of $9.78 million for
the year ended Dec. 31, 2019. As of Dec. 31, 2020, the Company had
$6.54 million in total assets, $2.67 million in total liabilities,
and $3.87 million in total stockholders' equity.
Philadelphia, Pennsylvania-based BDO USA, LLP issued a "going
concern" qualification in its report dated March 10, 2021, citing
that the Company has incurred substantial net losses since its
inception, has an accumulated deficit of $118.9 million as of Dec.
31, 2020 and the Company expects to incur further net losses in the
development of its business. These conditions raise substantial
doubt about its ability to continue as a going concern.
HENRY FORD VILLAGE: Seeks to Hire 'Ordinary Course' Professionals
-----------------------------------------------------------------
Henry Ford Village, Inc. seeks approval from the U.S. Bankruptcy
Court for the Eastern District of Michigan to employ professionals
used in the ordinary course of its business.
The motion, if granted, would allow the Debtor to hire "ordinary
course professionals" without filing separate employment and fee
applications.
The Debtor will pay each OCP, without prior application to the
court, 100 percent of its fees and expenses upon the submission to
and approval by the Debtor's chief restructuring officer of an
invoice. The fee cap for each OCP is $10,000 per month.
One of the OCPs that the Debtor proposes to hire is Baker Tilly US,
LLP, a firm in East Lansing, Mich., that provides tax and
regulatory services.
Baker Tilly can be reached at:
Baker Tilly US, LLP
2852 Eyde Parkway Suite 150
East Lansing, MI 48823
Tel: (517) 321-0110
About Henry Ford Village
Henry Ford Village, Inc. is a non-profit, non-stock corporation
established to operate a continuing care retirement community
located at 15101 Ford Road, Dearborn, Mich. It provides senior
living services comprised of 853 independent living units, 96
assisted living unites and 89 skilled nursing beds.
Henry Ford Village sought Chapter 11 protection (Bankr. E.D. Mich.
Case No. 20-51066) on Oct. 28, 2020. In the petition signed by CRO
Chad Shandler, Henry Ford Village was estimated to have $50 million
to $100 million in assets and $100 million to $500 million in
liabilities.
The Hon. Mark A. Randon is the case judge.
The Debtor tapped Dykema Gossett PLLC as its legal counsel, RBC
Capital Markets, LLC as investment banker, and FTI Consulting, Inc.
as financial advisor. Chad Shandler of FTI serves as the Debtor's
chief restructuring officer. Kurzman Carson Consultants, LLC is
the claims agent.
HWY 24 LUMBER: Gets Cash Collateral Access Thru April 6
-------------------------------------------------------
The U.S. Bankruptcy Court for the Eastern District of Texas,
Sherman Division, has authorized HWY 24 Lumber & Feed, Inc. to use
cash collateral on an interim basis through April 6, 2021, in
accordance with the interim budget.
NG Solutions, LLC asserts that (a) as of December 16, 2020, the
Debtor was indebted and liable to NG Solutions under that a Note
dated May 22, 2018, executed by the Debtor and payable to the order
of Enloe State Bank, which is secured by all of the inventory,
accounts, chattel paper, whether tangible or electronic, consumer
goods, deposit accounts, equipment, fixtures, general intangibles,
instruments now owned or hereafter acquired together with all
supporting obligations, proceeds, products, software, accessories
and accessions of Highway 24. NG asserts the Note is evidenced by a
Lost Instrument Affidavit. Furthermore, the Collateral is described
in detail in the UCC Financing Statements filed on February 14,
2020, February 17, 2020, and February 18, 2020.
NG Solutions asserts the amount owed under the Loan Documents
matured by its own terms on May 22, 2019. NG Solutions assets that
the amount, together with additional costs and fees that NG
Solutions is entitled to collect under the Loan Documents.
As adequate protection for the Debtor's use of Cash Collateral, NG
Solutions is granted valid, perfected, and enforceable replacement
liens and assignments on and first priority post-petition security
interests in all assets of the Debtor upon which NG Solutions'
liens and security interests granted in the Loan Documents would
otherwise attach under applicable non-bankruptcy law and all
proceeds, rents, products or profits thereof acquired by the Debtor
after the Petition Date.
The Replacement Liens granted are in addition to all security
interests, assignments, and liens now existing in favor of NG
Solutions and not in substitution or limitation thereof and will be
effective as of the Petition Date.
To the extent that the Replacement Liens are found by the Court to
be insufficient to provide NG Solutions with adequate protection,
NG Solutions will be granted an allowed administrative
superpriority expense claim pursuant to section 364(c)(1) of the
Bankruptcy Code.
The Debtor is also directed to maintain insurance with respect to
all of the Prepetition Collateral and Post-petition Collateral for
all the purposes and in the amounts maintained by the Debtor in
accordance with the requirements of the Loan Documents.
A final hearing on the matter is scheduled for April 6 at 9:30 a.m.
A copy of the order is available at https://bit.ly/30HemeD from
PacerMonitor.com.
About HWY 24 Lumber & Feed, Inc.
HWY 24 Lumber & Feed, Inc. sought protection under Chapter 11 of
the Bankruptcy Code (Bankr. E.D. Texas Case No. 20-42468) on Dec.
16, 2020. At the time of filing, the Debtor disclosed less than
$50,000 in assets and up to $1 million in liabilities.
Judge Brenda T. Rhoades oversees the case.
Eric A. Liepins, P.C. serves as the Debtor's legal counsel.
NG Solutions, LLC, as Lender, is represented by:
Russell W. Mills. Esq.
J. Reid Burley, Esq.
Bell Nunnally & Martin LLP
2323 Ross Avenue, Suite 1900
Dallas, TX 75201
Tel. 214-740-1400
Fax: 214-741-1499
E-mail: rmills@bellnunnally.com
E-mail: rburley@bellnunnally.com
ICAN BENEFIT: Case Summary & 20 Largest Unsecured Creditors
-----------------------------------------------------------
Debtor: iCan Benefit Group, LLC
5301 N. Federal Highway
Suite 375
Boca Raton, FL 33487
Business Description: iCan Benefit Group, LLC --
https://icanbenefit.com -- is a licensed
insurance agency offering a variety of
benefit programs and insurance products from
a number of licensed insurance companies.
Chapter 11 Petition Date: March 18, 2021
Court: United States Bankruptcy Court
Southern District of Florida
Case No.: 21-12567
Judge: Hon. Mindy A. Mora
Debtor's Counsel: Robert P. Charbonneau, Esq.
AGENTIS PLLC
55 Alhambra Plaza, Suite 800
Miami, FL 33134
Tel: 305-722-2002
E-mail: rpc@agentislaw.com
Estimated Assets: $10 million to $50 million
Estimated Liabilities: $10 million to $50 million
The petition was signed by Stephen M. Tucker, manager.
A copy of the petition is available for free at PacerMonitor.com
at:
https://www.pacermonitor.com/view/345GAGI/iCan_Benefit_Group_LLC__flsbke-21-12567__0001.0.pdf?mcid=tGE4TAMA
List of Debtor's 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
1. ACC Business Utility $27,823
400 West Avenue
Rochester, NY 14611
2. Administration 123, Inc. Trade Debt $20,068
168 N Coast Hwy #167
Laguna Beach, CA 92651
3. Alorica Direct, LLC Trade Debt $1,500
(Formerly West Direct)
5161 California Avenue
Irvine, CA 92617
4. Bush Ross PA Legal Fees $9,229
1801 N Highland Avenue
Tampa, FL 33602-2656
5. Fuego Leads LLC Media $12,120
2200 Commercial Blvd, #309
Fort Lauderdale, FL 33309
6. Fuerst Ittleman Legal Fees $15,000
David & Joseph
One SE 3rd Ave, Suite 1800
Miami, FL 33131
7. Glassberg & Glassberg, PA Legal Fees $7,657
13611 S Dixie Hwy,
#109-514
Miami, FL 33176
8. H. Shatz Trade Debt $23,485
5171 Lake Catalina Drive,
Apt# D
Boca Raton, FL 33496
9. HPI LLC Trade Debt $40,000
44 Laight Street,
Suite 3A
New York, NY 10013
10. Johnson Moore, LLC Legal Fees $24,269
150 North Wacker
Drive, Suite 1250
Chicago, IL 60606
11. Lipschultz, Levin & Legal Fees $6,853
Gray, L.L.C.
425 Huehl Road, Bldg 7
Northbrook, IL 60062
12. PEOple Premier, Inc. Trade Debt $10,873
13600 Icot Blvd, Bldg A
Clearwater, FL 33760
13. Premier Administrative Trade Debt $564,137
Solutions
13600 Icot Blvd, Bldg A
Clearwater, FL 33760
14. Premium Assignment Corporation Trade Debt $8,112
3522 Thomasville Road,
Suite 400
Tallahassee, FL 32309
15. Royale Courtyard Lease $1,980
Properties LLC
5301 N Federal Highway,
Suite 380
Boca Raton, FL 33487
16. S. Shatz Trade Debt $23,485
9175 Rutledge Avenue
Boca Raton, FL 33434
17. Sightline Retail, LLC $399,250
2400 SE C Street,
Suite 6
Bentonville, AR 72712
18. Sightline Retail, LLC Judgment Claim $82,500
2400 SE C Street,
Suite 6
Bentonville, AR 72712
19. Vertafore Trade Debt $5,271
11724 NE 195th Street
Bothell, WA 98011
20. Wal-Mart Stores, Inc. Judgment Claim $50,472
702 SW 8th Street
Bentonville, AR 72716
ICAN HOLDING: Voluntary Chapter 11 Case Summary
-----------------------------------------------
Debtor: iCan Holding, LLC
5301 N. Federal Highway
Suite #375
Boca Raton, FL 33487
Chapter 11 Petition Date: March 18, 2021
Court: United States Bankruptcy Court
Southern District of Florida
Case No.: 21-12568
Debtor's Counsel: Robert P. Charbonneau, Esq.
AGENTIS PLLC
55 Alhambra Plaza, Suite 800
Miami, FL 33134
Tel: 305-722-2002
E-mail: rpc@agentislaw.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Stephen M. Tucker, manager.
The Debtor stated it has no creditors holding unsecured claims.
A copy of the petition is available for free at PacerMonitor.com
at:
https://www.pacermonitor.com/view/YCQYS7A/iCan_Holding_LLC__flsbke-21-12568__0001.0.pdf?mcid=tGE4TAMA
INTELSAT SA: Equity Holders Lose Bid for Official Committee
-----------------------------------------------------------
Allison McNeely of Bloomberg News reports that Intelsat SA equity
holders lost their bid for formal representation in the bankruptcy
case as they fight to collect expected payments stemming from
Intelsat's surrender of some of its C-band spectrum.
Judge Keith Phillips ruled in a hearing Wednesday that the equity
holders failed to prove that their interests wouldn't be adequately
represented by the other committees.
A group of equity holders pushed to be granted official committee
status on the grounds that $4.8 billion of payments expected from
the Federal Communications Commission should flow to the parent
company.
About Intelsat S.A.
Intelsat S.A. -- http://www.intelsat.com/-- is a publicly held
operator of satellite services businesses, which provides a diverse
array of communications services to a wide variety of clients,
including media companies, telecommunication operators, internet
service providers, and data networking service providers. The
Company is also a provider of commercial satellite communication
services to the U.S. government and other select military
organizations and their contractors. The Company's administrative
headquarters are in McLean, Virginia, and the Company has extensive
operations spanning across the United States, Europe, South
America, Africa, the Middle East, and Asia.
Intelsat S.A., based in L-1246 Luxembourg, and its
debtor-affiliates, sought Chapter 11 protection (Bankr. E.D. Va.
Lead Case No. 20-32299) on May 14, 2020. The petition was signed by
David Tolley, executive vice president, chief financial officer,
and co-chief restructuring officer. In its petition, Intelsat
disclosed $11,651,558,000 in assets and $16,805,844,000 in
liabilities.
KIRKLAND & ELLIS LLP, and KUTAK ROCK LLP, as counsels; ALVAREZ &
MARSAL NORTH AMERICA, LLC as restructuring advisor; PJT PARTNERS LP
as investment banker; STRETTO as claims and noticing agent.
INTERIOR LOGIC: S&P Affirms B Issuer Credit Rating, Outlook Stable
------------------------------------------------------------------
S&P Global Ratings affirmed its 'B' issuer credit rating on
Calif.-based interior finishings design and installation services
provider Interior Logic Group Holdings LLC (ILG). At the same time
S&P assigned its 'B' issuer credit rating to Signal Parent Inc.,
the new issuer of ILG's proposed debt.
S&P is assigning its 'B' issue-level and '3' recovery ratings to
Signal Parent's proposed $550 million first-lien debt facility, and
its 'CCC+' issue-level and '6' recovery ratings to the $300 million
of unsecured debt.
The rating affirmation reflects expection for organic revenue
growth and cost-saving actions to allow for earnings-based
deleveraging below 6x by year-end 2021, from S&P Global
Ratings-adjusted debt to EBITDA of about 6.5x estimated at
transaction close. ILG's finishing and design services are driven
by housing completions, which can lag housing starts by more than
two quarters, meaning that significant work backlogs from high
builder activity over the last six to nine months should translate
into revenue growth for ILG in the second half of 2021. While
revenue and profitability are partially dependent on the company's
ability to effectively upsell premium design finishes, the
company's monthly design center orders are up 30% to 40% as of late
2020, and this provides good visibility into overall lot
assumptions for the year. S&P said, "Should growth, or more
importantly ILG's operating margins, decline from our current
expectations, we could lower our rating to reflect the company's
highly levered capital structure and the resulting limit on its
ability to withstand sharp declines in its cyclical end-markets. We
estimate that annual debt-servicing-related fixed charges will be
about $10 million higher pro forma for the new capital structure."
Sustained profitability above the 8% area is key to upholding the
current 'B' rating given the company's exposure to highly cyclical
construction end-markets. Over the past 12 months, ILG has
weathered quarterly revenue declines up to 12% while still
expanding its trailing 12-month gross margin by about 150 basis
points. The improvement reflects the company's variable
volume-driven cost base (up to 75% of costs are considered directly
variable), as well as the benefit of its shift toward higher-margin
technology-enabled design center services, versus sales that solely
focus on supply chain and installation logistics. At the same time,
the company's margin improvement also reflects the abatement of
certain headwinds faced in 2019 that are less in management's
direct control, such as concession requests from builders and
declining revenue per lot trends.
ILG has identified $30 million of cost take-outs over the next
three to 24 months targeting balanced savings across headcount,
procurement, and facility expenses. In 2021, S&P expects the most
actionable items to be largely offset by the return of costs
temporararily reduced during the pandemic (e.g., reduced workforce
hours during the peak pandemic lockdowns), as well as from minor
restructuring-related costs. Over the longer-term, cost
rationalization and supportive economic fundamentals, coupled with
ILG's investments in technology, visualization, and analytic
capabilities should allow it to continue expanding its EBITDA
margin toward the 9% area (from S&P Global Ratings' estimated
adjusted EBITDA margins of about 8.2% for 2020).
If ILG were to struggle to sustain its operating margin above 8%,
we believe this would likely suggest an inability to manage
pass-through costs of material and labor, or a failure in the
company's overall strategy to achieve higher-margin efficiencies
from its technology and new design-center growth investments.
S&P said, "Despite the elevated starting leverage, our stable
outlook reflects that we anticipate that ILG will bring credit
measures in line with our expectations for the rating by midyear
2022 by converting its backlog from high builder activity in late
2020 and early 2021 into earnings growth, while progressing on
identified cost actions, such that its adjusted leverage declines
below 5.5x and its free operating cash flow to debt improves to the
7%.
"We could lower our rating on ILG if it sustains leverage above
5.5x in 2022, free operating cash flow (FOCF) to debt below 5%, or
operating margins below 8%. This scenario would likely indicate an
inability to effectively manage operating costs or a weakening of
the company's ability to competitively sell premium interior design
finishing products and realize the benefits of its multiyear
investment in its technology capabilities. We could also lower our
rating if we expect the company's financial sponsor to pursue
aggressive financial policies, including dividend
recapitalizations, which prevent leverage from remaining below the
5.5x downgrade threshold.
"We could raise our rating on ILG if the company maintains its
EBITDA margins in the high-single digit percent area, while
sustaining leverage levels below 4x. We would require the company's
financial-sponsor ownership to commit to maintaining leverage at
these levels by adopting consistent financial polices related to
debt-funded dividends or large acquisitions. Finally, we would look
for supportive conditions in the residential construction
industry."
INVESTVIEW INC: Reports Highest Monthly Gross Revenue
-----------------------------------------------------
Investview, Inc. reported record combined revenue for the month of
February from its Bitcoin Mining and Product Sales Revenue.
"It was a record month for gross revenue demonstrating strength and
growth from multiple subsidiaries. We continue to execute on the
company's four key fintech objectives of Bitcoin mining, education,
financial trading tools and our newly announced ndau digital
currency product packages. Financial education remains a driving
force with individual demand growing rapidly especially with
greater participation from Gen X and Y. We will continue to
enhance our mining operations, expand our educational tools, and
increase our offerings to reach our fintech objectives," said Joe
Cammarata, Investview CEO.
The combined gross revenue of $5.5 million represents the highest
grossing month in the Company's history. February 2021 net income
of an estimated $1.9 million is also a first in the Company's
history. Rounding out the financial historical milestones is the
addition of over $1 million in Bitcoin and other digital currencies
recorded on the balance sheet as of Feb. 28, 2021.
Mario Romano, director of finance added, "Our February results
demonstrate the impact of the positive changes we continue to make
across our subsidiaries. By clearly defining our commitment to
fintech initiatives and support of digital currencies we are
delivering the elements required for individuals to adapt to a
fully digital economy."
February 2021 Financial Highlights
* Consolidated gross revenue was $5.5 million in February 2021,
the highest monthly revenue in the Company's history.
* Consolidated estimated net income of $1.9 million in February
2021, also reflects a record high monthly performance.
* The operating margin for February 2021 is estimated at 30%,
another record high for the Company.
* The Company's digital currency holdings comprised of ndau and
BTC reached over $1 million as of Feb. 28, 2021.
About Investview
Headquartered in Salt Lake City, Utah, Investview, Inc., is a
diversified financial technology organization that operates through
its subsidiaries, to provide financial products and services to
individuals, accredited investors and select financial
institutions.
Investview reported a net loss of $21.28 million for the year ended
March 31, 2020, compared to a net loss of $4.98 million for the
year ended March 31, 2019. As of Dec. 31, 2020, the Company had
$10.77 million in total assets, $23.79 million in total
liabilities, and a total stockholders' deficit of $13.02 million.
Haynie & Company, in Salt Lake City, Utah, the Company's auditor
since 2017, issued a "going concern" qualification in its report
dated June 29, 2020, citing that the Company has suffered losses
from operations and its current cash flow is not enough to meet
current needs. This raises substantial doubt about the Company's
ability to continue as a going concern.
JEFFERIES FINANCE: Fitch Alters Outlook on 'BB' LT IDR to Stable
----------------------------------------------------------------
Fitch Ratings has affirmed the Long-Term Issuer Default Ratings
(IDRs) of Jefferies Finance LLC (JFIN) and its debt co-issuing
subsidiary, JFIN Co-Issuer Corporation, at 'BB'. The Rating Outlook
has been revised to Stable from Negative. Fitch has also affirmed
JFIN and JFIN Co-Issuer Corporation's super senior debt ratings for
the priority revolving credit facility at 'BB+' and senior secured
debt ratings at 'BB'.
KEY RATING DRIVERS
IDRs and SENIOR DEBT
The Rating Outlook revision reflects the recent decline in JFIN's
leverage to pre-pandemic levels and Fitch's belief that JFIN's
earnings metrics will improve over the Outlook horizon due to
higher transaction volumes, lower interest expense and a decline in
loan loss provisioning. While JFIN could realize additional credit
losses in 2021, Fitch believes the impact on leverage will be
minimal given the level of reserves taken over the past year.
The rating affirmations reflect the benefits of JFIN's relationship
with Jefferies Group LLC (Jefferies; long-term IDR BBB/Stable),
which provides the firm with access to underwriting deal flow and
the resources of the broader platform, JFIN's strong and
experienced management team and supportive ownership from Jefferies
and Massachusetts Mutual Life Insurance Company (MassMutual;
long-term IDR AA/Stable). Both Jefferies and MassMutual have
provided JFIN with debt funding and incremental equity investments
over time to support business expansion. The rating affirmations
also reflect JFIN's focus on senior lending relationships in the
funded portfolio, low portfolio concentrations, solid asset quality
performance historically, although losses increased over the past
year, and sufficient liquidity.
Rating constraints include a fully secured funding profile,
higher-than-peer leverage, potential liquidity and leverage impacts
of meaningful draws on revolver commitments, and sensitivity of
deal flow and syndication capabilities to market conditions. The
ratings also contemplate the aggressive underwriting conditions in
the broadly syndicated market in recent years, including higher
underlying leverage, meaningful EBITDA adjustments, and, in many
cases, the absence of financial covenants. Fitch believes a
sustained slowdown in the economy is likely to translate to asset
quality issues more quickly, given the limited embedded financial
cushion in most portfolio credits and weaker lender flexibility in
credit documentation.
JFIN's funded loan portfolio amounted to $5.1 billion at Nov. 30,
2020 (fiscal YE20) and consisted largely of first-lien, broadly
syndicated loans. JFIN's funded portfolio remains well-diversified
from individual issuer and industry perspectives, particularly as
compared to business development companies, but concentrations
increased during fiscal 2020. The top 10 borrowers accounted for
approximately 18% of the funded portfolio at fiscal YE20, up from
around 9% at fiscal YE19, driven by the firm holding one relatively
large position that it previously intended to syndicate. Fitch
believes JFIN's exposure to borrowers in the hardest hit corporate
sectors is manageable, although the firm does have above-average
exposure to retail and consumer goods. The top industry
concentrations at fiscal YE20 included healthcare (13% of the
funded portfolio), nondurable consumer goods (12%), business
services (8%), finance (6%) and retail (6%).
Asset quality on JFIN's funded loan portfolio has been relatively
strong over time. Charge-offs have ticked up in recent years,
compared to historical levels, as a result of JFIN working out
certain energy and retail investments as well as the impact of the
coronavirus pandemic and associated lockdowns during fiscal 2020.
Net charge-offs ticked up to 2.2% in fiscal 2020 (year ended Nov.
30, 2020), compared to a four-year average of 0.7% annually from
fiscal 2016 through fiscal 2019. Impaired loans amounted to 3.0% of
JFIN's total loans receivable at fiscal YE20, up modestly from 2.7%
at fiscal YE19. Fitch believes JFIN could experience additional
losses in fiscal 2021, but believes that the firm has appropriately
reserved for future losses. At Nov. 30, 2020, reserves and deferred
fees amounted to approximately 4.3% of JFIN's funded portfolio,
which was above the peak charge-off rate experienced during the
financial crisis.
From an earnings perspective, JFIN's performance is heavily market
dependent, as underwriting revenues are driven by transaction
volumes and mix. JFIN's arranged deal volume picked up in fiscal
2020, relative to fiscal 2019, but remained well below the levels
seen in fiscal 2017 and 2018 given the drop off in market activity
following the onset of the pandemic. The firm arranged $26.8
billion of volume in fiscal 2020 across 96 transactions, up from
$18.1 billion of arranged volume across 98 transactions in the
prior year. While fee income was negatively affected by the decline
in deal activity in 2Q20 and 3Q20, net fee income was up 13.3%,
yoy, as earnings benefited from favorable market conditions in
fiscal 4Q20 and the backlog of deals.
Committed deals accounted for approximately 45% of JFIN's arranged
volume in fiscal 2020 and averaged 54% annually from fiscal
2016-2019. Committed deals can be particularly risky if market
conditions deteriorate between JFIN committing to a deal and fully
allocating its book. While JFIN attempts to manage this risk
through its underwriting process, which includes a thorough
assessment of the borrower's credit risk, in addition to
considerations related to pricing, capital markets, and
distribution conditions, the risk of getting hung on a committed
deal can never be fully mitigated, which serves as a rating
constraint.
JFIN realized a pre-tax net loss amounting to 1.1% of average
assets in fiscal 2020, down from pre-tax net income of 0.6% of
average assets in the prior year and an average of 1.3% from fiscal
2016-2019. However, JFIN noted that cash income was significantly
higher, at approximately $124 million (compared to a GAAP net loss
of $75 million), when adjusting for non-cash charges and net
deferred fees. Fitch expects JFIN's earnings to improve in fiscal
2021 as reserve levels normalize, fee income benefits from
increased deal activity, and interest expense declines as a result
of recent refinancing transactions and lower leverage.
JFIN's leverage, as measured by debt to tangible equity, amounted
to 4.7x at Nov. 30, 2020, which was up from 4.3x at Nov. 30, 2019
but within Fitch's 'bb' rating category quantitative leverage
benchmark range of 4.0x-7.0x for balance sheet intensive finance
and leasing companies with operating environment scores in the
'bbb' category. JFIN's outstanding debt at fiscal YE20 included
$263.3 million of borrowings under the firm's fronting lines.
Leverage would have been lower, at 4.5x, if those borrowings were
excluded.
Subsequent to the end of the fiscal year, JFIN sold the equity in
one of its collateralized loan obligations (CLOs), resulting in a
reduction in the firm's consolidated debt of around $360 million.
Fitch estimates that total leverage declined to 4.4x, on a pro
forma basis, and to 4.2x excluding borrowings under the fronting
lines. If leverage were further adjusted for outstanding borrowings
on the firm's corporate revolver, which is primarily used for
fronting deals, the pro forma metric would have been 3.9x. Fitch
views the decline in leverage in recent quarters favorably and
expects leverage to remain around or below the current (pro forma)
level. While JFIN's leverage remains elevated relative to other
rated underwriters and lenders in the middle market space, Fitch
views current leverage as appropriate for its rating category and
the risk profile of the assets.
JFIN uses term CLOs, revolver CLOs and warehouse facilities to
finance the funded loan portfolio (portfolio funding debt), while
term debt and senior notes issuances (collectively, non-funding
debt) and short-term fronting lines (funding debt) have been used
to fund the underwriting business. The firm also has a corporate
revolver (funding debt) to be used for general corporate purposes,
including the fronting of deals. JFIN's long-term debt and
revolving credit facility include incurrence-based covenants
limiting non-funding debt to total equity to 2.0x. This ratio was
1.2x at Nov. 30, 2020 and is the metric JFIN uses to manage
leverage. While the portfolio funding debt is non-recourse to JFIN,
Fitch views the CLO debt and warehouse facilities as a funding
source for one of the firm's core businesses and evaluates the
firm's leverage on a consolidated basis.
JFIN's liquidity resources included unrestricted cash on the
balance sheet, which amounted to $192.2 million at Nov. 30, 2020,
available equity capital commitments from Jefferies and MassMutual
of $195.2 million on a combined basis, and availability under
fronting facilities of $1.1 billion. JFIN also had $855.6 million
of undrawn capacity under warehouse facilities at fiscal YE20, and
revolving capacity in term CLOs and revolver CLOs. Cash balances
are volatile over time as they are based on the amount of
transactions fronted with balance sheet cash. If adjusted for the
repayment of transactions fronted with cash, JFIN noted that
liquidity from cash, available equity commitments, fronting lines
and certain credit facilities would have been approximately $2.7
billion at fiscal YE20.
Fitch believes JFIN has sufficient liquidity to meet its potential
obligations. Revolver draws declined to around 13% at fiscal YE20
from a peak of 63% following the onset of the coronavirus pandemic.
While the level of revolver draws could increase from current
levels, JFIN has been managing its unfunded direct exposure through
revolver CLOs, strategic sales and participation programs, which
have provided the firm with enhanced ability to fund its revolvers.
At Nov. 30, 2020, JFIN's undrawn commitments to borrowers amounted
to $2.8 billion; about $1.3 billion of which could be funded with
CLOs and CLO warehouse capacity.
JFIN's funding profile was fully secured at Nov. 30, 2020. Fitch
believes an unsecured funding component enhances funding
flexibility, particularly in times of stress and, therefore, viewed
the repayments of unsecured debt over the past two years
unfavorably. Still, Fitch recognizes the benefits to fixed charge
coverage resulting from the reduction in interest expense and views
JFIN's funding profile as relatively diverse for its rating. Fitch
believes JFIN's unsecured debt issuance will remain opportunistic
over time as CLOs remain a cost-effective way to fund the loan
portfolio.
The 'BB+' rating assigned to the senior secured priority revolving
credit facility is one notch above the IDR, reflecting Fitch's
expectation for good recovery prospects given strong asset coverage
and the relatively low portion of first-out debt in JFIN's funding
profile.
The 'BB' secured debt rating is equalized with the IDR, reflecting
Fitch's expectation for average recovery prospects under a stress
scenario.
SUBSIDIARIES AND AFFILIATED COMPANIES
The long-term IDR and debt ratings of JFIN Co-Issuer Corporation
are equalized with those of its parent, JFIN. JFIN Co-Issuer
Corporation is essentially a shell finance subsidiary, with no
material operations and is a co-issuer on the corporate revolver,
secured term loan and secured notes.
RATING SENSITIVITIES
IDRs AND SENIOR DEBT
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
-- Fitch believes the likelihood of a ratings upgrade over the
medium term is limited given the recent deterioration in
credit metrics amid the challenging economic backdrop. Longer
term, positive rating momentum could be driven by enhanced
funding diversity, including the addition of an unsecured
funding component, a decline in leverage approaching 3.0x, a
continued improvement in the firm's liquidity profile,
particularly as it relates to undrawn revolver commitments, as
well as evidence of strong asset quality performance of the
funded loan portfolio, increased revenue diversity, and
improved consistency of operating performance over time.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
-- An increase in total debt to tangible equity above 5.0x, non
funding debt to equity approaching or exceeding the covenanted
level, a material weakening in liquidity, meaningful
deterioration in asset quality, an extended inability to
syndicate transactions which results in material operating
losses and/or weakens the firm's reputation and market
position, or a change in the firm's relationships with
Jefferies and/or MassMutual could lead to negative rating
momentum.
-- The super senior debt and secured debt ratings are sensitive
to changes in JFIN's Long-Term IDR and to the relative
recovery prospects of the instruments. The debt ratings are
expected to move in tandem with JFIN's Long-Term IDR, although
the notching could change if there is a significant shift in
the levels of first-out or other secured debt.
SUBSIDIARIES AND AFFILIATED COMPANIES
JFIN Co-Issuer Corporation's ratings are expected to move in tandem
with JFIN's ratings.
BEST/WORST CASE RATING SCENARIO
International scale credit ratings of Financial Institutions and
Covered Bond 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.
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.
KEIVANS HOSPITALITY: Unsecureds Unimpaired in Amended Plan
----------------------------------------------------------
Keivans Hospitality, LLC, submitted a Third Amended Plan Of
Reorganization.
The Plan is a plan of reorganization. The Debtor shall continue
the operation of its business after confirmation of the Plan. The
Debtor's business consists of ownership and operation of a Hilton
Garden Inn located at 2409 Texmati Drive, Katy, Texas 77494. The
Debtor's business was negatively impacted by the effects of the
COVID-19 pandemic since March of 2020. The Plan will be funded
through income earned from continued operation of the hotel.
Class 2 Secured Noteholder's claim will be fixed as of March 31,
2020, in the amount of $7,998,245. Upon receipt of the $525,000 to
be paid by the Mousavi to the Secured Noteholder, the Secured
Noteholder will dismiss without prejudice its pending lawsuit in
the United States District Court for the Southern District of Texas
against Mousavi. The Secured Noteholder will thereafter not
exercise any remedies against Mousavi under the Guaranty unless and
until there is a post-confirmation default under the Plan, the
Guaranty or the Loan Documents. Class 2 is impaired.
Class 4 Allowed Unsecured Claims will be paid on the first day of
the month following the Effective Date and every month thereafter
for 60 months until paid in full. Such claims shall accrue interest
at 3 percent until paid. Class 4 is unimpaired under the Plan.
Attorneys for the Debtor:
Timothy L. Wentworth
OKIN ADAMS LLP
1113 Vine ST., Suite 240
Houston, Texas 77002
Tel: 713.228.4100
Fax: 888.865.2118
twentworth@okinadams.com
A copy of the Third Amended Plan Of Reorganization is available at
https://bit.ly/3tsovIi from PacerMonitor.com.
About Keivans Hospitality
Based in Katy, Texas, Keiv Hospitality, LLC, operates a Hampton Inn
and Suites hotel located at 22055 Freeway, Katy, Harris County
Texas. Keivans Hospitality, Inc. operates a Hilton Garden Inn
hotel located at 2509 Texmati Drive, Katy, Harris County, Texas.
Keiv Hospitality and Keivans Hospitality sought protection under
Chapter 11 of the Bankruptcy Code (Bankr. S.D. Tex. Lead Case No.
20-34408) on Sept. 1, 2020. Ben Mousavi, owner, signed the
petition.
At the time of the filing, Keiv Hospitality estimated assets of
between $1 million and $10 million and liabilities of the same
range while Keivans Hospitality had estimated assets of between $10
million and $50 million and liabilities of between $1 million and
$10 million.
Judge Jeffrey P. Norman oversees the cases.
The Debtors tapped Okin Adams LLP as legal counsel and Moore Tax
Services, Inc., as accountant.
KNOW LABS: Closes $14.2 Million Financing Led by Existing Investors
-------------------------------------------------------------------
Know Labs, Inc. has closed on $14.2 million of financing largely
led by existing investors and insiders.
The financing is another step in the Company's plans to up list on
a major exchange, either NASDAQ or the NYSE, and supports
continuing development and clinical testing on its platform
technology with its first focus on non-invasive blood glucose
monitoring, and future FDA approval. The current financing
provides sufficient capital so that management can ensure product
development stays on track and an up list to a major exchange is
event driven rather than driven by a need for capital.
As previously stated, the Company believes an up list to a major
exchange will:
* Provide additional opportunities to attract institutional and
retail investors, allowing the Company to broaden its investor
base in the United States and internationally;
* Increase the visibility of the Company, its growth strategy,
accomplishments and results to date;
* Enable an aggressive growth strategy;
* Increase liquidity of the Company's common shares; and
* Raise the Company's overall profile and ultimately enhance
shareholder value.
Product development and clinical testing remain focused on:
* Relationships with internationally recognized clinical
research
institutions to perform laboratory-based validation testing to
confirm internal test results;
* Continued work on miniaturization of the Know Labs platform
diagnostic technology, internal testing and refinement of the
use of its trade secret algorithms for exacting determination
of the platform's first use in determining blood glucose
levels;
* Expanding the Company's Intellectual Property portfolio;
* Preparation for submitting the Know Labs technology to the
FDA
for approval of its non-invasive blood glucose monitoring
technology; and
* Providing support to its Particle subsidiary as it launches
its
disinfecting light bulb into the marketplace.
About Know Labs
Know Labs, Inc., was incorporated under the laws of the State of
Nevada in 1998. Since 2007, the Company has been focused primarily
on research and development of proprietary technologies which can
be used to authenticate and diagnose a wide variety of organic and
non-organic substances and materials. The Company's Common Stock
trades on the OTCQB Exchange under the symbol "KNWN."
Know Labs reported a net loss of $13.56 million for the year ended
Sept. 30, 2020, compared to a net loss of $7.61 million for the
year ended Sept. 30, 2019. As of Dec. 31, 2020, the Company had
$3.22 million in total assets, $7.87 million in total current
liabilities, $14,602 in total non-current liabilities, and a total
stockholders' deficit of $4.66 million.
BPM LLP, in Walnut Creek, California, the Company's auditor since
2019, issued a "going concern" qualification in its report dated
Dec. 29, 2020, citing that the Company has sustained a net loss
from operations and has an accumulated deficit since inception.
