/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/210505.mbx T R O U B L E D C O M P A N Y R E P O R T E R Wednesday, May 5, 2021, Vol. 25, No. 124 Headlines 110 WEST PROPERTIES: June 1 Plan & Disclosure Hearing Set 110 WEST PROPERTIES: Unsecureds to Get What's Left of $22M Sale 1716 I LLC: June 3 Amended Plan & Disclosure Hearing Set 7 GENERAL CONTRACTING: Unsecureds Owed $6.14M to Get $400K in Plan ACADEMY LTD: Moody's Alters Outlook on 'B1' CFR to Positive AEROCENTURY CORP: Files Notice of May 20 Auction of 10 Aircrafts AGILITI INC: S&P Upgrades ICR to 'B+', Outlook Positive ALA TURK: Seeks to Hire S Kekatos & Associates as Accountant ALL TEXAS ELECTRICAL: Seeks to Hire Paul Zbranek as Accountant ALLIED UNIVERSAL: Moody's Rates Proposed Sr. Secured Notes 'B2' ALPHATEC HOLDINGS: Deloitte & Touche Replaces MHM as Auditor APEG MAXEY: Seeks to Tap Kraus Law Firm as Bankruptcy Counsel AQA ACQUISITION: Bugsnag Acquisition No Impact on Moody's B3 CFR AREU STUDIOS: Bid to Use Cash Collateral Moot AVEANNA HEALTHCARE: S&P Upgrades ICR to 'B-', Outlook Positive B-LINE CARRIERS: Wins Cash Collateral Access Thru May 25 BECKER BOILER: Wins Cash Collateral Access BILLINGS LODGE: May 25 Plan Confirmation Hearing Set BILLINGS LODGE: Plan Payments to be Funded by Asset Sale Proceeds BIOLARGO INC: Incurs $9.7 Million Net Loss in 2020 BISON BUILDING: Seeks to Hire Morgan Pierce as Legal Counsel BISON BUILDING: Seeks to Hire Sky Country Consulting as Accountant BLACKWATER TECHNOLOGIES: Unsecured Creditors to Get 5% Under Plan BLADE GLOBAL: Blade Acquisition Buying All Assets for $1 Million BMZ LLC: Has Until June 21 to File Plan & Disclosures BOMBARDIER INC: Moody's Hikes Rating on Sr. Unsecured Notes to Caa2 BORDEN IMPROVEMENTS: Wins Cash Collateral Access Thru June 3 BOY SCOUTS OF AMERICA: Abuse Survivors Oppose Disclosure Statement BOY SCOUTS OF AMERICA: More Abuse Claimants Resist Plan Disclosures BRAZOS ELECTRIC: Committee Taps FTI Consulting as Financial Advisor BRIARS INVESTMENTS: Seeks to Tap Hood & Bolen as Legal Counsel BURN FITNESS: Seeks Cash Collateral Access CANNABICS PHARMACEUTICALS: Announces Entry Into $1.37M Senior Note CANTWELL WOODWORKING: Industrial Buying Personal Property for $86K CARLA'S PASTA: Cash Collateral Access Extended to June 1 CBAC BORROWER: S&P Affirms 'CCC+' ICR; Outlook Stable CHARGING BEAR: Proposes May 20 Auction of Oklahoma City Property CLUB CAR: S&P Assigns 'B' Issuer Credit Rating, Outlook Stable COGENT COMMUNICATIONS: Moody's Rates New $500MM Secured Notes 'Ba3' COMMUNITY HEALTH: Files Form 10-Q for First Quarter CONCORD INC: Gets OK to Hire CliftonLarsonAllen as Accountant COSI INC: Seeks Fast Track Bankruptcy to Access COVID Relief Funds COSI INC: Seeks Quick Confirmation of Plan COSI INC: Unsecured Creditors Get 20% Recovery Under Plan COTTAGE CAR: Seeks to Hire Madoff & Khoury as Legal Counsel COTTAGE CAR: Wins Cash Collateral Access Thru June 30 CRAVE BRANDS: Cash Collateral Access Extended to May 11 CRC BROADCASTING: Has Cash Collateral Access Until May 31 CRESTWOOD HOSPITALITY: Seeks to Tap Sacks Tierney as Legal Counsel CSC HOLDINGS: Moody's Rates New $1.5BB Sr. Guaranteed Notes 'Ba3' CYTODYN INC: Inks $28.5 Million Financing Deal With Uptown Capital DANA INC: Fitch Rates Proposed $400MM Unsec. Green Bonds 'BB+' DANA INC: Moody's Rates New $400MM Sr. Unsecured Notes 'B2' DELRAY BEACH: Gets Interim OK to Hire Roshawn Banks as Counsel DEWIT DAIRY: Unsecured Creditors to Recover 64% to 82% in Plan DONALD ANTHONY DELLA: Ramseys Buying Cresson Property for $49K DOUBLE D GROUP: To Seek Plan Confirmation on June 15 EARTHWORKS & SALES: Wins Cash Collateral Access EKSO BIONICS: Posts $3.7-Mil. Net Loss for Quarter Ended March 31 ELDERHOME LAND: Seeks to Hire Gordon & Simmons as Legal Counsel ELECTRONIC DATA: Wins Cash Collateral Access Thru May 21 ELECTROTEK CORPORATION: June 15 Disclosure Statement Hearing Set ELITE PHARMACEUTICALS: Names Marc Bregman as CFO EMERGENT BIOSOLUTIONS: Moody's Alters Outlook on Ba2 CFR to Neg. ENGINEERED MACHINERY: Moody's Affirms 'B3' CFR Amid Foodmate Deal FIREBALL REALTY: Court OKs Sale, Nixes Cash Collateral Access Bid FLEXPOINT SENSOR: Incurs $607K Net Loss in 2020 FREDDIE MAC: Reports Net Income of $2.8 Billion for First Quarter FRESH BEGINNING: Seeks to Hire Wolff & Orenstein as Legal Counsel FRONTERA HOLDINGS: Court Confirms Reorganization Plan FRONTIER COMMUNICATIONS: Fitch Assigns 'BB-' LT IDR, Outlook Stable FRONTIER COMMUNICATIONS: Moody's Rates $750MM 2nd Lien Notes 'Caa2' FRONTIER COMMUNICATIONS: S&P Assigns 'B-' ICR, Outlook Stable GARRETT MOTION: CEO Survives Bankruptcy Fight With Centerbridge GATEWAY REST: Wins Cash Collateral Access GEE ACQUISITION: S&P Assigns 'CCC+' ICR on Debt Reduction GEE HOLDINGS: Moody's Assigns Caa1 CFR on Bankruptcy Emergence GENOCEA BIOSCIENCES: Incurs $12 Million Net Loss in First Quarter GENTIVA HEALTH: Moody's Puts B1 CFR Under Review for Upgrade GLACIAL MATERIALS: Creditor Seeks Correction of Claim Amount GLENVIEW HEALTH: Seeks to Tap Kerrick Bachert as Special Counsel GREENSILL CAPITAL: Seeks to Hire Matthew Tocks as CRO GREENSILL CAPITAL: Seeks to Hire Mayer Brown as Special Counsel GREENSILL CAPITAL: Seeks to Hire Togut Segal as Legal Counsel GREIF INC: Moody's Alters Outlook on Ba2 CFR to Stable GRIDDY ENERGY: Committee Seeks to Tap McDermott as Legal Counsel GRIDDY ENERGY: Committee Taps Province LLC as Financial Advisor GRIFFIN HEALTH: S&P Affirms 'BB+' Rating on 2019 Revenue Bonds HENRY ANESTHESIA: Wins Cash Collateral Access Thru May 31 HERITAGE RAIL: Trustee Selling Scenic View to TSRA for $300K HERTZ CORP: GSP Transportation Buying Assets for $138.2 Million HR NORTH DALE: Seeks to Hire Johnson Pope as Legal Counsel ILLINOIS SPORTS: S&P Affirms 'BB+' on State Tax-Supported Bonds INDUSTRIAL REPAIR: Wins Cash Collateral Access ISAGENIX WORLDWIDE: S&P Raises ICR to 'B-' on EBITDA Growth ITT HOLDINGS: Fitch Affirms 'BB+' LT IDR, Outlook Stable J.J.W. METAL: Unsecured Creditors to Recover 50% in Plan JILL ACQUISITION: Moody's Withdraws Caa3 Rating on Secured Loan JTS TRUCKING: To Sell Remaining Assets for $325K in Plan K&N PARENT: Moody's Raises CFR to Caa2 & Alters Outlook to Stable K-MAC HOLDINGS: Moody's Affirms B3 CFR & Alters Outlook to Stable L&L WINGS: Wins Cash Collateral Access Thru May 19 LAURENTIAN BANK: S&P Rates Additional Tier 1 Capital Notes 'BB-' LEE'S FOODSERVICE: Court Denies Bid to Access Cash Collateral LINEAR MOLD: Seeks to Hire Strobl Sharp as Legal Counsel LIVINGSTON INT'L: S&P Alters Outlook to Stable, Affirms 'B-' LT ICR LS MOTORCARS: Seeks Approval to Hire Carlo Ramirez as Accountant LSB INDUSTRIES: Incurs $13.3 Million Net Loss in First Quarter MAJORDRIVE HOLDINGS IV: Moody's Assigns First Time 'B3' CFR MICROVISION INC: Incurs $6.2 Million Net Loss in First Quarter MINNESOTA SCHOOL: Unsecureds Will Get 100% of Claims in Joint Plan MPR SUMMERS: Court Confirms Plan of Reorganization MRO HOLDINGS: Moody's Raises CFR to B3 & Alters Outlook to Stable MSCI INC: Moody's Hikes CFR to Ba1, Outlook Remains Stable MSCI INC: New 2031 Unsecured Notes No Impact on Moody's Ba1 CFR MSCI INC: S&P Rates New $500MM Senior Unsecured Notes 'BB+' MTS SYSTEMS: Moody's Withdraws B1 CFR After Amphenol Acquisition NATIONAL RIFLE: Has No Debt, Says NYAG Final Plea in Tossing Ch. 11 NEAL PROPERTIES: Seeks to Hire New Woodridge as Realtor NEAL STUBBS: May 6 Hearing on Sale of Two County 5 Osa Properties NSG HOLDINGS: Moody's Hikes Rating on 2025 Secured Notes From Ba1 OAKVIEW CROSSING: Unsecureds to Fully Recover Claim Sans Interest PEAK PROPERTY: Gets OK to Hire Your Castle Real Estate as Broker PH BEAUTY III: Moody's Alters Outlook on Caa1 CFR to Stable PIAGGIO AMERICA: Gets Approval to Tap Holland & Knight as Counsel PROJECT ACCELERATE: Moody's Alters Outlook on Caa1 CFR to Stable PROPULSION ACQUISITION: Moody's Withdraws Caa1 Corp. Family Rating PURDUE PHARMA: Aug. 9 Hearing on $4.5-Bil. Sacklers Plan PURDUE PHARMA: Non-Consenting States Say Plan Unconfirmable PURDUE PHARMA: PSD Creditors Say Disclosures Remain Inadequate PURE FISHING: S&P Affirms 'CCC+' Rating on First-Lien Term Loan QUINCY REAL ESTATE: Taps Jason Conrad of EXIT Realty as Broker REALOGY GROUP: S&P Alters Outlook to Positive, Affirms 'BB+' ICR RED BIRD: Seeks to Hire Gorfine, Schiller & Gardyn as Tax Advisor RIC METUCHEN: Seeks to Hire Schneck Law as Special Counsel RIVERBEND ENVIRONMENTAL: Unsecureds' Recovery Unknown in Plan RKJ HOTEL: Seeks to Hire Horwath HTL as Valuation Expert ROBERT F. TAMBONE: Cowans Buying Wenham Property for $3.185 Million ROYAL BLUE: Seeks to Use Cash Thru May 12 in Amended Motion SABON HOLDINGS: Unsec. Creditors to Recover 15% to 18% in Plan SATELLITE RESTAURANTS: Trustee Selling All Assets to CCK for $300K SCIENTIFIC GAMES: Amends Employment Contract With Senior VP SCOUTCAM INC: Incurs $4.7 Million Net Loss in 2020 SLIM DOLLAR: June 4 Plan Confirmation Hearing Set SM ENERGY: Reports $251.3-Mil. Net Loss for Quarter Ended March 31 SPI ENERGY: Posts $6.5 Million Net Loss in 2020 SPRY PUBLISHING: Seeks Cash Collateral Access ST. CHARLES COUNTY IDA: S&P Places 'BB+' Debt Rating on Watch Neg. STANLEY-TRAFTON: Court Confirms Reorganization Plan STAPLES INC: Moody's Lowers CFR to B2, Outlook Remains Negative STREAM TV: Deal to Dismiss Its Bankruptcy Shows Validity of Case TACORA RESOURCES: S&P Assigns 'B-' Long-Term ICR, Outlook Stable TANGO DELTA: Trustee Taps Whittaker & Associates as Tax Accountant THERMASTEEL INC: Asks Court to Approve Disclosure Statement THERMASTEEL INC: Unsecureds to Recover 100% in Trustee Plan THRIVE MERGER: Moody's Assigns First Time 'B3' Corp. Family Rating TKC HOLDINGS: Moody's Hikes First Lien Credit Facilities to B1 TWO GUNS CONSULTING: Taps Wickens Herzer as Special Counsel UNIVISION COMMUNICATIONS: S&P Assigns Prelim 'B+' on Sr. Sec. Notes US SHIPPING: Moody's Withdraws B3 CFR Following Debt Redemption VERONI BRANDS: Delays Filing of 2020 Annual Report VIENTO WINES: Wins Cash Collateral Access Thru June 30 YUNHONG CTI: Sells, Leases Back Lake Barrington Facility ********* 110 WEST PROPERTIES: June 1 Plan & Disclosure Hearing Set --------------------------------------------------------- On April 27, the U.S. Bankruptcy Court for the Central District of California conducted a hearing on arguments regarding the objection of Tarzana Crossing, A Merchant Faire, LLC to approval of the Disclosure Statement of Debtor 110 West Properties. This Court has carefully considered Tarzana's objection to the Disclosure Statement. The Bankruptcy Code requires adequate information to enable a hypothetical investor of the relevant class to make an informed judgment about the plan. The Disclosure Statement does not offer any suggested explanation why the Property was estimated to be worth over $27 million as of the Petition Date, and is now estimated by Debtor and the New Buyer to be worth $22 million, even though Colliers only received three offers for between $8 million and $13.3 million. But any views on that issue by Debtor would be only its opinion. Debtor's equity investors can make up their own minds about whether the disparity in stated values is a problem. The Court is persuaded, for the reasons set forth in the Responses and at the Hearing, that the objections raised by Tarzana are confirmation issues or have been sufficiently addressed for present purposes by the Disclosure Statement. On April 29, 2021, the Debtor filed amended versions of its Disclosure Statement and Plan together with the revised proposed forms of ballots. The Court conditionally approved the Disclosure Statement and ordered that: * May 18, 2021 is the deadline for ballots to be received and for any objections to confirmation of the Plan and final approval of the Disclosure Statement to be served and filed. * May 25, 2021 is the deadline is the deadline for the Plan proponent to serve and file responses to any objections. * June 1, 2021 at 2:00 p.m. via ZoomGov is the combined hearing on whether to confirm the Plan and whether to approve the Disclosure Statement on a final basis. A full-text copy of the order dated April 29, 2021, is available at https://bit.ly/2RnOP8G from PacerMonitor.com at no charge. The Debtor is represented by: Gregory K. Jones, Esq. Dykema Gossett LLP 333 South Grand Avenue, Suite 2100 Los Angeles, CA 90071 Tel: (213) 457-1800 Fax: (213) 457-1850 E-mail: gjones@dykema.com About 110 West Properties 110 West Properties, LLC, a privately held company in Los Angeles, filed a voluntary Chapter 11 petition (Bankr. C.D. Cal. Case No. 19-24048) on Nov. 29, 2019. The petition was signed by Richard K. Ullman, Sr. of RU, LLC, manager of the Debtor. At the time of the filing, the Debtor disclosed assets of between $10 million and $50 million and liabilities of the same range. Judge Neil W. Bason oversees the case. Dykema Gossett LLP is the Debtor's legal counsel. 110 WEST PROPERTIES: Unsecureds to Get What's Left of $22M Sale --------------------------------------------------------------- 110 West Properties, LLC, filed with the Bankruptcy Court an Amended Chapter 11 Plan and a corresponding Disclosure Statement. The Plan contemplates the sale of Debtor's Property to the Buyer CME for $22 million, plus the mutual releases, including releasing claims for the Prior Buyer's Deposits and claims against parties with indemnity claims against the Debtor, withdrawal of the $1,500,000 Dos Cabezas/Criscione Proof of Claim, withdrawal of the Lis Pendens, withdrawal of other Prior Buyers Adverse Bankruptcy Actions, and dismissal with prejudice of certain pending litigation, pursuant to a certain Real Property Purchase and Sale Agreement and Escrow Instructions. As condition for the consummation of the sale transaction, the Debtor will sell the Property to the Buyer free and clear of any and all claims, liens, interests and encumbrances, for the Purchase Price without being subject to higher and better bids. Closing of the sale is contingent upon the Buyer obtaining and funding a $10 million Senior Loan on or before the Closing Date: (a) that does not exceed 12% interest per annum; (b) permits the proposed Debtor's Deed of Trust to secure the $12 Million Note in favor of the Debtor and provide the Debtor with notices of default and permit the assumption by the Debtor in the event of the Buyer's default. The Buyer is to deposit into Escrow at least one business day prior to the Closing Date: (a) $10 million dollars it obtained via financing; (b) a promissory note for $12 million dollars, at a rate of 3% per annum, in favor of the Debtor with the loan due in full in 24 months, on the second anniversary of the Effective Date; (c) a Deed of Trust covering the Property in favor of the Debtor; (d) a guaranty of the Note by Michael Meyer and Teton Financial Membership Series, LLC – Aurora Insurance Managers – Series 8 (Guaranty); and (e) a Bill of Sale. Under the Plan, each holder of an Allowed General Unsecured in Class 3 will receive pro rata distributions from the cash received by the Debtor either at or after Closing in excess of the Administrative Claims, Class 1 and Class 2 Claims. Class 3 is impaired under the Plan. Classes 1, 2, 4, 5 and 6 are also impaired, and holders of Claims in each of these classes are entitled to vote to accept or reject the Plan. The confirmation hearing is set for June 1, 2021, at 2 p.m., via ZoomGov. A copy of the Amended Disclosure Statement is available for free at https://bit.ly/3gVt0rO from PacerMonitor.com. About 110 West Properties 110 West Properties, LLC, a privately held company in Los Angeles, filed a voluntary Chapter 11 petition (Bankr. C.D. Cal. Case No. 19-24048) on Nov. 29, 2019. The petition was signed by Richard K. Ullman, Sr. of RU, LLC, manager of the Debtor. At the time of the filing, the Debtor disclosed assets of between $10 million and $50 million and liabilities of the same range. Judge Neil W. Bason oversees the case. Dykema Gossett LLP is the Debtor's legal counsel. 1716 I LLC: June 3 Amended Plan & Disclosure Hearing Set -------------------------------------------------------- On April 28, 2021, debtor 1716 I LLC filed with the U.S. Bankruptcy Court for the District of Columbia a Second Amended Disclosure Statement describing Amended Chapter 11 Plan. On April 29, 2021, Judge Elizabeth L. Gunn conditionally approved the Second Amended Disclosure Statement and ordered that: * May 28, 2021, is fixed as the last day for the filing of objections, if any, to Debtor's Second Amended Disclosure Statement. * May 28, 2021, is fixed as the last day for holders of claims and interests to accept or reject Debtor's Amended Chapter 11 Plan. * June 3, 2021, at 11:00 a.m., is fixed as the date and time for the hearing on final approval of Debtor's Second Amended Disclosure Statement. * June 3, 2021, at 11:00 a.m., is fixed as the date and time for the hearing on confirmation of Debtor's Amended Chapter 11 Plan. A full-text copy of the order dated April 29, 2021, is available at https://bit.ly/3ugZlNL from PacerMonitor.com at no charge. Counsel for the Debtor: Wendell W. Webster, Esq. 1775 K Street, N.W., Suite 290 Washington, DC 20006 Tel: (202) 659-8510 E-mail: wwebsterfredrickson.com About 1716 I 1716 I LLC owns and operates a full-service nightclub, lounge, and bar business located in the central business section of the District of Columbia. It filed for Chapter 11 bankruptcy protection (Bankr. D.D.C. Case No. 19-00699) on Oct. 23, 2019. The Hon. S. Martin Teel, Jr. oversees the case. In its petition, the Debtor was estimated to have $100,000 to $500,000 in assets and $1 million to $10 million in liabilities. The petition was signed by Charles Zhou, shareholder and principal. The Debtor is represented by Wendell W. Webster, Esq., at Webster & Fredrickson, PLLC. 7 GENERAL CONTRACTING: Unsecureds Owed $6.14M to Get $400K in Plan ------------------------------------------------------------------ 7 General Contracting, Inc., filed a Second Amended Chapter 11 Plan of Reorganization and a corresponding Disclosure Statement. Under the Plan, the Debtor shall continue to operate its business and all related activities. All distributions under the Plan shall be made from future revenues from the Debtor's business. The Debtor estimates that the total amount of its general non-priority unsecured claim is $6,141,753. The Debtor forecasts net cash flow over its five-year budget to be approximately $290,000. Net cash flow is the amount of money left to pay unsecured creditors after meeting operating and administrative expenses, pre-petition and current taxes, and payments to secured creditors under the proposed Plan. The Holders of Allowed Unsecured Claim shall receive their pro-rata share of the Unsecured Creditor Fund into which the Debtor shall pay $285,000. The Debtor shall then distribute the monies from the Unsecured Creditor Fund to Holders of Allowed Unsecured Claims based on their respective pro-rata share on the first, second, third, fourth and fifth anniversaries of the Effective Date and the 66th month after the Effective Date. In addition, the Holders of Allowed Unsecured Claim shall receive their pro-rata share of the new value payments made by CPVE, LLC to purchase the equity interests in the Debtor. CPVE, LLC shall pay to the Unsecured Creditor Class $125,000 and distribute the payments to the Holders of Allowed Unsecured Claims based on their respective pro-rata share on the first, second, third, fourth and fifth anniversaries of the Effective Date. A copy of the Second Amended Disclosure Statement is available for free at https://bit.ly/2RjCJxk from PacerMonitor.com. About 7 General Contracting 7 General Contracting, Inc., owns a raw land located in Gulfport, Mississippi, having an appraised value of $2.2 million. 