These factors raise substantial doubt about the Company's ability
to continue as a going concern.
LATAM AIRLINES: Aims to Conclude Restructuring by December
----------------------------------------------------------
Aviation Week reports that LATAM Airlines Group aims to exit
Chapter 11 bankruptcy by the end of 2021 and believes its
restructuring process will improve the company's competitive
position going forward, particularly in key markets such as
Colombia.
According to Flight Global, LATAM Group CEO Roberto Alvo described
the closure of LATAM Airlines Argentina in June 2020 as a "very
hard decision", and told a CAPA Live event on March 10, 2021, that
"a problem always brings an opportunity, and now we can refocus our
resources where we believe we have a better chance of succeeding".
That means the group -- most of which is restructuring under US
Chapter 11 protection -- is "looking into the Colombian market,
which is the second-largest market in the region".
About LATAM Airlines SA
LATAM Airlines Group S.A. -- http://www.latam.com/-- is a
pan-Latin American airline holding company involved in the
transportation of passengers and cargo and operates as one unified
business enterprise.
LATAM Airlines Group S.A. is the largest passenger airline in South
America. Before the onset of the COVID-19 pandemic, LATAM offered
passenger transport services to 145 different destinations in 26
countries, including domestic flights in Argentina, Brazil, Chile,
Colombia, Ecuador and Peru, and international services within Latin
America as well as to Europe, the United States, the Caribbean,
Oceania, Asia and Africa.
LATAM Airlines Group S.A. and its 28 affiliates sought Chapter 11
protection (Bankr. S.D.N.Y. Lead Case No. 20-11254) on May 25,
2020. Affiliates in Chile, Peru, Colombia, Ecuador and the United
States are part of the Chapter 11 filing.
The Debtors disclosed $21,087,806,000 in total assets and
$17,958,629,000 in total liabilities as of Dec. 31, 2019.
The Hon. James L. Garrity, Jr., is the case judge.
The Debtors tapped Cleary Gottlieb Steen & Hamilton LLP as general
bankruptcy counsel; FTI Consulting as restructuring advisor; and
Togut, Segal & Segal LLP and Claro & Cia in Chile as special
counsel. Lee Brock Camargo Advogados, is the Debtors' local
Brazilian litigation counsel to the Debtors. Prime Clerk LLC is the
claims agent.
The Official Committee of Unsecured Creditors formed in the case
tapped Dechert LLP as its lead counsel, UBS Securities LLC, as
investment banker, and Conway MacKenzie, LLC. Klestadt Winters
Jureller Southard & Stevens, LLP is the conflicts counsel. Ferro
Castro Neves Daltro & Gomide Advogados, is the Committee's
Brazilian counsel.
The Ad Hoc Group of LATAM Bondholders tapped White & Case LLP as
counsel.
LE JARDIN HOUSE: $795K Sale of Condo Unit 404 to Edelkopfs Approved
-------------------------------------------------------------------
Judge Robert A. Mark of the U.S. Bankruptcy Court for the Southern
District of Florida entered a final order authorizing Le Jardin
House, LLC's sale of the real property located at 1150 102nd
Street, Condo Unit 404, in Bay Harbor Island, Florida, to Levi
Edelkopf and Shterna S. Edelkopf for $795,000.
A hearing on the Motion was held on March 11, 2021, at 11:30 a.m.
The Debtor owns the Property, and is also the developer of the
30-unit condominium project located on the Property commonly
referred to as Le Jardin Residences.
Upon timely receipt of the entirety of the Closing Proceeds from
the Buyers, the Debtor is authorized and empowered to fully perform
under, consummate and implement the terms of the Sale.
The sale is free and clear of all liens, claims, encumbrances and
interests of every kind and nature
Notwithstanding the foregoing: (a) an executed Special Warranty
Deed with respect to Unit 404; (b) a bill of sale; (c) a closing
statement; (d) a closing affidavit, and (e) a copy of the Final
Sale Order, will be the only documents the Debtor is required to
deliver to the Buyers to convey clean and marketable title.
At closing, the Debtor is authorized to and will pay, without
further order of the Court: (a) all amounts necessary to satisfy
all ad valorem real property tax liens on Unit 404, if any; (b) the
estate's prorated portion of 2019 ad valorem real property taxes on
Unit 404, if any; (c) $95% of the net proceeds from closing to
Titan in partial satisfaction of the First Mortgage; (d) $3,445.21
to DevStar pursuant to the DevStar Settlement; (e) $6,049.49 to
ItalKraft pursuant to the ItalKraft Settlement and ECF #169; (f)
all reasonable and customary closing expenses including all fees
claimed due to any buyer's cooperating broker; (g) all reasonable
and customary closing expenses including all fees and attorneys’
fees due to any closing agent or other professional assisting in
the Debtor in the closing as provided in ECF # 37; (h) all
applicable transfer stamps and other local, municipal, county,
state or federal fees (if any); (i) the Deposit to the Original 404
Buyer, in the amount of $378,595; and (j) any other items that the
Debtor determines, in the sound exercise of his business judgment,
are usual and customary closing expenses necessary to effectuate
the sale and transfer of Unit 404 to the Buyers free and clear of
all liens, claims, encumbrances and interests.
At closing, Titan is directed to execute all reasonably requested
documents necessary to release its liens on Unit 404. At closing,
DevStar is directed to execute all documents necessary to release
its liens on Unit 404.
The Debtor is further authorized, if it so chooses, to permit the
closing agent to make the authorized disbursements at closing and
remit the net proceeds to the estate, with such receipts and
disbursements to be recorded in the estate's accounting records as
if the estate received the entirety of the sale proceeds and
subsequently disbursed same and the Debtor will file a HUD
Settlement Statement from closing with the requisite quarterly
operating report and account for all disbursements made at Closing.
The Debtor will send the final HUD Settlement Statement to Titan
for approval prior to Closing. If a dispute arises with respect to
any aspect of the HUD Settlement Statement, Titan and the Debtor
will endeavor to resolve such issues amicably and if unable to do
so may ask intervention by the Court.
The provisions of Bankruptcy Rule 6004(h) will not apply to stay
consummation of the sale of the estate's right, title and interest
in Unit 404. The Final Sale Order will be effective and
enforceable immediately upon entry.
About Le Jardin House
Le Jardin House, LLC is a single asset real estate debtor (as
defined in 11 U.S.C. Section 101(51B)). Le Jardin is the fee
simple owner of a property located at 1150 102nd St., Bay Harbor
Island, Fla., valued by the company at $26.21 million.
Le Jardin House sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. S.D. Fla. Case No. 19-19182) on July 11,
2019. At the time of the filing, the Debtor disclosed $27,490,523
in assets and $7,167,406 in liabilities. The case is assigned to
Judge Robert A. Mark. Edelboim Lieberman Revah Oshinsky PLLC is
the Debtor's bankruptcy counsel.
On Feb. 5, 2020, the Court confirmed the Debtor's Plan of
Reorganization.
LOUISIANA HIGHWAY: Gets OK to Hire Maestri-Murrell as Broker
------------------------------------------------------------
Louisiana Highway St. Gabriel, LLC received approval from the U.S.
Bankruptcy Court for the Middle District of Louisiana to employ
Maestri-Murrell, Inc. as real estate broker.
The firm will market and sale the Debtor's real property located at
3825 LA Highway. 30, Saint Gabriel, La.
Denis Murrell, a partner at Maestri-Murrell, disclosed in a court
filing that his firm is a "disinterested person" as the term is
defined in Section 101(14) of the Bankruptcy Code.
The firm can be reached at:
Denis Murrell
Maestri-Murrell, Inc.
9018 Jefferson Hwy.
Baton Rouge, LA 70809
Tel: (225) 298-1250
Fax: 225.298.1251
About Louisiana Highway St. Gabriel
Louisiana Highway St. Gabriel, LLC and five affiliates filed their
voluntary petitions for relief under Chapter 11 of the Bankruptcy
Code (Bankr. M.D. La. Lead Case No. 20-10824) on Dec. 17, 2020. At
the time of the filing, Louisiana Highway had estimated assets of
less than $50,000 and liabilities of between $500,001 and $1
million.
Judge Douglas D. Dodd oversees the case.
William H. Patrick, III, Esq., at Fishman Haygood LLP, serves as
the Debtors' counsel.
MADDOX FOUNDRY: Court Extends Plan Exclusivity Thru April 5
-----------------------------------------------------------
At the behest of the Debtor Maddox Foundry & Machine Works, LLC,
Judge Karen K. Specie of the U.S. Bankruptcy Court for the Northern
District of Florida, Gainesville Division extended the period in
which the Debtor may file a Chapter 11 plan until and through April
5, 2021.
The Debtor is in the process of drafting a plan of reorganization
that will incorporate the relevant portions of the agreed order
with the goal that its primary creditor will support it. While the
Debtor anticipates filing a plan and disclosure statement prior to
the deadline, the Debtor remains in negotiations with creditors,
and such negotiations may extend past the exclusivity deadline.
With the extension, the Debtor will be able to continue the
negotiations with creditors and finish the process of drafting the
plan and disclosure statement.
A copy of the Court's Extension Order is available at
https://bit.ly/3lj2EQO from PacerMonitor.com.
About Maddox Foundry & Machine Works
Maddox Foundry & Machine Works, LLC, a company that operates a
foundry machine shop, sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. N.D. Fla. Case No. 20-10211) on October 7,
2020. At the time of the filing, the Debtor disclosed assets of
$500,000 and liabilities of $4.495 million.
Judge Karen K. Specie oversees the case. Seldon J. Childers, Esq.,
at ChildersLaw, LLC, serves as the Debtor's legal counsel and Dawn
Moesser, ASA, of ICS Asset Management Services, Inc. as the
Debtor's appraiser.
MAIREC PRECIOUS: Trustee's Sale of Sample Containers Approved
-------------------------------------------------------------
Judge Helen E. Burris of the U.S. Bankruptcy Court for the District
of South Carolina authorized Janet B. Haigler, the Liquidating
Trustee of Mairec Precious Metals U.S., Inc., to sell free and
clear of liens the estate's interest in numerous sample containers
containing fine recycled metal powder collected since the inception
of its business and used for chemical testing and/or assays to
Northam Platinum Limited for $60.25 a pound net material weight.
The Trustee is authorized to reimburse herself from the sale
proceeds for the $188 paid by the Trustee for the notice of sale
filing fee.
About Mairec Precious Metals U.S.
Mairec Precious Metals U.S., Inc., specializes in the recovery of
precious metals including gold, silver, platinum, palladium or
rhodium from various materials containing them. The Company
collects and recycles car catalysts, industrial catalysts,
electronic scrap, various sweeps and concentrates and other
industrial waste.
Mairec Precious Metals U.S. filed for Chapter 11 bankruptcy
protection (Bankr. D.S.C. Case No. 19-01198) on March 1, 2019. In
the petition signed by CRO David M. Baker, the Debtor was
estimated
to have $50 million to $100 million in assets and $10 million to
$50 million in liabilities.
The case has been assigned to Judge Helen E. Burris.
The Debtor tapped McCarthy, Reynolds, & Penn, LLC as its counsel,
and SSG Advisors, LLC, as its investment banker.
The Office of the U.S. Trustee appointed a committee of unsecured
creditors on March 13, 2019. The committee is represented by Beal,
LLC.
MARINE BUILDERS: March 25 Hearing on Myron Auction of All Assets
----------------------------------------------------------------
Judge Andrea K. McCord of the U.S. Bankruptcy Court for the
Southern District of Indiana granted the request of Marine
Builders, Inc., and Marine Industries Corp. to shorten the notice
period on their proposed sale of substantially all of Marine
Builders' assets by way of a public auction and all of Marine
Industries' inventory by way of a sealed bid auction conducted by
Myron Bowling Auctioneers, Inc., free and clear of liens.
A telephonic hearing on the Motion is set for March 25, 2021, at
9:30 a.m. (ET) (Dial-in No.: (877) 873-8018; Access Code: 1337825).
The Objection Deadline is March 24, 2021.
About Marine Builders
Marine Builders -- http://www.marinebuilders.net/-- is a
family-owned and operated company in the boat building business.
With 26-acre site and 14,000-square-foot of fabrication shop,
Marine Builders has both new construction and repair capabilities.
Founded in 1972, Marine Builders manufactures custom vessels,
ranging from work boats and barges to dry docks and excursion
vessels. Its subsidiary, Marine Industries Corporation, primarily
operates in the marine supplies business.
Marine Builders and Marine Industries filed voluntary petitions
for
relief under Chapter 11 of the Bankruptcy Code (Bank. S.D. Ind.
Lead Case No. 19-90632) on April 25, 2019. In the petitions
signed
by David A. Evanczyk, president and CEO, the Debtors estimated $1
million to $10 million in both assets and liabilities. The cases
are assigned to Judge Basil H. Lorch III. James R. Irving, Esq.,
at Bingham Greenebaum Doll LLP, represents the Debtors as counsel.
MARINE BUILDERS: Proposes Myron Auction of Substantially All Assets
-------------------------------------------------------------------
Marine Builders, Inc., and Marine Industries Corp. ask the U.S.
Bankruptcy Court for the Southern District of Indiana to authorize
the sale of substantially all of Marine Builders' assets by way of
a public auction and all of Marine Industries' inventory by way of
a sealed bid auction conducted by Myron Bowling Auctioneers, Inc.
Prior to the Petition Date, Marine Builders and WesBanco entered
into a promissory note in the original principal amount of $955,000
(as amended from time to time, "MBI Note").
On Jan. 25, 2012, to secure repayment of the MBI Note, Marine
Builders executed and delivered to WesBanco a Preferred Ship
Mortgage, and a Commercial Security Agreement granting WesBanco a
security interest in, among other things, all of Marine
Builders’s inventory, equipment, and accounts, now existing and
hereafter arising and acquired, including the vessel the Jenny
Lynne ("MBI Personal Property"), and all proceeds thereof ("MBI
Cash Collateral").
On Sept. 29, 2015, WesBanco filed a UCC-1 Financing Statement in
the Office of the Secretary of State of Kentucky as File No.
2015-2792086-21.01 perfecting its security interest in the MBI
Personal Property and MBI Cash Collateral. As of the Petition
Date, there is at least $881,197.21 due on the MBI Note.
On April 7, 2005, Marine Industries executed and delivered to
WesBanco a promissory note ("MIC Note"), in the original principal
amount of $250,000. The principal amount was later increased to
$600,000. On the same date, to secure repayment of the MIC Note,
Marine Industries executed and delivered to WesBanco a Commercial
Security Agreement granting WesBanco a security interest in, among
other things, all of its personal property, now existing and
hereafter acquired and wherever located, and all proceeds thereof.
On April 11, 2005, WesBanco filed a UCC-1 Financing Statement, in
the Office of the Secretary of State of Indiana as File No.
200500003271080 perfecting its security interest in the MIC
Personal Property and MIC Cash Collateral. As of the Petition
Date, there is at least $602,175.71 due on the MIC Note.
WesBanco filed proofs of claim [MBI Claim No. 7 and MIC Claim No.
4] that are secured by the Debtors'’ collateral, including the
vessel the Jenny Lynne. As adequate protection, WesBanco was
granted a lien on the Jenny Lynne to secure the obligations owed
under the MBI Claim and the MIC Claim. See Docket No. 64. As of
Dec. 20, 2019, the outstanding principal of the MBI Note was
$757,644.67, and the outstanding interest was $65,597.19, plus
other fees and costs. The outstanding principal of the MIC Note is
$557,589.41, with interest of at least $23,621.31, plus other fees
and costs.
On Nov. 23, 2020, the Court entered an Order Approving Agreed
Entry, thereby approving the Agreed Entry by and Among the Debtors
and WesBanco Bank Inc. with Respect to the Potential sale of the
Jenny Lynne. On Nov. 25, 2020, the Court entered the Jenny Lynne
Sale Order. Following an auction of the Jenny Lynne on Nov. 28,
2020, the Debtors and Daniel F. Coosemans as purchaser closed on
the sale of the Jenny Lynne for a sale price of $750,000, $37,500
of which was paid to the broker, Worth Avenue Yacht Sales. The
remainder of the sale price was paid to WesBanco towards the
amounts due under the Promissory Notes.
As of the Petition Date, NWSB holds claims against Marine Builders
with principal, interest, and fees in an approximate aggregate
amount of $2,307,438.66, which are outstanding under the terms of
various promissory notes. This claim is secured by a junior lien
on all accounts and equipment. It is further secured by a mortgage
on real property on which the Debtors operate, which real property
is owned by a trust for the benefit of the family of the Debtors'
principals. As of the Petition Date, NWSB holds a claim against
Marine Industries with principal, interest, and fees in an
approximate amount of $6,327.24, which is outstanding under the
terms of a promissory note.
The Debtors and Myron Bowling have agreed for the Auctioneer to
conduct auctions for the sale of substantially all of the Debtors'
equipment, inventory, and other tangible assets, upon the terms set
forth in the Auction Proposal submitted by the Auctioneer. The
parties' agreement to proceed with the Proposal is subject to
Approval of the Court of the instant Motion and the
contemporaneously filed application to retain and employ the
Auctioneer.
Under the terms of the Proposal, MBA will not seek any Seller's
commission to be charged to the Debtors or the Debtors' bankruptcy
estates in connection with their retention or the auction of any of
their assets. Instead, MBA will charge and retain an 18% buyer's
premium on auction sales. Further, MBA will seek to sell Marine
Industries’ new parts retail inventory ("MIC New Inventory") via
private treaty at no charge to the Debtors. MBA will, however, be
allowed reimbursement of expenses up to the amount of $40,000,
which will be deducted from the auction proceeds after the auction.
The Debtors propose to allow for payment of buyer's premiums by
any buyers of the Debtors' assets, and to allow for reimbursement
of MBA for expenses up to $40,000 with the proceeds of the auction,
without further leave from the Court.
MBA will charge and any buyer will pay the buyer's premium in
addition to the amount of the winning bid for any of the Debtors'
assets, which buyer's premium will inure to the benefit of MBA
prior to the further distribution of net sale proceeds. Its
allowed expenses up to the amount of $40,000 will also be
reimbursed from proceeds prior to the further distribution of the
net sale proceeds. The Debtors will disclose and provide notice of
the amount of expenses allowed to MBA in the report of sale to be
filed in the Chapter 11 Cases. The Debtors submit that allowance
and approval of such compensation arrangement without further leave
of the Court will eliminate additional and unnecessary
administrative expenses associated with the preparation of a
subsequent fee application as the Debtors seek to resolve the
Chapter 11 Cases following the auction process.
As of the date of the filing of the Motion, available information
concerning the proposed auction is as follows:
a. Property to Be Sold: Substantially all of the Debtors'
scheduled equipment, inventory, and other tangible asset excluding
any property or inventory that is a container of liquid product
that has been opened or used.
b. Auctioneer: Myron Bowling Auctioneers, Inc.
c. Auctioneer Contact Information: Myron Bowling Auctioneers,
Inc., c/o Kevin Gamm, Managing Partner, P.O. Box 369, Ross, Ohio
45061; telephone: 513.738.3311; facsimile: 513.738.021; email:
kevin@myronbowling.com.
d. Date, Time, and Location of Auction: No Auction(s) has
been scheduled at this time. The Auctioneer will begin to market
the Debtors’ assets immediately following Bankruptcy Court
approval of the sale and execution of a final agreement. It will
conduct the Auction(s) approximately 45 days following Bankruptcy
Court approval and agreement. The Debtors will promptly file with
the Bankruptcy Court a notice of the date(s) set for any Auction.
With the exception of the MIC New Inventory, the Auctioneer will
sell the Debtors' Assets at auction on a buyer's premium basis, and
will not charge a seller's commission to the Debtor or their
bankruptcy estates. The Auctioneer will offer the MIC New
Inventory for sale via private treaty at no charge to the Debtors
or their bankruptcy estates. An expense allowance of $40,000 will
be deducted from the auction proceeds after the auction. The
Debtors propose that the net proceeds from the sale will be
distributed to WesBanco and applied against outstanding amounts
owed under the Promissory Notes. In exchange for the application
of the net proceeds of the sale solely to WesBanco, the Debtors
understand that WesBanco may agree to waive all adequate protection
payments accrued and going forward and to consent to the Debtors'
use of the proceeds of their accounts receivable and cash as
proposed.
Specifically, the Debtors propose to use the proceeds of their
accounts receivable and cash to first remit $55,000 to NWSB. Next,
they will use the proceeds of their accounts receivable and cash to
pay administrative expense claims. The administrative expense
claims to be paid include, in no order of priority: (i) employee
wages, (ii) U.S. Trustee fees, (iii) professional fees incurred by
the Debtors' professionals, and (iv) other post-bankruptcy expenses
and taxes. The Debtors have been in discussions with WesBanco and
NWSB regarding the foregoing and believe they may obtain the
support of WesBanco and NWSB with respect to the foregoing proposal
and the relief requested herein prior to a hearing on the Motion.
The Debtors further ask the Court to authorize them to sell the
assets free and clear of all liens, with any such liens attaching
to the sale proceeds of the assets to the extent applicable.
Finally, the Debtors ask that the Sale Order be effective
immediately by providing that the 14-day stays under Bankruptcy
Rules 6004(h) and 6006(d) are waived, or, in the alternative, if an
objection to the sale is filed, the Court reduces the stay period
to the minimum amount of time needed by the objecting party to file
its appeal.
The Debtors have filed a separate motion asking to shortened notice
and an expedited telephonic hearing on this Motion at the hearing
currently scheduled for March 25, 2021, at 9:30 a.m. (ET) before
the Honorable Andrea K. McCord.
About Marine Builders
Marine Builders -- http://www.marinebuilders.net/-- is a
family-owned and operated company in the boat building business.
With 26-acre site and 14,000-square-foot of fabrication shop,
Marine Builders has both new construction and repair capabilities.
Founded in 1972, Marine Builders manufactures custom vessels,
ranging from work boats and barges to dry docks and excursion
vessels. Its subsidiary, Marine Industries Corporation, primarily
operates in the marine supplies business.
Marine Builders and Marine Industries filed voluntary petitions
for
relief under Chapter 11 of the Bankruptcy Code (Bank. S.D. Ind.
Lead Case No. 19-90632) on April 25, 2019. In the petitions
signed
by David A. Evanczyk, president and CEO, the Debtors estimated $1
million to $10 million in both assets and liabilities. The cases
are assigned to Judge Basil H. Lorch III. James R. Irving, Esq.,
at Bingham Greenebaum Doll LLP, represents the Debtors as counsel.
MARINE BUILDERS: Seeks to Shorten Notice Period on Sale of Assets
-----------------------------------------------------------------
Marine Builders, Inc., and Marine Industries Corp. ask the U.S.
Bankruptcy Court for the Southern District of Indiana to shorten
the notice period on their proposed sale of substantially all of
Marine Builders' assets by way of a public auction and all of
Marine Industries' inventory by way of a sealed bid auction
conducted by Myron Bowling Auctioneers, Inc.
The Debtors are winding down operations and propose to liquidate
their assets on an expedited basis and as soon as commercially
practicable.
On March 4, 2021, WesBanco Bank, Inc. filed its Motion to Terminate
Automatic Stay and Abandon Collateral. On March 10, 2021, The New
Washington State Bank ("NWSB") filed its Notice of Joinder to
Motion to Terminate Automatic Stay and Abandon Collateral. The
foregoing are set for hearing on March 25, 2021, at 9:30 a.m. (ET).
The Debtors respectfully submit that, in the interest of
efficiency, the Underlying Motion should come on for hearing at the
same time as WesBanco's and NWSB's requests regarding stay relief
as to the Debtors' assets. Moreover, reasonably limiting notice of
the Underlying Motion as requested will allow the Debtors to move
forward with the auction process more quickly and efficiently if
the Underlying Motion is granted.
The Debtors therefore ask entry of an order shortening the notice
period on the Underlying Motion and scheduling a telephonic hearing
on the Underlying Motion at the hearing currently scheduled in the
above-captioned chapter 11 cases for March 25, 2021, at 9:30 a.m.
(ET).
About Marine Builders
Marine Builders -- http://www.marinebuilders.net/-- is a
family-owned and operated company in the boat building business.
With 26-acre site and 14,000-square-foot of fabrication shop,
Marine Builders has both new construction and repair capabilities.
Founded in 1972, Marine Builders manufactures custom vessels,
ranging from work boats and barges to dry docks and excursion
vessels. Its subsidiary, Marine Industries Corporation, primarily
operates in the marine supplies business.
Marine Builders and Marine Industries filed voluntary petitions
for
relief under Chapter 11 of the Bankruptcy Code (Bank. S.D. Ind.
Lead Case No. 19-90632) on April 25, 2019. In the petitions
signed
by David A. Evanczyk, president and CEO, the Debtors estimated $1
million to $10 million in both assets and liabilities. The cases
are assigned to Judge Basil H. Lorch III. James R. Irving, Esq.,
at Bingham Greenebaum Doll LLP, represents the Debtors as counsel.
MCAFEE LLC: Fitch Affirms 'BB-' LongTerm IDR, Outlook Stable
------------------------------------------------------------
Fitch Ratings has affirmed McAfee, LLC's Long-Term (LT) Issuer
Default Rating (IDR) at 'BB-' with a Stable Rating Outlook. Fitch
has also affirmed McAfee's senior secured credit facility at
'BB'/'RR2'.
The affirmations reflect the company's strong profitability,
positive FCF profile, a leading market position supported by
positive brand reputation, weaker leverage metrics relative to
peers, and tailwinds in the cybersecurity market as IT security
threats become increasingly complex.
McAfee plans to divest its enterprise cyber security segment to a
Consortium led by Symphony Technology Group and become a pure play
consumer cybersecurity company. Proceeds from the $4 billion all
cash deal will be used to cover transaction fees, pay a special
dividend, and pay down $1.0 billion in term loan debt. Fitch
believes the loss of scale and revenue diversity from the sale of
the Enterprise segment are offset by the leverage neutral nature of
the transaction and by higher margins and growth rates in the
Consumer segment.
KEY RATING DRIVERS
Moderate Leverage Profile: McAfee's current leverage is 3.9x.
Although the sale of the Enterprise segment will result in the loss
of roughly half of revenue and a third of EBITDA, debt prepayments
of $1 billion will result in the transaction being largely leverage
neutral. Fitch is projecting leverage to trend down to 2.9x over
the rating horizon, consistent with other 'BB' companies.
Narrower Product Focus: Fitch expects the loss of the Enterprise
segment to result in a leaner, more focused and higher margin
company. Following the divestiture McAfee will lose about half of
its revenue base along with a third of EBITDA, but the remaining
company will have increased EBITDA margins in the high 40% to low
50% range as well as a higher growth rate. In recent years high
growth and margins at the Consumer segment have been held back by
underperformance in the Enterprise segment. Although scale and
revenue diversity will decrease substantially following transaction
Fitch believes this is offset by the stronger operating profile of
the new company, which will be better able to focus on its core
growth areas.
IT Security Threats Increasingly Complex: IT security threats have
evolved from PC-centric to mobile devices, networks, and user
identities. The evolving threats enable a continuous stream of
niche solutions to develop, addressing threats beyond the
traditional PC-centric security to protect users, data and networks
at various levels of the internet. While some of these solutions
were developed by legacy cybersecurity providers, many were created
by suppliers with narrow expertise. McAfee recently has placed an
increased emphasis on providing security to mobile devices in order
to align its product offerings to modern computing habits.
Reliance on Channel Partners: McAfee relies on channel partnerships
as a key part of their go-to-market strategy, notably signing a
five-year global agreement to provide consumer security on ASUS PC
product as well as renewing a deal to sell security products on
Costco.com. The loss of, or failure to sign new channel partners,
could result in growth headwinds for McAfee.
Fragmented Industry: The cyber security market is highly fragmented
with a high number of smaller providers continuing to remain
relevant by providing niche solutions to emerging threats. McAfee
benefits from a positive brand reputation as well as key channel
partnerships to maintain share in fragmented market. Additionally,
Fitch believes that the high number of smaller providers offers a
wealth of acquisition targets for a competitor of McAfee's size.
DERIVATION SUMMARY
McAfee's 'BB-' rating is supported by consistently positive FCF,
adequate liquidity and LTM gross leverage of 3.9x. Fitch expects
the company to maintain EBITDA margins in the high-40% range
following the divestiture of the Enterprise segment. Fitch believes
the remaining company will have a similar operational profile to
pure play consumer cybersecurity peer NortonLifeLock, Inc.
(BB+/Stable) following the divestiture although the leverage
profile is expected to remain elevated over the rating horizon.
Although McAfee is expected to significantly increase margins and
revenue growth following the transaction, Fitch notes potential
execution risks, decreased scale, and decreased revenue diversity
as offsetting factors.
KEY ASSUMPTIONS
-- Transaction closes in second half of 2021;
-- Transaction results in double digit revenue declines in 2021
and 2022 as the company experiences a half year and full year
without Enterprise segment revenues, respectively;
-- EBITDA margins increase to high-40% range following the
divestiture;
-- FCF margins increase to low-30% range following the
divestiture;
-- $1 billion in debt prepayments in 2021;
-- $2.5 billion special dividend in 2021 along with $500 million
in transaction expenses in 2021;
-- No substantial acquisitions over rating horizon.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
-- Fitch's expectation of Gross Leverage as estimated by Total
Debt with Equity Credit/Operating EBITDA below 3.5x;
-- Fitch's expectation of sustained market share growth resulting
in material accretive ARPC gains.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
-- Fitch's expectation of Gross Leverage as estimated by Total
Debt with Equity Credit/Operating EBITDA above 4.5x;
-- Fitch's expectation of sustained market share loss resulting
in ARPC erosion.
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
Current liquidity at McAfee consists of $660 million in revolver
availability as well as $231 million in available cash.
As of Dec. 26, 2020, debt at the company consists of a $164 million
revolver due 2022 with no current borrowings, a $500 million
revolver maturing 2024 with no current borrowings, a $3,179 million
first-lien term loan due September 2024, with $2,701 million
outstanding, a EUR1,073 term loan due September 2024 with $1,298
equivalent in Euros outstanding using Dec. 26, 2020 exchange
rates.
The company's USD denominated first lien debt accrues interest at L
+ 375 and the company's first lien EUR debt accrues interest at E +
350. The first lien term loans amortize at a rate of 1% of
principal annually, payable quarterly. Following the Enterprise
segment divestiture the company intends to prepay $1 billion of
term loan debt.
SUMMARY OF FINANCIAL ADJUSTMENTS
-- Fitch has made no material financial adjustments.
MEDLEY LLC: U.S. Trustee Unable to Appoint Committee
----------------------------------------------------
The U.S. Trustee for Region 3 on March 17 disclosed in a court
filing that no official committee of unsecured creditors has been
appointed in the Chapter 11 case of Medley, LLC.
About Medley LLC
Medley LLC, through its direct and indirect subsidiaries, including
Medley Capital LLC, is an alternative asset management firm
offering yield solutions to retail and institutional investors. It
provides investment management services to a permanent capital
vehicle, long-dated private funds, and separately managed accounts,
and serves as the general partner to the private funds. Medley is
headquartered in New York City and incorporated in Delaware.
As of Sept. 30, 2020, Medley had $3.4 billion of assets under
management in two business development companies, Medley Capital
Corporation (NYSE: MCC) and Sierra Income Corporation, and several
private investment vehicles. Over the past 18 years, Medley has
provided capital to over 400 companies across 35 industries in
North America.
Medley filed a Chapter 11 bankruptcy petition (Bankr. D. Del. Case
No. 21-10526) on March 7, 2021. The Debtor disclosed $5,422,369 in
assets and $140,752,116 in liabilities as of March 2, 2021.
The Debtor tapped Lowenstein Sandler LLP as its bankruptcy counsel,
Morris James LLP as local Delaware counsel, Eversheds Sutherland
(US) LLP as special counsel, and B. Riley Securities Inc. as
investment banker. Kurtzman Carson Consultants, LLC is the claims
agent, maintaining the page https://www.kccllc.net/medley
METRONOMIC HOLDINGS: Plan Exclusivity Period Extended Until April 6
-------------------------------------------------------------------
At the behest of the Debtor Metronomic Holdings, LLC, Judge Laurel
M. Isicoff of the U.S. Bankruptcy Court for the Southern District
of Florida, Miami Division extended the period in which the Debtor
may file a Chapter 11 plan through and including April 6, 2021, and
to solicit and obtain acceptances of the plan through and including
May 21, 2021.
Now, the Debtor will have more time to evaluate the claims filed
and potentially resolve certain disputed claims prior to filing a
Plan.
A copy of the Court's Extension Order is available at
https://bit.ly/3qNG97H from PacerMonitor.com.
About Metronomic Holdings
Metronomic Holdings, LLC is a real estate company that owns and
manages a portfolio of real estate assets in Miami-Dade County,
Fla., and McHenry County, Ill.
Metronomic Holdings filed a Chapter 11 petition (Bankr. S.D. Fla.
Case No. 20-20310) on September 23, 2020. At the time of the
filing, the Debtor disclosed assets of between $50 million and $100
million and liabilities of the same range.
Judge Laurel M. Isicoff oversees the case. The Debtor hired Aleida
Martinez Molina as its legal counsel. On March 3, 2021, the Debtor
employed Pack Law, P.A. to serve as co-counsel with Weiss Serota
Helfman Cole & Bierman, P.L., the firm handling its Chapter 11
case.
MICROVISION INC: General Counsel David Westgor Retires
------------------------------------------------------
David Westgor is stepping down from his role as general counsel of
MicroVision, Inc.
"I am proud to have been able to work with an exceptional
management team, board and legal group to help lead the evolution
of the Company for over 15 years including the last 8 years as
General Counsel," Westgor said. "I believe that this is an
exciting time for MicroVision. However, at 67, I believe the time
is right for me to move forward with my retirement plans and enjoy
the road ahead with my wife and family. I will be stepping back
from my current role but will continue to provide support to the
Company on a consulting basis through June as the Company
transitions to a new general counsel."
"MicroVision has been incredibly fortunate to have David Westgor
serve as our General Counsel," Brian Turner, chairman and
independent director at MicroVision, said. "David's integrity,
deep experience in law, governance and leadership have provided
great insight, guidance and tremendous value to the board and the
company. He is a marvelous person to know and work alongside and
will be greatly missed."
"David has guided the business through the long period of maturing
our technology and intellectual property to be well positioned to
execute on our strategy. On behalf of all our employees, I would
like to thank him for his dedication and service to help us reach
this point. I have really enjoyed working with him and will miss
his counsel," Sumit Sharma, chief executive officer of MicroVision,
said.
About MicroVision
MicroVision -- http://www.microvision.com-- is a pioneering
company in MEMS based laser beam scanning technology that
integrates MEMS, lasers, optics, hardware, algorithms and machine
learning software into its proprietary technology to address
existing and emerging markets. The Company's integrated approach
uses its proprietary technology to provide solutions for automotive
lidar sensors, augmented reality micro-display engines, interactive
display modules and consumer lidar modules.
MicroVision reported a net loss of $13.63 million for the year
ended Dec. 31, 2020, compared to a net loss of $26.48 million for
the year ended Dec. 31, 2019. As of Dec. 31, 2020, the Company had
$21.01 million in total assets, $11.99 million in total
liabilities, and $9.01 million in total shareholders' equity.
MICROVISION INC: Incurs $13.6 Million Net Loss in 2020
------------------------------------------------------
MicroVision, Inc. filed with the Securities and Exchange Commission
its Annual Report on Form 10-K disclosing a net loss of $13.63
million on $3.09 million of total revenue for the year ended Dec.