7 General Contracting, Inc., based in Loxley, AL, filed a Chapter 11 petition (Bankr. S.D. Ala. Case No. 20-10172) on Jan. 17, 2020. In the petition signed by Charlie Heath Mason, president, the Debtor disclosed $2,442,634 in assets and $11,581,296 in liabilities. The Hon. Henry A. Callaway presides over the case. Robert M. Galloway, Esq., at Galloway Wettermark & Rutens, LLP, serves as bankruptcy counsel. ACADEMY LTD: Moody's Alters Outlook on 'B1' CFR to Positive ----------------------------------------------------------- Moody's Investors Service changed the outlook for Academy, Ltd. to positive from stable. Concurrently, Moody's affirmed all of the company's ratings, including the B1 corporate family rating, B1-PD probability of default rating and B2 ratings on the senior secured term loan and notes. The speculative-grade liquidity rating remains SGL-1. The change in outlook to positive from stable reflects Academy's outperformance relative to expectations since the IPO, and the potential for the company to maintain solid credit metrics as demand in the sporting goods category moderates. The affirmation of the ratings reflects Moody's expectations for solid near-term earnings performance. The pandemic-driven pivot in consumer spending towards the sports and outdoors categories is likely to continue over the next several quarters. However, demand is likely to weaken once health and safety concerns abate, prompting consumers to return to more normalized spending patterns including on leisure and entertainment. The support from government stimulus checks is also unlikely to continue when the pandemic subsides. Moody's regard the coronavirus outbreak as a social risk under its ESG framework, given the substantial implications for public health and safety. However, there is a potential for any demand weakness to be materially mitigated by Academy's operational improvements, including its omni-channel and digital initiatives, better inventory management, growth in private label credit card penetration, as well as customer gains during the pandemic when the company's store remained open as it was deemed an essential retailer. Moody's took the following rating actions for Academy, Ltd.: Corporate Family Rating, Affirmed B1 Probability of Default Rating, Affirmed B1-PD Senior Secured Bank Credit Facility, Affirmed B2 (LGD4) Senior Secured Regular Bond/Debenture, Affirmed B2 (LGD4) Outlook, Changed To Positive From Stable RATINGS RATIONALE Academy's B1 CFR reflects the competitive nature of sporting goods retail, including the increased focus of major apparel and footwear brands on direct-to-consumer distribution and the shift to online shopping. In addition, sporting goods demand can fluctuate, in part driven by demand cycles in the firearms and ammunition category. Moody's expects revenue and earnings to decline in 2021-2022 following strong growth in 2020, as consumers return to more normalized spending habits. This could drive an increase in leverage to 3.2-3.5x compared to 2.8x as of January 30, 2021. In addition, as a retailer, Academy needs to make ongoing investments in its brand and infrastructure, as well as in social and environmental drivers including responsible sourcing, product and supply sustainability, privacy and data protection. At the same time, Academy's rating positively considers the company's very good liquidity, scale and solid market position in its regions. The turnaround strategy put in place by the current management team in 2018, including initiatives in merchandising, private label credit card and omnichannel investment, has been driving improved operating performance since the second half of 2019. In addition, Academy's value price points and diversified product assortment tend to result in resilient performance during economic downturns. The rating also considers governance factors, including the expectation for balanced financial strategies. Specifically, although the company remains majority-owned by private equity sponsor KKR, Moody's believes re-leveraging transactions are unlikely following the company's 2020 public equity offering and over 40% debt reduction. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE The ratings could be upgraded if the company demonstrates continued growth in revenue and operating profit beyond the current period of strong demand, while maintaining very good liquidity and balanced financial policies. Quantitatively, the ratings could be upgraded with expectations for Moody's-adjusted debt/EBITDA to be maintained below 3.75 times and EBIT/interest expense above 2.5 times. The ratings could be downgraded if earnings or liquidity significantly deteriorate or the company experiences material execution missteps. Aggressive financial strategy actions could also result in a downgrade. Quantitatively, the ratings could be downgraded if Moody's-adjusted debt/EBITDA is maintained above 4.5 times or EBIT/interest expense declines below 2.0 times. Academy, Ltd. is a US sports, outdoor and lifestyle retailer with a broad assortment of hunting, fishing and camping equipment, along with footwear, apparel, and sports and leisure products. The company operates 259 stores under the Academy Sports + Outdoors banner, which are primarily located in Texas and the southeastern United States, and its website. Academy generated approximately $5.7 billion of revenue for the fiscal year ended January 30, 2021. The company is publicly traded following the October 2020 IPO but controlled by affiliates of Kohlberg Kravis Roberts & Co L.P. The principal methodology used in these ratings was Retail Industry published in May 2018. AEROCENTURY CORP: Files Notice of May 20 Auction of 10 Aircrafts ---------------------------------------------------------------- AeroCentury Corp. and affiliated debtors filed with the U.S. Bankruptcy Court for the District of Delaware a notice of their sale, bidding procedures and sale hearing in connection with the sale of all or substantially all of their aircraft and related assets to Drake Asset Management Jersey Limited, subject to overbid. The aggregate consideration for the purchase of the Equipment and the related Lease Documents will be an amount equal to the amount of the then-outstanding Secured Obligations as of the Closing Date. On March 29, 2021, the Debtors filed with the Court their motion for the entry of: (A) an order (i) approving bidding procedures in connection with the sale of their assets; (ii) authorizing them to enter into the Stalking Horse Purchase Agreement; (iii) scheduling an auction for and hearing on the approval of the proposed sale or disposition of the Debtors' assets; (iv) approving notice of respective date, time and place for the Auction and for the Sale Hearing; (v) approving procedures for the assumption and assignment of certain executory contracts and unexpired leases; (vi) approving form and manner of notice; and (vii) granting related relief; and (B) an order authorizing and approving (i) the Sale free and clear of liens, claims, rights, encumbrances, and other interests; and (ii) the assumption and assignment of certain executory contracts and unexpired lease, and (iii) granting related relief. The Assets constitute 10 aircrafts owned by the Debtors and related leases with third-party lessees. For ease of reference following chart has been included to indicate the dates relevant to the Notice: a. May 17, 2021, at 5:00 p.m. (ET) - Bid Deadline b. May 18, 2021, at 4:00 p.m. (ET) - Sale Objection Deadline c. May 18, 2021, at 4:00 p.m. (ET) - Cure Cost/Assignment Objection Deadline d. May 19, 2021 - Bid Qualification Deadline e. May 20, 2021, at 10:00 a.m. - Auction f. May 25, 2021, at 2:00 p.m. (ET) - Post-Auction Objection Deadline and Sale Hearing On April 22, 2021, the Court entered the Bidding Procedures Order. Pursuant to the Bidding Procedures, bids for the Acquired Assets, or any subset thereof, must be received on or before May 17, 2021, at 5:00 p.m. (ET) and otherwise comply with the Bidding Procedures. Pursuant to the Bidding Procedures, in the event that the Debtors receive more than one Qualified Bid by the Bid Deadline, the Debtors will conduct the Auction, which will take place on May 20, 2021, at 10:00 a.m. (ET) telephonically, by videoconference, or at the offices of the proposed counsel to the Debtors, Young Conaway Stargatt & Taylor, LLP, Rodney Square, 1000 North King Street, Wilmington, Delaware 19801, or such later time or such other place as the Debtors will designate and provide notice of to all Qualified Bidders who have submitted Qualified Bids and to any creditors who indicated interest in attending the Auction, and by filing a notice on the docket of the Debtors’ chapter 11 cases. Notice of each Successful Bidder and Next-Highest Bidder will be published on the Debtors’ claims and noticing agent Kurtzman Carson Consultants LLC website (http://www.kccllc.net/aerocentury) no later than 24 hours following the Auction. Each Successful Bid and any Next-Highest Bid (or if no Qualified Bid other than that of a Stalking Horse Bidder is received, then the Stalking Horse Bid) will be subject to approval by the Bankruptcy Court. The Sale Hearing may be adjourned by the Debtors from time to time without further notice to creditors or other parties in interest other than by announcement of the adjournment in open court on the date scheduled for the Sale Hearing or by filing a notice, which may be a hearing agenda, stating the adjournment, on the docket of the Debtors' chapter 11 cases. Objections to the identity of a Successful Bidder other than the Stalking Horse Bidder, or otherwise to object to the conduct of the Auction, will be raised at the Sale Hearing. Copies of the Motion, the Bidding Procedures, and the Bidding Procedures Order may be obtained by parties in interest free of charge on the dedicated webpage related to the Debtors' chapter 11 case maintained by the claims and noticing agent in the case, KCC, (http://www.kccllc.net/aerocentury). Copies of such documents are also available for inspection during regular business hours at the Clerk of the Bankruptcy Court, 824 N. Market Street, 3rd Floor, Wilmington, DE 19801, and may be viewed for a fee on the internet at the Court's website (http://www.deb.uscourts.gov/)by following the directions for accessing the ECF system on such website. About AeroCentury Corp. AeroCentury Corp. is engaged in the business of investing in used regional aircraft equipment and leasing the equipment to foreign and domestic regional air carriers. The Company's principal business objective is to acquire aircraft assets and manage those assets in order to provide a return on investment through lease revenue and, eventually, sale proceeds. The Company is headquartered in Burlingame, California. AeroCentury Corp. and affiliates JetFleet Holdings Corp. and JetFleet Management Corp. sought Chapter 11 bankruptcy protection (Bankr. D. Del. Lead Case No. 21-10636) on March 29, 2021. Morrison & Foerster LLP and Young Conaway Stargatt & Taylor, LLP are serving as legal advisor, and B Riley Securities, Inc., is serving as financial advisor and investment banker. Kurtzman Carson Consultants is the claims agent, maintaining the page http://www.kccllc.net/aerocentury. AGILITI INC: S&P Upgrades ICR to 'B+', Outlook Positive ------------------------------------------------------- S&P Global Ratings raised its issuer credit rating on Minneapolis, MN-based health care technology management and service provider Agiliti Inc. to 'B+' from 'B'. S&P affirmed its first-lien secured issue level ratings of 'B+'. S&P revised the rating to '3' indicating its expectation for meaningful recovery in the event of a payment default. The recovery analysis reflects the recent full repayment of second-lien debt, as well as increased revolver size to $250 million. The outlook is positive, reflecting our expectation for continued top-line growth and stable profitability potentially leading to sustained debt to EBITDA below 4x. Agiliti Inc. completed its initial public offering (IPO), raising net proceeds totaling $397 million. It used proceeds for debt reduction and to place cash on the balance sheet, leading to pro forma adjusted debt to EBITDA of about 4x. Agiliti has materially lower debt leverage following its completed IPO and corresponding debt reduction. Agiliti recently completed its IPO, pricing shares at $14 per share and generating about $397 million of net proceeds. The company used proceeds to fully repay its $240 million second-lien term loan, repay $80 million of first-lien term loan, repay a small revolver balance, and place cash on the balance sheet. The transaction results in leverage improving by roughly one and a half turns. S&P now expects that continued top-line growth, stable margins, and the lower debt amount will enable the company to generate debt to EBITDA of about 4x in 2021. S&P said, "The upgrade reflects our expectation that the company will operate at lower debt leverage than historical levels following the IPO, and that the IPO and recent debt reduction signals a change in financial policy. Although the company remains majority financial sponsor owned by THL Partners, we expect a more conservative financial policy for the now publicly traded entity. We also believe that with the company's improved cash generation capabilities, it will have improved capacity to self-fund acquisitions without increasing debt leverage. "We believe that the company is positioned to sustain its meaningful growth trajectory in the coming years.This growth will likely come from a combination of acquisitions and organic opportunities, despite some risk of insourcing. Agiliti provides outsourced medical equipment solutions to health care facilities, including medical equipment and service staff to deal with a facility's supplemental and peak needs. We believe that there is growing demand for these services as health care facilities seek to address the capital-intensive nature of their businesses by utilizing the services of outsourcing providers like Agiliti. We believe insourcing remains a key risk, as providers could choose to manage their own equipment needs. We also view competitive pressure as a risk, as evidenced by Memorial Hermann Health Systems' decision to switch to a competitor in 2020. Despite this risk, we believe the company's ability to manage the vast majority of equipment items and simplify a facility's service needs encourages its customers to outsource. In recent years Agiliti has demonstrated a track record of rapid growth in revenue and EBITDA, supported in particular by the Clinical Engineering business line. "We expect acquisitions to remain a key piece of the overall growth strategy. The company spent about $88 million on Mobile Instruments in early 2020, and about $475 million on the 2021 acquisition of Northfield Medical Inc., a medical device repair and maintenance provider. We believe the company's improved cash generation capabilities will support its ability to remain acquisitive while maintaining leverage below historical levels. "We expect that lower interest expense, the recent Northfield acquisition, and continuous growth in clinical engineering and on-site management will further improve cash generation.We believe the company's improving cash flows should continue to strengthen, due to the lower interest expense post debt-reduction, contributions from acquired businesses, and Agiliti's shift to a more services focused business. In the past, the company's reliance on a capital-intensive equipment solutions business model that requires large capital investments to support equipment fleet. Over the past few years, the company's revenue mix has shifted toward capital-lite on-site management and CE services and this transition, combined with cost-containment measures and disciplined capital spending (capex) has led to a material improvement in Agiliti's cash conversion. In 2021 we expect capex of $65 million to $70 million. Going forward we expect capex in a similar range, and improved cash generation as the company's growth continues to come mostly from capital lite services. We now expect the company to generate over $100 million of free cash flow on a sustained basis. "The positive outlook on Agiliti Inc. reflects our expectation for continued top-line growth and stable profitability leading to gradually improved credit measures. We expect mid-single-digit percentage organic growth on new contract wins and the increased utilization of services by existing customers, will lead to gradually improving credit measures. We expect debt to EBITDA of about 4x in 2021. The COVID-19 pandemic led to the strong demand for hospital equipment and services, contributing to Agiliti's strong recent performance. Should Agilti continue to maintain solid growth, even after the temporary COVID-19-related tailwinds subside, while maintaining stable profitability along with debt to EBITDA below 4x, despite expected increased M&A, S&P could consider a higher rating. S&P could also consider an upgrade if financial sponsor THL Partners reduced its post-IPO ownership stake, resulting in a reassessment of financial policy. S&P could revise the outlook to stable if leverage increases above 4x on a sustained basis. This could occur due an operational setback, loss of customer contracts, or a large unexpected debt-funded acquisition. ALA TURK: Seeks to Hire S Kekatos & Associates as Accountant ------------------------------------------------------------ Ala Turk Inc. seeks approval from the U.S. Bankruptcy Court for the Eastern District of New York to employ S Kekatos & Associates, LLC as its accountant. The firm will render these services: (a) advise the Debtor with respect to its financial affairs during the pendency of its Chapter 11 case; (b) monitor and report cash flow; (c) prepare monthly operating reports; (d) assist with the development of various aspects of the Debtor's plan of reorganization and disclosure statement; (e) act as a liaison with creditor groups; and (f) perform all other accounting services for the Debtor as necessary in this Chapter 11 case. The firm will be paid at the hourly rate of $150, plus reimbursement of expenses. Spyros Kekatos, a certified public accountant at S Kekatos & Associates, disclosed in a court filing that his firm is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. The firm can be reached through: Spyros Kekatos, CPA S Kekatos & Associates LLC 22-76 Steinway Street Astoria, NY, 11105 Telephone: (718) 721-7111 Facsimile: (718) 721-5988 Email: spyrok@kekatosassociates.com About Ala Turk Ala Turk Inc. -- https://alaturkarestaurant.com/ -- owns and operates a restaurant specializing in Mediterranean cuisine. The restaurant is located at 1417 2nd Avenue, N.Y. Ala Turk filed its voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. E.D.N.Y. Case No. 20-42628) on July 15, 2020. Suleyman Secer, president, signed the petition. In the petition, the Debtor disclosed $263,500 in assets and $1,276,886 in liabilities. Judge Nancy Hershey Lord oversees the case. The Debtor tapped Lawrence F. Morrison, Esq., at Morrison Tenenbaum PLLC, as legal counsel and S Kekatos & Associates LLC as accountant. ALL TEXAS ELECTRICAL: Seeks to Hire Paul Zbranek as Accountant -------------------------------------------------------------- All Texas Electrical Contractors, Inc. seeks approval from the U.S. Bankruptcy Court for the Southern District of Texas to employ Paul Zbranek, II as its accountant. The Debtor requires an accountant to prepare its income tax returns and provide cash flow analysis relating to payment of taxes and amounts available for distribution. Mr. Zbranek will be paid at the rate of $250 per hour and reimbursed for out-of-pocket expenses incurred. Mr. Zbranek disclosed in a court filing that he is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code. The accountant can be reached at: Paul H. Zbranek, II 18635 Duke Lake Drive Spring, TX 77388 Tel: (713) 542-8126 About All Texas Electrical Contractors All Texas Electrical Contractors, Inc. -- http://www.alltexaselectrical.net/-- is a Houston-based company that provides electrical installation and services. All Texas Electrical Contractors filed a Chapter 11 petition (Bankr. S.D. Texas Case No. 20-34656) on Sept. 25, 2020. In the petition signed by Arthur Montemayor, president, the Debtor disclosed $1 million to $10 million in both assets and liabilities. Judge Eduardo V. Rodriguez presides over the case. O'Connor Wechsler, PLLC is the Debtor's bankruptcy counsel. ALLIED UNIVERSAL: Moody's Rates Proposed Sr. Secured Notes 'B2' --------------------------------------------------------------- Moody's Investors Service assigned a B2 rating to Allied Universal Holdco LLC's proposed USD, Euro, and GBP senior secured notes and a Caa1 rating to its proposed senior unsecured notes. The net proceeds will be used to repay other debt incurred by Allied Universal to complete the acquisition of G4S plc on April 6 for about $7 billion (excluding acquired cash) and pay related fees and expenses. RATINGS RATIONALE The B2 CFR reflects Moody's expectation that very high initial debt to EBITDA of 7.0 times as of December 31, 2020, pro forma for the acquisition of G4S and other acquisitions made in 2021, including of Secure America, LLC, should fall below 6.0 times by the end of 2022. Leverage declines will be driven by 2% to 4% organic revenue growth, expanding rates of profitability enabled by the anticipated achievement of over $150 million of annual cost reduction targets, as well as some debt repayment. However, cost reductions could take longer than planned or prove difficult to achieve. EBITA to interest expense expected around 2.5 times and free cash flow (before transaction expenses) to debt of at least 3% anticipated, as well as a very good liquidity profile, provide further rating support. All financial metrics cited reflect Moody's standard adjustments. Allied Universal has roughly doubled in revenue size and increased its North American footprint by about 25% by combining with G4S. Adding legacy G4S markets, notably in the UK, Belgium and The Netherlands in Europe, as well as many other global markets, leaves Allied Universal with a larger operating scale and greater geographic scope, but also non US dollar revenue and profits. Since about one third of revenue will be outside the US, the inclusion of Euro and Sterling-denominated debt among the acquisition financing sources helps balance Allied Universal's liabilities to its pro forma assets and profits. Moody's considers Allied Universal's liquidity profile as very good. The company closed the G4S acquisition with over $600 million of cash. Free cash flow (before transaction-related expenses) should be at least $300 million in 2021 and $400 million in 2022. Moody's anticipates full availability under its existing $300 million senior secured first lien revolving credit facility expiring 2024, proposed Eu300 million senior secured revolver due 2026 and unrated $1,000 million senior secured asset based revolving credit facility ("ABL") expiring 2024. Moody's anticipates that Allied Universal will increase the ABL size to $1,500 million. The $300 million and Eu300 million revolvers are subject to a maximum first lien net leverage ratio when utilization exceeds 30% of total capacity. Moody's does not anticipate that the covenant will be tested over the next year. If it were tested, Moody's believes that the company would remain compliant. The ratings assigned to the individual instruments are based on the probability of default of the company, reflected in the B2-PD PDR, as well as a family recovery of 50% of debt obligations assumed at default. The B2 (LGD3) ratings assigned to the proposed senior secured notes reflects the B2-PD probability of default rating ("PDR") and their ranking junior to the ABL and senior to the unsecured claims. The rated senior secured debts are secured by substantially all assets and by the stock of the company's material domestic and international subsidiaries. The secured debts are further supported by upstream guarantees from the material domestic subsidiaries. Collateral sharing arrangements and other structural features of the debt documents render all secured debts (other than the ABL) equal in Moody's waterfall of claims at default. The ABL is considered senior to the rated secured debts due to its first priority claim on the most liquid current US assets of the company. The senior secured debt documents include provisions permitting incremental debt capacity up to the sum of: 1) the greater of: a) $1,800 million; and b) pro forma adjusted EBITDA for the most recent trailing 12 month period; 2) in the case of debt secured pari passu with the existing secured debt, the maximum amount that can be incurred without causing the Senior Secured First Lien Net Leverage Ratio to exceed 4.75 times. No portion of the incremental capacity may be incurred with an earlier maturity than the initial term loans. Subject to certain limitations, Allied Universal will be permitted to designate any existing or subsequently acquired or organized non-borrower subsidiary as an "unrestricted subsidiary", subject to carve-out capacity and other conditions. There are no express "blocker" provisions which prohibit the transfer of material or specified assets to unrestricted subsidiaries. Non-wholly-owned subsidiaries are not required to provide guarantees; dividends or transfers resulting in partial ownership of subsidiary guarantors could jeopardize guarantees, with a protective provision requiring majority lender consent for any guarantee releases, if required under the credit agreement. There are no express protective provisions prohibiting an up-tiering transaction. The Caa1 (LGD6) ratings assigned to the senior unsecured debts reflects the B2-PD PDR to and their ranking within the capital structure junior to the secured debts. The stable outlook reflects Moody's expectations for low single digit revenue increases, EBITDA margins of over 10% and debt to EBITDA to fall below 6 times over the next 12 to 18 months. The stable outlook also incorporates Moody's expectation for periodic debt-funded acquisitions that could result in debt to EBITDA temporarily rising toward 7 times. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS The ratings could be upgraded if Moody's expects 1) debt to remain around 5.0 times; 2) free cash flow above 6.0% of total debt; 3) balanced financial policies; and 4) good liquidity. The ratings could be downgraded if 1) revenue growth rates decline toward break even; 2) expected profitability rate increases are not achieved; 3) debt to EBITDA is expected to remain above 6.5 times; or 4) free cash flow to debt is anticipated to remain below 3.0%. The principal methodology used in these ratings was Business and Consumer Service Industry published in October 2016. Assignments: Issuer: Allied Universal Holdco LLC Senior Secured Regular Bond/Debenture, Assigned B2 (LGD3) Senior Unsecured Regular Bond/Debenture, Assigned Caa1 (LGD6) Allied Universal, headquartered in Conshohocken, Pennsylvania and Santa Ana, California and controlled by affiliates of private equity sponsors Warburg Pincus and CDPQ, is one of the world's largest security and related services company. Moody's expects 2021 revenue (including a full year of G4S results) of around $19 billion. ALPHATEC HOLDINGS: Deloitte & Touche Replaces MHM as Auditor ------------------------------------------------------------ The Audit Committee dismissed Mayer Hoffman McCann P.C. as Alphatec Holdings, Inc.'s independent registered public accounting firm, effective immediately following the Company's filing of its Quarterly Report on Form 10-Q for the quarter ending March 31, 2021. MHM will continue to serve as the Company's independent registered public accounting firm until that time. The reports of MHM on the Company's consolidated financial statements as of and for the Company's two most recent years ended Dec. 31, 2020 and 2019 did not contain an adverse opinion or a disclaimer of opinion, and were not qualified or modified as to uncertainty, audit scope or accounting principles. During the Company's two most recent years ended Dec. 31, 2020 and 2019 and during the audits thereof, and through April 27, 2021, there have been no "disagreements" (as defined in Item 304(a)(1)(iv) of Regulation S-K and related instructions) between the Company and MHM on any matter of accounting principles or practices, financial statement disclosure or auditing scope or procedure, which disagreements, if not resolved to the satisfaction of MHM, would have caused MHM to make reference thereto in its reports on the consolidated financial statements for those years. During the years ended Dec. 31, 2020 and 2019, and through April 27, 2021, there have been no "reportable events" as follows: As noted in the Company's Annual Report on Form 10-K for the year ended Dec. 31, 2019, MHM concluded that the Company had not maintained effective internal control over financial reporting as of Dec. 31, 2019, based on criteria established in Internal Control - Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO), and its report dated March 16, 2020, expressed an adverse opinion thereon. The Audit Committee of the Board of Directors of Alphatec Holdings recently conducted a competitive selection process to determine the Company's independent registered public accounting firm for the fiscal year ending Dec. 31, 2021. The Committee considered several independent registered public accounting firms in this process, including Mayer Hoffman McCann P.C., which has served as the Company's independent registered public accounting firm since 2017. As a result of the competitive process, on April 27, 2021, the Audit Committee appointed Deloitte & Touche LLP as the Company's new independent registered public accounting firm for the Company's fiscal year 2021 and related interim periods, contingent upon the execution of an engagement letter following completion of Deloitte's standard client acceptance procedures. Deloitte's appointment will be effective immediately following the Company's filing of its Quarterly Report on Form 10-Q for the quarter ending March 31, 2021. During the Company's two most recent fiscal years ended Dec. 31, 2020 and Dec. 31, 2019, and for the subsequent interim period through April 27, 2021, neither the Company nor anyone on its behalf consulted Deloitte regarding any of the matters set forth in Item 304(a)(2)(i) or (ii) of Regulation S-K. About Alphatec Holdings Alphatec Holdings, Inc. (ATEC) (www.atecspine.com), through its wholly-owned subsidiaries, Alphatec Spine, Inc. and SafeOp Surgical, Inc., is a medical device company dedicated to revolutionizing the approach to spine surgery through clinical distinction. ATEC architects and commercializes approach-based technology that integrates seamlessly with the SafeOp Neural InformatiX System to provide real-time, objective nerve information that can enhance the safety and reproducibility of spine surgery. Alphatec Holdings reported a net loss of $78.99 million for the year ended Dec. 31, 2020, compared to a net loss of $57 million for the year ended Dec. 31, 2019. As of Dec. 31, 2020, the Company had $261.22 million in total assets, $58.31 million in total current liabilities, $38.03 million in long-term debt (less current portion), $41,000 in operating lease liability (less current portion), $11.35 million in other long-term liabilities, $23.60 million in redeemable preferred stock, and $129.88 million in stockholders' equity. APEG MAXEY: Seeks to Tap Kraus Law Firm as Bankruptcy Counsel ------------------------------------------------------------- Apeg Maxey LP seeks approval from the U.S. Bankruptcy Court for the Southern District of Texas to employ The Kraus Law Firm, PC as bankruptcy counsel. The firm will render these legal services: (a) protect and preserve the Debtor's estate; (b) advise the Debtor regarding its powers and duties in the continued operation of its business and management of its properties; (c) negotiate, prepare and pursue confirmation of a Chapter 11 plan and approval of a disclosure statement; (d) prepare legal papers; (e) appear in court; (f) assist with any disposition of the Debtor's assets by sale or otherwise; (g) review all pleadings filed in the Debtor's Chapter 11 case; (h) assist the Debtor with its insurance recovery litigation; and (i) perform all other necessary legal services in connection with the case. The firm's hourly rates for matters related to the Debtor's case are within the following ranges: Partners $400 Associates $250 Paraprofessionals $125 The principal professional and paraprofessionals designated to represent the Debtor and their standard hourly rates are: Jason D. Kraus, Shareholder $400 Teresa Minter, Paralegal $125 In addition, the firm will seek reimbursement for expenses incurred. Prior to the petition date, the firm received $11,000 from the Debtor. The firm used $5,500 for pre-bankruptcy fees and disbursements, leaving a balance of $5,500. Jason Kraus, Esq., a shareholder of The Kraus Law Firm, disclosed in a court filing that his firm is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. The firm can be reached through: Jason D. Kraus, Esq. The Kraus Law Firm, PC 19500 State Highway 249, Ste. 350 Houston, TX 77070 Telephone: (281) 781-8677 Facsimile: (281) 840-5611 Email: jdk@krausattorneys.com About Apeg Maxey LP Apeg Maxey LP filed a voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Texas Case No. 21-31246) on April 12, 2021. At the time of the filing, the Debtor disclosed $10 million to $50 million in both assets and liabilities. The Kraus Law Firm, PC serves as the Debtor's legal counsel. AQA ACQUISITION: Bugsnag Acquisition No Impact on Moody's B3 CFR ---------------------------------------------------------------- Moody's Investors Service said AQA Acquisition Holding, Inc's ("SmartBear") B3 Corporate Family Rating and B2 senior secured bank credit facilities' ratings will not be affected by the recently announced, debt funded acquisition of Bugsnag. The transaction will result in a modest increase in leverage of about 0.5x resulting from the issuance of incremental first and second lien term loans of $70 million and $54 million, respectively. Proceeds from the incremental debt issuance as well as new cash equity will be used to fund the acquisition. Although Moody's cash adjusted leverage remains high at near 8x, Moody's expects SmartBear will generate free cash flow to gross debt of about 5% over the next 12-18 months driven by continued revenue and bookings growth. Bugsnag will supplement SmartBear's already strong revenue growth, though the target company has a much lower profitability profile than SmartBear. Nevertheless, Moody's expects SmartBear to fully integrate Bugsnag into its operations, such that overall profitability will normalize over the next 18-24 months. SmartBear, headquartered in Somerville, MA is a provider of software testing automation tools used by software developers across a broad set of enterprise customers. Pro forma for its acquisition of Bugsnag, SmartBear generated revenues of approximately $63 million in the LTM period ended March 31, 2021. SmartBear is owned by funds affiliated with private equity sponsors Francisco Partners and Vista Equity Partners. AREU STUDIOS: Bid to Use Cash Collateral Moot --------------------------------------------- The U.S. Bankruptcy Court for the Northern District of Georgia, Atlanta Division, rendered moot Areu Studios, LLC's motion to use cash collateral. On March 17, 2021, the Court entered an Order Approving Disclosure Statement and Confirming Chapter 11 Plan. Confirmation of the Debtor's Second Amended Plan of Reorganization dated February 5, 2021, as modified, and its Amended Disclosure Statement for Amended Plan of Reorganization dated December 11, 2020, rendered moot the Debtor's Motion Requesting Authority to Use Cash Collateral which was filed on November 10, 2020. A copy of the order is available for free at https://bit.ly/3vBBGYv from PacerMonitor.com. About Areu Studios Areu Studios, LLC, which owns and operates a movie studio in Atlanta, Ga., sought protection under Chapter 11 of the Bankruptcy Code (Bankr. N.D. Ga. Case No. 20-71228) on Oct. 29, 2020. The petition was signed by Ozzie Areu, the company's manager. At the time of filing, the Debtor had estimated assets of less than $50,000 and liabilities of up to $10 million. Judge Paul Baisier oversees the case. Jones & Walden, LLC is the Debtor's legal counsel. AVEANNA HEALTHCARE: S&P Upgrades ICR to 'B-', Outlook Positive -------------------------------------------------------------- S&P Global Ratings raised its issuer credit rating on Aveanna Healthcare LLC to 'B-', from 'CCC+'. At the same time, S&P raised its issue-level ratings on Aveanna's first-lien debt to 'B-', from 'CCC+'. The recovery rating is '3' indicating its expectations for meaningful (50%-70%; rounded estimate: 50%) recovery in the event of default. S&P will withdraw its issue-level rating on Aveanna's second-lien debt when repayment is completed. Aveanna Healthcare LLC completed an initial public offering (IPO) of common stock, raising approximately $434 million, net of fees and expenses. The company plans to repay $100 million of its first-lien term loan and the entire $307 million outstanding under its second-lien term loan, which includes the $67 add-on to help fund the recent Doctor's Choice acquisition. S&P now forecasts adjusted debt to EBITDA of 6.4x in 2021 and 5.8x in 2022. S&P's positive outlook reflects its view that Aveanna's operations will continue to improve amid a stable reimbursement environment and continued recovery from the COVID-19 pandemic and that it will potentially sustain positive free operating cash flow at levels in line with comparable higher rated peers. Proceeds used from the IPO will significantly improve the company's debt to EBITDA. S&P said, "We now forecast debt to EBITDA of 6.4x and 5.8x in 2021 and 2022, respectively, compared to our prior forecast of 8.6x and 7.9x, respectively. If the company's underwriters exercise their overallotment to purchase common stock, we expect Aveanna would use the estimated net proceeds of $65 million to further paydown debt, which would lower our adjusted debt to EBITDA to 6.0x in 2021 and 5.4x in 2020." The company generates modest cash flow. Aveanna generated solid free operating cash flow in 2020, with adjusted discretionary cash flow to debt of over 8%, but it included the benefit of CARES Act grant funds and the deferral of payroll taxes. However, Aveanna decided to return the CARES Act grant monies and is required to repay the deferred payroll taxes in 2021 and 2022. Inclusive of these repayments, S&P expects adjusted discretionary cash flow to debt of between 2.5%-3.0% in 2021 and around 6.5% in 2022. S&P said, "We expect continued steady demand for Aveanna's services.The company's service volume has been recovering since it hit its trough in April 2020 amid the pandemic. Significantly increased demand for Employer of Record (EOR) services offset lower private duty nursing (PDN) volume resulting in modest organic revenue growth in 2020. We expect continued improving demand for PDN and solid EOR growth, along with contribution from acquisitions and its new home health and hospice platform, leading to revenue growth of about 20% in 2021. We also believe the reimbursement environment for Aveanna's core pediatric private duty nursing services will be stable in 2021. The company benefited from several temporary and permanent Medicaid rate increases amid the ongoing pandemic while experiencing only two minor Medicaid rate reductions from two states. Overall, we anticipate rate improvement of about 1%-2% in 2021. "The positive outlook reflects our view that demand for Aveanna's private duty services (PDS) segment will grow steadily over the next 12 months as the coronavirus pandemic subsides, while organic growth is supplemented by acquisitions, including the company's new home health and hospice platform. We believe the company could generate positive free operating cash flow over this time-period of around 3%-5%, in-line with comparable higher-rated peers. "We could lower the outlook to stable if revenue is lower than our base case or if high integration and transaction costs from acquisitions or operational disruptions lead to lower-than-expected free operating cash flow generation, or if the company uses its cash flow to fund shareholder-friendly initiatives including paying dividends. "We could raise the rating if we expect the company will sustain adjusted debt to EBITDA leverage below 6x and discretionary cash flow to debt above 3%. This could occur if the company's operational performance exceeds our expectation or