31, 2020, compared to a net loss of $26.48 million on $8.88 million
of total revenue for the year ended Dec. 31, 2019.
"Over the past year we have made important progress advancing our
automotive LiDAR development, bolstering our balance sheet,
building the strength of our team, and adding expertise to our
Board of Directors while exploring strategic alternatives," Sumit
Sharma, MicroVision's chief executive officer, said. "I expect
that the A-Sample hardware and benchmarked data, for demonstration
to interested parties, will be available in the April 2021
timeframe. I also expect that a version of our 1st generation Long
Range Lidar sensor, after internal validation, reliability and
compliance testing, could be available for sale, in small
quantities, in the third or fourth quarter of 2021."
As of Dec. 31, 2020, the Company had $21.01 million in total
assets, $11.99 million in total liabilities, and $9.01 million in
total shareholders' equity.
"We have incurred significant losses since inception. We have
funded our operations to date primarily through the sale of common
stock, convertible preferred stock, warrants, the issuance of
convertible debt and, to a lesser extent, from development contract
revenues, product sales and licensing activities. Since 2010,
there has been substantial doubt about our ability to continue as a
going concern," MicroVision said in its Annual Report.
At Dec. 31, 2020, the Company had $16.9 million in cash and cash
equivalents.
"Based on our current operating plan and including $61.4 million
received in 2021 under At-the-Market equity offering agreements
with Craig-Hallum Capital Group, we anticipate that we have
sufficient cash and cash equivalents to fund our operations for at
least the next 12 months. We may require additional capital to
fund our operating plan past that time. We may obtain additional
capital through the issuance of equity or debt securities, and/or
licensing activities. There can be no assurance that additional
capital will be available to us or, if available, will be available
on terms acceptable to us or on a timely basis. If adequate
capital resources are not available on a timely basis, we intend to
consider limiting our operations substantially. This limitation of
operations could include further reductions in our research and
development projects, staff, operating costs, and capital
expenditures," the Company added.
A full-text copy of the Form 10-K is available for free at:
https://www.sec.gov/Archives/edgar/data/65770/000113626121000040/body10k.htm
About MicroVision
MicroVision -- http://www.microvision.com-- is a pioneering
company in MEMS based laser beam scanning technology that
integrates MEMS, lasers, optics, hardware, algorithms and machine
learning software into its proprietary technology to address
existing and emerging markets. The Company's integrated approach
uses its proprietary technology to provide solutions for automotive
lidar sensors, augmented reality micro-display engines, interactive
display modules and consumer lidar modules.
MILLER BRANGUS: Seeks to Hire Luke Mobley as Auctioneer
-------------------------------------------------------
Miller Brangus, LLC seeks approval from the U.S. Bankruptcy Court
for the Middle District of Tennessee to employ Luke Mobley Auction
Services in connection with the sale of its cattle.
The firm will get 5 percent of the sales price for each cattle
sold. It will also receive reimbursement for out-of-pocket
expenses incurred.
Luke Mobley, a partner at Luke Mobley Auction Services, disclosed
in a court filing that the firm is a "disinterested person" as the
term is defined in Section 101(14) of the Bankruptcy Code.
The firm can be reached at:
Luke Mobley
Luke Mobley Auction Services
E. Pine St.
Batesville, AR 72501
Tel: (205) 270-0999
Email: LukeMobley1@gmail.com
About Miller Brangus
Headquartered in Franklin, Tenn., Miller Brangus LLC filed for
Chapter 11 bankruptcy protection (Bankr. M.D. Tenn. Case No.:
20-05282) on Dec. 2, 2020. David Doyle Miller, member, signed the
petition. The Debtor disclosed $4,579,945 in assets and $3,304,162
in liabilities.
Judge Marian F. Harrison presides over the case.
Griffin S. Dunham, Esq., at Dunham Hildebrand, PLLC, serves as the
Debtor's legal counsel.
MINNESOTA SCHOOL: Unsecured Creditors Will be Paid in Full
----------------------------------------------------------
Minnesota School of Business, Inc., and Globe University, Inc.,
submitted a Joint Chapter 11 Plan of Reorganization and a
Disclosure Statement.
The Plan contemplates a reorganization of the Debtors and payment
in full of Allowed General Unsecured Claims on or shortly after
Substantial Consummation as provided in the Plan from the following
sources: (i) proceeds from sales of certain parcels of Real
Property owned by MSB's subsidiaries; (ii) cash in the Debtors'
bankruptcy estates and their subsidiaries; (iii) the Deposit; (iv)
loans from refinancing of other parcels of Real Property owned by
MSB's subsidiaries, which loans will be secured by mortgages on the
parcels and guaranteed by the Debtors' principal shareholder; and
(v) loans from the Debtors' principal shareholder in an amount
necessary for the Plan.
A precondition to the Plan is receipt of the Department of
Education's final approval of the Settlement Agreement by and among
the Debtors, the State of Minnesota by and through its Attorney
General Keith Ellison , Chapter 11 Trustee, and the United States
Department of Education. In the unexpected event that final
approval is not received from the Department of Education, the
Chapter 11 Trustee will modify the Plan to be a liquidating plan.
Counsel to the Chapter 11 Trustee:
Edwin H. Caldie
Phillip J. Ashfield
STINSON LLP
50 South Sixth Street Suite 2600
Minneapolis, MN 55402
Telephone: 612.335.1500
Facsimile: 612.335.1657
Attorneys for the Debtors:
Clinton E. Cutler
James C. Brand
Samuel M. Andre
FREDRIKSON & BYRON, P.A.
200 South Sixth Street
Suite 4000
Minneapolis, MN 55402-1425
Tel: (612) 492-7000
A copy of the Disclosure Statement is available at
https://bit.ly/3vyTt3c from PacerMonitor.com.
About Minnesota School of Business
Minnesota School of Business, Inc., provides specialized training
programs in business, medical, legal, information technology,
massage, vet tech and drafting/design fields.
Minnesota School of Business, Inc., based in Woodbury, MN, filed a
Chapter 11 petition (Bankr. D. Minn. Case No. 19-33629) on Nov. 20,
2019. In the petition signed by Terry L. Myhre,
chairman/president, the Debtor was estimated to have $10 million to
$50 million in both assets and liabilities. The Hon. Kathleen H.
Sanberg is the presiding judge. Clinton E. Cutler, Esq., at
Fredrikson & Byron, P.A., serves as bankruptcy counsel to the
Debtor.
MOTORMAX FINANCIAL: Voluntary Chapter 11 Case Summary
-----------------------------------------------------
Debtor: Motormax Financial Services Corp.
P.O. Box 468
Columbus, GA 31902
Chapter 11 Petition Date: March 18, 2021
Court: United States Bankruptcy Court
Middle District of Georgia
Case No.: 21-40100
Debtor's Counsel: Fife M. Whiteside, Esq.
FIFE M. WHITESIDE PC
1124 Lockwood Ave
Columbus, GA 31906-2416
Tel: 706-320-1215
Fax: 706-320-1217
E-mail: whitesidef@mindspring.com
Estimated Assets: $50,000 to $100,000
Estimated Liabilities: $1 million to $10 million
The petition was signed by Karl White, CEO.
The Debtor failed to include in the petition a list of its 20
largest unsecured creditors.
A copy of the petition is available for free at PacerMonitor.com
at:
https://www.pacermonitor.com/view/6UIVKPI/Motormax_Financial_Services_Corp__gambke-21-40100__0001.0.pdf?mcid=tGE4TAMA
MYCELL TECHNOLOGIES: Seeks to Hire A.Y. Strauss as Counsel
----------------------------------------------------------
MyCell Technologies LLC seeks approval from the U.S. Bankruptcy
Court for the Southern District of New York to employ A.Y. Strauss
LLC as its legal counsel.
The firm's services include:
a. providing the Debtor with advice and preparing all necessary
documents regarding debt restructuring, bankruptcy and asset
dispositions;
b. taking all necessary actions to protect and preserve the
Debtor's estate during the pendency of its Chapter 11 case;
c. preparing legal papers;
d. advising the Debtor with regard to its rights and
obligations;
e. appearing in court; and
f. other legal services necessary to administer the case.
A.Y. Strauss will be paid at these rates:
Partners $500 to $600 per hour
Associates $425 per hour
Paralegals $200 per hour
The firm will also be reimbursed for out-of-pocket expenses
incurred.
The retainer fee is $25,000.
Eric Horn, Esq., a partner at A.Y. Strauss, disclosed in a court
filing that the firm is a "disinterested person" as the term is
defined in Section 101(14) of the Bankruptcy Code.
The firm can be reached at:
Eric H. Horn, Esq.
Heike M. Vogel, Esq.
A.Y. Strauss LLC
101 Eisenhower Parkway, Suite 412
Roseland, NJ 07068
Tel: (973) 287-5006
Fax: (973) 226-4104
Email: ehorn@aystrauss.com
About MyCell Technologies
MyCell Technologies LLC is an intellectual property and investment
holding company, which specializes in the development of
proprietary liquid formulations of stable, concentrated omega3s for
use in food, beverage, pet, medical and nutritional products.
MyCell Technologies sought Chapter 11 protection (Bankr. S.D.N.Y.
Case No. 20-12748) on Nov. 25, 2020. Glenn R. Langberg, director,
signed the petition. In the petition, the Debtor disclosed total
assets of $10,637 and total debt of $1,412,021.
Judge James L. Garrity, Jr. oversees the case.
The Debtor tapped Eric H. Horn, Esq., at A.Y. Strauss LLC, as its
legal counsel.
NATIONAL MEDICAL: Seeks to Extend Plan Exclusivity Thru July 7
--------------------------------------------------------------
National Medical Imaging, LLC and its affiliates request the U.S.
Bankruptcy Court for the Eastern District of Pennsylvania to extend
by 120 days the exclusive periods during which the Debtors may file
a plan of reorganization and to solicit acceptances until July 7,
2021, and September 6, 2021, respectively.
On February 22, 2021, the Court issued an Order and Memorandum
resolving U.S. Bank's Motion to Dismiss. Therein, the Court
dismissed certain counts against U.S. Bank without prejudice to the
Debtors' ability to file an amended complaint on or before March 8,
2021. The Debtors are currently evaluating the Court's decision and
whether or not they wish to file an amended complaint as to these
counts.
Whether or not the Debtors opt to file an amended complaint, the
Courts' decision denied dismissal of two counts against U.S. Bank
pertaining to:
(A) U.S. Bank's ability to set off its pre-petition claims against
the Debtors from its liability to the Debtors’ bankruptcy estates
under Section 303(i); and
(B) the extent, priority, and validity of U.S. Bank's asserted
liens against the Debtors' remaining assets—its claims against
U.S. Bank and other petitioning creditors pursuant to Section
303(i).
Resolution of these issues is necessary to determine U.S. Bank's
status as a secured creditor in these bankruptcy cases—an issue
that is critical to how U.S. Bank should be classified under any
chapter 11 plan. Importantly, resolution of these issues will also
require the Court to consider the application of federal bankruptcy
policy regarding Section 303(i) and its impact on U.S. Bank's
status as a secured creditor.
The Debtors' anticipate that the Court's decision on this federal
bankruptcy policy will also inform the parties as to U.S. Bank's
ability to share in any distribution of the Debtors' recovery under
Section 303(i), which in turn will impact U.S. Bank's
classification under and right to vote on any plan (i.e., whether
or not U.S. Bank can properly be classified separately from other
secured or unsecured creditors and/or whether or not U.S. Bank's
interests are impaired under the plan).
Accordingly, resolution of the U.S. Bank Adversary—and the
critical policy issues raised therein—is vital to the Debtors'
ability to formulate its plan and for the Debtors' other creditors
to make informed decisions thereon.
More time is therefore needed to allow the U.S. Bank Adversary to
be resolved in advance of the expiration of the Debtors' exclusive
periods. The Debtors do not expect litigation of the U.S. Bank
Adversary to be protracted. As the Court and the parties, both
acknowledge, the underlying facts are largely settled and not in
dispute. Accordingly, the Debtors anticipate proceeding relatively
quickly with filing an appropriate motion for determination soon
after the pleadings are closed.
In light of the relevant facts and circumstances, the requested
extension of the Exclusive Periods will not prejudice the
legitimate interests of any creditor and will afford the Debtors
the opportunity to pursue to fruition the beneficial objectives of
a confirmable liquidating plan.
A copy of the Debtors' Motion to extend is available at
https://bit.ly/3ljS9wB from PacerMonitor.com.
About National Medical
National Medical Imaging, LLC, and National Medical Imaging Holding
Company, LLC provide medical and diagnostic laboratory services
with a principal place of business located at 1425 Brickell Ave.,
Apt. 57E, Miami.
On June 12, 2020, National Medical Imaging and National Medical
Imaging Holding Company filed voluntary petitions for relief under
Chapter 11 of the Bankruptcy Code (Bankr. E.D. Pa. Lead Case No.
20-12618). At the time of the filings, each Debtor disclosed assets
of $10 million to $50 million and liabilities of the same range.
Judge Eric L. Frank oversees the case. The Debtors have tapped
Dilworth Paxson LLP as their bankruptcy counsel and Kaufman, Coren
& Ress, P.C. and Karalis P.C. as their special counsel. On October
23, 2020, the Debtors hired Erwin Chemerinsky, the dean, and Jesse
H. Choper Distinguished Professor of Law of the University of
California, Berkley School of Law, as their special counsel.
Prior to Debtors' voluntary Chapter 11 filing, DVI Receivables
Trusts and other creditors filed involuntary Chapter 11 petitions
(Bankr. E.D. Pa. Case Nos. 05-12714 and 05-12719) against Debtors
on March 3, 2005.
In 2014, National Medical Imaging hit U.S. Bank N.A. and eight
others with a $50 million lawsuit in Pennsylvania federal court
alleging the bank ruined its business by forcing it into
involuntary bankruptcy proceedings just as it was beginning to
implement a turnaround plan. National Medical Imaging claims that
the involuntary bankruptcy petitions ultimately destroyed its
business even though the cases were ultimately tossed.
NATIONAL RIFLE: Committee Seeks to Hire Norton Rose as Counsel
--------------------------------------------------------------
The official committee of unsecured creditors of National Rifle
Association of America and Sea Girt LLC seeks approval from the
U.S. Bankruptcy Court for the Northern District of Texas to employ
Norton Rose Fulbright US, LLP as legal counsel.
The firm will provide these services:
a. advise the committee regarding local rules, practices and
procedures, including Fifth Circuit law;
b. advise the committee with respect to its rights, duties and
powers in the Debtors' Chapter 11 cases;
c. assist the committee in its consultations and negotiations
with the Debtors relative to the administration of the cases;
d. assist the committee in analyzing the claims of creditors and
the Debtors' capital structure and in negotiating with holders of
claims and equity interests;
e. assist the committee in its investigation of the acts,
conduct, assets, liabilities and financial condition of the Debtors
and their insiders and of the operation of the Debtors'
businesses;
f. assist the committee in its analysis of, and negotiations
with, the Debtors or any third party concerning matters related to,
among other things, the assumption or rejection of certain leases
of non-residential real property and executor contracts, asset
dispositions, financing of other transactions and the terms of a
plan of reorganization for the Debtors;
g. advise the committee as to its communications to the general
creditor body;
h. represent the committee at all hearings and other proceedings
before the court;
i. review and analyze applications, orders, statements of
operations and schedules filed with the court and advise the
committee as to their propriety and, to the extent deemed
appropriate by the committee, support, join or object thereto;
j. advise the committee with respect to any legislative,
regulatory or governmental activities;
k. assist the committee in preparing pleadings and
applications;
l. assist the committee in its review and analysis of the
Debtors' various agreements;
m. prepare legal papers;
n. investigate and analyze any claims and causes of action that
are property of the Debtors' estates; and
o. perform other legal services.
The firm will be paid at these rates:
Partners $700 to $1,350 per hour
Of Counsel $670 to $1,225 per hour
Senior Counsel $520 to $1,175 per hour
Senior Associates $595 to $855 per hour
Associates $355 to $855 per hour
Paraprofessionals $230 to $480 per hour
The firm will also be reimbursed for out-of-pocket expenses
incurred.
In accordance with Appendix B-Guidelines for reviewing fee
applications filed by attorneys in larger Chapter 11 cases, Norton
provided the following in response to the request for additional
information:
a. The firm did not agree to any variations from, or
alternatives to, its standard or customary billing arrangements for
this engagement;
b. No rate for any of the professionals included in this
engagement varies based on the geographic location of the
bankruptcy case;
c. The firm did not represent any member of the committee prior
to its retention by the committee;
d. The firm expects to develop a prospective budget and staffing
plan to reasonably comply with the U.S. trustee's request for
information and additional disclosures, as to which the firm
reserves all rights; and
e. The committee has approved the firm's proposed hourly billing
rates.
Louis Strubeck, Jr., Esq., a partner at Norton, disclosed in a
court filing that the firm is a "disinterested person" as the term
is defined in Section 101(14) of the Bankruptcy Code.
The firm can be reached at:
Louis R. Strubeck, Jr., Esq.
Kristian W. Gluck, Esq.
Scott P. Drake, Esq.
Laura L. Smith, Esq.
Nick Hendrix, Esq.
Norton Rose Fulbright US LLP
2200 Ross Avenue, Suite 3600
Dallas, TX 75201-7932
Tel: (214) 855-8000
Fax: (214) 855-8200
Email: louis.strubeck@nortonrosefulbright.com
kristian.gluck@nortonrosefulbright.com
scott.drake@nortonrosefulbright.com
laura.smith@nortonrosefulbright.com
nick.hendrix@nortonrosefulbright.com
About National Rifle Association
of America and Sea Girt
Founded in 1871 in New York, the National Rifle Association of
America is a gun rights advocacy group. The NRA claims to be the
longest-standing civil rights organization and has more than five
million members.
Seeking to move its domicile and principal place of business to
Texas amid lawsuits in New York, National Rifle Association of
America sought Chapter 11 protection (Bankr. N.D. Tex. Case No.
21-30085) on Jan. 15, 2021. Affiliate Sea Girt LLC simultaneously
sought Chapter 11 protection (Case No. 21-30080).
The NRA was estimated to have assets and liabilities of $100
million to $500 million as of the bankruptcy filing.
Judge Harlin Dewayne Hale oversees the cases.
The Debtors tapped Neligan LLP and Garman Turner Gordon LLP as
their bankruptcy counsel, and Brewer, Attorneys & Counselors as
their special counsel.
The U.S. Trustee for Region 6 appointed an official committee of
unsecured creditors on Feb. 4, 2021. Norton Rose Fulbright US, LLP
and AlixPartners, LLP serve as the committee's legal counsel and
financial advisor, respectively.
NATIONAL RIFLE: Committee Taps AlixPartners as Financial Advisor
----------------------------------------------------------------
The official committee of unsecured creditors of National Rifle
Association of America and Sea Girt LLC seeks approval from the
U.S. Bankruptcy Court for the Northern District of Texas to employ
AlixPartners, LLP as financial advisor.
The firm will provide these services:
a. review and evaluate the Debtors' current financial condition,
business plans and cash and financial forecasts, and periodically
report to the committee;
b. review the Debtors' cash management, tax sharing and
intercompany accounting systems, practices and procedures;
c. review and investigate (i) related party transactions,
including those between the Debtors and non-debtor subsidiaries and
affiliates (including, but not limited to, shared services expenses
and tax allocations), and (ii) selected other pre-bankruptcy
transactions;
d. identify and review potential preference payments, fraudulent
conveyances and other causes of action that the various Debtors'
estates may hold against third parties;
e. analyze the Debtors' assets and claims, and assess potential
recoveries to the various creditor constituencies under different
scenarios;
f. assist in the development and review of the Debtors' plan of
reorganization and disclosure statement;
g. review and evaluate court motions filed or to be filed by the
Debtors or any other parties-in-interest, as appropriate;
h. render expert testimony and litigation support services,
including e-discovery services, as requested from time to time by
the Debtors and their counsel, regarding any of the matters to
which AlixPartners is providing services;
i. attend committee meetings and court hearings; and
j. assist with such other matters as may be requested that fall
within the firm's expertise and that are mutually agreeable.
The firm will be paid at these rates:
Managing Director $1,030 to $1,295 per hour
Director $825 to $980 per hour
Senior Vice President $665 to $755 per hour
Vice President $485 to $650 per hour
Consultant $180 to $480 per hour
Paraprofessional $305 to $325 per hour
The firm will also be reimbursed for out-of-pocket expenses
incurred.
David MacGreevey, a partner at AlixPartners, disclosed in a court
filing that the firm is a "disinterested person" as the term is
defined in Section 101(14) of the Bankruptcy Code.
The firm can be reached at:
David MacGreevey
AlixPartners, LLP
909 Third Avenue, Floor 30
New York, NY 10022
Tel: (212) 490-2500
Fax: (212) 490-1344
Email: dmacgreevey@alixpartners.com
About National Rifle Association
of America and Sea Girt
Founded in 1871 in New York, the National Rifle Association of
America is a gun rights advocacy group. The NRA claims to be the
longest-standing civil rights organization and has more than five
million members.
Seeking to move its domicile and principal place of business to
Texas amid lawsuits in New York, National Rifle Association of
America sought Chapter 11 protection (Bankr. N.D. Tex. Case No.
21-30085) on Jan. 15, 2021. Affiliate Sea Girt LLC simultaneously
sought Chapter 11 protection (Case No. 21-30080).
The NRA was estimated to have assets and liabilities of $100
million to $500 million as of the bankruptcy filing.
Judge Harlin Dewayne Hale oversees the cases.
The Debtors tapped Neligan LLP and Garman Turner Gordon LLP as
their bankruptcy counsel, and Brewer, Attorneys & Counselors as
their special counsel.
The U.S. Trustee for Region 6 appointed an official committee of
unsecured creditors on Feb. 4, 2021. Norton Rose Fulbright US, LLP
and AlixPartners, LLP serve as the committee's legal counsel and
financial advisor, respectively.
NEOVASC INC: Incurs $28.7 Million Net Loss in 2020
--------------------------------------------------
Neovasc Inc. filed with the Securities and Exchange Commission its
Annual Report on Form 40-F disclosing a net loss of $28.69 million
on $1.96 million of revenue for the year ended Dec. 31, 2020,
compared to a net loss of $35.13 million on $2.09 million of
revenue for the year ended Dec. 31, 2019.
As of Dec. 31, 2020, the Company had $17.88 million in total
assets, $15.90 million in total liabilities, and $1.98 million in
total equity.
Grant Thornton, LLP, in Vancouver, Canada, the Company's auditor
since 2002, issued a "going concern" qualification in its report
dated March 10, 2021, citing that the Company incurred a
comprehensive loss of $30.2 million during the year ended Dec. 31,
2020. These conditions, along with other matters raise substantial
doubt about the Company's ability to continue as a going concern as
at Dec. 31, 2020.
Revenues decreased by 6% for the year ended Dec. 31, 2020, compared
to the same period in 2019 as elective procedures, including the
implantation of Reducer, were temporarily suspended at many
hospitals due to the impact of COVID-19.
The gross margin for the year ended Dec. 31, 2020 was 77%, compared
to 78% gross margin for the same period in 2019 as the Company
continues to focus on the development of territories where it sells
the Reducer with a direct sales force.
Total expenses for the year ended Dec. 31, 2020 were $36,679,551
compared to $31,680,676 for the same period in 2019, representing
an increase of $4,998,875 or 16%, principally because of a
$2,528,240 increase in legal costs related to financings, as the
Company completed five financings during 2020, a $1,716,004
increase in share-based payments and a $1,130,794 increase in
cash-based employee expenses as it hired a new COO and other higher
paid staff, while still reducing head count overall.
Operating losses and comprehensive losses for the year ended
Dec. 31, 2020 were $35,168,428 and $30,170,251, respectively, or
$1.72 basic and diluted loss per share, as compared with
$30,047,080 operating losses and $33,618,494 comprehensive losses,
or $5.40 basic and diluted loss per share, for the same period in
2019.
Subsequent to the Fourth quarter
* Regained compliance with the minimum bid price requirement and
the minimum market value requirement under Nasdaq Listing
Rules.
* Completed a registered direct offering in February 2021 whi ch
raised approximately $72 million gross proceeds.
"Neovasc continued to advance its efforts to commercialize the
Reducer and further develop the Tiara devices in the fourth
quarter," said Fred Colen, president and chief executive officer of
Neovasc. "We are encouraged by the results of the quarter despite
the impact from COVID-19. We believe there is clearly strong
underlying demand for Reducer."
Colen continued, "We continue to advance the CE mark submission for
Tiara TA in Europe, with the goal of securing a regulatory decision
in the first half of the year. We also continue to make meaningful
progress on our Tiara TF development program and we are targeting a
first-in-human implant in the second half of 2021. Finally,
subsequent to the quarter, in February 2021, we took an important
step, raising $72 million gross proceeds to secure Neovasc's
ability to execute on our strategies for the medium term. We look
forward to continuing our progress in 2021."
A full-text copy of the Form 40-F is available for free at:
https://www.sec.gov/Archives/edgar/data/1399708/000110465921035050/tm2039647d1_ex99-3.htm
About Neovasc Inc.
Neovasc is a specialty medical device company that develops,
manufactures and markets products for the rapidly growing
cardiovascular marketplace. The Company is a leader in the
development of minimally invasive transcatheter mitral valve
replacement technologies, and minimally invasive devices for the
treatment of refractory angina. Its products include the Neovasc
Reducer, for the treatment of refractory angina, which is not
currently commercially available in the United States (2 U.S.
patients have been treated under Compassionate Use) and has been
commercially available in Europe since 2015, and Tiara, for the
transcatheter treatment of mitral valve disease, which is currently
under clinical investigation in the United States, Canada, Israel
and Europe. For more information, visit: www.neovasc.com.
NESCO HOLDINGS: S&P Raises ICR to 'B' on Custom Truck Acquisition
-----------------------------------------------------------------
S&P Global Ratings removed the rating on NESCO Holdings Inc. from
CreditWatch with positive implications. S&P raised the issuer
credit rating to 'B' from 'CCC+', given its view of improved
liquidity and leverage, along with the benefits of increased
scale.
S&P said, "We are also assigning our 'B' issue-level and '4'
recovery ratings to the proposed $920 million second-lien senior
secured notes due 2029 issued from its subsidiary NESCO Holdings II
Inc. The '4' recovery rating indicates our expectation for average
(30%-50%; rounded estimate: 45%) recovery in the event of a
default.
"We expect the acquisition of CTOS will significantly improve the
company's market position and enhance its existing fleet base. The
combination expands scale from about $300 million in revenue
(legacy NESCO) to $1.4 billion on a pro forma basis in 2021,
significantly improving its market share. Furthermore, the combined
platform will benefit from CTOS's vertical integration as a
one-stop shop, which includes equipment sales, rentals,
manufacturing, and up-fitting business lines. Both NESCO and CTOS
operate in the highly fragmented and cyclical U.S. equipment rental
industry, and the combined company remains heavily concentrated on
sales to the T&D and telecom end markets. Still, we anticipate
growth from T&D and telecom projects over the longer term due to
the aging U.S. power grid, increased support for electrification
initiatives, the integration of renewable and gas generation, and
the transition to 5G, which we expect to translate to top-line
growth in 2021 and going forward."
NESCO will now operate a combined fleet of 8,800 units, with an
average age of about 3.4 years. Given its younger fleet, the
company maintains good flexibility to increase the age of its fleet
out a few years, reducing the need for significant increases in
capital expenditures (capex) in the near term, if necessary. S&P
said, "As a result, we believe it could generate FOCF in the $80
million-$90 million range in 2021. We expect NESCO--similar to
other equipment rental companies we rate--to reduce its net rental
capex in a downturn to preserve liquidity."
Relative to peers, the combined company will have a relatively high
level of sales of new and used equipment. S&P said, "We still
compare the business to other equipment rental companies we rate,
however, because most of the profitability comes from its rental
operations. The high level of sales of new and used equipment
translates into relatively lower EBITDA margins, which we expect to
be in the low-20% area. We do not believe this necessarily
indicates a weaker business position, but rather it reflects the
mix of the business."
The proposed capital structure of the combined company
substantially improves legacy NESCO's liquidity and leverage. S&P
said, "Although the company is drawing on more than half of its
proposed ABL revolving credit facility at the onset of the
transaction, we believe the $350 million undrawn amount
significantly strengthens the company's liquidity position, which
was a key factor of our prior rating on NESCO."
Similarly, the new capital structure will significantly lower the
company's leverage. S&P said, "We believe the combined company will
generate top-line growth in the mid-single-digit area in 2021. In
our opinion, favorable end market trends will result in improved
rental and utilization rates. Given CTOS's lower-margin equipment
sales business, we believe that overall EBITDA margins will fall to
the low-20% area (down from the 40% area for legacy NESCO)." These
factors should result in S&P Global Ratings-adjusted debt to EBITDA
in the mid-4x area in 2021 before improving to the high-3x area in
2022.
S&P said, "Our assessment of NESCO's financial risk profile
incorporates Platinum Equity's controlling ownership. We believe
that financial sponsors frequently extract cash or otherwise
increase the leverage on their investments over time, usually
through acquisitions or shareholder returns. However, our base-case
forecast does not incorporate any significant debt-financed
dividends or acquisitions over the next 12 months. Energy Capital
Partners (ECP) and Capitol Investments (Capitol) own about 70% of
NESCO's outstanding common stock. Blackstone is CTOS's financial
sponsor. Post-transaction, Platinum will own about 60% of NESCO's
outstanding common stock, ECP will own about 10%, Blackstone will
own about 7%, Capitol will own about 3%, and CTOS management will
own about 1%.
"The stable outlook on NESCO reflects our view that the company
will benefit from the increased scale, as well as favorable
dynamics within the T&D and telecom end markets. We expect the
company to maintain S&P Global Ratings-adjusted debt to EBITDA in
the 4x-5x range and generate positive FOCF over the next 12
months."
S&P could lower its rating on NESCO if:
-- Operating performance weakens materially to the point where S&P
Global Ratings-adjusted debt to EBTIDA trends toward 6x; or
-- NESCO pursues significant debt-funded acquisitions and/or
shareholder returns resulting in similar leverage levels; or
-- FOCF turns negligible or negative; or
-- There is reduced capacity under the ABL revolver.
S&P could raise its rating on NESCO if:
-- The company generates strong positive FOCF; and
-- S&P Global Ratings-adjusted debt to EBITDA is meaningfully
below 4x, including potential acquisitions and shareholder returns.
This incorporates its view that credit measures can be volatile and
will be weaker in periods of stress. In this scenario, it would
also need to believe that the ownership group is committed to a
more conservative financial policy.
NESCO HOLDINGS: Unit to Offer $920 Million of Senior Secured Notes
------------------------------------------------------------------
Nesco Holdings, Inc.'s indirect wholly owned subsidiary Nesco
Holdings II, Inc. intends to offer $920 million aggregate principal
amount of senior secured second lien notes due 2029. The Notes
will be guaranteed on a senior secured second lien basis by Capitol
Investment Merger Sub 2, LLC and each of the Issuer's existing and
future wholly owned domestic restricted subsidiaries that
guarantees the Issuer's obligations under its first lien
asset-based revolving credit facility or certain other
indebtedness.
The net proceeds from the offering of the Notes, together with
borrowings under a new asset-based revolving credit facility to be
entered into by the Issuer and the proceeds from certain equity
issuances will be used to fund the previously announced acquisition
of 100% of the equity interests of Custom Truck One Source, L.P.,
including the repayment of certain indebtedness of Nesco and Custom
Truck and to pay related fees and expenses.
The Notes will not be registered under the Securities Act of 1933,
as amended, or any state securities laws, and, unless so
registered, may not be offered or sold in the United States or to,
or for the account or benefit of, U.S. persons absent registration
or pursuant to an applicable exemption from, or in a transaction
not subject to, the registration requirements of the Securities Act
and state securities laws.
About Nesco
Nesco -- https://investors.nescospecialty.com -- is a provider of
specialty equipment, parts, tools, accessories and services to the
electric utility transmission and distribution, telecommunications
and rail markets. Nesco offers its specialized equipment to a
diverse customer base for the maintenance, repair, upgrade and
installation of critical infrastructure assets including electric
lines, telecommunications networks and rail systems. Nesco's
coast-to-coast rental fleet of over 4,500 units includes aerial
devices, boom trucks, cranes, digger derricks, pressure drills,
stringing gear, hi-rail equipment, repair parts, tools, and
accessories.
Nesco reported a net loss of $21.28 million for the year ended Dec.
31, 2020, compared to a net loss of $27.05 million for the year
ended Dec. 31, 2019. As of Dec. 31, 2020, the Company had $768.40
million in total assets, $71.35 million in total current
liabilities, $728.12 million in total long-term liabilities, and a
total stockholders' deficit of $31.06 million.
* * *
As reported by the TCR on Dec. 11, 2020, S&P Global Ratings placed
all of its ratings on NESCO Holdings Inc., including its 'CCC+'
issuer credit ratings on the company and its subsidiary Capitol
Investment Merger Sub 2 LLC, on CreditWatch with positive
implications.
NN INC: Widens Net Loss to $100.6 Million in 2020
-------------------------------------------------
NN, Inc. filed with the Securities and Exchange Commission its
Annual Report on Form 10-K disclosing a net loss of $100.59 million
on $427.53 million of net sales for the year ended Dec. 31, 2020,
compared to a net loss of $46.74 million on $489.51 million of net
sales for the year ended Dec. 31, 2019.
As of Dec. 31, 2020, the Company had $624.96 million in total
assets, $265.72 million in total liabilities, $105.08 million in
series B convertible preferred stock, and $254.15 million in total
stockholders' equity.
"Based on available borrowing capacity of the Senior Secured
Revolver, the reduction in debt service costs as a result of the
debt prepayment with net proceeds from the sale of the Life
Sciences business in October 2020, and cash flows expected to be
generated from operations and investing activities, we anticipate
that our cash and cash equivalents are sufficient to support our
operations and meet our obligations, and that we will be able to
maintain compliance with the existing financial leverage ratio
covenant for the next twelve months from issuance of these
consolidated financial statements," NN said in its Annual Report.
A full-text copy of the Form 10-K is available for free at:
https://www.sec.gov/ix?doc=/Archives/edgar/data/918541/000091854121000003/nnbr-20201231.htm
About NN, Inc.
NN, Inc. -- www.nninc.com -- is a global diversified industrial
company that combines advanced engineering and production
capabilities with in-depth materials science expertise to design
and manufacture high-precision components and assemblies primarily
for the electrical, automotive, general industrial, aerospace and
defense, and medical markets. The Company has 32 facilities in
North America, Europe, South America, and China.
NSITE VENTURES: Unsecured Creditors to Paid by October 2021
-----------------------------------------------------------
[N]Site Ventures, LLC, on March 15, 2021, filed an Amended
Disclosure Statement for its proposed Plan of Reorganization.
The Disclosure Statement was amended to include the following
language to the treatment of unsecured creditors: The Debtor has
extended the term of the lease through Sept. 30, 2021. An
amendment to the lease was executed. The Debtor will continue to
do business in Ventura, California through September 2021.
Distribution of monies to be paid to creditors will occur on or
before October 2021.
Attorney for the Debtor:
COREY B. BECK, ESQ.
Nevada Bar No. 005870
THE LAW OFFICE OF COREY B. BECK, P.C.
425 South Sixth Street
Las Vegas, Nevada 89101
Tel: (702) 678-1999
Fax: (702) 678-6788
E-mail: becksbk@yahoo.com
A copy of the Disclosure Statement is available at
https://bit.ly/2OKYlBL from PacerMonitor.com.