if the company issues additional equity to further pay down debt." B-LINE CARRIERS: Wins Cash Collateral Access Thru May 25 -------------------------------------------------------- The U.S. Bankruptcy Court for the Middle District of Florida, Tampa Division, authorized B-Line Carriers, Inc., to use cash collateral on an interim basis, pending a further hearing on the Debtor's cash collateral motion, which is scheduled for May 25, 2021 at 2 p.m. The Debtor is authorized to use Cash Collateral including, without limitation, cash, deposit accounts, accounts receivable, and proceeds from its business operations in accordance with the approved budget, as long as the aggregate of all expenses for each week do not exceed the amount in the Budget by more than 10% for any such week on a cumulative basis. The Debtor is also authorized to provide adequate protection pursuant to the terms and conditions of the Interim Order and the Budget. In addition, Regions Bank, N.A. and the U.S. Small Business Administration are granted replacement liens in and upon all of the categories and types of collateral in which they held a security interest and lien as of the Petition Date to the same extent, validity and priority that they held as of the Petition Date. Cadence Bank, N.A. is granted a replacement lien on cash to the extent of $35,000 with the same validity and priority that it held as of the Petition Date. Regions Bank consented to a carve-out for the replacement lien being granted to Cadence. The Debtor is also directed to maintain insurance coverage for the collateral in accordance with the obligations under the loan and security documents. A copy of the order and the Debtor's budget is available for free at https://bit.ly/3vG5vau from PacerMonitor.com. The approved Budget provided for total expenses in the amount of: $50,744 for the week ending April 3, 2021, $116,048 for the week ending April 10, 2021, $43,425 for the week ending April 17, 2021, $181,340 for the week ending April 24, 2021, $46,744 for the week ending May 1, 2021, $110,048 for the week ending May 8, 2021, $39,425 for the week ending May 15, 2021, $176,154 for the week ending May 22, 2021, and $$42,611 for the week ending May 29, 2021. About B-Line Carriers B-Line Carriers, Inc., a full-service petroleum transportation company, filed its voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. M.D. Fla. Case No. 20-06034) on Aug. 7, 2020. The petition was signed by Jason L. Baldree, president. At the time of filing, the Debtor estimated $1 million to $10 million in both assets and liabilities. Judge Caryl E. Delano oversees the case. Amy Denton Harris, Esq., at Stichter, Riedel, Blain & Postler, P.A., is serving as the Debtor's counsel. On Jan. 5, 2021, the Court appointed Moecker Auctions, Inc. as Auctioneer. BECKER BOILER: Wins Cash Collateral Access ------------------------------------------ The U.S. Bankruptcy Court for the Eastern District of Wisconsin has authorized Becker Boiler Co, Inc. to use cash collateral on a final basis. The Debtor is authorized to continue use of its line of credit with Byline Bank on the same terms as under its existing Revolving Note during the pendency of the Debtor's case. The Debtor will continue to provide adequate protection to Byline on an Interim Basis throughout the pendency of the Debtor's case or until further order of the Court. A copy of the order is available for free at https://bit.ly/3ukVTlg from PacerMonitor.com. About Becker Boiler Becker Boiler Co. Inc., in the business for 64 years, provides boiler equipment, repairs, and installation services. The Company is owned by Hollnagel Enterprises. Becker Boiler filed for Chapter 11 bankruptcy (Bankr. E.D. Wisc. Case No. 21-21580) on March 26, 2021. The Debtor estimated assets and debt of $1 million to $10 million as of the bankruptcy filing. Judge G. Michael Halfenger oversees the case. KERKMAN & DUNN, led by Jerome R. Kerkman, is serving as the Debtor's counsel. VRAKAS S.C. is the accountant. BILLINGS LODGE: May 25 Plan Confirmation Hearing Set ---------------------------------------------------- On April 29, 2021, debtor Billings Lodge No. 394, Benevolent and Protective Order of Elks of United States of America, Inc., filed with the U.S. Bankruptcy Court for the District of Montana a Disclosure Statement for Chapter 11 Plan. Judge Benjamin P. Hursh approved the Disclosure Statement and ordered that: * May 25, 2021, at 9:00 a.m. in the Ella Knowles Courtroom, 4th Floor Room 4805, James F. Battin United States Courthouse, 2601 2nd Avenue North, Billings, Montana. * May 18, 2021, is fixed as the last day for filing and serving written objections to confirmation of Debtor's Plan, and for filing written acceptances or rejections of said Plan. A full-text copy of the order dated April 29, 2021, is available at https://bit.ly/3aZs0iF from PacerMonitor.com at no charge. Attorneys for the Debtor: Martin S. Smith, Esq. Lynsey Ross, Esq. Felt Martin, P.C. 2825 Third Avenue North, Ste 100 Billings, MT 59101 Telephone: (406) 248-7646 Email: msmith@feltmartinlaw.com lross@feltmartinlaw.com About Billings Lodge No. 394 Billings Lodge, No. 394, Benevolent and Protective Order of Elks of United States of America, Inc. is a tax-exempt civic and social organization. Elk Lodge is a Billings, Montana-based fraternal organization that hosts various civic events and social gatherings like wedding receptions, meetings, and other functions. Billings Lodge filed a voluntary Chapter 11 bankruptcy petition (Bankr. D. Mont. Case No. 20-10110) on June 5, 2020. The petition was signed by Jeffery R. Isom, exalted ruler. At the time of the filing, the Debtor disclosed assets of between $1 million and $10 million and liabilities of the same range. The Debtor has tapped Felt Martin PC as counsel; Heidi Giem of Paigeville Accounting, LLC as accountant; and David Goodridge with Real Estate by Hamwey as its real estate broker. The Office of the U.S. Trustee appointed a committee of unsecured creditors on July 23, 2020. BILLINGS LODGE: Plan Payments to be Funded by Asset Sale Proceeds ----------------------------------------------------------------- Billings Lodge No. 394, Benevolent and Protective Order of Elks of United States of America, Inc., filed with the U.S. Bankruptcy Court for the District of Montana a Disclosure Statement for Chapter 11 Plan dated April 29, 2021. The Plan of Reorganization provides for the continued operation of the Debtor. The Plan is filed with input and consultation from counsel for the Official Committee of Unsecured Creditors. The Plan provides for a reasonable time to market for sale the Debtor's most significant asset and to use the proceeds to pay its creditors. The Plan provides for full recovery to any allowed secured creditors of their allowed secured claim and for recoveries to unsecured creditors that are equal to if not greater than what they would receive if the Debtor were to be liquidated. Class 1 consists of Priority Non-Tax Claims. Except to the extent that the holder of an Allowed Priority Non-Tax Claim agrees to less favorable treatment, on the later of the Effective Date or the date such Priority Non-Tax Claim becomes Allowed, or as soon thereafter as is practicable, each holder, if any, shall be paid in Cash in an amount equal to the Allowed amount of such Priority Non-Tax Claim. Class 2 consists of Secured Claims. Except to the extent that the holder of an Allowed Secured Claim agrees to less favorable treatment or to the extent the Court has held the to be a certain amount, at closing on the sale of such Real Property, the net proceeds thereof, after payment of all costs relating to the sale, will be paid to Secured Creditors and applied to the Allowed Secured Claims in an amount sufficient to pay and satisfy the balance of the Allowed Secured Claim. Class 3 consists of Unsecured Claims. Except to the extent that the holder of an Allowed Unsecured Claim agrees to less favorable treatment, upon the sale of the Real Property the net proceeds thereof, after payment of all costs relating to the sale and satisfying in full all Administrative Expenses, Class 1, and Class 2 Claims, will be paid to Unsecured Claims in an amount sufficient to pay and satisfy the Unsecured Claims or a pro rata share of their claim. The Debtor intends to file an adversary action against the Albert and JoAnne Kersich (jointly "Kersiches") and William T. Alex to avoid the attachment of the judgment liens to the real property as avoidable preferential transfers. Judgment in favor of Debtor could eliminate the claims of the Kersiches and Alex as secured and there will be no secured claims against the real property. As with all litigation, the outcome of this adversary action cannot be forecasted with certainty. The Kersiches and Alex may have defenses to the Debtor's claims and determination of the claims will run parallel to the sale or Auction of the Real Property, which could complicate or delay payments to all creditors and administrative claimants. The Plan provides for the marketing and sale of the Debtor's real property. The Debtor believes that reasonable marketing and sale of the real property will result in sufficient sales proceeds, net of all costs of sale, to pay all or substantially all of the claims. In addition, a sale of the Debtor's real property would allow the Debtor to continue post-sale operations as an ongoing entity in a facility that better suits its current membership and their charitable purpose. The Debtor will continue to provide the community benefits that it has for over 100 years. Under the Plan, the Debtor will continue its efforts to market and sell its real property pursuant to this Plan. During the marketing period, the Debtor shall continue its activities and operations in the regular course, including collecting membership dues, leasing its facilities and venues, paying dues to the Elks, and such other activities that are in the ordinary course of the Debtor's business. After the sale of the Real Property, Debtor will distribute the proceeds from such sale. If the proceeds from the sale of Debtor's real property are not sufficient to satisfy the claims, Debtor will sell its Personal Property, if any, and distribute the proceeds to satisfy the remaining claims. The Debtor believes that the Plan is feasible and the best alternative available to the creditors, the Debtor and other parties in interest for resolution of the Bankruptcy Case. The Plan is feasible as it calls for the orderly sale of the Debtor's real property and necessary personal property, with distributions of the sale proceeds to creditors in full. Upon payment of its creditors, Debtor will be in a position to continue operations without any need for further liquidation or restructuring. A full-text copy of the Disclosure Statement dated April 29, 2021, is available at https://bit.ly/33cxUsl from PacerMonitor.com at no charge. Attorneys for the Debtor: Martin S. Smith, Esq. Lynsey Ross, Esq. Felt Martin, P.C. 2825 Third Avenue North, Ste 100 Billings, MT 59101 Telephone: (406) 248-7646 Email: msmith@feltmartinlaw.com lross@feltmartinlaw.com About Billings Lodge No. 394 Billings Lodge, No. 394, Benevolent and Protective Order of Elks of United States of America, Inc. is a tax-exempt civic and social organization. Elk Lodge is a Billings, Montana-based fraternal organization that hosts various civic events and social gatherings like wedding receptions, meetings, and other functions. Billings Lodge filed a voluntary Chapter 11 bankruptcy petition (Bankr. D. Mon. Case No. 20-10110) on June 5, 2020. The petition was signed by Jeffery R. Isom, exalted ruler. At the time of the filing, the Debtor disclosed assets of between $1 million and $10 million and liabilities of the same range. The Debtor has tapped Felt Martin PC as counsel; Heidi Giem of Paigeville Accounting, LLC as accountant; and David Goodridge with Real Estate by Hamwey as its real estate broker. The Office of the U.S. Trustee appointed a committee of unsecured creditors on July 23, 2020. BIOLARGO INC: Incurs $9.7 Million Net Loss in 2020 -------------------------------------------------- Biolargo, Inc. filed with the Securities and Exchange Commission its Annual Report on Form 10-K disclosing a net loss of $9.70 million on $2.43 million of total revenue for the year ended Dec. 31, 2020, compared to a net loss of $11.44 million on $1.86 million of total revenue for the year ended Dec. 31, 2019. As of Dec. 31, 2020, the Company had $4.94 million in total assets, $5.18 million in total liabilities, and a total stockholders' deficit of $235,000. Irvine, California-based Haskell & White LLP, the Company's auditor, issued a "going concern" qualification in its report dated March 30, 2021, citing that the Company has experienced recurring losses, negative cash flows from operations, has limited capital resources, a net stockholders' deficit, and significant debt obligations coming due in the near term. These matters raise substantial doubt about the Company's ability to continue as a going concern. A full-text copy of the Form 10-K is available for free at: https://www.sec.gov/Archives/edgar/data/880242/000143774921007650/blgo20201231_10k.htm About BioLargo Headquartered in Westminster, CA. BioLargo, Inc. -- www.biolargo.com -- invents, develops, and commercializes innovative platform technologies to solve challenging environmental problems like PFAS contamination, advanced water and wastewater treatment, industrial odor and VOC control, air quality control, and infection control. BISON BUILDING: Seeks to Hire Morgan Pierce as Legal Counsel ------------------------------------------------------------ Bison Building Systems, Inc. seeks approval from the U.S. Bankruptcy Court for the District of Montana to employ Morgan Pierce, PLLP to handle its Chapter 11 case. Morgan Pierce will be paid at these rates: Attorneys $295 to $335 per hour Paralegals $125 per hour The firm will also be reimbursed for out-of-pocket expenses incurred. The retainer fee is $25,000. Andrew Pierce, Esq., a partner at Morgan Pierce, 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: Andrew W. Pierce, Esq. Morgan Pierce, PLLP 1800 South Reserve St., Suite B Missoula, MT 59801 Tel: (406) 830-3875 Email: firm@morgan-pierce.com About Bison Building Systems Bison Building Systems, Inc. filed a Chapter 11 bankruptcy petition (Bankr. D. Mont. Case No. 21-90063) on April 20, 2021, disclosing under $1 million in both assets and liabilities. The Debtor tapped Morgan Pierce, PLLP as legal counsel and Sky Country Consulting, Inc. as accountant. BISON BUILDING: Seeks to Hire Sky Country Consulting as Accountant ------------------------------------------------------------------ Bison Building Systems, Inc. seeks approval from the U.S. Bankruptcy Court for the District of Montana to employ Sky Country Consulting, Inc. as accountant. The firm will provide accounting and administrative services including preparation and reconciliation of quarterly financial statements, preparation of monthly Chapter 11 operating reports, recommendations, training and assistance of the Debtor in documenting and implementing accounting best practices and related services. Sky Country Consulting will be paid at the rate of $75 per hour for accounting services and $40 per hour for administrative services. The firm will also be reimbursed for out-of-pocket expenses incurred. Sylvia Lundquist, a partner at Sky Country Consulting, 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: Sylvia Lundquist Sky Country Consulting, Inc. P.O. Box 345 Somers, MT 59932 About Bison Building Systems Bison Building Systems, Inc. filed a Chapter 11 bankruptcy petition (Bankr. D. Mont. Case No. 21-90063) on April 20, 2021, disclosing under $1 million in both assets and liabilities. The Debtor tapped Morgan Pierce, PLLP as legal counsel and Sky Country Consulting, Inc. as accountant. BLACKWATER TECHNOLOGIES: Unsecured Creditors to Get 5% Under Plan ----------------------------------------------------------------- Blackwater Technologies, Inc., filed with the Bankruptcy Court a Plan of Reorganization and a Disclosure Statement. The Plan contemplates the reorganization and on-going business operations of Debtor and the resolution of outstanding claims against it. The Plan provides that: * The Debtor shall pay all claims from Debtor's post-petition income from its business operation; * The Debtor shall act as the Disbursing Agent to make payments under the Plan unless Debtor appoints some other person or entity to do so; * The Debtor may maintain bank accounts under the confirmed Plan in the ordinary course of business; * The Debtor may also pay ordinary and necessary expenses of administration of the Plan in due course. Classes 1 through 5 are impaired and entitled to vote to accept or reject the Plan. Class 5 Claims shall consist of all amounts due and owing by Debtor on unsecured debts including contracts, notes or accounts and any deficiency amounts on secured claims. Debtor shall pay Holders of Allowed Unsecured Claims an aggregate distribution of 5% of their allowed Claims. Holders of Class 5 Claims shall receive five equal annual payments equivalent to 1% of their total Class 5 distribution for a period of five years with the first payment due December 31, 2021 and subsequent payments continuing on each subsequent December 31st for a total of five payments. A copy of the Disclosure Statement is available for free at https://bit.ly/3ugbMct from PacerMonitor.com. About Blackwater Technologies Carrollton, Ga.-based Blackwater Technologies, Inc., specializes in fire protection as well as low voltage projects. It provides fire alarm installation, maintenance and inspection services. Blackwater Technologies filed a voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. N.D. Ga. Case No. 20-11518) on Nov. 12, 2020. Charles C. Blackwell, chief executive officer, signed the petition. At the time of the filing, the Debtor disclosed $100,000 to $500,000 in assets and $1 million to $10 million in liabilities. Judge Paul Baisier oversees the case. Smith Conerly LLP and MJCO, LLC serve, as the Debtor's legal counsel and accountant, respectively. BLADE GLOBAL: Blade Acquisition Buying All Assets for $1 Million ---------------------------------------------------------------- Blade Global Corp. asks the U.S. Bankruptcy Court for the Northern District of California to authorize the sale of substantially all assets to Blade Acquisition, Inc. for (i) an amount in cash equal to $1 million, (ii) the assumption by the Buyer of the Assumed Liabilities pursuant to the Assignment and Assumption Agreements, and (iii) the addition of Cure Amounts for any added Assumed Contract or Assumed Lease, subject to overbid. For some months prior to the Petition Date, because operational losses had reached the point of unsustainability, the Debtor explored various strategic alternatives, ranging from raising capital to selling its assets. The companies the Debtor approached included its original investors, including Charter Communications and LG Electronics, Inc., as well as Intel, Apple, NVIDIA, Dell, ASUS, Rakuten, and Lenovo. When proposals for equity investments were rejected, the Debtor turned to proposals for acquisition. Intel did due diligence but, ultimately, failed to agree to a proposal. Charter Communications, an entity that employs a member of the Blade SAS Board of Directors, also engaged with the Debtor but similarly failed to agree any proposal. Parallel discussions took place with a major estate creditor, 2CRSI. The pre-bankruptcy inability to generate a sale led the Debtor to conclude that its accrued liabilities had grown too large to allow the pursuit of any path beyond an asset sale. Blade SAS entered into its own insolvency procedure, redressement judicaire (judicial reorganization), on Feb. 26, 2021. In the French procedure, the administrateur judiciaire, the official in charge of administrating or helping the company to exit the procedure, took bids for the purchase of the assets of Blade SAS. The initial bid deadline was March 19, 2021. Four bids were received. One was that of a subsidiary of Jezby Ventures, the entity with which the Debtor on the Petition Date entered into a Letter of Intent for purchase of the Assets for the price and on the terms set forth below. After further opportunity to better bids, Scaleway SAS made an offer. It appears that the other two bidders elected not to bid further. The hearing on the auction of assets of THE ASSET Blade SAS commenced at 4:30 p.m. on April 13, 2021 at the "Tribunal de Commerce" of Paris. The Tribunal considers terms, assets to be acquired and the number of employees retained. The offers of the candidates in France have now been approved for public disclosure. Jezby has bid €5 million and Scaleway has bid €4 million. At the end of the hearing, the Tribunal indicated that it will make its final decision by April 30, 2021. The case was filed on March 1, 2021, to allow an asset sale to proceed following the bidding on the assets of Blade SAS in the French proceeding. The Debtor determined in its business judgment to conduct a competitive bid-and-saleprocess for the orderly sale of substantially all of its Assets under sections 363(b) and (f) of the Bankruptcy Code. After extensive and arms'-length negotiations, the Debtor and the Stalking Horse Bidder, the U.S. acquisition entity for Jezby Ventures, entered into an Asset Purchase Agreement, dated March 17, 2021. On April 9, 2021, the Court entered the Bid Procedures Order. Among other things, pursuant to the Bid Procedures Order, (a) the deadline for overbids was set for 11:59 p.m. on April 12, 2021; (b) the Minimum Initial Overbid was set at $75,000; (c) Subsequent overbids were set at $100,000 unless otherwise ordered by the Court; and (d) the in-court Auction is a public hearing and without restriction as to attendees. The break-up fee is $50,000 and reimbursement of the Stalking Horse Bidder's and its professionals’ fees and expenses, subject to approval of the Court after notice and opportunity for hearing, is capped at $50,000. On April 12, 2021, Scaleway submitted a timely bid for the assets of the Debtor and made a good faith deposit. The Debtor has determined Scaleway is a Qualified Bidder in accordance with the Bidding Procedures. Scaleway's list of executory contracts to be assumed includes all the contracts the Stalking Horse Bidder wishes to assume and a supplemental list. At the April 15, 2021 status conference, the Court reset the Auction for May 3, 2021, along with the hearing on the Motion. The Court specified April 26, 2021, as the deadline for objections to Cure Amounts for Assumed Contracts and Assumed Leases. Both the Stalking Horse Bidder and Scaleway will need to amend their Asset Purchase Agreements specifying a later date for closing since both currently reflect an outside closing date of April 30, 2021. On April 15, 2021, the Debtor filed and served its Amended and Supplemental Notice of Possible Assumption and Assignment and Cure Amounts with Respect to The Executory Contracts and Unexpired Leases of The Debtor, listing in Exhibit A the same contracts listed in the Initial Notice and adding in an Exhibit B the additional contracts bidder Scaleway indicated it may wish to assume with proposed cure amounts. It now appears that Scaleway wishes to remove from its bid most or all of the contracts listed in Exhibit B to the Supplemental and the Corrected Notice. The Debtor anticipates that Scaleway will submit an amendment to its draft Asset Purchase Agreement so stating and a further Notice will be issued. By the Motion, the Debtor requests the entry of the Sale Order (i) authorizing the sale of the Acquired Assets free and clear of all liens, claims, encumbrances, and other interests to the Successful Bidder after the in-court Auction on the terms set forth in the Asset Purchase Agreement of the Successful Bidder; (ii) authorizing the assumption and assignment of executory contracts and unexpired leases; and (iii) granting any other and further relief necessary to effectuate the sale. In light of its need to move forward with a transaction and conclude the case soon as possible given the negative cash flow, the Debtor respectfully submits that ample business justification exists for the consummation of the proposed sale after Auction. Finally, the Debtor requests that the Sale Order be made effective immediately and provide that the 14-day stays under Bankruptcy Rules 6004(h) and 6006(d) are waived. As set forth throughout the Motion, any delay in the Debtor's ability to consummate the sale would be detrimental to the Debtor, its creditors and estate, and would impair its ability to maximize value of the Acquired Assets through an expeditious closing of the sale. A copy of the Agreement and the Exhibits is available at https://tinyurl.com/2xxvsb2j from PacerMonitor.com free of charge. The Purchaser: BLADE ACQUISITION INC. c/o Hubic SAS 2 rue Kellermann 59100 Roubaix France Attention: Octave Klaba Eric Sele E-mail: octave.klaba@jezby-ventures.com eric.sele@jezby-ventures.com The Purchaser is represented by: GREENBERG TRAURIG, P.A. 333 S.E. 2nd Avenue, 41st Floor Miami, FL 33131 Attn: John B. Hutton E-mail: huttonj@gtlaw.com About Blade Global Blade Global Corporation, a company that provides data processing, hosting and related services, filed its voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. N.D. Calif. Case No. 21-50275) on March 1, 2021. Perry Michael Fischer, sole director, signed the petition. At the time of filing, the Debtor estimated $50 million to $100 million in assets and $10 million to $50 million in liabilities. Judge M. Elaine Hammond oversees the case. Binder & Malter, LLP and Berliner Cohen, LLP serve as the Debtor's bankruptcy counsel and special corporate counsel, respectively. BMZ LLC: Has Until June 21 to File Plan & Disclosures ----------------------------------------------------- Judge Michael G. Williamson has entered an order where Debtors BMZ, LLC and Oldsmar JJ, LLC shall have through and including June 21, 2021 within which to file its Disclosure Statement and Plan. A full-text copy of the order dated April 29, 2021, is available at https://bit.ly/3eQiH5Q from PacerMonitor.com at no charge. Attorney for the Debtors: Steven M. Fishman, Esq. Steven M. Fishman, P.A. 2454 McMullen Booth Road, Suite D0607 Clearwater, FL 33759 Telephone: (727) 724-9044 E-mail: steve@attorneystevenfishman.com About BMZ, LLC Based in Clearwater, Fla., BMZ, LLC is a privately held company in the fast food and quick service restaurants business. BMZ sought protection under Chapter 11 of the Bankruptcy Code (Bankr. M.D. Fla. Case No. 20-07203) on Sept. 26, 2020. Scott Zieba, managing member, signed the petition. At the time of the filing, Debtor had estimated assets of between $100,000 and $500,000 and liabilities of between $1 million and $10 million. Steven M. Fishman, PA is the Debtor's legal counsel. BOMBARDIER INC: Moody's Hikes Rating on Sr. Unsecured Notes to Caa2 ------------------------------------------------------------------- Moody's Investors Service upgraded Bombardier Inc.'s senior unsecured notes to Caa2. As part of the same action, Moody's affirmed Bombardier's Caa2 Corporate Family rating, and Caa2-PD Probability of Default rating . The Speculative Grade Liquidity Rating is unchanged at SGL-3, indicating adequate liquidity and the outlook remains negative. "Bombardier's senior unsecured notes ratings have been upgraded in line with CFR because of the removal of priority claims following the sale of their transportation segment" said Jamie Koutsoukis, Moody's analyst. Affirmations: Issuer: Bombardier Inc. Corporate Family Rating, Affirmed Caa2 Probability of Default Rating, Affirmed Caa2-PD Upgrades: Issuer: Bombardier Inc. Senior Unsecured Regular Bond/Debenture, Upgraded to Caa2 (LGD4) from Caa3 (LGD4) Issuer: Connecticut Development Authority Senior Unsecured Revenue Bonds, Upgraded to Caa2 (LGD4) from Caa3 (LGD4) Outlook Actions: Issuer: Bombardier Inc. Outlook, Remains Negative RATINGS RATIONALE Following Bombardier's sale of its Transportation business to Alstom, the $1.5 billion in Bombardier Transportation convertible preferred shares held by the Caisse de depot et placement du Quebec ("CDPQ") are no longer part of the company's capital structure, removing the priority claim relative to Bombardier's unsecured debt. The sale provided net proceeds to Bombardier of approximately $3.6 billion, including about $600 million in shares of Alstom. Bombardier is constrained by 1) high cash flow consumption in 2021 (estimated at around $600 million) which will reduce Bombardier's currently adequate liquidity, 2) untenable leverage even after debt paydown from the transportation unit sale debt proceeds of $3.6 billion (not meaningful at Q4/2020 and an estimated 20x in 2021) , 3) large debt maturities from October 2022 through 2025 that have high refinancing risk. Bombardier benefits from 1) adequate liquidity over the next year, 2) significant scale, and a good market position in its remaining business jet segment, and 3) a nearly $11 billion backlog. Bombardier has adequate liquidity over the next year (SGL-3), with about $5.4 billion of committed available liquidity sources versus Moody's estimate of about $3.7 billion in uses. Sources are cash of $1.8 billion at year end 2020 (excluding cash that was held at Bombardier Transportation) and the $3.6 billion of proceeds received from the sale of its transportation unit to Alstom (including $600 million of Alstom shares, with a short lockup period) that closed in January 2021. Uses include Moody's expectation of $600 million of free cash flow usage through 2021, $2.4 billion already used or committed to debt reduction (repayment of $750 million senior secured credit facility in February 2021, and $1.5 billion with its March tender offer) and maturities of an additional $750 million in the next twelve months. The maturities consist of EUR414 million ($510 million) due in May 2021, $60 million due December 2021 (net of tender offer payment), and $180 million due March 2022 (net of tender offer payment). Bombardier doesn't have access to a revolving credit facility. The negative outlook reflects Bombardier's continued cash consumption, and though it has been able to address its near term maturities, there is uncertainty regarding its ability to refinance or reduce debt for its sizable maturities beginning in October 2022 ($4.7 billion due 10/22 through 03/25). FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS The ratings could be downgraded if there is increased default risk including distressed exchanges or inability to refinance its debt. Factors that could lead to an upgrade include less debt with adjusted financial leverage below 8x (not meaningful LTM Q4/20) and sustainable free cash flow generation. Bombardier has a dual class share structure by where the founding family has 50.9% of the voting rights through a special class of stock carrying 10 votes a share. The same group also has four of the company's 14 board seats, despite owning just 12.2% of the equity. Bombardier's management also has a track record of not meeting its provided guidance. The principal methodology used in these ratings was Aerospace and Defense Methodology published in July 2020. Headquartered in Montreal, Quebec, Canada, Bombardier Inc. is a manufacturer of business jets. Revenues in 2020 were $6.5 billion, pro-forma for the sale of its transportation segment. BORDEN IMPROVEMENTS: Wins Cash Collateral Access Thru June 3 ------------------------------------------------------------ The U.S. Bankruptcy Court for the Middle District of Florida, Orlando Division, has authorized Borden Improvements, LLC to use cash collateral on an interim basis through June 3, 2021. The Debtor is authorized to use cash collateral to pay: (a) amounts expressly authorized by the Court; (b) the current and necessary expenses set forth in the budget except pre-petition unsecured debt will not be paid; and (c) additional amounts as may be expressly approved in writing by Midwest Business Capital, a division of United Midwest Savings Bank, within 48 hours of the Debtor's request. As adequate protection, Midwest will have a perfected post-petition lien against cash collateral to the same extent and with the same validity and priority as the pre-petition lien, without the need to file or execute any documents as may otherwise be required under applicable nonbankruptcy law. The Debtor will also maintain insurance coverage for its property in accordance with the obligations under the loan and security documents with Midwest. A continued hearing on the matter is scheduled for June 3 at 10:15 a.m. A copy of the order is available for free at https://bit.ly/3th1303 from PacerMonitor.com. About Borden Improvements, LLC Borden Improvements, LLC is in the business of providing general home maintenance and improvement services to the general public, including carpentry, painting, plumbing, remodeling, drywall, electrical, deck repair and installation, tile, flooring, and other home maintenance and improvement services. Borden operates from leased premises located at 1850 Lee Road, Ste 313, Winter Park, FL 32789. Borden sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. M.D. Fla. Case No. 6:21-bk-01694) on April 15, 2021. In the petition signed by Brien T. Borden, managing member, the Debtor disclosed up to $50,000 in assets and up to $500,000 in liabilities. Judge Karen S. Jennemann oversees the case. BransonLaw, PLLC is the Debtor's counsel. BOY SCOUTS OF AMERICA: Abuse Survivors Oppose Disclosure Statement ------------------------------------------------------------------ The 29 Claimants represented by Gordon & Partners, P.A. (the Gordon & Partners Claimants) opposed the Disclosure Statement accompanying the Second Amended Chapter 11 Plan Of Reorganization of Boy Scouts Of America And Delaware BSA, LLC. The Gordon & Partners Claimants complained that the Disclosure Statements failed to disclose the assets and liabilities of each party receiving a release. "In the Disclosure Statement, the Debtors do nothing more than assert that childhood sexual abuse claims will range in value from somewhere between $2.4 billion and $7.1 billion. There is no discussion on how that value is determined," Jennifer Lipinski, Esq., at Gordon & Partners, P.A., counsel for the sexual abuse claimants pointed out. A copy of the objection is available for free at https://bit.ly/3tjqezm from Omni Agent Solutions, claims agent. The Gordon & Partners Claimants join in the objection filed by the Tort Claimants' Committee. 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 February 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 OF AMERICA: More Abuse Claimants Resist Plan Disclosures ------------------------------------------------------------------- The Claimants represented by Jacobs & Crumplar, P.A., and The Neuberger Firm P.A. (the J&C/TNF Claimants) filed an objection to the Disclosure Statement explaining the Second Amended Chapter 11 Plan Of Reorganization of Boy Scouts Of America And Delaware BSA, LLC. Thomas C. Crumplar, Esq., of Jacobs & Crumplar, P.A., counsel for the Claimants said the Debtors' Disclosure Statement failed to disclose the assets and liabilities of each party receiving a release. The Disclosure Statement does not provide any property-by-property valuation of the real or personal property that the Debtors intend to transfer to a settlement trust, or any property-by-property valuation of the real or personal property that the Debtors seek to retain. The Disclosure Statement also failed to provide valuation of the Debtors' other assets, including investments, he related. This lack of basic information makes it impossible for creditors, including the J&C/TNF Claimants, to determine whether each council is making a substantial contribution, to make an informed decision on whether to vote to accept or reject the Plan, Mr. Crumplar told the Court. A copy of the objection is available for free at https://bit.ly/2RdKuF3 from Omni Agent Solutions, claims agent. The J&C/TNF Claimants join the objection of the Tort Claimants' Committee. The J&C/TNF Claimants are survivors of sexual abuse who each filed a Sexual Abuse Proof of Claim in the Debtors' cases. 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. BRAZOS ELECTRIC: Committee Taps FTI Consulting as Financial Advisor ------------------------------------------------------------------- The official committee of unsecured creditors of Brazos Electric Power Cooperative, Inc. seeks approval from the U.S. Bankruptcy Court for the Southern District of Texas to employ FTI Consulting, Inc. as its financial advisor. The firm's services include: a. assistance in the review of financial-related disclosures required by the court, including schedules of assets and liabilities, statement of financial affairs and monthly operating reports; b. assistance in the preparation of analyses required to assess sizing and adequacy of any proposed debtor-in-possession financing or use of cash collateral; c. assistance in assessing and monitoring the Debtor's short term cash flow, liquidity, and operating results; d. assistance in the review of the Debtor's long-term financial projections, including cash generating capacity and identification of potential cost savings; e. assistance in the investigation, directed by the committee, of the events leading up to, during, and after Winter Storm Uri; f. assistance in the evaluation of the Debtor's contracts with its cooperative members, non-debtor subsidiary Sandy Creek, and other power suppliers; g. assistance in the review of the Debtor's proposed key employee retention and other employee benefit programs; h. assistance in the review of the Debtor's cost/benefit analysis with respect to the affirmation or rejection of various executory contracts and leases; i. assistance in the review of any tax issues associated with, but not limited to, claims/stock trading, preservation of net operating losses, refunds due to the Debtor, plans of reorganization, and asset sales; j. assistance in the review of the claims reconciliation and estimation process; k. assistance in the review of the Debtor's corporate structure including analysis of intercompany activities and claims; l. assistance in monitoring and developing strategies in connection with political intelligence, including legislative and regulatory lobbying efforts; m. assistance in the development of communications strategies with various stakeholders including regulatory agencies and state government officials and commissions; n. assistance in the review of other financial information prepared by the Debtor, including, but not limited to, cash flow projections and budgets, business plans, cash receipts and disbursement analysis, asset and liability analysis, and the economic analysis of proposed transactions for which court approval is sought; o. attendance at meetings and assistance in discussions with the Debtor, potential investors, banks, other secured lenders, the unsecured creditors' committee and any other official or unofficial committees organized in the Debtor's Chapter 11 case, the U.S. trustee, other parties in interest and their professionals; p. assistance in the review or preparation of information and analysis necessary for the confirmation of a Chapter 11 plan and related disclosure statement; q. assistance in the evaluation and analysis of avoidance actions, including fraudulent conveyances and preferential transfers; r. assistance in the prosecution of committee responses and objections to the Debtor's motions, including attendance at depositions and provision of expert reports or testimony on case issues as required by the committee; and s. other general business consulting services. FTI Consulting will be paid at these rates: Senior Managing Directors $785 to 1,295 per hour Directors/Senior Directors/Managing Directors $550 to 935 per hour Consultants/Senior Consultants $335 to 680 per hour Administrative/Paraprofessionals $125 to 290 per hour The firm will also be reimbursed for out-of-pocket expenses incurred. Andrew Scruton, senior managing director at FTI Consulting, 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: Andrew Scruton FTI Consulting, Inc. Three Times