About [N]Site Ventures
[N]Site Ventures, LLC, filed a Chapter 11 bankruptcy petition
(Bankr. D. Nev. Case No. 20-12931) on June 18, 2020, disclosing
under $1 million in both assets and liabilities. The Debtor is
represented by Corey B. Beck, Esq.
OBITX INC: Appoints Eric Jaffe as Chief Executive Officer
---------------------------------------------------------
OBITX, Inc. has selected Eric Jaffe as the Company's chief
executive officer. Mr. Jaffe will assume the responsibilities of
chief executive officer immediately, while the former interim chief
executive officer and chief financial officer Michael Hawkins, will
continue as the company's chairman and chief financial officer.
Mr. Jaffe will focus on OBITX's worldwide expansion of services and
operations, along with the development and implementation of OBITX
Venture's merger and acquisition concept. Eric will work with
board member Mark Gilroy in an active and sponsored role of OBITX
in the Special Purpose Acquisition Company (SPAC), Everything
Blockchain.
Mr. Jaffe brings a wealth and expertise to OBITX in business
management. Eric is an industry leading technology professional,
CEO, and serial entrepreneur. In his career he has had the
opportunity to lead or be a part of many great teams that have
leveraged vision, strategy, technology and great people to create
great companies. His experience has focused on the manufacturing,
legal, non-profit, blockchain and technology industries. He has
grown companies from start-up to successful acquisition that have
grown into national leaders in their space. He has been a part of
no less than 11 technology company acquisitions and has continually
been on the forefront of emerging technologies. He was an early
adopter of Bitcoin and blockchain having championed it and created
companies around it since 2015. Through his consulting practice he
has helped no lest than 35 major companies set their technology
strategy and accelerate their business growth. He couldn't be more
excited than to have this opportunity to lead a great team in
fulfilling Obitix's incredible vision. He is a graduate of Florida
International University with a degree in Business Management and
carries multiple technological certifications.
"I am very excited to be joining the OBITX team," said Eric Jaffe.
"I believe OBITX has a great business model and is building a
strong management team, a versatile board of directors, while
adding some of the markets most talented advisors that uniquely
positions us to capitalize on the changing business environment.
As industries and processes evolve through innovative and dynamic
structuring, consolidation and technology migrations, I believe
OBITX is in a position to provide a suite of services and solutions
to help our clients efficiently manage their blockchain networks
and maximize their budgets."
Michael Hawkins, OBITX Chairman and CFO stated, "Eric is the right
person for the OBITX team. His proven leadership skills, extensive
merger and acquisition experience, and business development skills
will help strengthen OBITX's partnerships, develop strategic
alliances, and expand our national and international sales
presence."
About OBITX Inc.
OBITX, Inc. -- http://www.ObitX.com-- is engaged in digital
cryptocurrency and blockchain development and consulting.
OBITX reported a net loss from operations of $168,028 for the year
ended Jan. 31, 2020, compared to a net loss from operations of
$392,042 for the year ended Jan. 31, 2019. As of Oct. 31, 2020,
the Company had $1.59 million in total assets, $297,200 in total
liabilities, and $1.29 million in total stockholders' equity.
Houston-based M&K CPAS, PLLC, the Company's auditor since 2019,
issued a "going concern" qualification in its report dated June 2,
2020, citing that the Company suffered a net loss from operations
and has a net capital deficiency, which raises substantial doubt
about its ability to continue as a going concern.
ON CALL ONLINE: Voluntary Chapter 11 Case Summary
-------------------------------------------------
Debtor: On Call Online, LLC
5301 N Federal Highway
Suite 375
Boca Raton, FL 33487
Chapter 11 Petition Date: March 18, 2021
Court: United States Bankruptcy Court
Southern District of Florida
Case No.: 21-12569
Judge: Hon Erik P. Kimball
Debtor's Counsel: Robert P. Charbonneau, Esq.
AGENTIS PLLC
55 Alhambra Plaza, Suite 800
Miami, FL 33134
Tel: 305-722-2002
E-mail: rpc@agentislaw.com
Estimated Assets: $0 to $50,000
Estimated Liabilities: $1 million to $10 million
The petition was signed by Stephen M. Tucker, manager.
The Debtor stated it has no creditors holding unsecured claims.
A copy of the petition is available for free at PacerMonitor.com
at:
https://www.pacermonitor.com/view/YWAW2QQ/On_Call_Online_LLC__flsbke-21-12569__0001.0.pdf?mcid=tGE4TAMA
ORGANIC POWER: Case Summary & 20 Largest Unsecured Creditors
------------------------------------------------------------
Debtor: Organic Power LLC
Ave El Naranjal Carr. PR 686
KM 17.6 Int. Cabo Caribe Industrial Park
Vega Baja, PR 00693
Business Description: Organic Power -- https://prrenewables.com --
offers food processing companies,
restaurants, pharmaceuticals and retail
outlets an alternative to landfill disposal;
a low cost & environmentally friendly
recycling option.
Chapter 11 Petition Date: March 17, 2021
Court: United States Bankruptcy Court
District of Puerto Rico
Case No.: 21-00834
Judge: Hon. Edward A. Godoy
Debtor's Counsel: Rafael A. Gonzalez Valiente, Esq.
GODREAU & GONZALEZ LAW
Calle McCleary 1806
Suite 1-B
San Juan, PR 00902
Tel: (787) 726-0077
E-mail: rgv@g-glawpr.com
Estimated Assets: $10 million to $50 million
Estimated Liabilities: $10 million to $50 million
The petition was signed by Miguel E. Perez, president.
A copy of the petition is available for free at PacerMonitor.com
at:
https://www.pacermonitor.com/view/DIPCK3A/ORGANIC_POWER__LLC__prbke-21-00834__0001.0.pdf?mcid=tGE4TAMA
List of Debtor's 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
1. ASM Precast $30,000
PO Box 1569
Vega Baja, PR
00694-1569
2. Brian E. Healy Deferred $315,092
PMB 632 Calle Compensation
Morena 267
San Juan, PR 00926
3. Euro Caribe $853,549
Packaging Co.
Chubb Plaza 33
Resolucion St
Suite 701 A
San Juan, PR 00920
4. Garratt Callahan $25,150
100 Fisk Dr SW
Atlanta, GA 30336
5. Home Depot $13,506
PO Box 790328
Saint Louis, MO
63179
6. Integrated Global Solutions $106,120
Centro Int's de
Mercadeo II
90 Carr 165 Ste 307
Guaynabo, PR
00968-8083
7. IRS FICA $63,720
PO Box 409101
Ogden, UT
84201-0038
8. IRS $18,080
PO Box 409101
Ogden, UT
84201-0038
9. La Vega Landfill & $103,260
Res. Inc.
PO Box 582
Vega Baja, PR 00694
10. O'Neill & Borges $17,627
250 Munoz Rlevra
Ave 800
San Juan, PR 00918
11. Organic Fuel $197,858
PMB 632
Calle Siera Morena 267
San Juan, PR 00926
12. Quadrell Billing-Vendor $62,702
PO Box 51397
Toa Baja, PR
00950-1397
13. Quantum Biopower Raw Material $18,611
Southing LLC
49 Depaolo Drive
Southington
Southington, CT
06489
14. RIMCO $99,311
PO Box 362529
San Juan, PR
00936-2529
15. Rod Rodder $24,377
PO Box 191713
San Juan, PR
00919-1719
16. Treasury Department Payroll $74,409
PO Box 195540 withholding
San Juan, PR
00919-5540
17. Treasury Dept SUTA $21,224
PO Box 195540
San Juan, PR
00919-5540
18. United Rental $19,566
83 J 190 Carr 865
Toa Baja, PR 00949
19. Wilfredo Diaz $125,000
PO Box 8155
Bayamon, PR 00960
20. Zero Medical $18,862
425 Carr 693
PMB 135
Dorado, PR 00646
PACIFICO NATIONAL: Unsecureds Will Recover 0.01% in Plan
--------------------------------------------------------
Pacifico National, Inc., filed a Plan of Reorganization that
proposes to pay creditors of Pacifico National, Inc., from cash
flow, operations, and future income.
Class 3 PNC Equipment Finance, LLC: This creditor filed Claim No.
14 in the full amount of $25,000. The claim will be treated as
secured in the amount of $25,000. The secured claim will be paid
over 36 months at 4.25% interest, at $740.88 per month.
Class 4: ASD Specialty Healthcare, LLC: This creditor filed Claim
No. 18 in the full amount of $823,060. The claim will be treated
as secured in the amount of $325,000 and unsecured in the amount of
$438,912. The secured claim will be paid over 36 months at 4.25%
interest, at $6,000 per month for the first twelve months following
confirmation, and $7,500 for the following 23 months with a
$109,166 balloon payment due on the 36th month.
Class 7: There are other still recorded and valid UCC-1s or other
parties that may claim secured status. Upon confirmation of the
Plan, the secured claims and UCC-I of the above creditors will be
extinguished and they will be treated only as unsecured creditors
to the extent they have allowed claims.
Class 8: Filed unsecured claims total $3,073,976 and unsecured
claims listed on Scheduled F and not listed as disputed,
contingent, or unliquidated, total 3,294,213. Unsecured creditors
will receive only $49,000, representing approximately .01%. Class
6 claimants will receive distribution pro rata in 12 installments
to be paid the first of the month of each subsequent with the first
quarter to begin the first of the 3rd month following the effective
date of the Plan.
Counsel for the Debtor:
Thomas H. Yardley
1970 Michigan Avenue, Bldg D
Cocoa, FL 32922-5723
Tel: (321) 633-5723
Fax: (321) 633-0512
E-mail: bankrupty@yardleylaw.net
A copy of the Plan of Reorganization is available at
https://bit.ly/3vsPiGa from PacerMonitor.com.
About Pacifico National Inc.
d/b/a AmEx Pharmacy
Pacifico National, Inc. -- https://amexpharmacy.com -- which
conducts business under the name AmEx Pharmacy, is a nationwide
compounding pharmacy specializing in dermatology and the
development of topical therapies. It services patients in 38
states throughout the United States.
Pacifico National filed its voluntary petition for relief under
Chapter 11 of the Bankruptcy Code (Bankr. M.D. Fla. Case No.
20-05009) on Sept. 3, 2020. Pacifico National President Mark L.
Sangree signed the petition.
At the time of the filing, the Debtor disclosed $363,794 in assets
and $6,583,984 in liabilities.
Bankruptcy Judge Lori V. Vaughan presides over the case.
The Debtor is represented by Thomas H. Yardley Law Offices.
PARKING MANAGEMENT: Unsecured Creditors Will Recover 85.9% in Plan
------------------------------------------------------------------
Parking Management Services of America, Inc., submitted a Second
Amended Disclosure Statement.
This is a reorganizing plan. The Debtor seeks to make payments
under a plan paying creditors a dividend over time. The effective
date of the Plan is projected to be July 15, 2021. Unless provided
otherwise, payments under the Plan are scheduled to be made on the
first day of each month for 60 months, starting with the month
subsequent to the month of the Effective Date.
The Plan treats claims as follows:
* Class 2A - On Deck Capital Inc. Secured Claim: POC-1 for
$23,922 as of Petition Date. The claim is fully secured. Pursuant
to Stipulation, the Debtor will repay Lender's Claim, which as of
March 1, 2021, will be at $22,922, with 0% interest per annum over
60 months period in equal monthly installments of principal and
interest of $382 each commencing on March 1, 2021, and continuing
for the next 59 installments on the 1st day of each subsequent
month, after which point the claim will be deemed fully repaid and
satisfied. Class 2A is impaired.
* Class 2B - On Deck Capital, Inc. Secured claim: POC-2, listed
at $87,488 as of Petition Date. The claim is fully secured.
Pursuant to Stipulation, the Debtor will repay this claim, which as
of March 1, 2021, will be at $73,181, with 6% interest per annum
over 60 months period in equal monthly installments of principal
and interest of $1,417 each commencing on March 1, 2021, and
continuing for the next 59 installments on the 1st day of each
subsequent month, after which point the Claim will be deemed fully
repaid and satisfied. Class 2B is impaired.
* Class 2C - Swift Financial, LLC. Secured claim: POC-3, listed
at $32,072 as of Petition Date. The claim is fully secured.
Pursuant to Stipulation, the Debtor will repay Claim, which as of
March 1, 2021, will be at $30,519 together with 6% interest per
annum on the claim over 60 months period in equal monthly
installments of principal and interest of $590 each commencing on
March 1, 2021, and continuing for the next 59 installments on the
1st day of each subsequent month, after which point the Claim will
be deemed fully repaid and satisfied. Class 2C is impaired.
* Class 2D - Ford Motor Credit Company, LLC Secured claim:
POC-6, listed at $85,188 as of Petition Date. The claim is fully
secured. The Debtor has cured or will continue curing any default
in payments pursuant to Adequate Protection Agreement and Order on
Motion for Relief of Stay and will continue making contractually
scheduled payments of $1,740.87 a month pursuant to the terms of
Contract/Promissory Note and Security Agreement. Class 2D is
impaired.
* Class 2E - Ford Motor Credit Company, LLC. Secured claim:
POC-7, listed at $83,199 as of Petition Date. The claim is fully
secured. The Debtor has cured or will continue curing any default
in payments pursuant to Adequate Protection Agreement and Order on
Motion for Relief of Stay and will continue making contractually
scheduled payments of $1,790 a month pursuant to the terms of
Contract/Promissory Note and Security Agreement. Class 2E is
impaired.
* Class 2F - Wells Fargo Bank, NA d/b/a Wells Fargo Auto.
Under-secured claim: POC-12,listed at $70,694: $59,975 listed as
secured portion of claim and remaining $10,719 as unsecured portion
of claim, as of petition date. With respect to secured portion of
$59,975, the Debtor has made and will continue making contractually
scheduled payments of $1,454 each that are equal to adequate
protection payments. There will be 36 remaining payments under the
contract from the Effective Date of the Plan. Class 2F is
impaired.
* Class 2G - Funding Metrics, LLC. Under-secured claim:
POC-16, listed at $15,478: $8,378 listed as secured claim and
remaining $7,100 as unsecured claim, as of Petition Date. Pursuant
to Stipulation, the Debtor shall only be obligated to repay this
Creditor's secured portion of Claim, which as of March 1, 2021 is
$7,226 with 6% interest per annum over 60 months period in equal
monthly installments of principal and interest of $139.70 each
commencing on March 1, 2021, and continuing for the next 59
installments on the 1st day of each subsequent month, after which
point the entire Claim, secured and unsecured portions, will be
deemed fully repaid and satisfied. Class 2G is impaired.
* Class 2H - Kabbage, Inc. Secured claim: No POC filed, listed
on Schedule "D" at $14,000.00 as of petition date. The claim is
fully secured. Pursuant to Stipulation, the Debtor will repay the
claim, which as of March 1, 2021, is agreed to be $7,017.50,
together with 0% interest on the claim over 24 months period in
equal monthly installments of principal and interest of $292.40
each commencing on the 1st day of the month from March 1, 2021, and
continuing for the next 23 installments on the first day of each
subsequent month, after which point the Claim will be deemed fully
repaid and satisfied. Class 2H is impaired.
* Class 4A - General Unsecured Claims which total $190,303.
Payment Interval: 60 monthly installments from the Effective Date
at 0% interest as follows:
Months 1-19: $0.00 a month
Months 20-35: $292.40 a month
Months 36-38: $2,184.61 a month
Months 39: $4,136.78 a month
Months 40-50: $5,590.68 a month
Months 51-55: $7,401.18 a month
Months 56-60: $9,930.38 a month
The class will receive a total estimated payout of $163,524 --
estimated to pay 85.93% of all claims in this class, but not more
than 100% of all claims in this class.
The Plan will be funded by continuing DEBTOR's business
operations.
Counsel for Parking Management Service of America:
Alla Tenina, Esq.
Tenina Law, Inc.
15250 Ventura Blvd, Suite 601
Sherman Oaks, CA 91403
Tel: (213)596-0265
Fax: (310)774-3674
E-mail: alla@teninalaw.com
A copy of the Second Amended Disclosure Statement is available at
https://bit.ly/3bWWh2B from PacerMonitor.com.
About Parking Management
Services of America
Parking Management Services of America, Inc., provides parking
attendants and attending personnel to various third parties'
parking locations. Parking Management Services filed a Chapter 11
petition (Bankr. C.D. Cal. Case No. 19-21103) on Sept. 19, 2019 in
Los Angeles, California. TENINA LAW, INC., serves as the Debtor's
counsel.
PENSKE AUTOMOTIVE: Moody's Completes Review, Retains Ba1 CFR
------------------------------------------------------------
Moody's Investors Service has completed a periodic review of the
ratings of Penske Automotive Group, Inc. and other ratings that are
associated with the same analytical unit. The review was conducted
through a portfolio review discussion held on March 4, 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
Penske Automotive Group, Inc.'s Ba1 corporate family rating
considers its position as the world's largest auto dealer by
revenue, with balance between its US and International divisions,
its diverse business model outside of the auto retail business,
especially the positive impact of its 29% ownership stake in Penske
Truck Leasing, the ability to "flex" its business model for
fluctuating macroeconomic conditions, which is being tested during
the present coronavirus pandemic, and opportunities for future
prudent growth across its numerous platforms. Ratings also consider
Penske's financial strategy, which has become more balanced in
recent years, particularly where shareholder distributions are
concerned, and its good liquidity.
The principal methodology used for this review was Retail Industry
published in May 2018.
PLYMOUTH PLACE: Fitch Assigns 'BB+' IDR, Outlook Stable
-------------------------------------------------------
Fitch Ratings has assigned a 'BB+' Issuer Default Rating (IDR) for
Plymouth Place (IL) and a 'BB+' revenue rating on the following
Illinois Finance Authority bonds expected to be issued on behalf of
Plymouth Place:
-- $23,960,000 revenue refunding bonds, series 2021A (Plymouth
Place).
Fitch also affirms the 'BB+' rating on the following Illinois
Finance Authority bonds also issued on behalf of Plymouth Place:
-- $24,765,000 (Plymouth Place) revenue refunding bonds, series
2013;
-- $53,650,000 (Plymouth Place) revenue bonds, series 2015.
The Rating Outlook is Stable.
The 2021A bonds will be issued as fixed rate. Bond proceeds will be
used to refund the series 2013 bonds, fund a debt service reserve
fund (DSRF) and pay for the cost of issuance. Concurrent with the
issuance of the series 2021A bonds, it is expected that Cinderella
bonds will be issued in the approximate par of $59.3 million, as an
unrated direct bank placement. Those bonds are expected to be
variable rate taxable bonds that will convert to non-taxable bonds
in 2025. Proceeds from the Cinderella bonds will refund the series
2015 bonds. Plymouth Place will use two fix payor swaps--one for
the taxable period and a second forward looking swap for when the
bonds convert to non-taxable in 2025--in order to hedge the
variable rate. Maximum annual debt service (MADS) is expected to be
approximately $4.5 million. The 2021A bonds are expected to sell
via negotiation the week of March 22nd.
SECURITY
The bonds are secured by an interest in the gross revenues of
Plymouth Place and a security interest in certain mortgaged
properties. A DSRF will be provided for the 2021A bonds.
ANALYTICAL CONCLUSION
The 'BB+' IDR and revenue rating reflect Plymouth Place's market
position, characterized by steady independent living (IL) demand in
a solid service area west of Chicago, an adequate operational
performance for a Type 'A' campus, and cash to debt and pro forma
maximum MADS coverage metrics that support a financial profile
consistent with the rating level, given the midrange revenue
defensibility and operating risk assessments. Unaudited financial
results for fiscal 2020 show Plymouth Place largely maintaining its
operating performance through the coronavirus pandemic. However,
Plymouth Place experienced negative net entrance fees in 2020
related to an extended period of time when the marketing or selling
of IL apartments was severely limited due, in part, to state
mandated restrictions on campus access at senior living facilities.
Despite the negative entrances fee receipts, Plymouth Place made
its debt service coverage covenant and that was helped by sustained
levels of IL occupancy, federal stimulus funding, and a good year
for philanthropy. Management reports that January and February have
been very strong months for move ins and entrance fees, eight
through the end of February, reflecting Plymouth Place's good
demand profile. Fitch expects Plymouth Place to have a solid year
of performance in fiscal 2021 as operations remain stable and
entrance fees receipts recover.
Capital spending is expected to remain below depreciation in the
next two years, which is consistent with the prior four years.
Plymouth Place is contemplating an IL expansion on the eastern part
of its campus. The financing for the expansion project is not
expected to occur in the next year, and Fitch would expect the
project to reach certain pre-sale levels before it would move
forward, which could also affect the timing. The project is not
factored into the current rating.
Fitch's forward look shows Plymouth Place metrics remaining largely
stable over the next few years. Post issuance, the operating ratio
is expected to improve slightly as interest costs are expected to
lower. MADS coverage is expected to improve as well due to the
lower interest costs and the extending of bond maturities with the
debt issuance. Plymouth Place is refinancing all of its long-term
debt with the 2021 debt issuances.
KEY RATING DRIVERS
Revenue Defensibility: 'bbb'
Good IL Demand in Solid Service Area
The midrange revenue defensibility assessment reflects Plymouth
Place's strong IL demand and pricing that is consistent with local
market--a relatively affluent area of the western metro Chicago
region-- and manageable direct competition in the form of limited
other providers that offer the Type 'A' Lifecare contract.
Operating Risk: 'bbb'
Adequate Operating Performance; Good Age of Plant
The midrange assessment is supported by adequate operating metrics,
with the operating ratio averaging 103.5% and the net operating
margin - adjusted (NOMA) averaging 18.8% in the four audited years
leading up to 2020. Capital spending over this time has remained
below depreciation; however, the average age of plant is good,
reflecting the relatively young age of the campus which was opened
in 2007.
Financial Profile: 'bb'
Stable Financial Profile Over Next Few Years
At YE 2020, Plymouth Place had unrestricted cash-to-adjusted debt
of about 49% and adequate pro-forma MADS coverage of 1.5x. Given
Plymouth Place's midrange revenue defensibility and midrange
operating risk assessments and Fitch's forward-looking scenario
analysis, Fitch expects Plymouth Place's key leverage metrics to
remain consistent with the 'BB+' rating. Post issuance. Fitch
expects Plymouth Place's cash to adjusted debt to drop and MADS
coverage to improve, even taking into consideration recent economic
and operational volatility caused by the coronavirus pandemic.
ASYMMETRIC ADDITIONAL RISK CONSIDERATIONS
No asymmetric risk considerations were relevant to the rating
determination. However, Plymouth Place is significantly increasing
the risk to its debt structure with this debt issuance. Post
issuance, Plymouth Place will have mostly variable rate, privately
placed bank debt that will be hedged with swaps. The bank exposure,
the exposure to renewal risk (the bank commitment is for 10 years),
and the introduction of swaps increase the risk on the debt
structure. While the debt structure was not a factor in the current
rating, the riskier debt structure could constrain the rating
moving forward.
RATING SENSITIVITIES
Factor that could, individually or collectively, lead to positive
rating action/upgrade:
-- Strengthening of the financial profile, such that the
operating rating ratio is consistently below 100%, cash to
debt improves to approximately 50%, and MADS coverage is
consistently at 2x.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
-- Weakening in performance such that the operating ratio rises
above 105%, cash to debt deteriorates to below 40%, and MADS
coverage remains below 1.5x.
-- A project-based debt issuance such that cash to debt falls
below 30% and other leverage metrics remain stressed even
after project stabilization.
BEST/WORST CASE RATING SCENARIO
International scale credit ratings of Sovereigns, Public Finance
and Infrastructure issuers have a best-case rating upgrade scenario
(defined as the 99th percentile of rating transitions, measured in
a positive direction) of three notches over a three-year rating
horizon; and a worst-case rating downgrade scenario (defined as the
99th percentile of rating transitions, measured in a negative
direction) of three notches over three years. The complete span of
best- and worst-case scenario credit ratings for all rating
categories ranges from 'AAA' to 'D'. Best- and worst-case scenario
credit ratings are based on historical performance.
CREDIT PROFILE
Plymouth Place operates a Type 'A' LPC located in La Grange Park,
IL, roughly 15 miles west of downtown Chicago. The organization
operates 182 IL apartments, 52 assisted living (AL) units, 26
memory support units, and 75 skilled nursing beds. Plymouth Place
offers a variety of resident contracts--from 0% refundable to 90%
refundable. The majority of current residents have chosen the 90%
refundable contracts. While Plymouth Place began operations in
1944, the current campus opened in 2007 as a replacement facility.
Total operating revenue was nearly $31 million in fiscal 2020
(unaudited).
REVENUE DEFENSIBILITY
Plymouth Place's occupancy across the continuum of care has held up
well through the coronavirus pandemic. IL occupancy remained at 90%
as of Dec. 30, 2020. IL occupancy averaged 96% over the last four
audited years, and Fitch expects IL occupancy to return to close to
those levels over the next year. Occupancy levels across assisted
living, dementia, and skilled nursing were also solid over the last
four years, generally ranging from 85% to 95%. Plymouth Place
temporarily reduced the number of skilled nursing facility (SNF)
beds (from 86 to 76), to allow for all private rooms and isolation
areas, in response to the coronavirus pandemic. SNF occupancy fell
to 71% by YE 2020, but Fitch expects that figure to improve over
the next year, as the flow of short-term rehab referrals from area
hospitals rebuilds and Plymouth Place's IL residents age through
the continuum. AL and memory care occupancies have fared better
through the pandemic, holding steady at 87% and 92%, respectively,
at YE 2020. Management has implemented a number of patient and
staff health and safety protocols in response to the pandemic --
including installing hospital-grade ionization and ultraviolet air
filtration and cleaning systems. Additionally, 99% of residents
have been vaccinated, along with many staff members. The health and
safety protocols and the level of vaccinations are yielding
marketing benefits.
The majority of Plymouth Place's residents come from a two to five
mile area that surrounds the campus in Le Grange Park. The service
area is sound, with property values above average. Although
population and general economic indicators in the greater metro
Chicago are mixed, La Grange is among the wealthier communities in
the area. The Chicago metro area has many competitors for senior
living, but there are no new developments in the immediate service
area. Additionally, competition from full continuum of care Type
'A' providers is limited. Most of the area competitors offer a
different type of contract and/or don't offer the full continuum of
care.
The good service area demographics has enabled Plymouth Place to
regularly increase fees, both for monthly service fees and on
entrance fees. According to Zillow data, entrance fees are in line
with prevailing housing prices in the local market.
OPERATING RISK
Plymouth is a Type 'A" lifecare community, which limits its cost
management ability, given residents pay the same monthly service
fee as they age through the continuum.
Plymouth Place's operating metrics remained sound in fiscal 2020,
despite pressures from the coronavirus pandemic. YE 2020 results
show the operating ratio measured approximately 102.8%, in-line
with the 103% that Plymouth Place averaged between fiscals 2015 and
2019. Plymouth Place's NOM measured a good 9.2%. The sound
operating margins in fiscal 2020 were driven by continued flexing
of expenses (with only limited layoffs), the maintenance of
sufficient occupancy rates, and receipt of approximately $900,000
in CARES Act grants. These helped offset lower revenue and
unbudgeted expenses of approximately $375,000. One exception to
sound operating metrics is the NOMA. After averaging a good nearly
20% over the last five years, Plymouth Place's NOM dropped
considerably to 2.5% in 2020. The reason for this, despite
continued adequate core operating margins, was a steep decline in
net entrance fees received, which ended the year at a -$2 million
after averaging nearly $3.2 million over the prior four years.
Particularly in the early days of the pandemic, Plymouth Place's
entrance fees refunds exceeded entrance fees received.
Plymouth Place ended the year on a positive sales and entrance fee
trajectory, which has carried over into 2021, with management
reporting eight sales through the end of February. That is best
quarter Plymouth Place has ever had for sales. Plymouth Place's
operating metrics in 2021 should be at least as good as those
recorded in 2020. Plymouth Place has approximately $3 million in
unrecognized Paycheck Protection Funds, which are not in the
budget. Should Plymouth Place receive forgiveness on those funds
that will add to Plymouth Place's financial performance in 2020.
Longer term, margins should return to levels consistent with prior
year trends.
Plymouth Place's capex have averaged about 44.2% of depreciation
over the last five years and management expects capex to be
approximately 70% to 80% of depreciation in the next few years,
limited primarily to routine maintenance and renovation of existing
turned over units. Despite the lower capital spending, the average
age of plant is good at 10.7 years as of 2020, largely reflecting
the young age of the campus which was redeveloped in the early
2000s and opened in 2007. Plymouth Place management and the board
are contemplating whether or not to move forward on an expansion on
the East Campus, which currently has seven occupied cottages. That
project, if it moves forward, may include new money debt and/or be
supported by fundraising. Fitch will evaluate the credit
implication of the project and any related financing should the
East Campus project move forward. A financing for the project is
not expected to happen in the next year.
Over the last four years, Plymouth Place has had relatively good
revenue only coverage, averaging approximately 0.9x, which is
especially strong for a below investment grade, Type 'A' contract
facility. Fitch expects that to improve slightly as MADS is
expected to lower with the current debt issuance. Pro forma MADS as
a percent is good as well at 12.6% in 2020. Debt-to-net-available
is expected to weaken as total debt will increase to be able to
fully refund the 2015 bonds, which aren't callable until 2025, but
remain in line with a midrange assessment.
FINANCIAL PROFILE
Given Plymouth Place's midrange revenue defensibility and midrange
operating risk assessments and Fitch's forward-looking scenario
analysis, Fitch expects the Plymouth Place's key leverage metrics
to remain consistent with a 'BB+' rating, throughout the current
economic and business cycle. As of YE 2020, Plymouth Place had
unrestricted cash of approximately $33.5 million (inclusive of $2.9
million of PPP funds). This represents about 41% of total debt.
Plymouth Place has no debt equivalents.
Fitch's baseline scenario, which is a reasonable forward look of
financial performance over the next five years given current
economic expectations, shows Plymouth Place maintaining operating
and financial metrics that are largely consistent with the current
rating and with historical levels of performance. Capital spending
is expected to remain below depreciation. Fitch's baseline scenario
assumes an economic stress (to reflect equity volatility), which is
specific to Plymouth Places asset allocation. Despite the stress,
Plymouth Place maintains cash-to-adjusted debt levels that are
consistent the 'BB+' rating throughout Fitch's baseline forward
looking scenario and remains resilient even under a potential
stress case scenario. MADS coverage remains steady slightly better
than the prior five years. Days cash on hand is expected to remain
above 330 days in the forward looking scenario, indicating a
liquidity profile assessment that is neutral to the rating
outcome.
ASYMMETRIC ADDITIONAL RISK CONSIDERATIONS
While no asymmetric additional risk considerations affected the
rating outcome, Plymouth Place is moving to a riskier debt
structure with the 2021 debt issuances. Plymouth Place's current
debt structure is conservative, with all its debt, public fixed
rate bonds. Post issuance, Plymouth Place's debt structure will be
a mix of approximately 71% privately placed bank debt and 29%
public fixed rate debt. The bank debt will be variable rate and
synthetically fixed with swaps. While the increased risk to the
debt structure has not affected the current rating, the debt
structure could constrain the rating moving forward.
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.
POP GOURMET: Court Confirms Reorganization Plan
-----------------------------------------------
Judge Timothy W. Dore has entered an order confirming the Plan of
POP Gourmet, LLC.
In Paragraph 4.02.a(2) of the Plan, the phrase "Pursuant to 11
U.S.C. Sec. 1191(e) and notwithstanding 11 U.S.C. Sec.
1129(a)(9)(a)," is deleted.
The Third Amended Plan of Reorganization proposes to pay creditors
of Pop Gourmet, LLC over a five-year plan period. Holders of
allowed general unsecured claims will receive a distribution in
excess of what they would receive under a liquidation of the
Debtor.
Since the Petition Date, the company has restarted the
manufacturing and marketing of its flavored popcorn and potato
chips and now seeks to take advantage of shifting consumer spending
and consumption habits. With a combination of planned hires
including a National Sales Manager, future strategic partnerships,
and an aggressive E-commerce plan, the company
targets consistent growth throughout the plan's lifetime. Pop
Gourmet's proposed Plan of Reorganization is designed to bridge the
gap between restructuring and profit-generation.
The Plan treats claims as follows:
* Class 1: Secured Claims. This Class consists of secured
claims held by prepetition noteholders and assignees whose
indebtedness is secured pari passu by the same collateral. This
Class is impaired. The Debtor proposes to make fixed monthly
payments towards the Class 1 Claim, with the first monthly payment
starting April 2022. The first monthly payment for Class 1 is
projected to be $7887. Missed or insufficient payments due to a net
cash outflow will accrue on the outstanding balance at an interest
rate of 4.25%. At the start of each plan year, monthly installments
will be recalculated such that the outstanding principal balance is
fully amortized by the end of Year Five.
* Class 3: General Unsecured Claims. This class is impaired.
To the extent there are sufficient Distributable Funds available to
do so: Beginning on the first business day of the first month
following the Effective Date, and continuing on the first business
day of each subsequent month for 59 months, the Reorganized Debtor
may make payments to Class 3 claimants on account of Allowed Class
3 Claims.
Plan payments shall be funded by the Reorganized Debtor's monthly
income and, only to the extent necessary, by the new financing.
Attorneys for the Debtor:
John R. Rizzardi
Aditi Paranjpye
CAIRNCROSS & HEMPELMANN, P.S.
524 Second Avenue, Suite 500
Seattle, WA 98104-2323
Telephone: (206) 587-0700
Facsimile: (206) 587-2308
E-mail: jrizzardi@cairncross.com
E-mail: aparanjpye@cairncross.com
A copy of the Order is available at https://bit.ly/3vB4rW8 from
PacerMonitor.com.
A copy of the Third Amended Plan of Reorganization is available at
https://bit.ly/3r469fj from PacerMonitor.com.
About Pop Gourmet
POP Gourmet, LLC -- https://www.popgourmetpopcorn.com/ -- is a
manufacturer of potato chips, corn chips, popcorn, and similar
snacks.
POP Gourmet, LLC, based in Seattle, WA, filed a Chapter 11 petition
(Bankr. W.D. Wash. Case No. 20-11497) on May 26, 2020. In the
petition signed by CEO Steve Gallo, the Debtor disclosed $463,637
in assets and $5,034,487 in liabilities. The Hon. Timothy W. Dore
presides over the case. CAIRNCROSS & HEMPELMANN, P.S., serves as
bankruptcy counsel to the Debtor.
PURDUE PHARMA: Opioid Victims Each to Get Up to $48,000 in Plan
---------------------------------------------------------------
Jonathan Randles of the Wall Street Journal reports that opioid
victims of Purdue Pharma will get up to $48,000 under the company's
bankruptcy plan
Purdue's chapter 11 plan would create a $700 million to $750
million trust to resolve thousands of personal-injury claims
related to OxyContin.
Individuals who filed claims over opioid addiction or overdose
deaths against OxyContin maker Purdue Pharma LP are projected to
receive as much as $48,000 under the company's bankruptcy plan.
Estimated payouts under Purdue's chapter 11 proposal, filed Monday,
depend on the severity of an individual's injury or addiction, with
the least severe cases getting an estimated $3,500. Administrators
would determine individuals' eligibility for compensation and rate
the severity of their opioid injuries through a point system,
according to court papers filed Monday. Specific eligibility and
qualification requirements will be made public later.
A preliminary analysis projects victims who qualify for the most
severe injuries will receive between $16,000 and $48,000, less
severe cases likely would get between $5,000 and $31,000, and the
least severe cases likely would get $3,500, according to court
papers. Purdue's court filings said it is impossible to determine
with certainty how much a specific personal-injury claimant will
get from the trust. The analysis was performed by lawyers
representing a group of people with personal-injury claims against
Purdue, court papers say.
The compensation procedures are part of a broader reorganization
plan that offers a blueprint for resolving more than 100,000
personal-injury claims related to OxyContin, Purdue's flagship
opioid painkiller.
The bankruptcy plan, which tracks the ways that other companies
have resolved massive legal liability through chapter 11, was
criticized Tuesday by state attorneys general who haven't signed on
to Purdue's restructuring deal and by some lawyers representing
opioid victims who believe it doesn’t provide enough funding for
those affected by addiction.
Payments would come from a special trust, funded with between $700
million and $750 million, according to court documents. It would be
one of several trusts that would be created to fund opioid
abatement programs across the U.S., should the reorganization be
approved by the U.S. Bankruptcy Court in White Plains, N.Y.
Purdue's plan could be challenged in coming months by opioid
victims and state attorneys general. The personal-injury trust will
get $300 million after the chapter 11 plan is approved and goes
effective; the remaining $400 million or $450 million would be
provided either in annual installments or through insurance
proceeds, according to court documents.
Covered injuries include overdose deaths, addiction and babies born
with neonatal abstinence syndrome, known as NAS, which is caused by
exposure to opioids in the womb.
On Tuesday, March 16, 2021, lawyers representing children diagnosed
with NAS said most such children are likely to get $3,500 under the
proposal. The money set aside for these children is inadequate to
cover the cost of long-term aid and treatment they will require to
live healthy lives, said Scott Bickford, a lawyer representing
babies diagnosed with NAS.
"We are only beginning to understand the impact of NAS and the
resources children need to live healthy lives and even survive
infancy," Mr. Bickford said.
A coalition of 24 U.S. states attorneys generals said Tuesday that
although Purdue's latest plan is an improvement over an earlier
deal from 2019, “it falls short of the accountability that
families and survivors deserve." Purdue came into bankruptcy with a
partial deal supported by some states already in hand. The company
has been negotiating for months to broaden support for the deal.
States opposing the restructuring proposal include California,
Massachusetts, New York and Pennsylvania.
Purdue was tipped into chapter 11 by a wave of lawsuits related to
OxyContin that began building in 2017. The company pleaded guilty
in November 2020 to three federal felonies, including paying
illegal kickbacks and deceiving drug-enforcement officials
Members of the Sackler family who own Purdue will have no role in
the company’s governance or operations when it leaves bankruptcy.
The reorganized Purdue instead will be overseen by a new
independent board focused on addressing the opioid crisis and
developing and distributing medicines to reverse overdoses and
treat opioid addiction, the company has said.
Judge Robert Drain is expected to consider approving Purdue's
bankruptcy plan in August 2021, according to court documents.
About Purdue Pharma LP
Purdue Pharma L.P. and its subsidiaries --
http://www.purduepharma.com/-- develop and provide prescription
medicines and consumer products that meet the evolving needs of
healthcare professionals, patients, consumers and caregivers.
Purdue's subsidiaries include Adlon Therapeutics L.P., focused on
treatment for Attention-Deficit/Hyperactivity Disorder (ADHD) and
related disorders; Avrio Health L.P., a consumer health products
company that champions an improved quality of life for people in
the United States through the reimagining of innovative product
solutions; Imbrium Therapeutics L.P., established to further
advance the emerging portfolio and develop the pipeline in the
areas of CNS, non-opioid pain medicines, and select oncology
through internal research, strategic collaborations and
partnerships; and Greenfield Bioventures L.P., an investment
vehicle focused on value-inflection in early stages of clinical
development.
Opioid makers in the U.S. are facing pressure from a crackdown on
the addictive drug in the wake of the opioid crisis and as state
attorneys general file lawsuits against manufacturers. More than
2,000 states, counties, municipalities and Native American
governments have sued Purdue Pharma and other pharmaceutical
companies for their role in the opioid crisis in the U.S., which
has contributed to the more than 700,000 drug overdose deaths in
the U.S. since 1999.
OxyContin, Purdue Pharma's most prominent pain medication, has been
the target of over 2,600 civil actions pending in various state and
federal courts and other fora across the United States and its
territories.
On Sept. 15 and 16, 2019, Purdue Pharma L.P. and 23 affiliated
debtors each filed a voluntary petition for relief under Chapter 11
of the U.S. Bankruptcy Code (Bankr. S.D.N.Y. Lead Case No.
19-23649), after reaching terms of a preliminary agreement for
settling the massive opioid litigation. The Debtors' consolidated
balance sheet as of Aug. 31, 2019, showed $1.972 billion in assets
and $562 million in liabilities.
U.S. Bankruptcy Judge Robert Drain oversees the cases.
The Debtors tapped Davis Polk & Wardwell LLP and Dechert LLP as
legal counsel; PJT Partners as investment banker; AlixPartners as
financial advisor; and Prime Clerk LLC as claims agent.
Akin Gump Strauss Hauer & Feld LLP and Bayard, P.A., represent the
official committee of unsecured creditors appointed in Debtors'
bankruptcy cases.
David M. Klauder, Esq., was appointed as fee examiner. The fee
examiner is represented by Bielli & Klauder, LLC.
PURDUE PHARMA: Sacklers Hike Plan Funding to $4.5 Billion
---------------------------------------------------------
Purdue Pharma L.P., et al., submitted a Plan and a Disclosure
Statement.
On the very first day of the Chapter 11 cases, the Debtors
committed to turn over all of their assets for the benefit of their
claimants and the American public, with the goal of directing as
much of the value of their assets as possible to combatting the
opioid crisis in this country. Today, the Debtors propose a Plan
that delivers on this goal.
The Plan also significantly improves on the initial settlement
framework that was in place at the commencement of these Chapter 11
cases, most notably by increasing the amount that Purdue Pharma's
existing shareholders will be required to pay in the aggregate from
$3.0 billion to $4.5 billion. Of this sum, $225 million has been
paid by the shareholders to satisfy their civil settlement with the
U.S. Department of Justice, leaving $4.275 billion for the
creditors in this bankruptcy case. This material improvement in
the recovery from the shareholders directly increases by $1.275
billion the amount of funds that can be directed towards
abatement.
As for Purdue Pharma, it will cease to exist. On the Effective
Date, the Debtors' businesses will be transferred to a newly
created company, which will be indirectly owned by two of the
opioid abatement trusts. No federal, state, or local governmental
entity will own the new company. The new company will be a private
company, will be required to operate in a responsible and
sustainable manner, and will be subject to the same laws and
regulations as any other pharmaceutical company. The new company
will, however, be historic and unique because its charter will
require that it deploy its assets to address the opioid crisis in
two ways. First, the new company will continue the Debtors'
development of opioid overdose reversal and addiction treatment
medications, and will be authorized to deliver an unlimited amount
of such medications at cost when development is complete. Second,
this new company will continue to grow the Debtors' non-opioid
businesses, including developing its robust and diversified
pipeline of non-opioid investigative candidates that have the
potential to address several serious medical conditions, with
resulting improvements in the value of the business benefiting the
relevant opioid abatement trusts.
As a result of the improvements to the settlement framework, it is
expected that approximately $5 billion in value will be provided to
trusts, each with a mission to fund abatement of the opioid crisis.
An additional $700 million to $750 million will be provided to a
trust that will make distributions to qualified personal injury
claimants
The first phase of Mediation resulted not only in an agreement on
allocation of estate resources among major creditor constituencies,
but also an extraordinary commitment from the states, territories,
tribes, municipalities and other governmental units, treatment
providers, third-party payors and insurance carriers and legal
guardians of children born with neonatal abstinence syndrome to
accept distributions in the form of funding for programs designed
to abate the opioid crisis (distributions to holders of PI Claims
will not be subject to such provision). Under the structure agreed
to in the first phase of Mediation, which is embodied in the Plan,
funds created for the benefit of each group associated with the
Private Claimants will receive fixed cash distributions over time,
4 with varying values and time periods for each such group,
including a fund of between $700 million and $750 million to make
distributions to holders of PI Claims. Residual value after
satisfying other obligations under the Plan will be distributed
through two newly established national opioid abatement trusts, the
National Opioid Abatement Trust (the "NOAT") and the Tribe Trust,
on account of the Non-Federal Domestic Governmental Claims and
Tribe Claims, respectively. All value distributed to NOAT and the
Tribe Trust will be exclusively dedicated to programs designed to
abate the opioid crisis and for no other purpose (other than to
fund administration of the programs themselves and to pay fees and
costs). The Debtors believe that funding these dedicated abatement
funds, while allocating significant value for distribution to
holders of PI Claims, is in the best interest of creditors and of
the American public.
While the Mediation was ongoing, the Debtors also reached a
settlement with the United States. On Nov. 18, 2020, the
Bankruptcy Court approved PPLP entering into: (i) a plea agreement
(the "Plea Agreement") by and among PPLP and the United States6;
and (ii) a civil settlement agreement by and between PPLP and the
United States (the "Civil Settlement," and together with the Plea
Agreement, the "DOJ Resolution"). On November 24, 2020, in
accordance with the terms of the DOJ Resolution, PPLP pled guilty
in the United States District Court for the District of New Jersey
(the "New Jersey District Court") to an information charging it
with three felony offenses: one count charging a dual-object
conspiracy to defraud the United States and to violate the Food,
Drug, and Cosmetic Act, and two counts charging conspiracy to
violate the Federal Anti-Kickback Statute. Consistent with the
terms of the Plea Agreement, the New Jersey District Court's
consideration of the Plea Agreement has been deferred to the
sentencing hearing, which will occur following confirmation of the
Debtors' Plan. If the Plea Agreement is accepted by the New Jersey
District Court at the sentencing hearing, the DOJ Resolution will
fully resolve the United States' civil and criminal investigations
into the Debtors' past practices related to the production, sale,
marketing and distribution of opioid products. Pursuant to the
Plea Agreement, among other things, the Debtors and the United
States agreed to a criminal forfeiture judgment in the amount of $2
billion (the "Forfeiture Judgment") that will be entered after
confirmation of the Chapter 11 Plan and upon the New Jersey
District Court's acceptance of the Plea Agreement, and will be
deemed to have the status of an allowed superpriority
administrative expense claim against PPLP.
Critically, the United States further agreed to provide a credit
offsetting the Forfeiture Judgment (the "Forfeiture Judgment
Credit") of up to $1.775 billion for value distributed or otherwise
conferred by Purdue Pharma under the Plan in respect of claims
asserted by state, tribal, or local government entities, provided
that the Plan provides for the emergence of a public benefit
company (or entity with a similar mission) and certain other terms
and conditions as described in more detail in the Plea Agreement.
The Forfeiture Judgment Credit therefore helps maximize the amount
of value that can be dedicated to abatement purposes. Distribution
of the value from the Debtors' Estates, which is estimated at more
than $4 billion, to NOAT and the Tribe Trust to fund abatement
programs under the Plan will satisfy the first primary requirement
to realize the Forfeiture Judgment Credit. The transfer of the
Debtors' business to NewCo, which is described in more detail
below, will satisfy the second primary requirement. Accordingly,
the Plan contemplates that the Debtors will be able to utilize the
full amount of the Forfeiture Judgment Credit. See Article III.U
for a further description of the DOJ Resolution.
Prior to and continuing during and after the second phase of
Mediation, which primarily concerned causes of action against the
Sackler Families, the Special Committee of the Debtors' Board of
Directors, with the advice of legal and financial advisors,
conducted a searching and exacting review of their claims against
the Sackler Families and related entities. The purpose of this
comprehensive investigation was to enable the Debtors to continue
to negotiate the terms of any final settlement with the Sackler
Families and to determine whether proposed settlement terms would
fall within the range of reasonableness and would satisfy the
standards for approval of settlements in bankruptcy cases,
including weighing the value of potential estate claims, the
possibility of success on those claims (including the strength of
any defenses), the need for protracted litigation with its
attendant expense, uncertainty, inconvenience, and delay, and the
challenges of collecting on a potential judgment, among other
things, against the settlement's immediate and future benefits.
In the second phase of Mediation, the Debtors, the Creditors
Committee, the AHC, the MSGE and the NCSG negotiated with
representatives of the Sackler Families regarding a potential
resolution of the causes of action against the Sackler Families.
These efforts resulted in material improvements to the terms of the
initial Settlement Framework. Specifically, the amount that the
Sackler Families will be required to pay in the aggregate has
increased from $3 billion under the initial Settlement Framework to
$4.5 billion, consisting of $4.275 billion that will be paid under
the Plan and $225 million that has been paid by the Sackler
Families to satisfy their civil settlement with the United States
Department of Justice. The principal consideration for such
payments required under the Plan are the release and injunction
provisions with respect to specified parties associated with the
Sackler Families provided for under the Plan.
Finally, PPLP will not emerge from Chapter 11. Instead,
substantially all of the Debtors' non-cash assets (other than
certain causes of action and insurance rights), including direct or
indirect interests in PPLP's subsidiaries as separate legal
entities except as otherwise provided by or permitted in the Plan,
and approximately $200 million of cash will be transferred directly
or indirectly to NewCo, a newly formed limited liability company
under Delaware law as described in more detail in Section 5.4 of
the Plan. NewCo will be indirectly owned by NOAT and the Tribe
Trust, and the net value generated by NewCo will ultimately be
directed to abating the opioid crisis. There will also be a
guarantee by NewCo in favor of the Master Disbursement Trust as
described in more detail in Section 5.2 of the Plan.
NewCo will be required to be operated in a responsible and
sustainable manner, balancing: (i) the interests of its
stakeholders to fund and provide abatement of the opioid crisis;
(ii) effective deployment of its assets to address the opioid
crisis; and (iii) the interests of those materially affected by its
conduct. As a result, NewCo will operate in an accountable manner
with nearly all of the net value that it generates ultimately being
used to abate the opioid crisis. The NewCo Managers—who will
effectively function as a board of directors for the new
company—will initially be selected by the Ad Hoc Committee, and
acceptable to the MSGE Group, in consultation with the Debtors and
the Creditors' Committee, and pursuant to a selection process that
is reasonably acceptable to the Debtors; provided that the DOJ
shall have the right, in its discretion, to observe such selection
process.7 The initial NewCo Managers must all be disinterested and
independent, and any replacement NewCo Managers will be selected by
the disinterested managers of TopCo, a newly created company that
will hold the equity interests and voting rights in NewCo. The
NewCo and TopCo organizational documents and identity of the
initial NewCo Managers and initial TopCo Managers will be included
in the Plan Supplement. The Sackler Families will have no role in
the selection of the NewCo Managers or in any other aspect of
NewCo's governance or operations.
Counsel to the Debtors:
Marshall S. Huebner
Benjamin S. Kaminetzky
Timothy Graulich
Eli J. Vonnegut
Christopher S. Robertson
DAVIS POLK & WARDWELL LLP
450 Lexington Avenue
New York, New York 10017
Telephone: (212) 450-4000
Facsimile: (212) 701-5800
A copy of the Disclosure Statement is available at
https://bit.ly/3lpVWIF from PacerMonitor.com.
About Purdue Pharma LP
Purdue Pharma L.P. and its subsidiaries --
http://www.purduepharma.com/-- develop and provide prescription
medicines and consumer products that meet the evolving needs of
healthcare professionals, patients, consumers and caregivers.
Purdue's subsidiaries include Adlon Therapeutics L.P., focused on
treatment for Attention-Deficit/Hyperactivity Disorder (ADHD) and
related disorders; Avrio Health L.P., a consumer health products
company that champions an improved quality of life for people in
the United States through the reimagining of innovative product
solutions; Imbrium Therapeutics L.P., established to further
advance the emerging portfolio and develop the pipeline in the
areas of CNS, non-opioid pain medicines, and select oncology
through internal research, strategic collaborations and
partnerships; and Greenfield Bioventures L.P., an investment
vehicle focused on value-inflection in early stages of clinical
development.
Opioid makers in the U.S. are facing pressure from a crackdown on
the addictive drug in the wake of the opioid crisis and as state
attorneys general file lawsuits against manufacturers. More than
2,000 states, counties, municipalities and Native American
governments have sued Purdue Pharma and other pharmaceutical
companies for their role in the opioid crisis in the U.S., which
has contributed to the more than 700,000 drug overdose deaths in
the U.S. since 1999.
OxyContin, Purdue Pharma's most prominent pain medication, has been
the target of over 2,600 civil actions pending in various state and
federal courts and other fora across the United States and its
territories.
On Sept. 15 and 16, 2019, Purdue Pharma L.P. and 23 affiliated
debtors each filed a voluntary petition for relief under Chapter 11
of the U.S. Bankruptcy Code (Bankr. S.D.N.Y. Lead Case No.
19-23649), after reaching terms of a preliminary agreement for
settling the massive opioid litigation. The Debtors' consolidated
balance sheet as of Aug. 31, 2019, showed $1.972 billion in assets
and $562 million in liabilities.
U.S. Bankruptcy Judge Robert Drain oversees the cases.
The Debtors tapped Davis Polk & Wardwell LLP and Dechert LLP as
legal counsel; PJT Partners as investment banker; AlixPartners as
financial advisor; and Prime Clerk LLC as claims agent.
Akin Gump Strauss Hauer & Feld LLP and Bayard, P.A., represent the
official committee of unsecured creditors appointed in Debtors'
bankruptcy cases.
David M. Klauder, Esq., was appointed as fee examiner. The fee
examiner is represented by Bielli & Klauder, LLC.
PURE BIOSCIENCE: Incurs $595K Net Loss in Second Quarter
--------------------------------------------------------
PURE Bioscience, Inc. filed with the Securities and Exchange
Commission its Quarterly Report on Form 10-Q disclosing a net loss
of $595,000 on $916,000 of total revenue for the three months ended
Jan. 31, 2021, compared to a net loss of $666,000 on zero revenue
for the three months ended Jan. 31, 2020.
For the six months ended Jan. 31, 2021, the Company reported a net
loss of $775,000 on $2.51 million of total revenue compared to a
net loss of $1.79 million on zero revenue for the six months ended
Jan. 31, 2020.
As of Jan. 31, 2021, the Company had $5.28 million in total assets,
$780,000 in total current liabilities, and $4.51 million in total
stockholders' equity.
Tom Y. Lee, chief executive officer, said that, "Our net product
sales have continued to increase in comparison to last year's
pre-pandemic numbers. We are now seeing reorders in the
janitorial/sanitation channel as many of our distributors have
worked through inventory purchased during the pandemic.
"We are pleased that the FAA has continued to expanded use, which
will only increase as air travel picks up. The vetting process for
this approval was strict and PURE Hard Surface was fully adopted.
In addition, we have continued to work alongside SmartWash
Solutions toward the full commercialization and rollout of PURE
Control/Smart Wash Boost to provide new levels of fresh produce
safety," concluded Lee.
Liquidity
The Company has a history of recurring losses, and as of Jan. 31,
2021 the Company has incurred a cumulative net loss of
$124,249,000. In addition, the Company used $912,000 in operating
and investing activities resulting in a cash balance of $2,927,000.
Based on current projections, the Company believes its available
cash on-hand, its current efforts to market and sell its products,
and its ability to significantly reduce expenses, will provide
sufficient cash resources to satisfy its operational needs, for at
least one year from the date these financial statements are
issued.
Pure Bioscience said, "Our future capital requirements depend on
numerous forward-looking factors. These factors may include, but
are not limited to, the following: the acceptance of, and demand
for, our products; our success and the success of our partners in
selling our products; our success and the success of our partners
in obtaining regulatory approvals to sell our products; the costs
of further developing our existing products and technologies; the
extent to which we invest in new product and technology
development; and the costs associated with the continued operation,
and any future growth, of our business. The outcome of these and
other forward-looking factors will substantially affect our
liquidity and capital resources.
"Until we can continually generate positive cash flow from
operations, we will need to continue to fund our operations with
the proceeds of offerings of our equity and debt securities.
However, we cannot assure you that additional financing will be
available when needed or that, if available, financing will be
obtained on terms favorable to us or to our stockholders. If we
raise additional funds from the issuance of equity securities,
substantial dilution to our existing stockholders would likely
result. If we raise additional funds by incurring debt financing,
the terms of the debt may involve significant cash payment
obligations as well as covenants and specific financial ratios that
may restrict our ability to operate our business."
A full-text copy of the Form 10-Q is available for free at:
https://www.sec.gov/Archives/edgar/data/1006028/000149315221006001/form10-q.htm
About PURE Bioscience, Inc.
PURE Bioscience, Inc. -- www.purebio.com -- is focused on
developing and commercializing its proprietary antimicrobial
products primarily in the food safety arena. The Company provides
solutions to combat the health and environmental challenges of
pathogen and hygienic control. Its technology platform is based on
patented, stabilized ionic silver, and its initial products contain
silver dihydrogen citrate, better known as SDC. This is a
broad-spectrum, non-toxic antimicrobial agent, which offers 24-hour
residual bacterial protection and formulates well with other
compounds. As a platform technology, SDC is distinguished from
existing products in the marketplace because of its superior
efficacy, reduced toxicity and mitigation of bacterial resistance.
PURE is headquartered in Rancho Cucamonga, California (San
Bernardino metropolitan area).
RAMEN CONCEPTS: Gets OK to Hire BGW CPA as Accountant
-----------------------------------------------------
Ramen Concepts 1, LLC received approval from the U.S. Bankruptcy
Court for the Western District of North Carolina to employ BGW CPA,
PLLC as accountant.
The firm's services include:
a. preparing federal and applicable state income tax returns
with supporting schedules;
b. preparing county property tax returns;
c. preparing monthly and annual compiled financial statements;
d. assisting the Debtor's management in preparing analytical
reports regarding the Debtor's operations; and
e. other consulting and planning services.
The firm will be paid a flat fee of $500 per month for preparing
monthly compiled financial statements, and $1,500 for preparing
annual compiled financial statements. For all other services, the
firm will be paid $300 per hour for partners, $150 per hour for
assistants, and $55 per hour for data entry clerk.
The firm will also be reimbursed for out-of-pocket expenses
incurred.
Van Smith, a partner at BGW CPA, PLLC, disclosed in a court filing
that the firm is a "disinterested person" as the term is defined in
Section 101(14) of the Bankruptcy Code.
The firm can be reached at:
Van Smith
BGW CPA, PLLC
5821 Fairview Road, Suite 208
Charlotte, NC 28209
Tel: (704) 552-0553
About Ramen Concepts 1
Ramen Concepts 1 LLC -- http://futobuta.com/-- owns and operates a
ramen house called Futo Buta.
Ramen Concepts 1 filed a voluntary petition for relief under
Chapter 11 of the Bankruptcy Code (Bankr. W.D.N.C. Case No.
21-30081) on Feb. 16, 2021. Michael Shortino, manager, signed the
petition. In the petition, the Debtor disclosed that it had
estimated assets of between $100,001 and $500,000 and liabilities
of between $1 million and $10 million.
Judge Laura T. Beyer oversees the case.
Rayburn Cooper & Durham, PA and Shumaker Loop & Kendrick, LLP serve
as the Debtor's bankruptcy counsel and special corporate counsel,
respectively. BGW CPA, PLLC is the Debtor's accountant.
RAMEN CONCEPTS: Gets OK to Hire Shumaker Loop as Special Counsel
----------------------------------------------------------------
Ramen Concepts 1, LLC received approval from the U.S. Bankruptcy
Court for the Western District of North Carolina to employ Shumaker
Loop & Kendrick, LLP as special corporate counsel.
The Debtor requires special counsel to:
a. provide corporate advice regarding the impact of the Debtor's
Chapter 11 case on its corporate affairs;
b. represent the Debtor in various corporate governance and tax
matters;
c. provide legal advice on real estate and leasing-related
matters; and
d. represent the Debtor in non-bankruptcy litigation matters.
The firm will be paid at these rates:
Partners $325 to $735 per hour
Associates $320 to $495 per hour
Paralegal $205 to $290 per hour
The firm will also be reimbursed for reasonable out-of-pocket
expenses incurred.
The retainer fee is $10,000.
Lynn Chandler, Esq., a partner at Shumaker Loop & Kendrick,
disclosed in a court filing that the firm is a "disinterested
person" as the term is defined in Section 101(14) of the Bankruptcy
Code.
The firm can be reached at:
Lynn F. Chandler, Esq.
Shumaker Loop & Kendrick, LLP
101 South Tryon Street, Suite 2200
Charlotte, NC 28202
Office: (704) 375-0057
Direct: (843) 996-1920
Email: lchandler@shumaker.com
About Ramen Concepts 1
Ramen Concepts 1 LLC -- http://futobuta.com/-- owns and operates a
ramen house called Futo Buta.
Ramen Concepts 1 filed a voluntary petition for relief under
Chapter 11 of the Bankruptcy Code (Bankr. W.D.N.C. Case No.
21-30081) on Feb. 16, 2021. Michael Shortino, manager, signed the
petition. In the petition, the Debtor disclosed that it had
estimated assets of between $100,001 and $500,000 and liabilities
of between $1 million and $10 million.
Judge Laura T. Beyer oversees the case.
Rayburn Cooper & Durham, PA and Shumaker Loop & Kendrick, LLP serve
as the Debtor's bankruptcy counsel and special corporate counsel,
respectively. BGW CPA, PLLC is the Debtor's accountant.
REGIONAL VALVE: April 21 Hearing on Disclosure Statement
--------------------------------------------------------
The Bankruptcy Court has entered an order that the hearing to
consider the approval of Regional Valve Corp.'s Chapter 11 Small
Business Disclosure Statement filed on January 29, 2021, will be
held before the Honorable Meredith S. Grabill on Wednesday, April
21, 2021, at 3:00 p.m. The parties shall participate by phone.
April 14, 2021, is fixed as the last day for filing and serving
written objections to said Disclosure Statement.
About Regional Valve Corp
Regional Valve Corp -- http://www.regionalvalvecorp.com/--
provides industrial utility, petro chemical, marine, oil field, and
commercial equipment. It also offers repair, testing,
installation, and maintenance of safety relief valves for air, gas,
steam, and liquid services.
Regional Valve Corp filed its voluntary petition for relief under
Chapter 11 of the Bankruptcy Code (Bankr. E.D. La. Case No.
20-11025) on June 8, 2020. In the petition signed by Donald J.
Roth, Jr., president/registered agent, the Debtor disclosed
$941,080 in assets and $1,212,129 in liabilities. Phillip K.
Wallace, Esq., at PHILLIP K. WALLACE, PLC, is the Debtor's counsel.
RUBIE'S COSTUME: Debtor Wins Approval of Liquidating Plan
---------------------------------------------------------
Daniel Gill of Bloomberg Law reports that halloween and party
costume giant Rubie's Costume Co. won approval of its Chapter 11
liquidation plan that pays creditors with the proceeds of a $140
million sale.
The plan approved Wednesday, March pays secured creditors in full
and provides recoveries of between 34% and 61% to unsecured
creditors, which have claims between $7 million and $11 million,
according to the company's disclosures.
Current shareholders' equity interests are extinguished. But the
Beige family, which founded Rubie's and operated the company for 70
years, has a 30% stake in Rubies II LLC, the company that bought
the business.
About Rubie's Costume Company
Rubie's Costume Company Inc. is a distributor, manufacturer, and
designer of costume and party-related accessories that serve over
2,000 retail accounts. It also maintains licensing partnerships
with top studios like Nickelodeon, Warner Bros, Lucasfilm, Marvel,
and Disney for products inspired by WWE, Ghostbusters, Stranger
Things, DC Comics, JoJo Siwa, Harry Potter, and Star Wars.
Rubie's Costume Company and its affiliates sought Chapter 11
protection (Bankr. E.D.N.Y. Lead Case No. 20-71970) on April 30,
2020. Rubie's Costume was estimated to have $100 million to $500
million in assets and $50 million to $100 million in liabilities as
of the filing.
Judge Alan S. Trust oversees the cases.
The Debtors tapped Meyer, Suozzi, English & Klein, P.C. and Togut,
Segal & Segal LLP as bankruptcy counsel; BDO USA, LLP as
restructuring advisor; and SSG Capital Advisors LLC as investment
banker. Kurtzman Carson Consultants is the claims agent.
The Office of the U.S. Trustee appointed a committee of unsecured
creditors on May 18, 2020. The committee is represented by Arent
Fox, LLP.
* * *
On Sept. 24, 2020, Debtors won court approval to sell substantially
all assets as a going concern to Rubie's II, LLC. Rubie's Costume
Company, et al., were renamed to RCCI Wind Down Company, Inc., et
al., following the closing of the sale.
SC SJ HOLDINGS: DIP Loan, Cash Collateral Access OK'd
-----------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware has
authorized SC SJ Holdings LLC and affiliates to, among other
things, use cash collateral on an interim basis and obtain
postpetition financing in accordance with the budget.
Debtor SC SJ Holdings, LLC is authorized to obtain a superpriority
postpetition non-amortizing credit facility of up to $7.5 million
provided by FMT SJ Catering LLC as DIP Lender, of which up to $2.5
million shall be approved pursuant to the Interim Order.
The Debtors said they have an immediate and critical need to obtain
the DIP Facility and continue using the Cash Collateral and other
Prepetition Secured Loan Collateral, among other things, to
preserve the value of the Hotel property and allow it to continue
as a going concern, maintain business relationships with vendors,
make payroll, satisfy utilities costs, fund the costs and expenses
of the Cases, including payment of professionals' fees, and pay for
other expenses incurred in the ordinary course of business.
CLNC 2019-FL1 Funding, LLC, provided a prepetition term loan
pursuant to a Loan Agreement, dated as of January 2, 2018, in the
principal amount of up to $173,485,000. As of the SC SJ Debtor's
Petition Date, the Debtors were liable and indebted to the
Prepetition Secured Lender in the aggregate principal amount of
$173,485,000.
Prior to the Petition Dates, the Debtors granted to the Prepetition
Secured Lender, or the Mortgage Trustee a first priority security
interest in and continuing lien on substantially all of the
Debtors' assets.
The aggregate value of the Prepetition Secured Loan Collateral
exceeds the aggregate amount of the Prepetition Secured Loan
Obligations.
The Debtors and the DIP Lender agree to bear their own costs, fees
and expenses incurred in connection with the DIP Facility;
notwithstanding the foregoing, the Borrower may use DIP Facility
proceeds for payment of professional fees and expenses as set forth
in the Budget.
The Debtor is authorized to use cash collateral, provided that the
Prepetition Secured Lender is provided adequate protection and no
Cash Collateral Event of Default has occurred.
These events constitute Events of Default under the Court's Order:
(i) any Debtor's failure to comply with any of the material
terms or conditions of the Interim Order;
(ii) the failure of the Debtors to make any payment under the
Interim Order to the Prepetition Secured Lender within five
business days after such payment becomes due (other than payments
required under paragraph 11(d));
(iii) the Interim Order or the Final Order (if entered) ceases,
for any reason (other than by reason of the express written
agreement by the Prepetition Secured Lender), to be in full force
and effect in any material respect;
(iv) the Court will have entered an order amending,
supplementing or otherwise modifying the Interim Order in a manner
materially adverse to the Prepetition Secured Lender without the
Prepetition Secured Lender's consent;
(v) any Debtor affirmatively supports in writing an action
commenced by any person against the Prepetition Secured Lender or
the Mortgage Trustee with respect to the Prepetition Secured Loan
Documents;
(vi) the Court will have entered an order granting relief from
the automatic stay to the holder or holders of any security
interest to permit foreclosure (or the granting of a deed in lieu
of foreclosure or the like) on any of the Debtors' assets which
have an aggregate value in excess of $100,000;
(vii) the filing of any pleading by any Debtor in support of any
other person's opposition to any motion filed in the Court by the
Prepetition Secured Lender seeking confirmation of the amount of
its claims or the validity or enforceability of the Prepetition
Secured Loan Liens, except with regard to good faith disputes over
the payment of fees and expenses; and/or
(viii) the occurrence of a Lender Termination Event (as defined
under that Restructuring Support Agreement, dated as of March 9,
2021, by and between the Debtors, Sam Hirbod, Eagle Canyon Capital,
LLC, CLNC Fair Jose Pref, LLC, and the Prepetition Secured Lender.
As adequate protection, the Prepetition Secured Lender is granted
to secure payment of an amount equal to the Collateral Diminution,
a valid, binding, continuing, enforceable, fully perfected first
priority senior security interest in and lien on the Prepetition
Secured Loan Collateral and all other of the Debtors' real and
personal property, assets and rights of any kind or nature.
All of the DIP Obligations will constitute allowed superpriority
administrative expense claims against the Borrower (without the
need to file any proof of claim) with priority over any and all
claims against the Debtors.
The Prepetition Secured Lender is also allowed administrative
expense claim in the amount of any Collateral Diminution.
The DIP Superpriority Claims, Adequate Protection Claims, and
Adequate Protection Liens granted are subject to payment of the
Carve-Out. The "Carve-Out" means an amount equal to (a) all fees
required to be paid under 28 U.S.C. section 1930(a) plus interest
at the statutory rate; (b) plus the sum of all fees and expenses of
up to $25,000 incurred by a trustee under section 726(b) of the
Bankruptcy Code; and (c) allowed and unpaid claims and expenses
against the Debtors' estates for unpaid fees, costs, and expenses
that are both included in the Budget and incurred by persons or
firms retained by the Debtors or any official committee of
unsecured creditors appointed in these Cases, whose retention is
approved by a final order of the Court under section 327 and 1103
of the Bankruptcy Code, subject to the terms of any other interim
or other compensation order entered by the Court that are incurred
(i) at any time before delivery by the DIP Lender of a Carve-Out
Trigger Notice whether allowed by the Bankruptcy Court prior to or
after delivery of a Carve-Out Trigger Notice (subject to any
further limits imposed by the Final DIP Order), and (ii) after the
occurrence and during the continuance of an Event of Default and
delivery of written notice thereof, in an aggregate amount not to
exceed $350,000; provided, however that nothing in the Order will
be construed to impair the ability of any party to object to the
fees, expenses, reimbursement or compensation.
A final hearing on the matter is scheduled for April 6, 2021 at 2
p.m.
A copy of the order is available for free at https://bit.ly/38GbOlg
from PacerMonitor.com.
About FMT SJ and SC SJ
San Ramon-based Eagle Canyon Management's SC SJ Holdings LLC owns
The Fairmont San Jose, an 805-room luxury hotel located at 170
South Market Street, San Jose, California, in the heart of Silicon
Valley. The Hotel is near many of the largest Fortune 1000
corporations and is a popular location for conferences and
conventions, particularly in the technology industry.
On March 5, 2021, FMT SJ LLC filed a voluntary petition for relief
under Chapter 11 of the United States Bankruptcy Code (Bankr. D.
Del. Case No. 21-10521).
On March 10, 2021, SC SJ Holdings LLC filed a voluntary petition
for Chapter 11 relief (Bankr. D. Del. Case No. 21-10549).
The Debtors' bankruptcy cases are pending joint administration
before the Honorable John T. Dorsey.
The Debtors tapped PILLSBURY WINTHROP SHAW PITTMAN LLP as
bankruptcy counsel; COLE SCHOTZ P.C. as local counsel; and VERITY
LLC as financial advisor. STRETTO is the claims agent.
CLNC 2019-FL1 Funding, LLC, as lender, is represented by:
Jeffrey C. Krause, Esq.
Michael Neumeister, Esq.
Gibson, Dunn & Crutcher LLP
333 South Grand Ave.
Los Angeles, CA 90071-3197
E-mail: jkrause@gibsondunn.com
E-mail: mneumeister@gibsondunn.com
- and -
Derek C. Abbott, Esq.
Morrison Nichols Arsht & Tunnell LLP
1201 N. Market Street, 16th Floor
Wilmington, DE 19899-1347
E-mail: dabbott@morrisnichols.com
FMT SJ Catering LLC as DIP Lender is represented by:
Steven Kortanek, Esq.