Square, 9th Floor New York, NY 10036 Tel: (212) 247-1010 Email: andrew.scruton@fticonsulting.com 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. Texas 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. The Debtor tapped Norton Rose Fulbright US, LLP as bankruptcy counsel, Foley & Lardner LLP and Eversheds Sutherland US LLP as special counsel, Collet & Associates LLC as investment banker, and Berkeley Research Group, LLC as financial advisor. Stretto is the claims and noticing agent. The U.S. Trustee for Region 7 appointed an official committee of unsecured creditors in the Debtor's case on March 15, 2021. The committee is represented by the law firms of Porter Hedges, LLP and Kramer, Levin, Naftalis & Frankel, LLP. FTI Consulting, Inc. is the committee's financial advisor. BRIARS INVESTMENTS: Seeks to Tap Hood & Bolen as Legal Counsel -------------------------------------------------------------- Briars Investments, Inc. seeks approval from the U.S. Bankruptcy Court for the Southern District of Mississippi to employ Hood & Bolen, PLLC to handle its Chapter 11 case and perform necessary legal services. The hourly rates of Hood & Bolen's attorneys and staff are as follows: Partners $300 Associates $200 Senior Paralegals $125 Junior Paralegals $85 In addition, Hood & Bolen will seek reimbursement for expenses incurred. Hood & Bolen received a retainer in the amount of $12,500 from the Debtor. R. Michael Bolen, Esq., a partner at Hood & Bolen, disclosed in a court filing that the firm does not represent interests adverse to the Debtor and its estate. The firm can be reached through: R. Michael Bolen, Esq. Hood & Bolen, PLLC 3770 Hwy. 80 West Jackson, MS 39209 Telephone: (601) 923-0788 Email: rmb@hoodbolen.com About Briars Investments Briars Investments, Inc. filed a voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Miss. Case No. 21-00740) on April 26, 2021, listing under $1 million in both assets and liabilities. Judge Katharine M. Samson oversees the case. Hood & Bolen, PLLC serves as the Debtor's legal counsel. BURN FITNESS: Seeks Cash Collateral Access ------------------------------------------ Burn Fitness, LLC and its related Debtor entities, Burn Fitness-2, LLC and Burn Fitness-3, LLC, ask the U.S. Bankruptcy Court for the Eastern District of Michigan, Southern Division, for authority to use cash collateral and provide adequate protection. The Debtors will use the funds to pay their post-petition obligations of rent, payroll, compensation to independent contractors, and obtain necessary supplies and services required to operate their businesses. The Debtors have been severely impacted by the COVID-19 pandemic, which resulted in total shut-downs of their health and fitness facilities, and then significantly reduced operations pursuant to state regulations where they could only operate with 25% of their normal capacity. Comerica Bank has a first position perfected security interest against all of the Debtors' assets, including the Debtors’ pre-petition Cash Collateral. The loan obligations to Comerica are supported by various loan documents which include Security Agreements, and are guaranteed by, cross-collateralized and cross-defaulted by and among each of the Debtors, as well as guaranteed by Alyssa Tushman, Mark Dufresne and Burn Fitness Holdings LLC. The U.S. Small Business Administration has a second position perfected security interest against certain of the Debtors' assets, including Debtors' pre-petition Cash Collateral. These obligations to Comerica and the SBA are evidenced by: A. Burn Fitness, LLC: (1) Comerica Loan (SBA7(a) Loan), Obligation No. 9895461407-26 dated August 1, 2018 in the original amount of $790,000; UCC-1 Financing Statement filed on July 2, 2014, Filing No. 2014097721-4, UCC-3 Continuation Statement filed February 2, 2019, Filing No. 20190202000007-1; and UCC-1 Financing Statement filed August 6, 2018, Filing No. 20180807000192-8. The present balance due on this loan (as of April 30, 2021) is approximately $551,874.36. The monthly payment is $8771.00. (2) U.S. Small Business Administration "SBA Disaster Loan" dated September 1, 2020 in the original amount of $150,000. UCC-1 Financing Statement filed on September 10, 2020, Filing No. 20200910000353-5. The present balance due on this loan is $150,000. The first monthly payment due on this loan is September 1, 2021 in the amount of $731. B. Burn Fitness-2, LLC: (1) Comerica Loan (SBA7(a) Loan) Obligation No. 9895370970-26 dated June 23, 2014 in the original amount of $841,000; as amended on February 21, 2015 to the maximum amount of $853,000; UCC-1 Financing Statement filed on July 2, 2014, Filing No. 2014097735-3, UCC-3 Continuation Statement filed February 2, 2019, Filing No. 20190202000006-2. The present balance due on this loan (as of April 30, 2021) is approximately $442,245.61. The monthly payment is $9098.16. (2) U.S. Small Business Administration "SBA Disaster Loan" dated September 1, 2020 in the original amount of $150,000.00. UCC1 Financing Statement filed on September 10, 2020, Filing No. 20200910000365-0. The present balance due on this loan is $150,000.00. The first monthly payment due on this loan is September 1, 2021 in the amount of $731.00. C. Burn Fitness-3, LLC: (1) Comerica Term Note (SBA7(a) Loan), Obligation No. 9895444619-26, dated July 15, 2017 in the original amount of $1,523,000; UCC-1 Financing Statement filed on July 28, 2017, Filing No. 201707310000092-8. The present balance due on this loan (as of April 30, 2021) is approximately $1,024,104.51. The monthly payment is $16,153.78. (2) U.S. Small Business Administration, "SBA Disaster Loan" dated September 1, 2020 in the original amount of $150,000. UCC-1 Financing Statement filed on September 10, 2020, Filing No. 20200910000364-1. The present balance due on this loan is $150,000. The first monthly payment due on this loan is September 1, 2021 in the amount of $731. As of the Petition Date, the Debtors' assets principally consisted of high-end fitness equipment, with an estimated value of $500,000 at each of the locations, and bank accounts held separately by each Debtor with funds which include proceeds of the SBA Disaster Loans and Private Protection Program Loans. Pursuant to the Proposed Budget, the Debtors project these necessary expenses for the next 30 days: (1) Burn Fitness, LLC: $106,522.17 (2) Burn Fitness-2, LLC: $95,391.74 (3) Burn Fitness-3, LLC: $94,240.24 As adequate protection, the Debtors propose to provide Comerica with a replacement lien on all of the Debtors' post-petition assets, effective as of the Petition Date. Each Debtor will make its monthly payment to Comerica, commencing May 1, 2021, and continuing on the first day of each consecutive month thereafter until the effective date of a confirmed plan of reorganization, the dismissal, liquidation or conversion of a particular Debtor's chapter 11 case, or pursuant to further order of the Court, in the amount of the current monthly payment due under each of the Comerica Loans for that Debtor. For the avoidance of doubt, the monthly payments will be for: (1) Burn Fitness, LLC: $8,771.00 (2) Burn Fitness-2, LLC: $9,098.16 (3) Burn Fitness-3, LLC: $16,153.78 Comerica also has additional non-Debtor collateral as security for Comerica Loans, which will remain in place. With respect to the SBA, the Debtors propose that no payments be made until September 1, 2021, in accordance with the terms of each of the SBA loans; and the SBA will have a replacement lien on the Debtors' post-petition tangible and intangible personal property, including, but not limited to inventory, equipment, instruments, chattel paper, and electronic chattel paper, documents, accounts, including credit card receivables, deposit accounts, general intangibles, including all accessions, attachments, accessories, parts, supplies and replacements for the collateral, and all products, proceeds and collections thereof and all records and data relating thereto, to the same extent, validity and priority as such liens existed on the Petition Date. Each Debtor maintains a bank account at Comerica. The current balance of each bank account includes SBA Disaster Loan proceeds of $150,000 and PPP Loan proceeds. The Secured Lenders will be adequately protected by replacement liens on post-petition assets, including Debtors' accounts and cash. Continued operation of the Debtors' businesses will preserve the value of the Secured Lenders' interests in their pre-petition collateral. Counsel for the Debtors has been in contact with counsel for Comerica Bank regarding the use of Cash Collateral and has negotiated for the consensual use of Cash Collateral. A copy of the motion and the Debtor's monthly budget is available for free at https://bit.ly/2RhLbNB from PacerMonitor.com. The Debtor projects total monthly income of: Burn Fitness - $68,200 Burn Fitness 2 - $ 59,700 Burn Fitness 3 - $46,800 and total monthly expenses of: Burn Fitness - $106,522.17 Burn Fitness 2 - $95,391.74 Burn Fitness 3 - $94,240.24 About Burn Fitness, LLC Burn Fitness operate health and fitness centers in three separate locations in Michigan -- Rochester, Clawson and and Livonia. Burn Fitness focuses on personal service and a high-quality experience. Burn Fitness and its affiliates sought protection under Chapter 11 of the Bankruptcy Code (Bankr. E.D. Mich. Case No. 21-43828) on April 30, 2021. In the petition signed by Alyssa Tushman, manager and authorized agent, each of the Debtors disclosed up to $1 million in assets and up to $10 million in liabilities. Judge Mark A. Randon oversees the case. Julie Beth Teicher, Esq. at MADDIN, HAUSER, ROTH & HELLER, P.C. is the Debtor's counsel. CANNABICS PHARMACEUTICALS: Announces Entry Into $1.37M Senior Note ------------------------------------------------------------------ Cannabics Pharmaceuticals Inc. entered into a Senior Secured Note for $1,375,000 with an institutional investor. This follows the previously disclosed Securities Purchase Agreement dated Dec. 17, 2020, a Restated Securities Purchase Agreement dated as of Feb. 22, 2020, as well as accompanying documents for an aggregate principal amount of $2,750,000 having an aggregate original issue discount of 10%, and ranking senior to all outstanding and future indebtedness of the Company. This most recent Note has now been received by the Company. The Convertible Notes mature on the one-year anniversary of the date on which they are issued. The Convertible Notes must be paid in cash and the Company may not voluntarily prepaid by the Company except as described in "Redemptions at Company Election". The Convertible Notes are being sold with an original issue discount and do not bear interest except upon the occurrence of an Event of Default, in which event the applicable rate will be 18.00% per annum. The Convertible Notes are convertible at any time or times after the Issuance Date in whole or in part, at the option of the holders thereof, into shares of the Company's common stock at a rate equal to the amount of principal, interest (if any) and unpaid late charges (if any), divided by a conversion price of $0.35 (subject to adjustment as provided in the Note). About Cannabics Cannabics Pharmaceuticals Inc., based in Bethesda, Maryland, is dedicated to the development and licensing of personalized cannabinoid-based treatments and therapies. The Company's main focus is development and marketing innovative bioinformatic delivery systems for cannabinoids, personalized medicine therapies and procedures based on cannabis originated compounds and bioinformatics tools. The parent Company Cannabics Inc was founded by a group of Israeli researchers from the fields of cancer research, pharmacology and molecular biology. Cannabics reported a net loss of $7.47 million for the year ended Aug. 31, 2020, compared to net income of $1.13 million for the year ended Aug. 31, 2019. As of Nov. 30, 2020, the Company had $1.70 million in total assets, $442,687 in total current liabilities, and $1.25 million in total stockholders' equity. Weinstein International. C.P.A., in Tel - Aviv, Israel, the Company's auditor since 2019, issued a "going concern" qualification in its report dated Nov. 4, 2020, citing that the Company has incurred significant losses and needs to raise additional funds to meet its obligations and sustain its operations. These conditions raise substantial doubt about the Company's ability to continue as a going concern. CANTWELL WOODWORKING: Industrial Buying Personal Property for $86K ------------------------------------------------------------------ Cantwell Woodworking, LLC, asks the U.S. Bankruptcy Court for the Eastern District of Pennsylvania to authorize the sale of machinery, equipment and other personal property, located at 500 Pine Street, Building 4, in Holmes, Pennsylvania, to Industrial Recovery Service, Inc., for 86,000. Among the property owned by the Debtor are the Assets, which Assets are defined in a Purchase Agreement dated June 30, 2020. The Debtor has received an offer from an Auctioneer, the Buyer, licensed and bonded in the Commonwealth of Pennsylvania, to purchase Debtor's Assets outright for the sum of $86,000. The Purchase Agreement, an Amendment to the Purchase Agreement, dated Dec. 28, 2020, and Second Amendment to the Purchase Agreement dated April 10, 2021, all of which have been executed by the Debtor and the Buyer, memorialize the terms and conditions agreed upon by the parties for the purchase of said Assets by the Buyer/Auctioneer. There are liens recorded against the Assets Including, but not limited to, a lien in favor of the Commonwealth of Pennsylvania, Department of Revenue, in the amount of $24,981.28. On July 1, 2020, in accordance with the Purchase Agreement between the parties, the Buyer sent a deposit in the amount of $30,000, which said deposit is being held by the law firm of Hoffmeyer & Semmelman, LLC as Escrow Agent for the Buyer. Shortly after execution of the Purchase Agreement by the Seller, the Seller stopped the Buyer's access to the premises upon which the Assets are located and thereafter sought to obtain higher offers for the Assets in question. After unsuccessfully attempting to obtain a higher price for the Assets over a period of several months, on Dec. 28, 2020, the Debtor and the Buyer entered into the Amendment to the Purchase Agreement. Given the inability of the Debtor to obtain a higher price for the Assets from any other source, the agreed upon Purchase Price for the Assets with the Buyer/Auctioneer is fair and reasonable, and in the best interests of the Debtor's Estate. For the foregoing reasons, the Debtor respectfully requests that the Honorable Court grants the relief requested and Orders: A. That the Debtor is authorized to sell the Assets to the Buyer/Auctioneer for the Purchase Price, in accordance with the Purchase Agreement and the Amendment thereto. B. That the sale of the Assets to Buyer/Auctioneer will be free and clear of any and all liens and encumbrances on the said Assets. c. That any and all proceeds of any auction or any other sale of the Assets by the Buyer/Auctioneer, will be and remains the sole proceeds of the Buyer/Auctioneer. D. That the Buyer/Auctioneer will have cost-free access to the Premises, as defined in the Purchase Agreement, as amended, and as set forth. E. That upon the entry of any Order, the Court provides the Buyer/Auctioneer, with the name and address of the person or entity to whom payment of the full Purchase Price should be made. F. That the terms of the Purchase Agreement and two Amendments thereto be incorporated into and made a part of any Order of the Court. G. That the lien of the Commonwealth of Pennsylvania, Department of Revenue, is relegated to the proceeds received by the Debtor from the Purchase Price paid by Buyer only, and that the Debtor is authorized to pay said lien upon receipt of the balance of said proceeds. H. Such other and further relief as the Honorable Court may deem appropriate. A copy of the Agreement is available at https://tinyurl.com/7frky8t8 from PacerMonitor.com free of charge. The Purchaser: INDUSTRIAL RECOVERY SERVICE, INC. 365 West Cottage Place P.O. Box 5086 York, PA 17405 About Cantwell Woodworking Cantwell Woodworking, LLC, filed a Chapter 11 bankruptcy petition (Bankr. E.D. Pa. Case No. 21-10031). The Debtor hired Adelstein & Kaliner LLC, as counsel. CARLA'S PASTA: Cash Collateral Access Extended to June 1 -------------------------------------------------------- Judge James J. Tancredi has issued a first supplemental order modifying and extending an earlier order authorizing Carla's Pasta, Inc. and Suri Realty, LLC, to use cash collateral and obtain secured postpetition financing on a superpriority basis. The Debtors are authorized to use cash collateral consistent with the Supplemental Budget pursuant to the terms of the Final Order as modified as requested in the Motion. The Debtors require the use of Cash Collateral until June 1, 2021 to preserve the value of the estates. The Debtors do not have sufficient funding for the orderly transition and winddown of the business without the use of Cash Collateral. On March 1, the Court entered its Final Order. Paragraph 11 of the Final Order is deleted in its entirety and replaced with the following: "Termination Events Relating to Cash Collateral Usage. The Lenders' willingness to consent to the Debtors' use of Cash Collateral will immediately and automatically terminate -- except as the Lenders may otherwise agree in writing in their sole discretion -- upon the earliest to occur of any one or more of the following: (i) June 1, 2021; (ii) The effective date of any confirmed plan of reorganization in the Chapter 11 Case; (iii) The occurrence of any violation by the Debtors of the Order, including, but not limited to, the Debtors' failure to adhere to the Approved Budgets or violation of the covenants; (iv) The dismissal of the Chapter 11 Case or the conversion of the Chapter 11 Case into a case under Chapter 7 of the Bankruptcy Code; (v) A trustee or an examiner with enlarged powers (beyond those set forth in sections 1106(a)(3) and (4) of the Bankruptcy Code) relating to the operation of the business of either of the Debtors is appointed in the Chapter 11 Case without the prior written consent of the Lenders (which consent may be withheld in their sole discretion), or either of the Debtors applies for, consents to, or acquiesces in, any such appointment without the prior written consent of the Lenders (which consent may be withheld in their sole discretion); (vi) The Order is stayed, reversed, vacated, amended or otherwise modified in any respect without the prior written consent of the Lenders (which consent may be withheld in their sole discretion); (vii) Except with respect to the order of the Court authorizing the sale of substantially all of the Debtors' assets, the order or any other Court enters an order or judgment in the Chapter 11 Case modifying, limiting, subordinating, or avoiding or reducing the amount, priority, perfection or validity of any portion of the Prepetition Indebtedness or DIP Indebtedness or imposing, surcharging or assessing against the Lenders or their claims or any DIP Collateral or Prepetition Collateral any costs or expenses, whether pursuant to section 506(c) of the Bankruptcy Code or otherwise; (viii) The Debtors file any application for approval or allowance of, or any order is entered approving or allowing, any administrative expense claim in the Chapter 11 Case in an aggregate amount exceeding $25,000, having any priority over, or being pari passu with, the super administrative priority granted to the Lenders under the Order (excluding the Carve Out); (ix) An order is entered in the Chapter 11 Case granting relief from the automatic stay of section 362 of the Bankruptcy Code to any holder or holders of a lien on any property of the estate, except for de minimis assets not subject to the Lenders' liens, in allowing such holder or holders to foreclose or otherwise realize upon such liens; (x) Any motion or application is filed by or on behalf of the Debtors in the Chapter 11 Case seeking the entry of an order, or an order is entered in the Chapter 11 