LimNexus LLP
1000 N. West Street, Ste. 1200
Wilmington, DE 19801
E-mail: steven.kortanek@limnexus.com
SC SJ HOLDINGS: Gets OK to Hire Stretto as Claims Agent
-------------------------------------------------------
SC SJ Holdings LLC and FMT SJ LLC received approval from the U.S.
Bankruptcy Court for the District of Delaware to employ Stretto as
claims and noticing agent.
The firm will oversee the distribution of notices and the
maintenance, processing and docketing of proofs of claim filed in
the Debtors' Chapter 11 cases.
The firm will be paid a retainer in the amount of $50,000 and will
be reimbursed for out-of-pocket expenses incurred.
Sheryl Betance, senior managing director at Stretto, disclosed in a
court filing that the firm is a "disinterested person" as the term
is defined in Section 101(14) of the Bankruptcy Code.
The firm can be reached at:
Sheryl Betance
Stretto
410 Exchange Suite 100
Irvine, CA 92602
Tel: (800) 634-7734 / 714.716.1872
Email: sheryl.betance@stretto.com
About SC SJ Holdings and FMT SJ
San Ramon-based Eagle Canyon Management's SC SJ Holdings LLC owns
The Fairmont San Jose, an 805-room luxury hotel located at 170
South Market St., San Jose, Calif. The hotel is near many of the
largest Fortune 1000 corporations and is a popular location for
conferences and conventions, particularly in the technology
industry.
On March 5, 2021, SC SJ Holdings' affiliate, FMT SJ LLC, filed a
voluntary petition for relief under Chapter 11 of the Bankruptcy
Code (Bankr. D. Del. Case No. 21-10521). On March 10, 2021, SC SJ
Holdings sought Chapter 11 protection (Bankr. D. Del. Case No.
21-10549). The cases are jointly administered under Case No.
21-10549.
At the time of the filing, SC SJ Holdings disclosed assets of
between $100 million and $500 million and liabilities of the same
range. FMT SJ disclosed that it had estimated assets of between
$500,000 and $1 million and liabilities of between $100 million and
$500 million.
The Debtors tapped Pillsbury Winthrop Shaw Pittman, LLP as their
bankruptcy counsel, Cole Schotz P.C. as local counsel, and Verity
LLC as financial advisor. Stretto is the claims agent.
SEADRILL PARTNERS: Seeks to Extend Plan Exclusivity Until June 29
-----------------------------------------------------------------
Debtors Seadrill Partners LLC and its affiliates request the U.S.
Bankruptcy Court for the Southern District of Texas, Houston
Division to extend the exclusive periods during which the Debtors
may file a Chapter 11 plan and to solicit votes, through and
including June 29, 2021, and August 28, 2021, respectively.
The Debtors' chapter 11 process is working as intended to align
stakeholders and maximize value for the Debtors' estates. Since
commencing these chapter 11 cases, the Debtors have made
substantial progress in obtaining the necessary relief to mitigate
the effects of their "free fall" into chapter 11 and reach an
agreement with the ad hoc group of lenders under the Debtors'
prepetition term loan B facility (the "Ad Hoc Group") on the
framework of a restructuring that will significantly de-lever the
Debtors' balance sheet and best position them to capitalize on new
business opportunities as markets begin to recover.
The completion of the strategic process led by the Conflicts
Committee of the Board of Directors of Seadrill Partners LLC to
select go-forward service providers for the Debtors' fleet of
drillships and semi-submersibles is critical to these efforts. The
outcome of this process will serve as the foundation for the
restructuring contemplated by the Plan and the accompanying
Disclosure Statement.
Notwithstanding this progress, however, significant work remains.
Although the Debtors have filed the Plan and Disclosure Statement,
key issues remain open. Most critically, the Debtors have received
several alternative proposals for the operation of their vessels
since selecting go-forward service providers. The Debtors are
currently assessing such proposals and, to the extent they
determine any such alternative proposal is superior, will explore
the execution of an alternative arrangement.
Additionally, the Debtors must work with their key stakeholders to
negotiate critical documents necessary for the implementation of
the Plan, including negotiating transition services agreements with
the Debtors' existing and go-forward service providers to ensure a
smooth transition of these services. For example, the new
management services agreement with Energy Drilling was approved by
the Court on February 2, 2021, and the related transition of
services is well underway and should not be disrupted at this
stage. These are fundamental threshold matters that need to be
addressed before the Plan can be prosecuted and solicitation can
occur.
Through the Conflicts Committee and its independent advisors, the
Debtors also must continue discussions with Seadrill Limited
regarding the resolution of the ongoing issues between Seadrill
Limited, the Debtors, and the Ad Hoc Group. These are all
achievable goals, but they require additional time to implement. It
would be counterproductive to these efforts for the Debtors to lose
their exclusive rights to file and solicit the Plan at this
juncture and jeopardize the significant case progress they already
have made.
And since the Petition Date, the Debtors have paid their undisputed
post-petition debts in the ordinary course of business or as
otherwise provided by Court order. Accordingly, the Debtors request
a 90-day extension of their exclusive periods to file and solicit
acceptances of the chapter 11 plan to protect the progress made to
date and to ensure that the Debtors remain on track to emerge from
chapter 11 on a timeline that is in the best interests of the
Debtors' estates while avoiding the disruptive effects of competing
chapter 11 plans.
A copy of the Debtor's Motion to extend is available at
https://bit.ly/3cBIoGf from primeclerk.com.
About Seadrill Partners
Seadrill Partners LLC (NYSE: SDLP) is a limited liability company
formed by deepwater drilling contractor Seadrill Ltd. (OTCMKTS:
SDRLF) to own, operate and acquire offshore drilling rigs.
Seadrill Partners was founded in 2012 and is headquartered in
London, the United Kingdom. Seadrill Partners, set up as an
asset-holding unit, owns four drillships, four semi-submersible
rigs, and three so-called tender rigs which are all operated by
Seadrill Ltd.
Seadrill Partners LLC and its affiliates sought Chapter 11
protection (Bankr. S.D. Tex. Lead Case No. 20-35740) on December 1,
2020. Mohsin Y. Meghji, authorized signatory, signed the petitions.
Seadrill Partners disclosed $4,579,300,000 in assets and
$3,122,300,000 in total debts as of June 30, 2020.
Judge Marvin Isgur oversees the cases. The Debtors tapped Kirkland
& Ellis LLP, Kirkland & Ellis International LLP, and Jackson Walker
LLP as their bankruptcy counsel, and Sheppard Mullin Richter &
Hampton, LLP as conflicts counsel. KPMG LLP provides tax provision
and consulting services to the Debtors.
And on March 3, 2021, the Debtors employ Lugenbuhl, Wheaton, Peck,
Rankin & Hubbard as their special counsel.
SENSATA TECHNOLOGIES: S&P Alters Outlook to Stable, Affirms BB+ ICR
-------------------------------------------------------------------
S&P Global Ratings revised its outlook on Sensata Technologies B.V.
to stable from negative and affirmed its 'BB+' issuer credit rating
and all of its issue-level ratings on the company. At the same
time, S&P assigned its 'BB+' issue-level rating and '4' (rounded
estimate: 35%) recovery rating to the company's proposed $500
million unsecured notes.
S&P said, "The stable outlook reflects our expectation that Sensata
will continue to expand at a faster pace than its end markets and
maintain EBITDA margins in the mid- to high-20% range over the next
12-24 months. We also believe the company will continue to generate
consistently strong free cash flow with free operating cash flow
(FOCF) to debt approaching 15%, supporting strong liquidity.
"Our revised forecasts for Sensata indicate a higher resiliency
than we previously expected amid the broad macroeconomic recovery
in its end markets, albeit with some headwinds. The company's
recent results underscored its solid competitive position in the
specialized and fragmented sensors and controls market, where it
continued to outperform its broader end markets. For instance, in
2021 Sensata expects its automotive business (58% of 2020 revenue)
to outperform the industry by 400 basis points (bps)-600 bps and
its heavy vehicle and off-road segment (about 17% of 2020 revenue)
to outperform by 600 bps-800 bps given its new business wins. It
also appears likely that the company will sustain above-average
margins relative to those of its peers. We expect Sensata to
further reduce its long-term operating costs to align them with its
demand levels, which we believe are unlikely to return to 2019
levels for at least two years.
"Although we view its recent outperformance on its new business
wins as credit positive, new product launches can initially dilute
its high margins. Developing new products also generally requires
research and development (R&D) spending and its margins on these
products can be quite low (at least initially). In recent quarters,
Sensata expanded the sales of its new products while its legacy
products experienced a slight contraction in demand, which reduced
the company's margins because of its less-favorable product mix.
"The stable outlook on Sensata reflects our view that it will
continue to expand at a faster pace than its end markets and
maintain EBITDA margins in the mid- to high-20% range over the next
12-24 months. We believe the company will continue to generate
consistently strong free cash flow with FOCF to debt approaching
15%.
"We could lower our rating on Sensata if it appears likely that its
debt to EBITDA would approach 4.0x and FOCF to debt will remain
below 15% on a sustained basis. This could occur because the
company decides to pursue large debt-financed acquisitions or
experiences unexpected issues with its operations that increase its
costs.
"While unlikely over the next 12 months, we could raise our rating
on Sensata if its debt to EBITDA falls to around 2x and its FOCF to
debt improves to around 25% on a sustained basis. Furthermore, we
would have to believe the company will continue to strengthen its
competitive position in the sensor business while sustaining EBITDA
margins in the high-20% range before we would raise our rating."
SHD LLC: Gets OK to Hire Walker Commercial as Auctioneer
--------------------------------------------------------
SHD, LLC received approval from the U.S. Bankruptcy Court for the
Western District of Virginia to employ Walker Commercial Services,
Inc. as auctioneer.
The firm will assist in the marketing and sale of the Debtor's real
property and improvements located at 213 Rolling Thunder Lane in
Staunton, Va.
The firm will be paid a 5 percent buyer's premium and will be
reimbursed for out-of-pocket expenses incurred.
William Walker, III, a partner at Walker Commercial Services,
disclosed in a court filing that the firm is a "disinterested
person" as the term is defined in Section 101(14) of the Bankruptcy
Code.
The firm can be reached at:
William J. Walker, III
Walker Commercial Services, Inc.
101 Albemarle Avenue, SE
Roanoke, VA 24013
Tel: (540) 344-6160
Fax: (540) 344-6164
About SHD LLC
SHD, LLC filed a voluntary petition for relief under Chapter 11 of
the Bankruptcy Code (Bankr. W.D. Va. Case No. 20-50831) on Nov. 30,
2020. Robert E. Ladd, manager, signed the petition. In the
petition, the Debtor disclosed assets of between $1 million and $10
million and liabilities of the same range.
Judge Rebecca B. Connelly oversees the case.
Woods Rogers, PLC and Elmore Hupp & Company, PLC serve as the
Debtor's legal counsel and financial advisor, respectively.
SIMPLE SITEWORK: To Seek Plan Confirmation on April 27
------------------------------------------------------
On March 9, 2021, Simple Sitework Inc. filed an amended disclosure
statement with respect to a plan.
Judge Jeffrey P. Norman Court ordered on March 12, 2021, that:
* The disclosure statement filed by Simple Sitework Inc. is
conditionally approved.
* April 16, 2021, is fixed as the last day for filing written
acceptances or rejections of the plan referred to above.
* April 22, 2021, is fixed as the last day for filing and
serving written objections to the disclosure statement and
confirmation of the plan.
* The Debtor will file a ballot summary not later than April
22, 2021.
* April 27, 2021, at 9:30 a.m. in Courtroom 403, United States
Courthouse, 515 Rusk Street, Houston, Texas is fixed for the
hearing on final approval of the disclosure statement (if a written
objection has been timely filed) and for the hearing on
confirmation of the plan.
About Simple Sitework
Simple Sitework, Inc., is a locally owned and operated company
providing residential and commercial site-work throughout Southeast
Texas.
Simple Sitework filed a voluntary petition for relief under Chapter
11 of the Bankruptcy Code (Bankr. S.D. Tex. Case No. 20-34508) on
Sept. 11, 2020. Judge Jeffrey P. Norman oversees the case.
Margaret M. McClure, Esq., is the Debtor's bankruptcy counsel.
SOURCE HOTEL: Seeks to Hire Levene Neale as Legal Counsel
---------------------------------------------------------
The Source Hotel, LLC seeks approval from the U.S. Bankruptcy Court
for the District of California to employ Levene Neale Bender Yoo &
Brill L.L.P. as its legal counsel.
The firm's services include:
a. advising the Debtor with regard to the requirements of the
bankruptcy court and the Office of the U.S. Trustee;
b. advising the Debtor with regard to certain rights and
remedies of its bankruptcy estate and the rights, claims and
interests of creditors;
c. representing the Debtor in court proceedings or hearings
unless it is represented in such proceedings or hearings by special
counsel;
d. conducting examinations and representing the Debtor in any
adversary proceeding except to the extent that such proceeding is
in an area outside of the firm's expertise or which is beyond the
firm's staffing capabilities;
e. preparing legal papers;
f. representing the Debtor with regard to obtaining financing or
using cash collateral;
g. assisting the Debtor in any asset sale process;
h. assisting the Debtor in the negotiation, formulation,
preparation and confirmation of a plan of reorganization; and
i. other legal services necessary to administer the Debtor's
Chapter 11 case.
Levene will be paid at these rates:
Attorneys $535 to $635 per hour
Paraprofessionals $250 per hour
The firm will also be reimbursed for out-of-pocket expenses
incurred.
The Debtor paid the firm the amount of $100,000 as pre-bankruptcy
retainer.
Juliet Oh, Esq., a partner at Levene, disclosed in a court filing
that the firm is a "disinterested person" as the term is defined in
Section 101(14) of the Bankruptcy Code.
The firm can be reached at:
Juliet Y. Oh, Esq.
Levene Neale Bender Yoo & Brill L.L.P.
10250 Constellation Boulevard, Suite 1700
Los Angeles, CA 90067
Tel: (310) 229-1234
Fax: (310) 229-1244
Email: rb@lnbyb.com
About The Source Hotel
The Source Hotel, LLC owns a four-star, full-service Hilton Hotel
development located in Buena Park, Calif.
The Source Hotel sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. C.D. Calif. Case No. 21-10525) on Feb. 26,
2021. Donald Chae, manager, signed the petition. In the petition,
the Debtor disclosed assets of between $50 million and $100 million
and liabilities of the same range.
Judge Erithe A. Smith oversees the case.
Levene Neale Bender Yoo & Brill L.L.P. is the Debtor's legal
counsel.
STA VENTURES: Bay Point Says Plan Still Unconfirmable
-----------------------------------------------------
Creditor Bay Point Capital Partners II, LP, filed a limited
objection to the Amended and Restated Disclosure Statement Dated
March 8, 2021, for the Chapter 11 Plan of Reorganization of debtor
STA Ventures, LLC.
In this limited Objection, Bay Point no longer asserts that the
Amended Disclosure Statement fails to provide adequate information
that would enable a hypothetical investor to make an informed
judgment about the plan. Bay Point continues to assert, however,
that even as amended the Debtor's proposed plan is unconfirmable on
its face.
For multiple reasons, the Plan is not confirmable: (i) the Plan
does not provide an adequate means of implementation; (ii) the
proposed 4.5% interest rate is contrary to Till v. SCS Credit
Corp., 541 U.S. 465 (2004), and the Bankruptcy Code; and (iii) the
proposed sale and refinancing of the Collateral violates the
Bankruptcy Code.
Bay Point contends the Debtor will not be able to implement the
Plan as proposed because Bay Point intends to notice a Secured
Party Sale of Allen's membership interests in the Debtor which will
be consummated prior to confirmation.
Bay Point points out that the Amended Disclosure Statement
generically provides that the Debtor will attempt to sell its
assets and refinance its debt, and failing that, auction off some
of its assets. But this bare-bones proposal does not provide Bay
Point with adequate information to know whether the Debtor is
likely to succeed in its endeavor and whether such success would be
sufficient to give Bay Point at least what it would be entitled to
in a liquidation.
Bay Point further points out that the Amended Disclosure Statement,
however, provides no information for how or when the Debtor intends
to sell the remainder of the Walton County Property, and it
provides no details for how the Debtor intends to refinance the
Fulton County Property.
Bay Point submits that there readily exists an efficient market for
financing of loans for purchase of undeveloped real estate. The
existence of Bay Point's business model alone is proof of that, and
Bay Point is ready to prove the existence of an efficient market at
a hearing. When the Debtor previously approached the efficient
market for a loan on the Collateral, the best interest rate the
Debtor obtained was 12%. Given the current circumstances of the
Debtor, the efficient market's interest rate certainly has not
fallen to some 4.5%, a mere 1.25% above the prime rate. Therefore,
the Court should not apply the prime-plus formula and should
instead apply the market rate of interest. Because the Plan
proposes to pay an interest rate based on Till's formula approach
without acknowledging the existence of an efficient market for the
loan, the Plan is not confirmable.
Bay Point asserts that the Plan's proposed allocation of the
proceeds of the sale of the Walton County Property is contrary to
the Bankruptcy Code because the Debtor seeks to apply the sale
proceeds first to principal for a partial sale of Bay Point's total
collateral, and then to interest without satisfying the entirety of
Bay Point's claim.
Counsel for Bay Point Capital Partners II, LP:
SEAN A. GORDON
JOHN C. ALLERDING
AUSTIN B. ALEXANDER
THOMPSON HINE LLP
Two Alliance Center
3560 Lenox Road N.E., Suite 1600
Atlanta, Georgia 30326-4266
Telephone: (404) 541-2900
Facsimile: (404) 541-2905
E-mail: sean.gordon@thompsonhine.com
john.allerding@thompsonhine.com
austin.alexander@thompsonhine.com
About STA Ventures
STA Ventures, LLC is a limited liability corporation with principal
office address at 145 Houze Way, Roswell, Fulton County, Ga.
On June 1, 2020, STA Ventures filed a Chapter 11 bankruptcy
petition (Bankr. N.D. Ga. Case No. 20-66843). The petition was
signed by Stephen T. Allen, its managing member. At the time of
the filing, the Debtor disclosed assets of $1 million to $10
million and estimated liabilities of the same range.
The Debtor has tapped Chamberlain, Hrdlicka, White, Williams &
Aughtry as legal counsel; Peach Appraisal Group, Inc. as appraiser;
and Magaro & Conine, CPA as accountant.
STURDIVANT TAYLOR: $770K Sale of All Assets to Rebecca Poe Approved
-------------------------------------------------------------------
Judge Neil P. Olack of the U.S. Bankruptcy Court for the Southern
District of Mississippi has entered the modified agreed order
granting the sale by Sturdivant Taylor, LLC, and Building Blocks of
Madison Crossing Daycare and Learning Center, Inc., of
substantially all their assets to Rebecca Poe for $770,000.
Kristy Sturdivant, who owns 100% of both Debtors, is authorized and
directed to execute all documents necessary to complete these
transactions.
The Buyer has the deposited the sum of $10,000 with the law firm of
Hood & Bolen, PLLC, that is being held "in trust" by the law firm
in its escrow account. The law firm of Hood & Bolen, PLLC, is
authorized and directed at the direction of Rebecca Poe at closing
to either return these funds to her or apply the funds to the
purchase price.
The objection of the U. S. Trustee is resolved by the Debtors
agreeing to file a closing statement within 10 days after the sale
closes and by agreeing to allocate the sale expenditures between
the estates of Sturdivant Taylor and Building Blocks. The total
amount to be distributed at closing to the holders of secured
claims will be approximately $63,700. Of this amount $45,200 will
be paid to BankFirst attributed to its claim in Sturdivant Taylor
and $18,500 to BankPlus attributed to its claim in Building Blocks
less ½ of the closing costs up to $1,000.
The real estate commission will be equally divided between these
two creditors which makes the allocation between these two estates
at 71% for Sturdivant Taylor and 29% for Building Blocks. The
parties agree that the allocation applies only to the distribution
of the sales proceeds. The sale, and/or transfer, of property
containing personally identifiable information will be consistent
with those procedures currently in place by the Debtors regarding
the transfer of personally identifiable information in accordance
with 11 U.S.C. Section 363(b)(1)(A).
The purchased assets include the customer lists maintained by
Building Blocks and the customer lists include personally
identifiable information, but the transfer of the customer lists
will be consistent with those procedures currently in place by the
Debtors.
The sale is free and clear of liens, claims and interests, with
such interests attaching to the proceeds of sale.
The Buyer will immediately advance the sum of $70,000 from which
the previously approved 9% commission in the amount of $6,300 will
be paid to the broker at closing leaving $63,700 that will be
applied as specified.
The Buyer will immediately purchase Building Blocks "as is" for the
sum of $18,500 payable from the $63,700 to BankPlus attributed to
its claim in Building Blocks less ½ of the closing costs up to
$1,000 as a going concern. She will take over operations after
closing and will continue operating Building Blocks with the
children currently enrolled and will be provided all information
concerning the enrolled children and their parents.
As for the purchase of the assets of Sturdivant Taylor, the Buyer
will make a down payment of $45,200 that will be paid from the
remaining $63,700 to BankFirst attributed to its claim in
Sturdivant Taylor. In addition, she will enter into a lease
purchase agreement for all assets of Sturdivant Taylor "as is"
being the parcel of real property containing 1-acre (43,560 square
feet), more or less, located at 243 Yandell Road, Canton,
Mississippi, with a building located thereon in the sum of $700,000
which will be paid pursuant to the lease purchase agreement.
The monthly rental of such lease will be $4,000 a month with $1,000
of this amount being applied to the purchase price and the
remaining $3,000 being pure rent. The monthly rental will be
payable on the first day of each month commencing on the first day
of the month following execution of the lease purchase agreement
and continuing on the first day of each succeeding month thereafter
for the following 36 months at which time Rebecca Poe will make a
balloon payment of $664,000 provided all rental payments have been
paid. The funds from the balloon payment will be used first to
satisfy the amounts due and owing to BankFirst and second to
BankPlus.
The lease purchase agreement will also provide that Rebecca Poe
will be responsible for paying all property taxes and repairs on
the Sturdivant Taylor property, will pay a $25 late fee for any
rental fee paid after the 10th day of the month for which it is due
and will maintain all necessary and required insurance for the
daycare. Adequate insurance on the building will be maintained by
Sturdivant Taylor.
BankFirst has joined and has agreed to refinance its matured loan
upon retaining its first lien position on the Sturdivant Taylor
property and being paid the sum of $45,200 for past due payments of
$35,200, with the remaining $10,000 being applied for an updated
appraisal, updated title work, and attorney's fees which have been
incurred by BankFirst. Sturdivant Taylor will also bring all
property taxes on the property current and provide an assignment of
rents to BankFirst in the event it defaults in payments.
BankPlus has joined and has agreed to refinance its loan that is
maturing upon retaining its second lien position on the Sturdivant
Taylor property and being paid the sum of $18,500 attributed to its
claim in Building Blocks less ½ of the closing costs up to $1,000
at closing. BankPlus will also release its lien on the accounts
receivable of Building Blocks at closing. BankPlus agrees that its
mortgage on the Sturdivant Taylor property will remain a second
position and will be subordinate to the security position of
BankFirst in the property relating to any amount due and owing to
BankFirst.
MDOR has filed proof of claim [POC 1-2] for $7,899.45 in
withholding taxes with $6,135 classified as secured under MDOR
liens 942904, 981723, 989802, 1012171, 1014438, 1029309, 1031974,
1043688, 1051291, 1065241, 1079632, 1121079, 1125377, 1131339,
1170176, 1172258. MDOR consents to the sale of the assets and to
the distribution of proceeds as set forth in the Order. Based on
the selling price stated in the Order, MDOR acknowledges that there
will be no excess funds available to pay the secured portion of
proof of claim [POC 1-2]. The proposed sale will not affect the
validity or priority of MDOR's liens as to the debtor(s) and will
not affect the attachment of the MDOR liens to any other property
of the Debtor(s). Kristy Sturdivant, the 100% owner of Building
Blocks and Sturdivant Taylor, acknowledges that she is personally
responsible for payment of the taxes set forth in proof of claim
[POC 1-2].
The closing attorney is authorized and directed to disburse the
previously approved commission to the broker, Ward Whicht and
Sunbelt, LLC, in the amount of $6,300 which is a 9% commission on
$70,000.
The closing attorney is authorized and directed to disburse the sum
of $45,200 to BankFirst which will be applied to past due payments
of $35,200, with the remaining $10,000 being applied for an updated
appraisal, updated title work, and attorney's fees which have been
incurred by BankFirst. Sturdivant Taylor will also bring all
property taxes on the property current and provide an assignment of
rents to BankFirst in the event it defaults in payments.
The closing attorney is authorized and directed to disburse the
sum of $18,500 to BankPlus which will be applied to its claim in
Building Blocks less ½ of the closing costs up to $1,000 at
closing for consideration of a loan renewal pursuant to the terms
and conditions agreed to by BankPlus and Kristy Sturdivant that
include BankPlus retaining its second lien position on the
Sturdivant Taylor property and releasing its lien on the accounts
receivable of Building Blocks at closing.
The closing attorney is authorized and directed to deliver a
closing report or settlement statement to R. Micheal Bolen, the
attorneys for the Debtors, within seven days of closing to be filed
therein. The law firm of Hood & Bolen, PLLC, is authorized and
directed at the direction of Rebecca Poe at closing to either
return the sum of $10,000 she deposited with the law firm that is
being held "in trust" in its escrow account or deliver the funds to
the closing attorney to be applied to the purchase price.
The objection of the U. S. Trustee is resolved by the Debtors
agreeing to file a report of sale with a copy of the closing
statement within 10 days after the sale closes and by agreeing to
allocate the sale expenditures between the estates of Sturdivant
Taylor and Building Blocks. The Debtors have done this by
attributing $45,200 or 71% being paid to BankFirst to the
Sturdivant Taylor estate and $18,500 or 29% being paid to BankPlus
less ½ of the closing costs up to $1,000 to the Building Blocks
estate.
The real estate commission has been equally divided in this
allocation. This allocation applies only to the distribution of
the sales proceeds. Furthermore, the sale, and/or transfer, of
property containing personally identifiable information will be
consistent with those procedures currently in place by the Debtors
regarding the transfer of personally identifiable information. The
purchased assets include the customer lists maintained by Building
Blocks and the customer lists include personally identifiable
information, but the transfer of the customer lists will be
consistent with those procedures currently in place by the Debtors.
About Sturdivant Taylor
Sturdivant Taylor, LLC, owns and leases real property located at
243 Yandell Road, Canton, Miss., with a building located thereon
leased to Building Blocks of Madison Crossing Daycare and Learning
Center, Inc. where it operates a daycare.
Sturdivant Taylor and Building Blocks sought protection under
Chapter 11 of the Bankruptcy Code (Bankr. S.D. Miss. Lead Case
No.19-03561) on Oct. 7, 2019. At the time of the filing,
Sturdivant Taylor disclosed assets of less than $50,000 and
liabilities of less than $1 million. The cases have been assigned
to Judge Neil P. Olack. Hood & Bolen, PLLC, is the Debtors' legal
counsel.
On Dec. 13, 2019, the Court appointed Ward Whicht and Sunbelt, LLC
as broker.
STURDIVANT TAYLOR: Modified Order Granting Sale of All Assets OK'd
------------------------------------------------------------------
Judge Neil P. Olack of the U.S. Bankruptcy Court for the Southern
District of Mississippi has entered an agreed order granting the
request of Sturdivant Taylor, LLC, and Building Blocks of Madison
Crossing Daycare and Learning Center, Inc., to modify and
substitute new order authorizing their sale of substantially all
assets to Rebecca Poe.
The parties have requested the modification of order granting
motion to sell, etc., by changing the terms of the sale as
specified in the proposed order modifying as approved by BankFirst,
BankPlus and MDOR and the U. S. Trustee that was attached to the
motion for relief from order as Exhibit A.
The only parties to be affected by the modification are BankFirst,
BankPlus and MDOR and they have agreed to the proposed
modifications and substitution of the proposed modified order.
About Sturdivant Taylor
Sturdivant Taylor, LLC, owns and leases real property located at
243 Yandell Road, Canton, Miss., with a building located thereon
leased to Building Blocks of Madison Crossing Daycare and Learning
Center, Inc. where it operates a daycare.
Sturdivant Taylor and Building Blocks sought protection under
Chapter 11 of the Bankruptcy Code (Bankr. S.D. Miss. Lead Case
No.19-03561) on Oct. 7, 2019. At the time of the filing,
Sturdivant Taylor disclosed assets of less than $50,000 and
liabilities of less than $1 million. The cases have been assigned
to Judge Neil P. Olack. Hood & Bolen, PLLC, is the Debtors' legal
counsel.
On Dec. 13, 2019, the Court appointed Ward Whicht and Sunbelt, LLC
as broker.
SUNERGY CALIFORNIA: U.S. Trustee Appoints Creditors' Committee
--------------------------------------------------------------
The U.S. Trustee for Region 17 on March 17 appointed an official
committee to represent unsecured creditors in the Chapter 11 case
of Sunergy California, LLC.
The committee members are:
1. DEPCOM Power, Inc.
Attn: Steve Chun, EVP Project Finance
9185 E. Pima Center Parkway, Suite 100
Scottsdale, AZ 85258
Phone: (510)579-4265
E-mail: schun@depcompower.com
cscaglione@depcompower.com
2. XPO Global Forwarding, Inc.
Attn: Stephanie Penninger, Esq.
Senior Director Legal Counsel
11215 North Community House Road
Charlotte, NC 28277
Phone: (704)956-6028
E-mail: Stephanie.Penninger@xpo.com
3. Edges Electrical Group, LLC
Attn: Gleb Finkelman, General Counsel
1135 Auzerais Avenue
San Jose, CA 94126
Phone: (408)477-8034
E-mail: gleb@edgesgroup.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 Sunergy California
Sunergy California LLC -- http://www.sunergyus.com/-- is a solar
module supplier. It was founded in 2016 and is headquartered and
has module production facilities in Sacramento, Calif.
Sunergy California filed a Chapter 11 petition (Bankr. E.D. Calif.
Case No. 21-20172) on Jan. 20, 2021. In the petition signed by Lu
Han, chairman, the Debtor disclosed total assets of $7,629,993 and
total liabilities of $17,226,553.
Judge Christopher M. Klein oversees the case.
Gonzalez & Gonzalez Law, P.C. and RKF Global PLLC serve as the
Debtor's bankruptcy counsel and special counsel, respectively.
SUPERIOR PLUS: DBRS Confirms BB(high) Rating on Sr. Unsecured Debt
------------------------------------------------------------------
DBRS Limited confirmed the Issuer Rating of Superior Plus LP at BB
(high) and the Senior Unsecured Debentures rating at BB based on
the unchanged recovery rating of RR5. Both trends are Stable. DBRS
Morningstar took these rating actions following the Company's
announcement that it has entered into a definitive agreement to
sell its Specialty Chemicals business to Canadian private equity
fund Birch Hill Equity Partners for total consideration of $725
million. The sale price includes $600 million in gross cash
proceeds and a $125 million unsecured note that bears a rate of 6%
and matures in five and a half years. In addition, the purchase
price is subject to an EBITDA-based adjustment, which could lead to
another unsecured note up to a maximum of $84 million being issued
to Superior Plus or an unsecured note up to a maximum of $84
million being issued by Superior Plus to the buyer. The Company
also announced that the proceeds from the sale would be primarily
used for the repayment of the revolving credit facility, followed
by accelerated acquisitions of retail propane distribution
businesses while maintaining its financial policy. Superior Plus
also mentioned that the sale of the Specialty Chemicals business is
expected to reduce the Company's lease liabilities by $104 million.
Furthermore, the Company stated that it has a strong pipeline of
acquisitions and anticipates doubling the EBITDA from operations of
its U.S. propane distribution business over the next five years.
Firstly, the rating confirmations reflect DBRS Morningstar's view
that the improved customer and geographic diversification, as well
as the enhanced margins and scale of the Energy Distribution
business achieved through portfolio shifting in recent years,
mainly in the U.S., offsets the loss of diversification and scale
as a result of the sale of the Specialty Chemicals business, whose
economic drivers are generally different than those underlying the
Company's Energy Distribution business. Superior Plus has boosted
the margins and scale of its Energy Distribution portfolio in the
U.S. by divesting itself of its less-profitable wholesale refined
fuels and retail distillate assets and buying higher-margin retail
propane distribution businesses. This has also improved
weather-related risk diversification, as the Company's footprint in
the U.S. has expanded beyond the northeast and now also spans the
warmer regions of the southeast, midwest, and California. The
Company's U.S. activities, which primarily consist of propane
distribution to residential customers, to some extent also
represent a level of diversification when compared with its
Canadian activities, which are mostly for wholesale, commercial,
and industrial end-use applications.
Secondly, DBRS Morningstar acknowledges that Superior Plus has been
successful in its external growth strategy, mostly in the U.S.
retail energy distribution area, by acquiring small and large
propane distribution businesses and successfully integrating them,
which to a certain degree mitigates the financial and integration
risks associated with the future acceleration of acquisitions.
Thirdly, the sale of the Specialty Chemicals business, which
Superior Plus has been intending to accomplish for some time, not
only frees up capital but also allows the Company's management to
continue focusing on its core strategy of growing its Energy
Distribution footprint in the U.S. Finally, DBRS Morningstar
acknowledges Superior Plus' commitment to maintain its overall
financial policy and leverage, as measured by debt-to-EBITDA of
between 3.0 times (x) and 3.5x.
Overall, Superior Plus' operating performance and business risk
profile continue to support the current ratings. DBRS Morningstar
expects the Company to remain acquisitive and, given the fragmented
nature of the propane distribution sector, there is no shortage of
tuck-in acquisition targets available. However, if financial policy
shifts, significant debt-financed acquisitions (especially during a
period of notable market weakness), negative free cash flow, or
difficulties and delays in integrating newly acquired businesses
cause leverage metrics to deteriorate beyond what is considered
commensurate with the ratings for an extended period of time (such
that debt-to-EBITDA increases above 3.5x or cash flow-to-debt falls
below 20% on a sustained basis), DBRS Morningstar could consider a
negative rating action. Conversely, DBRS Morningstar would likely
consider a positive rating action only if the Company demonstrated
a commitment to a materially stronger financial profile over a
longer period and significantly improved weather diversification.
Notes: All figures are in Canadian dollars unless otherwise noted.
TAILORED BRANDS: CEO Steps Down After $75M Lifeline
---------------------------------------------------
March 16, 2021, Tailored Brands, Inc., announced that Dinesh Lathi
will step down from his role as President and Chief Executive
Officer, effective March 26, 2021. Board members Bob Hull and Peter
Sachse will act as Interim Co-CEOs while the Board searches for a
permanent successor.
"It has been my pleasure to work as part of the talented and
dedicated Tailored Brands team, and I want to thank all of my
colleagues for their support and many contributions over the past
five years," Mr. Lathi said. "I believe in the power of our brands
and am confident the hard work we have done together has put the
Company on a path toward long-term growth and success. I will be
rooting for everyone at Tailored Brands as you take these next
steps."
In December 2020, Tailored Brands successfully completed its
Chapter 11 restructuring, and earlier this month, the Company
announced $75 million in new financing. After these events, and
with business performance beginning to recover from the impacts of
the COVID-19 pandemic, the Board and Lathi mutually agreed that
this is the right time to re-evaluate the skills and experiences
needed in the CEO role as the Company prepares for its next chapter
of growth and success.
"With a solid financial structure now in place and the support of
its new owners behind it, Tailored Brands is well positioned for
growth in its next chapter," Mr. Hull stated. "We are immensely
grateful for Dinesh's contributions as both a director and
executive of the Company over the past five years, and especially
for his leadership in successfully guiding the Company through both
the restructuring and the unprecedented challenges of the global
pandemic. We wish him well in all of his future endeavors."