Case, approving any subsequent debtors in-possession facility for borrowed money or other extensions of credit unless such subsequent facility and such order expressly provide for the indefeasible payment and complete satisfaction in full in cash to the Lender of all DIP Indebtedness prior to, or concurrently with, any initial borrowings or other extensions of credit under such subsequent facility; and (xi) The Debtors at any time fail to have a chief restructuring officer or other non-insider management reasonably acceptable to the Lenders and the Committee. The Debtors obtained DIP financing from their existing the lenders BMO Harris Bank, N.A., and People's United Bank, National Association up to an aggregate amount of $1,500,000, inclusive of an interim amount not to exceed $750,000. The Debtors have been authorized to pay in full the amounts due under the DIP Loan Documents at the closing of the sale of substantially all assets pursuant to the sale orders of the Court in satisfaction of the DIP Indebtedness, which the Lenders have estimated to be $1,507,735 at the time of the anticipated closing on April 30, 2021. A copy of the order and the Debtor's four-week budget is available for free at https://bit.ly/2RlZKjn from PacerMonitor.com. The Debtor projects total wind down expenses of $178,800, total disbursements of $2,535,719 and ending bank cash of $20,771,285 through May 29. A further hearing on any continued use of Cash Collateral is scheduled for May 26 at 11 a.m. About Carla's Pasta Carla's Pasta was founded in 1978 by Carla Squatrito and is a family-owned and operated business headquartered in South Windsor, Connecticut. Carla's Pasta manufactures high-quality food products including pasta sheets, tortellini, ravioli, and steam bag meals for branded and private label retail, foodservice distributors, and restaurant Carla's Pasta's stock is held by members of the Squatrito family. On Dec. 31, 2016, Carla's Pasta acquired 100% of Suri Realty, LLC's membership interests. Suri's business is limited to the ownership of two adjoining parcels of real property with an address of 50 Talbot Lane, South Windsor, Connecticut, and 280 Nutmeg Road, South Windsor, Connecticut. On Oct. 29, 2020, an involuntary petition for relief under Chapter 7 of the Bankruptcy Code was filed against Suri by the Dennis Group, HJ Norris, LLC, Renaissance Builders, Inc., and Elm Electrical, Inc. On Dec. 17, 2020, the Court approved Suri's request and converted the involuntary Chapter 7 case to a Chapter 11. Carla's Pasta filed a Chapter 11 petition (Bankr. D. Conn. Case No. 21-20111) on Feb. 8, 2021. The Debtor estimated assets of $10 million to $50 million and liabilities of $50 million to $100 million. The law firm of Locke Lord LLP is the Debtors' counsel. Cowen & Co is the Debtors' investment banker. Sandeep Gupta of Nova Advisors is the Debtors' CRO. Stretto is the claims agent. CBAC BORROWER: S&P Affirms 'CCC+' ICR; Outlook Stable ----------------------------------------------------- S&P Global Ratings affirmed all ratings on CBAC Borrower LLC, including its 'CCC+' issuer credit rating on the company, and removed the ratings from CreditWatch, where it had placed them with negative implications on March 17, 2020. S&P said, "The stable outlook reflects our expectation that even though CBAC's leverage will remain high in 2021, we anticipate EBITDA will cover fixed charges and liquidity will likely be adequate in 2021, reducing a chance of a downgrade over the next 12 months. "We believe the company has adequate liquidity and sufficient anticipated EBITDA coverage of fixed charges, reducing the possibility of a downgrade this year. Despite our base case forecast for the company's lease-adjusted leverage to remain very high (above 8x) and possibly unsustainably so for a single casino operator at least through 2022, we believe that CBAC's cash flow will recover enough to sufficiently cover its fixed charges in 2021. This, coupled with the company's excess cash on the balance sheet, should support adequate liquidity and reduce the likelihood of a credit crisis over the next 12 months." CBAC used excess cash in the second half of 2020 to pay down $10 million of its $15 million revolver balance. CBAC also obtained an amendment to its revolving credit facility, replacing the maximum senior secured leverage covenant with a minimum quarterly EBITDA covenant through Dec. 31, 2021, establishing a minimum liquidity requirement through March 31, 2022, and subsequently reduced its revolver commitment to $10 million. In S&P's base case, it estimates that CBAC will maintain sufficient coverage under its minimum EBITDA and liquidity thresholds, reducing the likelihood of a covenant violation over the next 12 months. The senior secured leverage will resume testing for the quarter ending June 30, 2022. In addition, the company had approximately $43.2 million in cash as of Dec. 31, 2020. As a result, the company has adequate liquidity over the next 12-24 months under S&P's base case operating performance assumptions, and it believes a near-term default is unlikely given the company's next material debt maturity (its term loan facility) is in 2024 (the company's $10 million revolver matures in 2022). CBAC has been operating at stricter capacity restrictions than competitors, but those restrictions are easing. Casinos in Maryland have been operating at varying capacity constraints since reopening in June 2020. Horseshoe has been particularly hard hit in terms of capacity restrictions relative to competitors because of its downtown Baltimore location. As a result, CBAC's revenue recovery has been slower than other regional casinos. Four of Maryland's six casinos have no capacity limitations as of March 12, 2021, but some slot machine and gaming table seats remain blocked off to comply with social-distancing guidelines. The two exceptions are MGM National Harbor, which raised capacity to 50% from 25% on March 12, and Baltimore's Horseshoe Casino, which raised capacity to 50% from 25% on March 26. In general, capacity restrictions and social distancing requirements on casino floors do not pose much of a problem for regional casino operators, given that historical utilization rates on casino floors are often below these limits, except possibly during peak hours over weekends and holidays. The more stringent restrictions on Horseshoe Baltimore, however, could affect visitation on weekends and during busy holidays, thus affecting revenue generation, especially on table games. As a result, while Horseshoe has been generating slot revenue exceeding 80% of 2019 revenue in the first quarter of 2021, table game revenue has been about half of 2019 levels. S&P expects table game revenue will improve in the coming months given the recently increased capacity limits. Horseshoe Baltimore has a relatively weak position in a competitive but deep gaming market. CBAC's Horseshoe Baltimore operates in the highly competitive Baltimore-Washington, D.C. gaming market. S&P said, "Although we view the market favorably in terms of population density, income demographics, and propensity to game, there are six competing properties within 100 miles of Horseshoe Baltimore, three of which are within 50 miles. We believe Horseshoe Baltimore's urban location, and more limited amenities compared with competitors, has created challenges in attracting customer traffic. We believe this has resulted in Horseshoe Baltimore's weak position in the market, as demonstrated by the fact that, over the past two years, Horseshoe Baltimore's market share of gross gaming revenue has been below its fair share of gaming positions in the market. Nevertheless, we believe the property does benefit somewhat in terms of attracting customers by being part of Caesars Entertainment Inc.'s player loyalty program." S&P said, "The stable outlook reflects our expectation that even though CBAC's leverage could remain high in 2021, we anticipate EBITDA will cover fixed charges and liquidity will likely be adequate in 2021, reducing the chance of a downgrade over the next 12 months. "We could lower our rating on CBAC if its liquidity position deteriorated, which may occur as a result of generally weaker demand due to heightened competitive pressures. While less likely given the pace of vaccinations and easing of restrictions, this could also occur if CBAC faced increased capacity restrictions or another extended shutdown because of another wave of the pandemic or new variants. "It is highly unlikely we would raise our rating on CBAC over the next year given high forecast leverage, the uncertainty around the effects of the coronavirus on its capacity and visitation, and our belief that its capital structure is unsustainable over the long term. However, we could consider an upgrade if it maintained EBITDA interest coverage of more than 2x on a sustained basis, improved leverage well under 7.5x, and were able to build back excess cash balances and maintain good revolver availability." CHARGING BEAR: Proposes May 20 Auction of Oklahoma City Property ---------------------------------------------------------------- Charging Bear, LLC, asks the U.S. Bankruptcy Court for the Western District of Oklahoma to authorize the auction sale of its sole asset, the improved real property more particularly described as Lot 5, Block 1 of The Offices at MacArthur Crossing, a Replat of a portion of Lot 6, Block 2 of MacArthur Crossing, an Addition to the City of Oklahoma City, Oklahoma County, Oklahoma, according to the recorded plat thereof, with a street address of 5800 NW 135th Street, Oklahoma City, Oklahoma, to be held by Dakil Auctioneers, Inc. on May 20, 2021, at 10:00 a.m. A hearing on the Motion is set for May 18, 2021, at 10:00 a.m. Objections, if any, must be filed no later than 21 days from the date of filing of the Motion. The Debtor respectfully asks the Court to enter a Sale Order approving and confirming the Sale of the Assets, free and clear of all liens, claims, encumbrances, and interests of any kind to the Successful Bidder. The sale is an "As-Is Where-Is" asset sale. The Debtor makes no warranty as to condition, title or otherwise. The Debtor believes that it is in the best interests of the Estate and the creditors to pursue the Sale of the Assets under Sections 105 and 363 of the Bankruptcy Code. It further believes that marketing for the highest and best offer(s) and conducting the Auction will maximize value for all creditors of the Estate. The Auction Sale will be conducted with a reserve of $2.2 million equal to the sum of (i) the amount of accrued ad valorem taxes, and (ii) the allowed secured claim of Bank 7. In the event the real property is not sold at auction, the Auctioneer expenses for marketing the property will be paid from the rent proceeds on deposit. The Assets are subject to the security interests/mortgage liens, ad valorem tax liens and business park association lien more particularly described as follows: A. Oklahoma County Treasurer 2019 and 2020 ad valorem taxes $101,998.22 B. Bank 7 First Purchase Money Mortgage lien in the principal amount of $1,959,751 plus interest, costs and attorney fees as provided in the Note from July 27, 2020 until paid. C. Walt's Trucking, LLC Second Mortgage lien $634,194.99 (Debtor has objected to Walt's Proof of Claim for the amount of the secured claim lien in excess of $233,919.25, but not its priority). D. CrossFirst Bank Third Mortgage lien $1,863,206.84 E. MacArthur Crossing Office Park Association lien $30,539.15 The priority of the distribution of the sale proceeds, in the event of sale, will be according to the date the liens referenced were filed other than the ad valorem tax liens. Further, in the event of sale, the sale proceeds will be paid at closing of the sale after payment of the accrued ad valorem taxes to the Oklahoma County Treasurer. In the event no successful bid is made at the auction sale, the automatic stay will be modified to allow the secured creditors to sell the real estate other than through a bankruptcy sale and the real property will be abandoned without necessity of seeking relief from the stay and abandonment by any secured creditor. Accordingly, the Debtor in the exercise of its reasonable business judgment, believes that the Sale is in the best interest of all parties and represents the best opportunity for the Estate to maximize recoveries for the Estate. Due to the possibility of incurring additional administrative expenses by the Estate an immediate need exists to facilitate the orderly and, more importantly, timely Sale of the Assets. Therefore, the Debtor asks the Court to lift the stay provided by Bankruptcy Rule 6004(h), so that the Sale of the Assets can be finalized immediately upon the entry of the Sale Order. About Charging Bear Charging Bear LLC is a single asset real estate the Debtor (as defined in 11 U.S.C. Section 101(51B)). It is the owner of fee simple title to certain parcels located in Oklahoma City, Oklahoma having an appraised value of $3.4 million. Charging Bear sought protection under Chapter 11 of the Bankruptcy Code (Bankr. W.D. Okla. Case No. 20-13610) on Nov. 11, 2020. Charles V. Long, Jr., managing member, signed the petition. At the time of the filing, the Debtor had total assets of $3,400,544 and total liabilities of $4,081,531. Douglas N. Gould, PLC, is the Debtor's legal counsel. CLUB CAR: S&P Assigns 'B' Issuer Credit Rating, Outlook Stable -------------------------------------------------------------- S&P Global Ratings assigned its 'B' issuer credit rating to Club Car LLC, its 'B' issue-level rating and '3' recovery rating to its term loan B, and its 'CCC+' issue-level rating and '6' recovery rating to its unsecured notes. On April 12, 2021, Ingersoll Rand Inc. entered into an agreement to sell its Specialty Vehicle Technologies segment (Club Car LLC) to private-equity firm Platinum Equity in a $1.68 billion all-cash transaction. S&P expects the sale to be completed by the third quarter. In connection with the transaction, the holding company MajorDrive Holdings IV LLC plans to issue a $100 million asset-based lending (ABL) facility, a $775 million senior secured term loan B, and $450 million of senior unsecured notes. S&P said, "Our issuer credit rating reflects Club Car's high leverage, financial-sponsor ownership, participation in the cyclical golf and consumer markets, concentrated manufacturing footprint, and narrow product focus in golf carts and other low-speed vehicles, which are partially offset by its leading market position and strong brand recognition, good distribution strategy, track record of successful product introductions, and solid free cash flow generation. We expect Club Car to reduce its very high leverage following the leveraged buyout to the mid-6x area in 2022, from about 8x in 2021, on EBITDA growth and modest debt repayment. In addition to its high expected leverage, we view the company's financial-sponsor ownership as increasing its business risk because financial sponsors tend to use incremental leverage to fund acquisitions, investments, or cash distributions over time." Club Car has a leading market position and long-standing reputation as a premium manufacturer in the golf cart industry, where it primarily competes against EZ-GO and Yamaha. In 2020, the company's sales to golf course operators accounted for just over half of its new cart sales. Although S&P views Club Car's end markets as relatively cyclical, with the level of demand tied to consumer discretionary spending, spending on golf remained resilient throughout the COVID-19 pandemic due to elevated participation rates given the limited alternative entertainment and recreation options and favorable income demographics of its participants. Additionally, Club Car often leases golf carts to course operators, typically for a period of 4-5 years, which provides some visibility into its future sales based on its fleet renewal and replacement cycles. Following the expiration of its leases, Club Car has the option to resell the used carts, which it often offers to its retail and commercial customers. The company sells its products primarily through independent distributors. S&P believes its well- established global distribution channels create some barriers to entry. Club Car sells its products worldwide, though its revenue is highly concentrated in the U.S. given that it only derived about 10% of its sales from outside the country in 2020. The company assembles most of its vehicles at a single manufacturing facility in Georgia, which--in our view--involves some concentration risk. That said, its concentrated manufacturing footprint also contributed to its minimal manufacturing downtime and supply chain disruptions last year. Although Club Car currently manufactures the vehicles it sells in the Asia-Pacific region at its Wuijang, China facility, it will be required to shift its production to a new manufacturing space in China after the close of the transaction. Additionally, the vehicles Club Car manufactures in this facility account for only a small percentage of its overall sales. S&P said, "We expect favorable trends in Club Car's two largest segments to support its expansion and compensate for a slower recovery in its Commercial segment. We forecast the company's sales will increase by about 11% in 2021 on a continued double-digit percent rise in its Consumer sales and strong momentum in its Golf business following a rapid recovery from the pandemic-related disruptions in the second quarter of 2020. Club Car's Golf and Consumer segments account for approximately 83% of its new cart sales. In recent years, an increase in the number of rounds played, greater overall participation in the sport, and a rise in the proportion of rounds driven has led golf courses to increase the size of their fleets and accelerated their fleet replacement cycles. Additionally, during the pandemic courses implemented single-ridership requirements to comply with social distancing restrictions. This resulted in greater wear and tear on their fleets and increased short-term demand for carts. We also expect an accelerating shift toward lithium-ion battery powered vehicles to be a key support for the company's future expansion." Club Car projects that nearly half of the carts sold in its Golf segment will be lithium-ion powered by the end of 2021, which will increase its average selling price because these carts command a premium over lead-acid battery or gas-powered carts, though this will be somewhat offset by their longer replacement cycles. Since introducing its Onward model in 2017, Club Car has gained market share and substantially expanded its Consumer segment. To support the expansion of its Consumer segment, the company added over 250 new dealer agreements, most of which were with power-sports retail merchandisers. SP said, "We believe certain favorable trends, including an increase in outdoor recreation activities, the aging population, the proliferation of master-planned communities, and sustainable mobility trends, will support increased sales of Club Car's feature-rich electric vehicles. The company's online platform also enables its customers to customize the options for their carts. Club Car typically sells an average model with $500-$700 of accessories. Over the longer term, we expect that the client relationships in its Consumer segment may be less sticky and subject to greater competition than the relationships in its Golf segment." S&P said, "We anticipate the company's adjusted debt to EBITDA will improve toward the mid-6x area over the next 12-18 months given its solid free operating cash flow (FOCF) and our expectation for debt repayment. We project Club Car's S&P Global Ratings-adjusted EBITDA will increase to about $140 million in 2021, from $133 million in 2020, on its higher volumes, the favorable shift in its sales mix, and the elimination of corporate allocation costs. The company's stand-alone costs, the restructuring costs related to its operational improvements, and its transaction expenses will partially offset these factors. Despite the increase in its EBITDA, we expect Club Car's S&P Global Ratings-adjusted EBITDA margin to