Mr. Sachse added: "The team at Tailored Brands is incredibly
strong, and even in the midst of the pandemic, Dinesh guided them
to make smart investments to strengthen the brands and the value
proposition they deliver for customers. As a result, the Company is
now delivering enhanced online and omnichannel options to shop
seamlessly across channels, piloting new in-store experiences to
make shopping safer and more enjoyable, and offering an expanded
product assortment. We will continue to accelerate this progress to
meet the evolving needs of our customers and ensure we’re earning
their continued loyalty every day by helping them look and feel
their best for moments that matter."
About Tailored Brands
Tailored Brands, Inc., (NYSE: TLRD) is an omni-channel specialty
retailer of menswear, including suits, formal wear and a broad
selection of polished and business casual offerings. It delivers
personalized products and services through its convenient network
of over 1,400 stores in the United States and Canada as well as its
branded e-commerce websites at http://www.menswearhouse.com/and
http://www.josbank.com/ Its brands include Men's Wearhouse, Jos.
A. Bank, Moores Clothing for Men and K&G.
Tailored Brands reported a net loss of $82.28 million for the year
ended Feb. 1, 2020, compared to net earnings of $83.24 million for
the year ended Feb. 2, 2019. As of Feb. 1, 2020, Tailored Brands
had $2.42 billion in total assets, $2.52 billion in total
liabilities, and a total shareholders' deficit of $98.31 million.
On Aug. 2, 2020, Tailored Brands and its subsidiaries sought
Chapter 11 protection (Bankr. S.D. Tex. Lead Case No. 20-33900).
As of July 4, 2020, Tailored Brands disclosed $2,482,124,043 in
total assets and $2,839,642,691 in total liabilities.
The Hon. Marvin Isgur is the case judge.
The Debtors tapped Kirkland & Ellis LLP as general bankruptcy
counsel; Jackson Walker L.L.P., Stikeman Elliot LLP and Mourant
Ozannes as co-bankruptcy counsel; PJT Partners LP as financial
advisor; Alixpartners, LLP as restructuring advisor; Deloitte &
Touche LLP as auditor, and A&G Realty Partners, LLC as the real
estate consultant and advisor. Prime Clerk LLC is the claims
agent.
* * *
Tailored Brands on Dec. 1, 2020, emerged from bankruptcy protection
following a financial restructuring process that helped the U.S.
men's fashion retailer eliminate $686 million of debt from its
balance sheet.
Tailored Brands in February 2021 said it "severely underperformed"
compared to the projections in its Chapter 11 reorganization plan
and needs roughly $75 million by the beginning of March 2021 to
avoid a default. Silver Point
Capital, its largest equity holder and a lender, agreed to provide
the funds and help it avoid another bankruptcy.
TENTLOGIX INC: Seeks to Extend Plan Exclusivity Until May 26
------------------------------------------------------------
Debtor Tentlogix Inc. requests the U.S. Bankruptcy Court for the
Southern District of Florida, West Palm Beach Division to extend
the exclusive periods during which the Debtor may file a Chapter 11
plan and solicit acceptances until May 26, 2021, and July 26, 2021,
respectively.
The deadline for creditors in this case to file proofs of claims is
February 5, 2021, and the deadline for governmental claims to be
filed is May 26, 2021. The Debtor requests the additional time in
this case to allow it time to review the claims and determine plan
treatment.
Plus, the government maintains a claim in excess of $2,000,000.00
and the deadline for the filing of such a claim runs on May 26,
2021. Finally, it is unclear at this time what further effects the
COVID-19 virus will have on the Debtor.
The Debtor's request for extension of the Exclusive Periods is
reasonable given the Debtor's progress to date and the current
status of all post-petition payables.
The Debtor is not seeking this extension to delay the
administration of the case and does not believe that any creditors
or parties in interest will be prejudiced by this requested
extension.
A copy of the Debtor's Motion to extend is available at
https://bit.ly/2OUGIiA from PacerMonitor.com.
About Tentlogix Inc.
Tentlogix Inc. filed for Chapter 11 bankruptcy protection (Bankr.
S.D. Fla. Case No. 20-22971) on November 27, 2020. Gary Hendry,
chief executive officer, signed the petition.
At the time of the filing, the Debtor disclosed $3,135,866 in
assets and $10,689,420 in liabilities.
Judge Mindy A. Mora oversees the case. The Debtor tapped Kelley,
Fulton & Kaplan, P.L. as its legal counsel and Carr Riggs & Ingram
as its accountant.
TEREX CORP: S&P Rates New First-Lien Credit Facility 'BB+'
----------------------------------------------------------
S&P Global Ratings assigned its 'BB+' issue-level rating and '1'
recovery rating to Terex Corp.'s proposed first-lien credit
facility, which will comprise a $300 million five-year revolving
credit facility, a $300 million five-year multicurrency revolving
credit facility, and a $325 million term loan due 2028. The '1'
recovery rating indicates its expectation for very high (90%-100%;
rounded estimate: 95%) recovery in the event of a payment default.
S&P believes the company will use the proceeds from the proposed
term loan to repay most of the outstanding amounts on its existing
term loans. It expects the revolving credit facilities to be
undrawn as of the close of the transaction.
S&P views this transaction as credit neutral. Therefore, its 'BB-'
issuer credit rating and stable outlook on Terex remain unchanged.
ISSUE RATINGS--RECOVERY ANALYSIS
Key analytical factors
-- S&P's simulated default scenario assumes a payment default
occurring in 2025 amid a sustained economic downturn that reduces
the demand for the company's access and materials processing
equipment and leads to a significant deterioration in its operating
performance and cash flow generation.
-- S&P values the company on a going-concern basis using a 5.5x
multiple of its projected emergence EBITDA of about $203 million.
The 5.5x multiple reflects Terex's portfolio of brands, global
reach, and good scale compared with that of similarly rated capital
goods companies.
-- S&P's recovery analysis assumes that in a simulated default
scenario--after satisfying any unpaid administrative expenses and
other priority claims--the first-lien lenders' recoveries would be
in the 90%-100% range (rounded estimate: 95%).
Simulated default assumptions
-- Year of default: 2025
-- Jurisdiction: U.S.
-- The revolving credit facilities are 85% drawn at default
Simplified waterfall
-- Gross enterprise value: $1.11 billion
-- Net enterprise value after administrative expenses (5%): $1.06
billion
-- Obligor/nonobligor split: 40%/60%
-- Collateral value available to first-lien lenders: $836 million
-- Estimated first-lien claims: $849 million
--Recovery expectations: 90%-100% (rounded estimate: 95%)
-- Value available for unsecured lenders: $222 million
-- Estimated unsecured and pari passu claims: $704 million
--Recovery expectations: 30%-50% (rounded estimate: 30%)
Note: All debt amounts include six months of prepetition interest.
TESTER DRILLING: Seeks to Hire Holmes Weddle as Special Counsel
---------------------------------------------------------------
Tester Drilling Services, Inc. seeks approval from the U.S.
Bankruptcy Court for the District of Alaska to employ Holmes Weddle
& Barcott, P.C. as special counsel.
The Debtor needs the firm's legal assistance in connection with a
case (Case No. 18-00244) filed in the U.S. District Court for the
District of Alaska, and to defend the Debtor in another district
court litigation (Case No. 18-00019) brought by Precision Cranes,
Inc. to recover amounts claimed from the Debtor.
The firm will be paid based upon its normal and usual hourly rates
and will be reimbursed for out-of-pocket expenses incurred. The
retainer fee is $50,000.
David Freeman, Esq., a partner at Holmes Weddle & Barcott,
disclosed in a court filing that the firm is a "disinterested
person" as the term is defined in Section 101(14) of the Bankruptcy
Code.
The firm can be reached at:
David M. Freeman, Esq.
Holmes Weddle & Barcott, P.C.
701 W 8th Ave, Unit 700
Anchorage, AK 99501
Tel: (907) 274-0666
Fax: 907-277-4657
Email: dfreeman@hwb-law.com
About Tester Drilling Services
Tester Drilling Services, Inc., an Anchorage, Alaska-based
construction company, sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. D. Alaska Case No. 20-00282) on Dec. 5,
2020. Peter B. Tester, authorized representative, signed the
petition. In its petition, the Debtor was estimated to have $1
million to $10 million in both assets and liabilities.
Judge Gary Spraker oversees the case.
David H. Bundy, P.C. and Holmes Weddle & Barcott, P.C. serve as the
Debtor's bankruptcy counsel and special counsel, respectively.
TITAN INTERNATIONAL: Names Tony Eheli as Chief Accounting Officer
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Tony Eheli has been appointed vice president and chief accounting
officer and will serve as Titan International, Inc.'s principal
accounting officer, effective as of March 8, 2021. In connection
with Mr. Eheli's appointment, David A. Martin ceased his service as
the Company's principal accounting officer on March 8, 2021;
however, he will continue to serve in his role as senior vice
president and chief financial officer and as the Company's
principal financial officer.
Mr. Eheli, age 43, previously served as a global director of
Financial Planning and Analysis at Danaher Corporation, and was the
global corporate controller of two separate division of Danaher
Corporation previously. Prior to his employment at Danaher
Corporation, Mr. Eheli was an audit manager for
PriceWaterhouseCoopers. Mr. Eheli obtained his Masters of Business
Administration in Finance at the University of Chicago's Booth
School of Business and his Bachelor's degree in Banking and Finance
from the University of Nigeria.
Mr. Eheli was granted $100,000 worth of the Company's restricted
common stock, subject to the award letter and three year vesting
period, in connection with his appointment as vice president and
chief accounting officer. The number of shares of common stock
issued will be based on the closing price of the Company's common
stock on March 25, 2021, the date of the grant.
About Titan
Titan International, Inc. -- http://www.titan-intl.com-- is a
global manufacturer of off-highway wheels, tires, assemblies, and
undercarriage products. Headquartered in Quincy, Illinois, the
Company globally produces a broad range of products to meet the
specifications of original equipment manufacturers (OEMs) and
aftermarket customers in the agricultural,
earthmoving/construction, and consumer markets.
Titan International reported a net loss of $65.08 million for the
year ended Dec. 31, 2020, compared to a net loss of $51.52 million
for the year ended Dec. 31, 2019. As of Dec. 31, 2020, the Company
had $1.03 billion in total assets, $830.62 million in total
liabilities, $25 million in redeemable noncontrolling interest, and
$176.26 million in total equity.
* * *
As reported by the TCR on June 23, 2020, S&P Global Ratings
affirmed its ratings on Titan International Inc., including the
'CCC+' issuer credit rating. S&P expects weak demand to lower
Titan's profitability, causing negative free operating cash flow
(FOCF) generation in 2020.
As reported by the TCR on May 11, 2020, Moody's Investors Service
downgraded its ratings for Titan International, including the
company's corporate family rating to 'Caa3' from 'Caa1'. The
downgrades reflect expectations for challenging industry conditions
through 2020 to pressure Titan's earnings and cash flow, resulting
in the company's capital structure remaining unsustainable with
excessive financial leverage above 10x debt/EBITDA likely into 2021
and a weak liquidity profile reliant on external and alternative
funding sources.
TPT GLOBAL: Allows Rennova Deal to Dissolve to Protect Shareholders
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TPT Global Tech Inc. disclosed that the deal with Rennova Health
has been terminated. The Company had previously announced it
sought certain protections which could not be agreed upon. The
Company further sought certain terms of development under the
license agreement which was never completely finalized. The
Company further stated that despite allowing the termination, it
had already secured its own National CLIA license as of March 1,
2021 under its TPT MedTech division. This termination with Rennova
Health will have no impact on the Company's SaaS division moving
forward and has never been a part of the company's "QuikPASS"
"QuiKLAB" Technology platforms. Finally, the company continues to
move forward with its "QuikLAB" deployment in the US and abroad.
The parties had negotiated for several months to finalize certain
terms of the agreement that was previously announced.
"We wish Rennova good luck with the intended new path," said TPTW
CEO Stephen Thomas.
About TPT Global Tech
TPT Global Tech Inc. (OTC:TPTW) based in San Diego, California, is
a Technology/Telecommunications Media Content Hub for Domestic and
International syndication and also provides technology solutions to
businesses domestically and worldwide. TPT Global offers Software
as a Service (SaaS), Technology Platform as a Service (PAAS),
Cloud-based Unified Communication as a Service (UCaaS) and
carrier-grade performance and support for businesses over its
private IP MPLS fiber and wireless network in the United States.
TPT's cloud-based UCaaS services allow businesses of any size to
enjoy all the latest voice, data, media and collaboration features
in today's global technology markets. TPT's also operates as a
Master Distributor for Nationwide Mobile Virtual Network Operators
(MVNO) and Independent Sales Organization (ISO) as a Master
Distributor for Pre-Paid Cellphone services, Mobile phones
Cellphone Accessories and Global Roaming Cellphones.
TPT Global reported a net loss of $14.03 million for the year ended
Dec. 31, 2019, compared to a net loss of $5.38 million for the year
ended Dec. 31, 2018. As of Sept. 30, 2020, the Company had $15.96
million in total assets, $36.86 million in total liabilities, $4.79
million in total mezzanine equity, and a total stockholders'
deficit of $25.69 million.
Sadler, Gibb & Associates, LLC, in Salt Lake City, UT, the
Company's auditor since 2016, issued a "going concern"
qualification in its report dated April 14, 2020 citing that the
Company has suffered recurring losses from operations and has a net
capital deficiency which raise substantial doubt about its ability
to continue as a going concern.
TPT GLOBAL: Welcomes Major General Wharton to Board of Advisors
---------------------------------------------------------------
TPT Global Tech Inc. disclosed that Major General John F. Wharton
(US Army Ret), former Commanding General of U.S Army Research,
Development and Engineering Command, will be joining the TPT Global
Tech Inc. Board of Advisors.
Major General Wharton is a career Army veteran with over 3 decades
of Service to the Nation. In last military assignment, he was
responsible for the U.S. Army's science and technology budget and
programs with an annual operating budget of $6.2 billion. There he
led more than 13,000 scientists, engineers and support personnel
across all disciplines and sectors.
Major General Wharton will be providing guidance and expertise for
TPTW's newly created Global Defense Division and helping the entire
suite of TPTW offerings in his capacity as a member of the TPT
Global Tech Advisory Board. He will work with the company's
telecoms, satellite, 5G and radar technologies units and help with
domestic and international business globally from Europe to the
Middle East, the Caribbean and beyond.
Major General Wharton will also be assisting TPT Global Tech
offering a wide range of services from the research, development,
engineering and technology transfer counsel and how best to gain
government awards. "I look forward to becoming part of the TPT
Global Tech team working with my good friend Stephen Thomas and
expanding the reach both nationally and internationally.
"As we ramp up our defense division and expand our company-wide
offerings and technical expertise, Major General Wharton's
experience, knowledge and government contacts will be a critical
component to leading us forward," Stephen J. Thomas, III, chief
executive officer of TPT Global Tech, said. "From
telecommunications to software deployment and development, Major
General Wharton's will be instrumental in building and expanding
our capabilities in existing industry verticals while also helping
us break into areas we had not previously explored but must
participate in to get to where we want to be as a business."
About TPT Global Tech
TPT Global Tech Inc. (OTC:TPTW) based in San Diego, California, is
a Technology/Telecommunications Media Content Hub for Domestic and
International syndication and also provides technology solutions to
businesses domestically and worldwide. TPT Global offers Software
as a Service (SaaS), Technology Platform as a Service (PAAS),
Cloud-based Unified Communication as a Service (UCaaS) and
carrier-grade performance and support for businesses over its
private IP MPLS fiber and wireless network in the United States.
TPT's cloud-based UCaaS services allow businesses of any size to
enjoy all the latest voice, data, media and collaboration features
in today's global technology markets. TPT's also operates as a
Master Distributor for Nationwide Mobile Virtual Network Operators
(MVNO) and Independent Sales Organization (ISO) as a Master
Distributor for Pre-Paid Cellphone services, Mobile phones
Cellphone Accessories and Global Roaming Cellphones.
TPT Global reported a net loss of $14.03 million for the year ended
Dec. 31, 2019, compared to a net loss of $5.38 million for the year
ended Dec. 31, 2018. As of Sept. 30, 2020, the Company had $15.96
million in total assets, $36.86 million in total liabilities, $4.79
million in total mezzanine equity, and a total stockholders'
deficit of $25.69 million.
Sadler, Gibb & Associates, LLC, in Salt Lake City, UT, the
Company's auditor since 2016, issued a "going concern"
qualification in its report dated April 14, 2020 citing that the
Company has suffered recurring losses from operations and has a net
capital deficiency which raise substantial doubt about its ability
to continue as a going concern.
TRIMAS CORP: S&P Rates New $350MM Senior Unsecured Notes 'BB-'
--------------------------------------------------------------
S&P Global Ratings assigned its 'BB-' issue-level rating and '5'
recovery rating to TriMas Corp.'s proposed $350 million senior
unsecured notes due 2029. The '5' recovery rating indicates its
expectation for modest (10%-30%; rounded estimate: 25%) recovery in
the event of a payment default.
S&P said, "We believe the company will use the proceeds from the
transaction to refinance its existing $300 million senior unsecured
notes due 2025 and for general corporate purposes. Additionally,
TriMas Corp. has launched a process to extend the maturity of its
$300 million revolving credit facility (unrated) from September
2022 until March 2026.
"We consider this transaction to be leverage neutral and view the
maturity extension on the revolving credit facility as credit
positive because it will improve the company's debt maturity
profile."
ISSUE RATINGS--RECOVERY ANALYSIS
Key analytical factors
S&P simulated default scenario contemplates a default occurring in
2025 following extended difficult market conditions in TriMas'
competitive end markets and rising raw material costs, both of
which severely pressure its sales and margins.
Simulated default assumptions
-- Simulated year of default: 2026
-- EBITDA multiple: 5.5x
-- EBITDA at emergence: $68.6 million
-- Jurisdiction: U.S.
Simplified waterfall
-- Net enterprise value at default (after 5% administrative
costs): $358 million
-- Valuation split (obligors/nonobligors): 85%/15%
-- Value available to first-lien debt (collateral/non-collateral):
$339.5 million/$19 million
-- Secured first-lien debt claims: $265 million
-- Value available to unsecured debt (collateral/non-collateral):
$75 million/$19 million
-- Senior unsecured debt claims: $357 million
--Recovery expectations: 10%-30% (rounded estimate: 25%)
Note: S&P said, "Debt amounts include six months of accrued
interest that we assume will be owed at default. Collateral value
includes asset pledges from obligors plus equity pledges in
nonobligors. We generally assume usage of 85% for cash flow
revolvers at default."
TRITON WATER: S&P Assigns 'B' Rating on $750MM Senior Secured Notes
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S&P Global Ratings assigned its 'B' issue-level rating to Triton
Water Holdings, Inc.'s $750 million senior secured notes due in
2028 and 'CCC+' issue-level rating to its $670 million senior
unsecured notes due in 2029.
The secured notes, which are pari passu with the company's recently
launched $1.8 billion first-lien term loan, have a recovery rating
of '3', reflecting S&P's expectation for meaningful (50%-70%;
rounded estimate: 65%) recovery in the event of default. Our
recovery rating on the unsecured notes is '6', reflecting its
expectation for negligible (0%-10%; rounded estimate: 0%)
recovery.
One Rock Capital and Metropoulos & Co. are using the proceeds from
the notes issuances, along with the term loan, to partly fund the
acquisition of Nestle Waters North America (which will do business
as Triton Water Holdings).
TRUCKING & CONTRACTING: Unsecureds to $25K Per Month in Plan
------------------------------------------------------------
The Debtor, Trucking & Contracting Services, LLC, filed a Chapter
11 Plan of Reorganization and a Disclosure Statement on March 15,
2021.
TCS entered into a court-approved agreement with RTS Financial
Service, Inc., to continue to sell its accounts/accounts receivable
to RTS. RTS' postpetition fee has charged only 1% over its
pre-petition fee (now 2.75%). TCS intends to keep this agreement
post-confirmation.
During the chapter 11 case, TCS has made significant progress in
paying down what it owes to its secured creditors. It has also
kept all taxes current during the pendency of the case. TCS has
also paid off the real estate contract on the 72 acres of land it
owns and upon which its offices and equipment yard are located.
TCS has made all adequate protection payments to secured creditors
as well. TCS has collected prepetition accounts receivable,
including $390,000 from ConchoOperating, LLC, a former oil well
water cleaning customer of TCS. TCS is in the process of objecting
to claims in order to reduce the amount of general unsecured debt
in the case. A number of unsecured claimants owe TCS for use of
its tanks and equipment and their claims should be reduced by what
is owed to TCS.
TCS has filed an adversary proceeding against Henry McDonald and
removed the state court lawsuit against him into Bankruptcy Court.
The parties have settled the adversary proceeding. A motion
requesting approval of the settlement between TCS and McDonald is
out on notice to TCS' creditors. TCS' business has been negatively
affected by the COVID-19 pandemic, as has the entire oil and gas
industry. TCS' cash flow has been reduced because of this
circumstance. However, it appears that vaccines are now available
and people are slowly being vaccinated. TCS believes its cash flow
will improve significantly by May 2021.
The Plan provides:
* TCS shall pay the Class IV F allowed secured claim of New
Mexico Workforce Solution at 5% interest within five years of the
Effective Date.
* TCS shall pay the Class IV G allowed secured claim of Hitachi
Capital America Corp. within 30 days of the effective date of the
plan.
* TCS shall pay the Class IV H allowed secured claim of Stearns
Bank within 30 days of the effective date of the plan.
* TCS will pay the Class V claims of allowed unsecured claims
within 11 years and nine months of the Effective Date, with
payments beginning in the 61st month from the Effective Date. Each
allowed non-priority claim will receive its pro-rata share of the
monthly payment amount of $25,000.
* The Class VI claimant, Melissa Acosta will retain her equity
in TCS.
* TCS will pay the Class II, III, IV, and V claims from TCS'
monthly net income, which is income accrued after deduction for
monthly operating expenses.
Because of the COVID 19 pandemic, TCS' monthly cash flow has
fluctuated in its oil well water cleaning business. However, TCS
has recently been substituting higher income from its earth=moving
business for its oil well water cleaning business. The Debtor
projects that its net income for the first year of a confirmed plan
will be an average of $50,000 per month. The Debtor further
projects its net income for the last 10 years of the plan will be
an average of $60,000 per month.
Counsel for the Debtor:
P. Diane Webb
Diane Webb, Attorney at Law, P.C.
PO Box 30456
Albuquerque, NM 87190-0456
Tel: (505) 243-0600
E-mail: diwebb@swcp.com
A copy of the Disclosure Statement is available at
https://bit.ly/3bUYaNe from PacerMonitor.com.
About Trucking & Contracting
Trucking & Contracting Services, LLC, is a trucking company in the
business of removing the produced water from the oil released from
wells located in Southern New Mexico and West Texas. TCS runs
15-20 trucks on a daily basis.
TCS sought protection under Chapter 11 of the U.S. Bankruptcy Code
(Bankr. D.N.M. Case No. 19-11319-j11) on May 31, 2019, listing
under $50,000 in assets and $1 million to $10 million in
liabilities. Judge Robert H. Jacobvitz oversees the case. Diane
Webb is the Debtor's counsel.
TWO GUNS CONSULTING: Gets OK to Hire Jordan Holzer as Counsel
-------------------------------------------------------------
Two Guns Consulting & Construction, LLC received approval from the
U.S. Bankruptcy Court for the Southern District of Texas to employ
Jordan Holzer & Ortiz, P.C. to handle its Chapter 11 case.
The firm will be paid at these rates:
Attorneys $350 to $550 per hour
Legal Assistants $150 to $200 per hour
The firm will also be reimbursed for out-of-pocket expenses
incurred.
Jordan received from the Debtor an advance fee of $25,000.
Nathaniel Peter Holzer, Esq., a partner at Jordan, disclosed in a
court filing that the firm is a "disinterested person" as the term
is defined in Section 101(14) of the Bankruptcy Code.
The firm can be reached at:
Nathaniel Peter Holzer, Esq.
Jordan Holzer & Ortiz, P.C.
500 North Shoreline Blvd., Suite 900
Corpus Christi, TX 78401
Tel: (361) 884-5678
Fax: (361) 888-5555
Email: pholzer@jhwclaw.com
About Two Guns Consulting &Construction
Two Guns Consulting & Construction, LLC is a company in the heavy
and civil engineering construction industry.
Two Guns Consulting & Construction sought protection under Chapter
11 of the Bankruptcy Code (Bankr. S.D. Texas Case No. 21-21061) on
March 9, 2021. Charles Luke Duncan, sole managing member, signed
the petition. In the petition, the Debtor disclosed total assets
of $1,313,914 and total liabilities of $5,038,064.
Judge David R. Jones oversees the case.
Jordan Holzer & Ortiz, P.C. is the Debtor's legal counsel.
TWO GUNS: Seeks Cash Collateral Access
--------------------------------------
Two Guns Consulting & Construction, LLC and Charles Luke Duncan ask
the U.S. Bankruptcy Court for the Southern District of Texas,
Corpus Christi Division, for authority to use cash collateral on an
interim basis in accordance with either the proposed or a revised
budget that will be presented at the hearing.
The Debtor requires the use of cash collateral to pay expenses
relating to ongoing operations of the Debtors' business.
The Debtors do not believe there are any creditors with a security
interest in their cash or receivables. However, one creditor,
Prosperity Bank, has asserted that it does have an interest in the
cash collateral of Debtor Two Guns.
Two Guns previously had a line of credit with Prosperity Bank
secured by its accounts receivable, and Prosperity Bank filed its
UCC-1 to perfect that security interest. Then in September 2019,
Two Guns pledged some of its heavy equipment, commercial trucks and
trailers to Prosperity Bank for a new note, and the entire
borrowing under the new note was used to pay off the line of credit
in full. The new note does not include a lien in Debtor's AR, and
so that obligation does not create a security interest in Two
Guns’ cash collateral. Two Guns did not draw any more funds on
the line of credit. However, Prosperity Bank failed to release its
UCC-1 from the LOC revolver that was paid off.
Two Guns proposes to pay Prosperity Bank adequate protection of its
security interests in the amount of $1,000 per month. Two Guns
currently owes Prosperity Bank $77,286. The loan is secured by
collateral the bank valued at $150,000 in its proof of claim in the
previous chapter 11 (Case #; 20-20077; POC # 3 filed Feb. 24,
2020), and which the Debtor values at $125,000. As a result,
Prosperity Bank's claims are already adequately protected by a
substantial equity cushion on its tangible collateral, and will be
further protected by Two Guns' proposed payment of post-petition
adequate protection payments for ongoing use of that tangible
collateral, and so regardless of whether Prosperity Bank has an
interest in cash collateral, it is fully protected on its secured
claim.
A copy of the motion is available for free at
https://bit.ly/3eMV5jX from PacerMonitor.com.
About Two Guns Consulting & Construction, LLC
Two Guns Consulting & Construction, LLC is part of the heavy &
civil engineering construction industry. Two Guns sought protection
under Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D. Tex. Case
No. 21-21061) on March 9, 2021. In the petition signed by Charles
Luke Duncan, sole managing member, the Debtor disclosed $1,313,914
in assets and $5,038,064 in liabilities.
Judge David R. Jones oversees the case.
Nathaniel Peter Holzer, Esq. at JORDAN, HOLZER & ORTIZ, P.C. is the
Debtor's counsel.
UGI INTERNATIONAL: Fitch Affirms 'BB+' LT IDR, Outlook Stable
-------------------------------------------------------------
Fitch Ratings has affirmed UGI International, LLC's (UGII)
Long-Term Issuer Default Rating (IDR) at 'BB+' with a Stable
Outlook.
The rating of UGII is underpinned by its leading market position as
a liquefied petroleum gas (LPG) distributor in Europe, and its
solid business profile with customer and supplier diversification.
UGII's credit profile is constrained by limited organic growth
potential, reflecting the company's concentration of operations in
the EU and smaller scale relative to investment-grade peers'.
The pandemic has had a limited impact on earnings and profitability
as UGII has demonstrated continued effective unit-margin
management, while distributing almost no dividends in 2020 also
helped it maintain a solid financial profile with healthy credit
metrics and liquidity.
KEY RATING DRIVERS
Solid 2020 Results, Coronavirus Impact Manageable: Impact on UGII's
sales during the pandemic has been manageable. UGII posted stronger
2020 results than Fitch had expected. Despite a sharp economic
contraction in most European countries due to the pandemic, and
warmer than normal average weather conditions resulting in lower
LPG consumption (-10% yoy), UGII reported a slight Fitch-estimated
EBITDA increase of 2% yoy with an EBITDA margin of 16%. Falling
propane prices to an extent allowed UGII to protect margins by
delaying benefits being passed onto end-customers. Cost-efficiency
measures also helped to offset weakening volumes and input price
increases.
Credit Metrics Consistent with Rating: Fitch expects UGII to remain
well-placed relative to its Fitch-rated peers, based on an average
FFO adjusted net leverage below 3.0x and FFO fixed-charge coverage
above 6.0x in 2021-2024. Its financial profile is underpinned by a
conservative capital structure and low target leverage of 2.0x-2.5x
net debt/EBITDA. Fitch estimates that the company will generate
steady cash from operations above USD200 million a year, and given
UGII's moderate capex on average of USD120 million and reinstated
dividends, a neutral-to negative post-dividend free cash flow (FCF)
in 2021-2024 on average.
Flexible Dividends: UGII does not have a minimum dividend policy,
which adds to its financial flexibility. Dividend payments depend
on the company's deleveraging ability and market conditions. All
this should result in a healthy liquidity position to allow UGII to
operate through further potential market downturns. Fitch expects
UGII to pay around USD150 million-USD160 million of dividends,
assuming annual average EBITDA of around USD350 million during
2021-2024, which is lower than management expectations.
Rating on a Standalone Basis: The IDR reflects UGII's Standalone
Credit Profile (SCP), because Fitch assesses the legal, operational
and strategic ties between the company and its ultimate majority
shareholder, UGI Corp (NR), as moderate in accordance with Fitch's
Parent and Subsidiary Rating Linkage methodology. UGI Corp. is a
holding company investing in a diversified portfolio of energy,
power and utility assets, including AmeriGas Partners, L.P.
(BB/Stable), UGI Energy Services, LLC (BB/Stable) and UGI Utilities
(A-/Stable).
UGI Corp. operates each of its businesses separately. While UGI
Corp has strong operational control over UGII, the legal ties are
limited, as UGII's EUR350 million notes and EUR300 million term
loan are non-recourse to the parent, with no guarantees or
cross-default provisions. Although UGII raises debt independently,
the parent has supported its growth funding.
Price Contracts: Long-term margins have been fairly stable despite
volume and pricing volatility, with higher margins in retail and
tighter mark-ups for bulk customers. The contracts of most UGII
customers have pricing arrangements, whereby prices fluctuate with
changes in propane spot prices. Around 14% of UGII's profits are
derived from fixed-price contracts, for which sold volumes are
hedged with forward contracts.
Growth Through Acquisitions: UGII is a leading distributor of LPG
in Europe, with the advantage of scale compared with many
competitors, and moderate geographic diversification. It plans to
grow through further LPG-market consolidation by acquiring the LPG
businesses of oil majors, as it did with BP plc (A/Stable), Royal
Dutch Shell plc (AA-/Stable), and Total SA (AA-/Stable) in 2015.
However, the company does not plan any significant acquisitions in
the nearest future, while debt-financed M&A could adversely affect
its credit profile.
This would enable cost savings by acquiring and optimising supply
and distribution channels in existing markets. LPG is a by-product
and not a focus of major energy companies, which continue to divest
their LPG operations.
Secured Supply Chain and Distributions: UGII enjoys security of
supply with almost half (40%) of its propane coming from the North
Sea region close to Norway and the UK, and the remainder from west
and north Africa, the US, the Middle East and Russia. It also has
multiple modes of supply transport including trucks, railcars and
ships. UGII has an extensive storage network throughout Europe.
UGII's flexibility (with regard to inventories, contracts and
cross-border flexibility, for example), can easily mitigate supply
disruptions of a few days. Longer disruption might put pressure on
supply but could partially be offset by UGII suppliers' strong
positions in neighbouring countries.
DERIVATION SUMMARY
UGII is firmly positioned relative to its Fitch rated peers as Vivo
Energy plc (BB+/Stable), Puma Energy Holdings Pte. Ltd (BB-/RWN)
and EG Group Limited (B-/Stable). Vivo and Puma have more
diversified businesses than UGII, with integrated downstream and
midstream operations. Puma is more geographically diversified than
UGII in emerging markets. Fitch views the less volatile operating
environment and stronger governance environment in Europe (compared
with emerging markets) for UGII as a mitigating factor for Europe's
weak demand. EG Group is a leading independent petrol-station
operator, with exposure to both the U.S. and Australian markets and
a strong market share in seven western European countries. However,
EG Group is much more leveraged.
UGII has a strong cash-generative profile, with neutral FCF (after
dividends) and higher average EBITDA margin than its peers. This is
due to a higher margin on retail propane and LPG sales (for home
heating and cooking as well as industrial use) than Puma and Vivo,
which are focused on highly competitive and low-margin retail
motor-fuel sales. UGII has a stronger financial profile with lower
FFO adjusted net leverage than Puma and EG Group, while Vivo has
lower leverage than UGII. All three peers are slightly less
capital-intensive than UGII.
UGII is also better-positioned than its sister company, AmeriGas
Partners, L.P. (APU, BB/Stable), which is also a large propane
retailer. APU operates, however, in a highly fragmented US market
with about a 15% market share. APU has much higher Fitch-estimated
leverage, but a stronger EBITDA margin. Its margin benefits from
its ability to compete with small retail propane distributors in
the US and to use its size to lower or eliminate overhead costs
while maintaining sales. Additionally, APU has become adept at
managing EBITDA and gross margins, even in an environment of
contracting sales and volatile propane prices.
KEY ASSUMPTIONS
-- Eurozone GDP growing in 2021-2022 on average 4.5% after a
significant drop in 2020; inflation of 0.8% in 2021 and 1.3%
in 2022;
-- US dollar/euro and sterling/US dollar rates of 0.85 and 1.18
respectively in 2021-2022;
-- LPG volumes to remain flat in 2021-2024;
-- Flat net sales by unit in 2021-2024;
-- EBITDA on average USD350 million with average EBITDA margin of
16% in 2021-2024;
-- Average USD150 million-USD160million dividends annually in
2021-2024;
-- Annual average capex of around USD120 million in 2021-2024.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
-- Increased scale of business while maintaining solid market
shares within the countries it operates in, and without
impairing profitability.
-- FFO adjusted net leverage sustainably below 2.0x, with FFO
fixed-charge cover above 6x for the next four years.
-- Positive FCF generation with FCF margin of more than 5% up to
2024.
Factor that could, individually or collectively, lead to negative
rating action/downgrade:
-- Weaker-than-Fitch-expected financial performance due to
aggressive upstream dividend policy or mostly debt-funded M&A,
resulting in FFO adjusted net leverage persistently higher
than 3.0x and FFO fixed-charge coverage of less than 4.0x up
to 2024.
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: UGII's liquidity is supported by internally
generated cash flow and a senior unsecured EUR300 million revolving
credit facility expiring in 2023. As of end- September 2020, UGII
held cash and cash equivalent balances of USD209 million. This
compares with almost no short-term maturities in 2021 and
USD16million in 2022.
UGII's EUR350 million seven-year senior unsecured notes due in 2025
ranks pari passu with an unsecured EUR300 million loan with bullet
repayment in 2023, and a EUR300 million RCF available until 2023.
Debt Guarantees: All three instruments share the same guarantors.
The bonds are guaranteed by subsidiaries representing about 80% of
UGII's EBITDA, with two main French guarantors representing around
two-thirds of UGII's total EBITDA. It has no prior-ranking debt at
operating companies.
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.
VAC FUND: Unsecureds Could Get 1% to 2% in Committee-Backed Plan
----------------------------------------------------------------
VAC Fund Houston, LLC, and its Official Committee of Unsecured
Creditors filed a Fourth Amended Joint Chapter 11 Plan of
Reorganization and a corresponding Disclosure Statement on March
12, 2021.
A hearing on the Fourth Amended Disclosure Statement is set for
9:30 a.m. on April 29, 2021.
Goldman Sachs and Lendinghome would foreclose on the houses that
are their respective collateral and Unsecured Creditors would
receive nothing if Debtors' assets were liquidated in a case under
Chapter 7 of the Bankruptcy Code.
The Committee and the Debtor negotiated and devised the terms of
the Joint Plan in order to provide the Unsecured Creditors a much
better result. Under the Joint Plan the Reorganized Debtor, with
direct input from designated representatives of the Committee, will
sell its assets in an orderly manner over not more than eighteen
months in order to maximize the sale prices and net proceeds for
the benefit of the Unsecured Creditors.
Unsecured claims against the estate total approximately $4 million,
of which an estimated $3.5 million will be allowed unsecured
claims. Under the proposed Joint Plan, each unsecured creditor
holding an Allowed Claim will receive payments over time equal to
that creditor's pro-rata portion of the equity in all of the
Debtor's assets after payment in full of the secured claims of
Lendinghome and Goldman Sachs, Allowed Administrative Claims and
Priority Claims.
Although Exhibit 7 to the Disclosure Statement shows that under the
proposed Joint Plan, each unsecured creditor holding an Allowed
Claim will not be paid any amounts for its claim, it is possible
that control of the Debtor by the Management Board, which will be
comprised of two unsecured creditors, may be able to obtain some
form of payment that will lead to a 1% to 2% pro-rata payment to
the Unsecured Creditors' Pool.
A copy of the Fourth Amended Disclosure Statement dated March 12,
2021, is available at https://bit.ly/30YMMcW
About VAC Fund Houston
VAC Fund Houston, LLC, a Nevada-based company engaged in activities
related to real estate, filed a voluntary petition for relief under
Chapter 11 of the Bankruptcy Code (Bankr. D. Nev. Case No.
19-17670) on Dec. 2, 2019, disclosing $15,948,556 in assets and
$17,369,695 in liabilities. The petition was signed by Christopher
Shelton, trustee of VAC Fund Houston Trust, manager of Debtor.
Judge Mike K. Nakagawa oversees the case.
Christopher R. Kaup, Esq., at Tiffany & Bosco, P.A., is the
Debtor's legal counsel.
The U.S. Trustee for Region 17 appointed a committee of unsecured
creditors on Jan. 15, 2020. The committee is represented by
Brinkman Portillo Ronk, APC.
VERRA MOBILITY: S&P Alters Outlook to Stable, Affirms 'B+' ICR
--------------------------------------------------------------
S&P Global Ratings revised its outlook on Verra Mobility Corp. to
stable from negative and affirmed its 'B+' issuer credit rating. In
addition, the company plans to amend an existing $866 million term
loan and issue newly proposed $350 million in senior unsecured
notes due 2029 to refinance existing debt and finance the
acquisition of Melbourne, Australia-based-Redflex Holdings Ltd.
(ASX:RDF).
S&P said, "At the same time, we are raising our first-lien
issue-level ratings to 'BB-' from 'B+' and revising our recovery
rating to '2' from '3' to reflect, among other things, the
lower-level of secured debt capitalization.
"Simultaneously, we are assigning our 'B-' issue-level rating and
'6' recovery rating to the company's proposed senior unsecured
notes, reflecting our expectation of negligible recovery given the
level of subordination in the capital structure.
"The revised outlook reflects our expectation that the company's
leverage will return to below 5x by the end of 2021. We expect
adjusted leverage to remain below 5x by the end of 2021, as
economic growth and the ongoing COVID-19 vaccine distribution
supports travel demand. Additionally, credit measures should
improve as the company laps the sharp drop in earnings in the
second-quarter of 2020 and starts to collect on its large
outstanding receivables balances from the New York City
Transportation Authority.
"Nevertheless, we project reported debt to increase by 15% on the
proposed debt-financed RedFlex acquisition. We anticipate leverage
will increase to 5.8x on a pro forma basis from 5.2x as of year-end
2020 before declining to the high-4x area by the end of 2021. We
believe deleveraging will primarily come from the recovery in the
commercial services segment, which historically represented 62% of
total sales (46% as of year-end 2020) and modest contributions from
RedFlex. We expect Redflex to generate at least $9 million of
annual EBITDA upon close of the transaction, with potential upside
due to the synergies and geographic expansion opportunities.
"The stable outlook reflects our expectation that the company will
likely benefit from improved operating conditions and successfully
close on the acquisition to maintain leverage below 5.0x on a
sustained basis. Under our base case, we expect the company to make
steady progress collecting its large New York City Transportation
Authority receivable balance.
"We could lower our ratings on Verra Mobility if the company
materially underperforms our base-case expectations for sales and
earnings from a weakened operating performance, substantial
customer losses, or additional pandemic-related headwinds such that
adjusted leverage would remain sustained above 5.0x.
"We could raise the rating if increasing scale in the toll and
fleet business, expansion and retention of the customer base and
improved operating leverage continue to reduce adjusted leverage to
below 4x, while free operating cash flow generation (FOCF)
generation remains above $120 million."
VI GROUP INVESTMENT: Hires 23 Realty as Real Estate Broker
----------------------------------------------------------
Vi Group Investment, LLC seeks approval from the U.S. Bankruptcy
Court for the Northern District of Georgia to employ 23 Realty
Advisors, LLC as real estate broker.
The firm will market and sell the Debtor's real property located at
127 Perimeter Center W., Dunwoody, Ga.
The firm will be paid a commission of 2 percent of the gross sales
price.
Kory Pryor, a partner at 23 Realty Advisors, disclosed in a court
filing that the firm is a "disinterested person" as the term is
defined in Section 101(14) of the Bankruptcy Code.
The firm can be reached at:
Kory Pryor
23 Realty Advisors, LLC
2121 N. Frontage Road West, Suite 10
Vail, CO 81657
Tel: (404) 422-7200
About Vi Group Investment
Vi Group Investment, LLC, a single asset real estate debtor, sought
protection under Chapter 11 of the Bankruptcy Code (Bankr. N.D. Ga.
Case No. 21-51722) on March 2, 2021. Vi To, the Debtor's sole
member, signed the petition.
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.
Rountree, Leitman & Klein, LLC is the Debtor's legal counsel.
VI GROUP INVESTMENT: Seeks to Hire Rountree Lietman as Counsel
--------------------------------------------------------------
Vi Group Investment, LLC seeks approval from the U.S. Bankruptcy
Court for the Northern District of Georgia to employ Rountree
Lietman & Klein, LLC to handle its Chapter 11 case.
The firm's services will include:
1. advising the Debtor regarding its powers and duties in the
management of its property;
2. preparing legal papers;
3. assisting in the examination of claims of creditors;
4. assisting in the formulation and preparation of a plan of
reorganization and in seeking confirmation of the plan;
5. other legal services necessary to administer the Debtor's
bankruptcy case.
Rountree will be paid at these rates:
Attorneys $195 to $495 per hour
Paralegals $150 to $195 per hour
The firm will also be reimbursed for out-of-pocket expenses
incurred. The retainer fee is $20,000.
William Rountree, Esq., a partner at Rountree Leitman & Klein,
disclosed in a court filing that the firm is a "disinterested
person" as the term is defined in Section 101(14) of the Bankruptcy
Code.
The firm can be reached at:
William A. Rountree, Esq.
Benjamin R. Keck, Esq.
Taner N. Thurman, Esq.
Rountree Leitman & Klein, LLC
2987 Clairmont Road, Suite 350
Atlanta, GA 30329
Telephone: (404) 584-1238
Email: wrountree@rlklawfirm.com
bkeck@rlklawfirm.com
tthurman@rlklawfirm.com
About Vi Group Investment
Vi Group Investment, LLC, a single asset real estate debtor, sought
protection under Chapter 11 of the Bankruptcy Code (Bankr. N.D. Ga.
Case No. 21-51722) on March 2, 2021. Vi To, the Debtor's sole
member, signed the petition.
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.
Rountree, Leitman & Klein, LLC is the Debtor's legal counsel.
VOYAGER AVIATION: DBRS Lowers Long-Term Issuer Rating to CC
-----------------------------------------------------------
DBRS, Inc. has downgraded the Long-Term Issuer Rating of Voyager
Aviation Holdings, LLC to CC from B, while also downgrading the
Company's Long-Term Senior Debt rating to C from CCC (high).
Concurrently, DBRS Morningstar also downgraded the Long-Term Issuer
Rating of the Company's wholly-owned subsidiary, Voyager Finance
Co. (VFC), to CC from B and its Long-Term Senior Debt rating to C
from CCC (high). All ratings have been placed Under Review with
Negative Implications. The Intrinsic Assessment (IA) for the
Company is CC, while its Support Assessment is SA3. The Support
Assessment for VFC is SA1.
KEY RATING CONSIDERATIONS
The rating action follows the Company's announcement that it has
reached an agreement with its existing shareholders and certain
existing bondholders of its August 2021 Notes to restructure and
recapitalize the Company (the Exchange Offer). In our view, Voyager
has limited financial flexibility with no unencumbered aircraft as
of September 30, 2020, no stand-by bank credit facilities, and
aviation finance markets that are essentially closed for
participants of a smaller scale, including Voyager. As such, we
view the Company as having very limited options to refinance the
Notes, and that a default on the Notes would be likely without a
successful debt exchange. Indeed, should the Exchange Offer not to
be accepted by 95% of the current holders of the Notes, the Company
has stated that it would pursue either an in-court restructuring in
Ireland or the U.S. We see this as providing a strong inducement
for the existing bondholders to accept the Exchange Offer. Per DBRS
Morningstar policy, such an exchange is considered a distressed
debt exchange and the equivalent to a default on the Notes. As
such, upon the successful execution of the Exchange Offer, DBRS
Morningstar will lower Voyager's Long-Term Issuer Rating to
Selective Default (SD) reflecting that the Company is still
performing on its secured debt obligations and operating as a going
concern, while downgrading the Long-Term Senior Debt rating to "D"
or Default.
Per the Exchange Offer, the existing shareholders of Voyager have
agreed to relinquish their equity stake in the Company in exchange
for $15 million of new 5-year 8.50% Senior Notes due 2026 (the New
Notes). At September 30, 2020, Voyager had $382.9 million of
tangible equity. Meanwhile, the bondholders of the Notes would
tender their existing notes in exchange for all the equity in
Voyager, $200 million of liquidation preference preferred equity,
and $150 million of the New Notes. On September 30, 2020, there was
approximately $415.3 million outstanding of the 8.50% August 2021
Notes. Following a successful execution of the Exchange Offer,
Voyager will maintain its existing management agreement with
Amedeo, but Amedeo will relinquish its 2.5% ownership in the
Company for a pro-rata share of the $15 million in new Notes.
With the announcement of the Exchange Offer, Voyager indicated that
all shareholders have agreed to the restructuring and
recapitalization of the Company and that as of February 19, 2021,
approximately 60% of the existing bondholders in the Notes have
agreed to the plan. Over the coming weeks, Voyager will seek
consent from the remaining holders of the Notes with a required
majority of 95% necessary to successfully implement the Exchange
Offer.
RATING DRIVERS
Given the Under Review with Negative Implications and the
expectation of the debt exchange, an upgrade in the ratings is not
likely in the near-term. Upon successful execution of the Exchange
Offer, the Long-Term Issuer Rating will be lowered to Selective
Default (SD), while the Long-Term Debt ratings will be downgraded
to D. If the Exchange Offer is unsuccessful and the Company pursues
a restructuring of the Notes in the courts, the ratings would
likely be downgraded to D.
Notes: DBRS Morningstar notes that this Press Release was amended
on February 24, 2021, to incorporate the disclosure regarding
Coronavirus Disease.
All figures are in U.S. dollars unless otherwise noted.
WAND NEWCO 3: Moody's Completes Review, Retains B2 CFR
------------------------------------------------------
Moody's Investors Service has completed a periodic review of the
ratings of Wand NewCo 3, Inc. and other ratings that are associated
with the same analytical unit. The review was conducted through a
portfolio review discussion held on March 4, 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 1m 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.
Wand NewCo 3, Inc.'s (dba "Caliber") B2 corporate family rating
reflects the company's leading market position -- with practically
national coverage - in the highly fragmented collision repair
sub-sector, and its strong relationships with national and major
insurance carriers, which represent the vast majority of its
revenues. Caliber's credit profile is constrained by the company's
very high leverage and weak interest coverage. Caliber benefits
from strong industry fundamentals should continue to support stable
and predictable demand for its services. Caliber's credit profile
is constrained by the company's aggressive growth strategy and
financial policies, as well as the integration risks associated
with the merger with ABRA. The rating is supported by Caliber's
adequate liquidity.
The principal methodology used for this review was Retail Industry
published in May 2018.
WASHINGTON PRIME: Inks Deal to Hold Off Debt as Bankruptcy Looms
-----------------------------------------------------------------
Washington Prime Group Inc. has signed an agreement to hold off
some debt for now, but the company is still considering a possible
Chapter 11 bankruptcy.
On Feb. 15, 2021, WPG L.P. elected to withhold an interest payment
of $23.2 million interest with respect to its Senior Notes due 2024
Notes and, as provided for in the indenture governing the Notes, to
enter the 30-day grace period to make such payment.
The Columbus-based real estate investment trust on March 16, 2021,
told the Securities and Exchange Commission Tuesday that it has
signed forbearance agreements, giving it 15 days to make a deal
with creditors across 67% of the company's aggregate debt. The
forbearance period under each of the Bank Forbearance Agreements
ends on the earlier of March 31, 2021, and the occurrence of any of
the specified early termination events as described therein. WPG
L.P. and certain of its subsidiaries also agreed to additional
restrictions in connection with the Forbearance Agreements.
"The company is continuing to engage in negotiations and
discussions to restructure its capital structure," it said in a
statement. "The uncertainty associated with the company's ability
to meet these obligations ... raises substantial doubt about the
company's ability to continue as a going concern."
Bloomberg reported this month that the company was preparing a
filing, citing sources familiar with the talks.
Washington Prime also reported on Tuesday, March 16, 2021, a $262
million net loss in 2020, including a $111.4 million net loss in
the fourth quarter alone.
Revenue for the whole year was $524.4 million, which was down from
$661.5 million in 2019.
Washington Prime also suspended dividends and withheld 2021
financial projections.
Columbus Business First reports that the ongoing Covid-19 pandemic
has devastated Washington Prime, which reported tenants were unable
to pay rent as lockdowns closed malls. Business First notes that
traffic hasn't returned, either, with more people shopping online
or avoiding indoor malls for outdoor spaces.
While negotiations continue, Washington Prime said it "expects to
continue to provide quality service to its customers without
interruption and work with its business partners as usual during
the course of these discussions and any potential transaction."
The company hired Kirkland & Ellis LLP last month as legal counsel
and Guggenheim Securities LLC as its investment banker. It
restructured compensation for 17 executives to pay them $11.6
million upfront to stay with the company.
In analysis last February 2021, Fitch Ratings downgraded the
company for the third time during the pandemic, noting that it
would unlikely find buyers if it tried to sell off its malls and
"has limited to no options to access external capital," predicting
a bankruptcy or restructuring.
About Washington Prime Group
Columbus, Ohio-based Washington Prime Group Inc. (NYSE: WPG) is a
retail REIT that owns a mix of enclosed malls and open-air
community centers across the United States. Gross assets totaled
$7.7 billion including pro-rata share of JVs as of 2Q20.
The real estate investment trust, based in Columbus, Ohio, was
formed in May 2014 following a spinoff from the biggest U.S. mall
owner, Simon Property Group. It went on to grow its portfolio of
shopping malls when it acquired Glimcher Realty Trust, in January
2015. Washington Prime currently operates about 100 malls across
the country.
* * *
Washington Prime Group, L.P., the operating partnership of
Washington Prime Group Inc., said in a regulatory filing that on
Feb. 15, 2021, it elected to withhold an interest payment of $23.2
million due on Feb. 15, 2021, with respect to WPG L.P.'s
outstanding Senior Notes due 2024.
WPG L.P. has engaged Kirkland & Ellis LLP as legal counsel and
Guggenheim Securities, LLC as investment banker to assist the
Company and its subsidiaries with respect to their continuing
discussions with certain counterparties as well as other lenders
within the Company's capital structure.
WEINSTEIN CO: Emergency Stay Bid of Plan Objectors Denied
----------------------------------------------------------
Law360 reports that a Delaware federal judge on Tuesday, March 16,
2021, denied an emergency bid to halt The Weinstein Co.'s Chapter
11 proceedings brought by four objectors who are bringing sexual
misconduct claims against disgraced movie mogul Harvey Weinstein,
saying the women failed to point out any errors in the bankruptcy
court's confirmation of the liquidation plan.
U.S. District Judge Maryellen Noreika denied the objectors'
emergency stay motion, saying they are unlikely to succeed on their
argument that third-party nonconsensual releases should not have
been included in the Plan because the company is being liquidated.
About The Weinstein Company
The Weinstein Company (TWC) -- http://www.WeinsteinCo.com/-- is a
multimedia production and distribution company launched in 2005 in
New York by Bob and Harvey Weinstein, the brothers who founded
Miramax Films in 1979. TWC also encompasses Dimension Films, the
genre label founded in 1993 by Bob Weinstein. During Harvey and
Bob's tenure at Miramax and TWC, they have received 341 Oscar
nominations and won 81 Academy Awards.
TWC dismissed Harvey Weinstein in October 2017, after dozens of
women came forward to accuse him of sexual harassment, assault or
rape.
The Weinstein Company Holdings LLC and 54 affiliates sought Chapter
11 protection (Bankr. D. Del. Lead Case No. 18-10601) on March 19,
2018, after reaching a deal to sell all assets to Lantern Asset
Management for $310 million.
The Weinstein Company Holdings estimated $500 million to $1 billion
in assets and $500 million to $1 billion in liabilities.
The Hon. Mary F. Walrath is the case judge.
Cravath, Swaine & Moore LLP is the Debtors' bankruptcy counsel,
with the engagement led by Paul H. Zumbro, George E. Zobitz, and
Karin A. DeMasi, in New York.
Richards, Layton & Finger, P.A., is the local counsel, with the
engagement headed by Mark D. Collins, Paul N. Heath, Zachary I.
Shapiro, Brett M. Haywood, and David T. Queroli, in Wilmington,
Delaware.
The Debtors also tapped FTI Consulting, Inc., as restructuring
advisor; Moelis & Company LLC as investment banker; and Epiq
Bankruptcy Solutions, LLC, as claims and noticing agent.
The official committee of unsecured creditors retained Pachulski
Stang Ziehl & Jones, LLP as its legal counsel, and Berkeley
Research Group, LLC, as its financial advisor.
WEST VIRGINIA: April 7 Hearing on Sale of Canaan Valley Property
----------------------------------------------------------------
Judge B. McKay Mignault of the U.S. Bankruptcy Court for the
Northern District of West Virginia will convene a hearing on April
7, 2021, at 1:30 p.m., to consider the sale proposed by West
Virginia Resorts, LLC, of a water utility and a sewer utility, and
all of the personal property and equipment which is a part of the
facilities and situate in Canaan Valley, Tucker County, West
Virginia, to John Dehn for $65,000, cash.
The Objection Deadline is April 1, 2021. To participate in the
hearing parties are instructed to dial (888)273-36580 and provides
access code 1039652# when prompted to do so.
If no written objection to the Motion to Sell is filed by the
objection deadline, the Court may, in its discretion, cancel the
hearing and grant the Motion to Sell without further notice or
opportunity for hearing.
About West Virginia Resorts LLC
West Virginia Resorts LLC, a privately held company in Charleston,
W.Va., sought protection under Chapter 11 of the Bankruptcy Code
(Bankr. N.D. W.Va. Case No. 19-00587) on July 18, 2019. At the
time of the filing, the Debtor was estimated to have assets of
between $1 million and $10 million and liabilities of the same
range. The case is assigned to Judge Patrick M. Flatley. The
Debtor is represented by Caldwell & Riffee.
WESTERN MIDSTREAM: S&P Alters Outlook to Stable, Affirms 'BB' ICR
-----------------------------------------------------------------
S&P Global Ratings revised the rating outlook on West Texas
Intermediate (WTI) to stable from negative. S&P's outlook on
Western will continue to mirror its outlook on OXY at current
rating levels because OXY is a material counterparty to Western and
provides about 65% of the company's revenues.
S&P said, "We are also affirming the 'BB' issuer credit rating on
Western, and the 'BB' issue-level rating on the company's senior
unsecured notes.
"The stable rating outlook on Western is underpinned by our stable
outlook on our 'BB-' rating on OXY. Also supporting the stable
rating outlook on Western is S&P Global Ratings-adjusted leverage
that averages between 3.5x and 4x over the next few years.
"We revised our rating outlook on Western's most important
counterparty, OXY, to stable from negative. We revised our WTI oil
price expectations to average $55 per barrel (bbl) through 2022, a
material increase from prior expectations of $45/bbl. Following
that change, we revised our outlook on OXY to stable primarily due
to our forecast for an improvement in its leverage as well as other
factors such as its lower cost structure and its near-term debt
maturity schedule. The producer contributes about 65% of Western's
revenues so OXY's creditworthiness is a key input when assessing
counterparty risk and cash flow stability at Western. The stable
rating outlook on OXY directly impacts our rating outlook on
Western because we limit Western's rating to one notch higher than
OXY. We currently rate OXY one notch lower at 'BB-'."
Western has materially delevered after outperforming in terms of
both EBITDA and free cash flow generation in 2020. Given its
fixed-fee contract structure, steadier than expected volumes, and
enhanced operating cost structure, the company outperformed our
EBITDA expectations in 2020. The company also scaled back growth
capital spending and cut its distribution, leading to material free
cash flow generation during the year. Importantly, leverage fell
below 4x. S&P expects leverage to remain below 4x as the company
continues to generate robust free cash flow and use it to repay
debt, while taking a measured approach to increasing shareholder
returns.
S&P said, "The stable outlook on Western Midstream reflects our
outlook on OXY, its largest customer, because we limit our rating
on Western to one notch higher than our rating on OXY given its
reliance on the latter as a counterparty. The stable outlook also
captures our view that Western will maintain leverage in the
3.5x-4x range over the next few years as it focuses on generating
free cash flow and maintains a somewhat conservative approach to
capital allocation.
"We could lower the rating on Western if we lowered the rating on
OXY. This could occur if OXY's debt to EBITDA increases and is
sustained above 6x, or if OXY becomes overly reliant on capital
markets, aggressively spends capital, or prioritizes shareholder
returns over debt reduction.
"We could raise our rating on Western if we raise our rating on OXY
while Western maintained its current financial policy. We could
upgrade OXY if financial metrics improve relative to our base-case
scenario such that its average funds from operations (FFO) to debt
nears 20% while its debt to EBITDA approaches 4x on a sustained
basis. This would most likely occur if commodity prices increase or
the company achieves material debt reduction beyond our current
expectations while maintaining at least adequate liquidity and we
see a plausible path toward further deleveraging."
WHITE RIVER: Has Until June 15 to File Plan & Disclosures
---------------------------------------------------------
On March 11, 2021, the U.S. Bankruptcy Court for the District of
Montana conducted a hearing where debtor White River Contracting
LLC requested additional time to file a disclosure statement and
proposed Chapter 11 plan. Judge Benjamin P. Hursh has ordered
that:
* The Debtor shall have until June 15, 2021, to file its
disclosure statement and Chapter 11 Plan.
* June 29, 2021, is fixed as the last day to file any
objections to Debtor's disclosure statement.
* July 7, 2021, at 09:00 a.m. in the Bankruptcy Courtroom,
Russell Smith Courthouse, 201 East Broadway, Missoula, Montana is
the hearing on approval of Debtor's disclosure statement.
A full-text copy of the order dated March 11, 2021, is available at
https://bit.ly/3vEiaLJ from PacerMonitor.com at no charge.
The Debtor is represented by:
Matt Shimanek, Esq.
SHIMANEK LAW PLLC
317 East Spruce St.
Missoula, MT 59802
Tel: (406) 544-8049
E-mail: matt@shimaneklaw.com
About White River Contracting
White River Contracting LLC is a privately held company in the
residential building construction industry that specializes in
custom-tailored homes.
White River Contracting, based in Hamilton, MT, filed a Chapter 11
petition (Bankr. D. Mont. Case No. 20-90251) on Nov. 3, 2020. In
the petition signed by Craig Rostad, managing member, the Debtor
was estimated to have $1 million to $10 million in assets and $10
million to $50 million in liabilities. The Hon. Benjamin P. Hursh
presides over the case. SHIMANEK LAW PLLC serves as bankruptcy
counsel to the Debtor.
WHITE STONE FOODS: Wants Plan Exclusivity Extended Thru March 31
----------------------------------------------------------------
Debtor White Stone Foods, LLC requests the U.S. Bankruptcy Court
for the Southern District of Florida, Fort Lauderdale Division to
extend the exclusive periods during which the Debtor may file a
plan of reorganization and to solicit ballots on such a plan until
March 31, 2021, and June 1, 2021, respectively.
On November 12, 2020, the Debtor and Long John Silvers' ("LJS") met
at a conference, to discuss the terms of a viable plan of
reorganization. Although no final agreement on the terms of a
viable plan of reorganization was reached at that conference, the
parties are continuing to discuss the issues. The Debtor is hopeful
a resolution will be reached.
The Debtor desires to focus its full attention on stabilizing the
business and formulating an exit strategy to this Chapter 11 case,
which will hinge on the discussions with LJS. The Debtor does not
want to be concerned with competing plans.
The Debtor's motion to extend is not filed for any dilatory purpose
and no prejudice will result to any party if the requested
extension is granted.
A copy of the Debtor's Motion to extend is available at
https://bit.ly/2OSGHvR from PacerMonitor.com.
About White Stone Foods
White Stone Foods, LLC, a privately held company in the fast-food
restaurant business, sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. S.D. Fla. Case no. 20-11531) on February 4,
2020. White Stone Foods, as a franchisee, operating 13 separate
retail restaurants under the Franchise names Long John Silvers' and
A & W Restaurants.
In the petition signed by John S. Robles, managing member, the
Debtor was estimated to have $50,000 to $100,000 in assets and $1
million to $10 million in liabilities.
Judge Peter D. Russin replaced Judge Scott M. Grossman, who
previously oversees the Debtor's case. Brian S. Behar, Esq. at
Behar Gutt & Glazer, P.A., is the Debtor's legal counsel. Rodriguez
Kinzbrunner & Company, LLC, serves as an accountant to the Debtor.
WIRTA HOTELS: Seeks Cash Collateral Access
------------------------------------------
Wirta 3, LLC and Wirta Hotels 3, LLC ask the U.S. Bankruptcy Court
for the Western District of Washington for authority to continue
using cash collateral on an interim basis.
The Debtors require the use of cash collateral in which Wilmington
Trust, National Association -- as Trustee, on Behalf of the
Registered Holders of Citigroup Commercial Mortgage Trust 2017-C4,
Commercial Mortgage Pass-Through Certificates, Series 2017-C4 --
and any other creditor may claim an interest (whether valid or
not), subject to and in accordance with the terms set forth in the
Final Order (I) Authorizing Use of Cash Collateral and (II)
Granting Related Relief.
The Debtors' request for authority to continue to use Cash
Collateral is subject to these terms:
-- The Debtors request use of Cash Collateral from April 1,
2021 (the day on which the Current Cash Collateral Order would
expire) through the later of June 30, 2021 or the end of the month
in which the conclusion of the confirmation hearing on the Plan
occurs.
-- The Debtors will grant additional adequate protection liens
which will have the same extent, priority, validity, and status as
Wilmington's prepetition liens, and which are binding and perfected
automatically upon entry of the Order (subject to a carve out for
the Professional Fund).
-- The Debtors will continue to provide the same reporting to
Wilmington and the United States Trustee on substantially the same
terms as set forth in the Current Cash Collateral Order for the
duration of the Additional Period.
-- The Debtors will pay $25,000 per month ($20,000 for Foster
Garvey as counsel and $5,000 for Premier Capital Associates as
financial advisor) for the months of April, May, and June 2021,
into a professional fund to be maintained by Foster Garvey in a
trust account in substantially the manner as provided for in the
Current Cash Collateral Order.
The Debtors also contend, Wilmington's potential interests in the
Cash Collateral are adequately protected by virtue of (i) a very
substantial equity cushion that Wilmington has across its
collateral package, (ii) the Debtors' adherence to the Budget,
which will constrain cash outflows to those strictly necessary to
enable the Debtors to continue operating in the ordinary course,
and (iii) continuation of similar forms of adequate protection that
were provided to Wilmington in the Current Cash Collateral Order.
The Debtors believe the value of the Hotel is approximately $13
million. The recent appraisal commissioned by Wilmington values
the Hotel at $11.5 million with a projected stabilization value of
$15.2 million by February 2024. The $11.5 million current valuation
is up $500,000 from the prior valuation, which has substantially
bolstered Wilmington's position in the collateral during the
Chapter 11 cases.
The Debtors note that Wilmington has an equity cushion today of no
less than 25.7% and as much as 45.7%. If Wilmington' claim amount
does not change by February 2024, that equity cushion -- per
Wilmington's own appraisal, which shows the Hotel appreciating in
value by millions of dollars over the next three years -- would be
no less than 43.8% and as much as 53.6%.
The Debtors are also willing to grant Wilmington adequate
protection liens, which are replacement liens pursuant to section
361 of the Bankruptcy Code. The Debtors propose that the Adequate
Protection Liens have the same extent, priority, validity, and
status as Wilmington's prepetition liens. The Adequate Protection
Liens provide Wilmington additional adequate protection above and
beyond the substantial equity cushion.
A copy of the Motion is available for free https://bit.ly/3qSngAj
from PacerMonitor.com.
About Wirta Hotels
Wirta Hotels 3, LLC and Wirta 3, LLC own and operate the Holiday
Inn Express & Suites in Sequim, Washington. They own the real
property (1141 East Washington Street) upon which the hotel is
situated. Bret Wirta and Patricia Wirta, husband and wife, own
100% of Wirta.
On Sept. 18, 2020, Wirta Hotels and Wirta 3 filed Chapter 11
petitions (Bankr. W.D. Wash. Lead Case No. 20-12398). At the time
of filing, Wirta Hotels disclosed $2,365,830 in assets and
$2,805,775 in total liabilities while Wirta 3 disclosed $13,214,141
in assets and $7,017,530 in liabilities.
Judge Marc Barreca oversees the cases.
Foster Garvey, PC is the Debtor's legal counsel.
[^] BOOK REVIEW: Bankruptcy Crimes
----------------------------------
Author: Stephanie Wickouski
Publisher: Beard Books
Softcover: 395 Pages
List Price: $124.95
Review by Gail Owens Hoelscher
Order your personal copy today at
https://bit.ly/3dTzyDY
Did you know that you could be executed for non-payment of debt in
England in the 1700s? Or that the nailing of an ear was the
sentence for perjury in bankruptcy cases in 1604? While ruling out
such archaic penalties, Stephanie Wickouski does believe "in the
need for criminal sanctions against bankruptcy fraud and for
consistent, effective enforcement of those sanctions." She decries
the harm done to individuals through fraud schemes and laments the
resulting erosion in public confidence in the judicial system.
This leading authoritative treatise on the subject of bankruptcy
fraud, first published in August 2000 and updated annually with new
material, will prove invaluable for bankruptcy law practitioners,
white collar criminal practitioners, and prosecutors faced with
criminal activity in bankruptcy cases. Indeed, E. Lawrence
Barcella, Jr. of Paul, Hastings, Janofsky, and Walker, in
Washington, DC, said, "If I were a lawyer involved in a bankruptcy
matter, whether civil or criminal, and had only one reference work
that I could rely upon, it would be this book." And, Thomas J.
Moloney with Cleary, Gottlieb, Steen & Hamilton described the book
as "an essential reference tool."
An estimated 10% of bankruptcy cases involve some kind of abuse or
fraud. Since launching Operation Total Disclosure in 1992, the U.S.
Department of Justice has endeavored to send the message that
bankruptcy fraud will not be tolerated. Bankruptcy judges and
trustees are required to report suspected bankruptcy crimes to a
U.S. attorney. The decision to prosecute is based on the level of
loss or injury, the existence of sufficient evidence, and the
clarity of the law. In some cases, civil penalties for fraud are
deemed sufficient to punish and deter.
Ms. Wickouski suggests that some lawyers might not recognize
criminal activity that the DOJ now targets for investigation. She
gives several examples, including filing for bankruptcy using an
incorrect Social Security number, and receiving payments from a
bankruptcy debtor that were not approved by the bankruptcy court.
In both of these real life examples, DOJ investigations led to
convictions and jail time.
Ms. Wickouski says that although new schemes in bankruptcy fraud
have come along, others have been around for centuries. She takes
the reader through the most common traditional schemes, including
skimming, the bustout, the bleedout, and looting, as well as some
new ones, including the bankruptcy mill. The main substance of
Bankruptcy Crimes is Ms. Wickouski's detailed analysis of the U.S.
Bankruptcy Criminal Code, chapter 9 of title 18, the Federal
Criminal Code. She painstakingly analyzes each provision, carefully
defining terms and providing clear and useful examples of actual
cases. She ends with a good chapter on ethics and professional
responsibility, and provides a comprehensive set of annexes.
Bankruptcy Crimes is never dry, and some of the cases will make you
nostalgic for the days of ear-nailing. This comprehensive, well
researched treatise is a particularly invaluable guide for debtors'
counsel in dealing with conflicts, attorney-client relationships,
asset planning, and an array of legal and ethical issues that
lawyers and bankruptcy fiduciaries often face in advising clients
in financially distressed situations.
Stephanie Wickouski is a partner at Bryan Cave Leighton Paisner
LLP, advising clients on all aspects of bankruptcy, insolvency and
commercial transactions, including bond defaults, trust indentures,
business acquisitions, real estate, health care and financial
fraud. With more than 30 years of experience handling complex
reorganization cases throughout the country, she has served as lead
bankruptcy counsel in multiple high-profile cases.
Ms. Wickouski is also the author of Indenture Trustee Bankruptcy
Powers & Duties, an essential guide to the legal role of bond
trustee. She also writes the Corporate Restructuring blog
(http://blogs.bankrupt.com).She has a national reputation and is
an industry leader in corporate insolvency, and is a frequent
lecturer, author and commentator on bankruptcy subjects.
Ms. Wickouski joined Gardner Carton & Douglas' Corporate
Restructuring Practice as a partner in August 2002 and worked in
the Firm's Washington, D.C. office. Prior to joining Gardner
Carton & Douglas, she was a partner at Arent Fox Kintner Plotkin &
Kahn in Washington, D.C. and New York City, and prior to that, a
partner at Reed Smith.
Prior to entering private practice, she was a trial attorney with
the Civil Division of the U.S. Department of Justice, where she
received awards for her handling of litigation in airline
bankruptcies. She is a panel mediator for the U.S. Bankruptcy Court
for the Southern District of New York.
*********
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then-ending.
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*********
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
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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.
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