remain relatively flat year over year at between 15% and 16% in 2021. We expect the company's restructuring charges to be elevated through 2022 as it supports the execution of several operational improvement initiatives primarily focused on improving its procurement and reducing its material costs. The estimated one-time cost to achieve these initiatives is $15 million. We anticipate Club Car's higher earnings will be offset by its significant debt service costs. However, given its low capital intensity, we believe the company will generate FOCF of between $50 million and $75 million in 2021. We assume Club Car will prioritize deleveraging over the next 12-18 months and use its positive cash flow to repay outstanding borrowings under its proposed term loan. "The stable outlook reflects that, despite the company's leverage exceeding our 7x downgrade threshold in 2021 following the leveraged buyout, we expect it to increase its revenue and earnings on favorable industry trends, its recent new product introductions, and its investments in operational improvement initiatives, which may decrease its leverage to the mid-6x area by the end of 2022. Additionally, we expect that Club Car's EBITDA coverage of interest expense will be about 5x in 2021 and about 3x in 2022, which we consider good for the current rating." S&P could lower its rating on Club Car if it sustains leverage of more than 7x. This could occur if: -- The company experiences challenges in operating as a stand-alone entity and its performance is weaker than S&P expects; -- The company is unable to capitalize on favorable trends, realize cost savings from its operational improvements, and capture further market share in its Consumer segment; or -- It uses its positive cash generation to fund a sponsor dividend or pursues debt-funded acquisitions. Although unlikely over the next 12 months, S&P could raise its rating on Club Car if the company successfully transitions to operating as a stand-alone entity and demonstrates a commitment to deleveraging by using its positive cash flow generation to repay debt while sustaining debt to EBITDA of well below 5x (including potential acquisitions and shareholder returns). COGENT COMMUNICATIONS: Moody's Rates New $500MM Secured Notes 'Ba3' ------------------------------------------------------------------- Moody's Investors Service has assigned a Ba3 rating to Cogent Communications Group, Inc.'s (Cogent) proposed $500 million senior secured notes due 2026. The net proceeds from this offering, together with cash on hand, will be used to finance the redemption in full of the company's outstanding 5.375% senior secured notes due 2022 (2022 Notes), with any remaining net proceeds to be used for general corporate purposes and/or to make special or recurring dividends to Cogent Communications Holdings, Inc. (Cogent Holdings), the public holding company parent of Cogent. All other ratings, including Cogent's B2 corporate family rating and stable outlook, are unchanged. Assignments: Issuer: Cogent Communications Group, Inc. Senior Secured Notes, Assigned Ba3 (LGD2) RATINGS RATIONALE Cogent's B2 CFR is supported by a strong liquidity profile and Moody's expectation for mid to high single-digit revenue growth and solid margins due to robust internet traffic growth, its expanding and diversified customer base, and a productive and growing sales force. The company's low cost structure and targeted niche product sales approach continue to make it a nimble and formidably persistent competitor against larger companies burdened with more complex, higher cost legacy structures. Pro forma for the senior secured notes financing Moody's expects debt/EBITDA (Moody's adjusted) at year-end 2021 to approach the mid 5x range and fall closer to 5.0x by year-end 2022, supported by upward revenue pressure beginning in late 2021 and into 2022 accompanied by margin expansion. The company is constrained by slightly negative to potentially neutral free cash flow generation which results from its use of targeted debt leverage to optimize shareholder returns largely through its dividend policy. The senior secured debt issuance will ultimately facilitate a dividend to Cogent Holdings and extend the maturity profile of Cogent by repaying debt coming due in 2022. While liquidity currently offsets some of the risks inherent in this financial policy, Cogent's relatively high leverage, moderate scale and highly competitive end markets could also pressure the company's future credit profile absent the balanced approach to this policy that exists. Cogent has a simple strategy that focuses primarily on selling high speed internet access to on-net customers, typically by leasing dark fiber between its network and its customers' locations, with limited pursuit of off-net solutions for specific customer needs. Cogent's focus on internet service allows for a streamlined cost structure and uniform network architecture. Technology trends continue to be favorably aligned with Cogent's architecture, as enterprise and net-centric customers' networking and transit needs still remain heavily reliant upon dedicated internet access. Older, complex network IT architectures face obsolescence risks in favor of low cost IP networks. This trend benefits Cogent and will continue to support its growth. Cogent's revenue growth slowed in 2020 as new and existing customers in its corporate segment were more cautious about upgrading or adding services as a result of the Covid-19 pandemic. However, solid underlying demand and continued traffic growth support the return to stronger, longer term revenue growth. During the first quarter of 2021, Cogent began a process of reducing its consolidated leverage (as defined within the indenture governing its existing 2022 Notes) to below 4.25x. The company sought this consolidated leverage reduction in order to meet the indenture's terms for enabling the transfer of available funds from Cogent to Cogent Holdings, its public holding company parent. These funds, once transferred to Cogent Holdings, can be used for dividends, share repurchases or certain investments. The consolidated leverage (as defined within the indenture) reduction began with open market repurchases totaling $115.9 million of the existing 2022 Notes during Q1 2021. The next step in this process was the issuance of a conditional call in early April 2021 for $45.0 million of the existing 2022 Notes. The combination of these repurchases and this conditional call will reduce Cogent's consolidated leverage under the terms of its indenture to less than 4.25x, which allows for the transfer of available cash funds to Cogent Holdings. As a key part of this capital transfer, Cogent is offering $500.0 million of senior secured notes due 2026. Once these new senior secured notes due 2026 are priced, Cogent will redeem the $45.0 million of the 2022 Notes as part of the conditional call, which effectively reduces indenture-defined consolidated leverage to below 4.25x and allows for the reclassification of certain funds to the company's restricted payments basket. Following this consolidated leverage (as defined within the indenture) reduction to below 4.25x and the reclassification of the funds, Cogent will close on this new $500 million senior secured notes transaction and simultaneously place a portion of the proceeds with the trustee for the 2022 Notes sufficient to pay the principal of, and accrued and unpaid interest on, at the December 1, 2021 call date, which will extinguish Cogent's obligations under the indenture and effectively cancel the 2022 Notes. Moody's would expect to withdraw the ratings on the 2022 Notes at the time of this extinguishment, which is expected on or around May 7, 2021. The instrument ratings reflect both the probability of default of Cogent, as reflected in the B2-PD probability of default rating, an average expected family recovery rate of 50% at default given the mix of secured and unsecured debt, and the loss given default (LGD) assessment of the debt instruments in the capital structure based on a priority of claims. Cogent's new senior secured notes due 2026 are rated Ba3 (LGD2), two notches above the B2 corporate family rating to reflect their senior position in the capital structure. The senior secured notes are guaranteed by Cogent's domestic subsidiaries and secured by a pledge of stock of 100% of Cogent's US subsidiaries and 65% of the Company's non-US subsidiaries. In addition, the new senior secured notes due 2026 are guaranteed on a senior unsecured basis by Cogent Holdings. However, Cogent Holdings will not be subject to the covenants under the indenture governing these new secured notes as it is not a party to the Indenture and is not governed by the indenture. Cogent's $430 million (USD equivalent) of senior unsecured Euro notes due 2024 are rated B3 (LGD5), reflecting their junior position to the new senior secured notes due 2026. Cogent's bond indentures will continue to restrict certain payments, such as dividends or share repurchases, if consolidated leverage (as defined within the indenture) is above 4.25x. Moody's expects Cogent to continue to maintain very good liquidity. As of March 31, 2021 and on an aggregate basis pro forma for the new senior secured notes transaction and associated capital management process, $389 million in cash is expected to be held on a consolidated basis at Cogent Holdings, with the bulk of that cash remaining at Cogent, the operating entity. Moody's expects Cogent to generate slightly negative free cash flow during the next several quarters with cash balances expected to decline due to the company's equity stakeholder returns. Moody's believe that Cogent will likely supplement its regular quarterly dividends with share buybacks and/or special dividends. As of December 31, 2020, Cogent had $30.4 million available for stock buybacks under its share repurchase program which is authorized through December 2021. Cogent does not have a revolving credit facility. While cash balances will shrink steadily, Moody's expects Cogent to maintain at least $60 million of cash at all times, a level believed to be the minimum required to run the business prudently. The stable outlook is based on Moody's view that while Cogent's earnings and cash flow will continue to grow, equity stakeholder returns -- in the form of dividends and share buybacks -- will increase in tandem. Moody's expects the company will maintain sufficient liquidity while debt levels remain relatively constant. Cogent's low cost structure and niche sales approach, in conjunction with its aggressive equity stakeholder return policy, will prevent the company from generating meaningful positive free cash flow for the near future. The top 20 equity stakeholders of Cogent's public holding company parent own approximately 70% of outstanding shares and are primarily large institutional managers, with Cogent's CEO and founder controlling approximately a 10% stake. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS Moody's could upgrade Cogent's ratings if leverage is sustained below 4x (Moody's adjusted) and free cash flow is positive. Moody's could downgrade Cogent's ratings if leverage is sustained above 5x (Moody's adjusted). Cogent Communications Holdings, Inc., with headquarters in Washington, DC, is a multinational Tier 1 internet service provider. The company offers dedicated internet access and data transport over its fiber optic, IP network to corporate and net-centric customers. Cogent, as one of the top five largest carriers of internet traffic in the world, generated $568 million in revenue in 2020. The principal methodology used in these ratings was Communications Infrastructure Industry published in September 2017. COMMUNITY HEALTH: Files Form 10-Q for First Quarter --------------------------------------------------- Community Health Systems, Inc. filed with the Securities and Exchange Commission its Quarterly Report on Form 10-Q disclosing a net loss attributable to the company's stockholders of $64 million on $3.01 billion of net operating revenues for the three months ended March 31, 2021, compared to net income attributable to the company's stockholders of $18 million on $3.02 billion of net operating revenues for the three months ended March 31, 2020. As of March 31, 2021, the Company had $15.59 billion in total assets, $16.70 billion in total liabilities, $481 million in redeemable noncontrolling interests in equity of consolidated subsidiaries, and a total stockholders' deficit of $1.59 billion. Net cash provided by operating activities increased $44 million, from approximately $57 million for the three months ended March 31, 2020, to $101 million for the three months ended March 31, 2021. The increase was primarily attributable to the timing and amount of interest payments. Cash paid for interest was $203 million during the three months ended March 31, 2021 compared to $264 million for the three months ended March 31, 2020. Cash paid for income taxes, net of refunds received, resulted in a net payment of less than $1 million, and a net refund of approximately $2 million during the three months ended March 31, 2021 and 2020, respectively. The Company's net cash used in investing activities was approximately $120 million for the three months ended March 31, 2021, compared to approximately $109 million for the three months ended March 31, 2020, a decrease of approximately $11 million. The cash used in investing activities during the three months ended March 31, 2021 was primarily impacted by an increase in cash used in the purchase of property and equipment of $6 million, an increase of $4 million in cash used for acquisition of facilities and other related businesses, and an increase in cash used to purchase other investments of $7 million. The increase in cash used in investing activities was partially offset by a $4 million increase in cash proceeds from dispositions of hospitals and other ancillary operations, and a $2 million increase in cash proceeds from the sale of property and equipment. The Company's net cash used in financing activities was $406 million for the three months ended March 31, 2021, compared to net cash provided by financing activities of $82 million for the three months ended March 31, 2020, an increase in cash used in financing activities of approximately $488 million. This was primarily due to the net effect of the Company's debt repayments, refinancing activities, and cash paid for deferred financing costs and other debt-related costs during the three months ended March 31, 2021. Community Health said, "We believe that internally generated cash flows and current levels of availability for additional borrowing under the ABL Facility, as well as our continued access to the capital markets, will be sufficient to finance acquisitions, capital expenditures, working capital requirements, and any debt repurchases or other debt repayments we may elect to make or be required to make through the next 12 months. PHSSEF funds that we have received and may continue to receive under the CARES Act and related legislation will be used according to their terms and conditions as reimbursement for lost revenues and incremental expenses attributable to COVID-19, including working capital requirements and capital expenditures. The COVID-19 pandemic has resulted in, and may continue to result in, significant disruptions of financial and capital markets, which could reduce our ability to access capital and negatively affect our liquidity in the future. Additionally, while we have received PHSSEF payments and accelerated Medicare payments under the CARES Act and related legislation and may continue to receive and be able to utilize PHSSEF payments which have been received, as noted above, there is no assurance regarding the extent to which anticipated ongoing negative impacts on us arising from the COVID-19 pandemic will be offset by benefits which we may recognize or receive in the future under the CARES Act and related legislation or any future stimulus measures. "We may elect from time to time to continue to purchase our outstanding debt in open market purchases, privately negotiated transactions or otherwise. Any such debt repurchases will depend upon prevailing market conditions, our liquidity requirements, contractual restrictions, applicable securities laws requirements, and other factors." A full-text copy of the Form 10-Q is available for free at: https://www.sec.gov/ix?doc=/Archives/edgar/data/1108109/000156459021021968/cyh-10q_20210331.htm About Community Health Systems Inc. Community Health Systems, Inc. -- http://www.chs.net-- is a publicly traded hospital company and an operator of general acute care hospitals in communities across the country. The Company, through its subsidiaries, owns, leases or operates 84 affiliated hospitals in 16 states with an aggregate of approximately 13,000 licensed beds. The Company's headquarters are located in Franklin, Tennessee, a suburb south of Nashville. Community Health Systems reported net income attributable to the Company's stockholders of $511 million on $11.78 billion of net operating revenues for the year ended Dec. 31, 2020, compared to a net loss attributable to the Company's stockholders of $675 million on $13.21 billion of net operating revenues for the year ended Dec. 31, 2019. As of Dec. 31, 2020, the Company had $16.01 billion in total assets, $17.06 billion in total liabilities, $484 million in redeemable noncontrolling interests in equity of consolidated subsidiaries, and a total stockholders' deficit of $1.54 billion. * * * As reported by the TCR on Dec. 29, 2020, S&P Global Ratings raised its issuer credit rating on Community Health Systems Inc. to 'CCC+' from 'SD' (selective default) and raised its rating on the company's unsecured debt due 2028 to 'CCC-' from 'D'. S&P said the company's recent financial transactions have improved its maturity profile and lowered interest costs. In November 2020, Fitch Ratings affirmed the Long-Term Issuer Default Ratings (IDR) of Community Health Systems, Inc. (CHS) and subsidiary CHS/Community Health Systems, Inc. at 'CCC'. CONCORD INC: Gets OK to Hire CliftonLarsonAllen as Accountant ------------------------------------------------------------- Concord, Inc. received approval from the U.S. Bankruptcy Court for the Northern District of Georgia to employ CliftonLarsonAllen LLP as its accountant. The Debtor needs the assistance of an accountant to prepare and file its 2020 federal and state tax returns and to provide tax and planning analysis. CliftonLarsonAllen's annual fee estimate for the 2020 business income tax returns, property tax returns, tax planning and analysis is $20,000. Jamie Henkemeyer, a managing principal at CliftonLarsonAllen, disclosed in a court filing that the firm is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. The firm can be reached through: Jamie Henkemeyer CliftonLarsonAllen LLP 3575 Piedmont Road Northeast Building 15, Suite 1550 Atlanta, GA 30305 Telephone: (404) 262-3300 Facsimile: (404) 262-3271 About Concord Inc. Founded in Philadelphia in 1983, Concord, Inc. has distinguished itself as a leader in the provision and management of driver qualification file management, substance abuse programs, physical examinations, regulatory compliance consulting, occupational health and safety services, policy development and consulting, and employee background screening. Concord filed its voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. N.D. Ga. Case No. 21-52482) on March 26, 2021. At the time of the filing, the Debtor disclosed $1 million to $10 million in both assets and liabilities. Judge Paul Baisier oversees the case. The Debtor tapped Will B. Geer, Esq., at Wiggam & Geer, LLC as legal counsel and CliftonLarsonAllen, LLP as accountant. COSI INC: Seeks Fast Track Bankruptcy to Access COVID Relief Funds ------------------------------------------------------------------ Daniel Gill of Bloomberg Law reports that Cosi Inc. is seeking to accelerate its bankruptcy case in order to have a shot at federal funds available to restaurants struggling during the pandemic. The fast-casual chain hopes to have a hearing on confirming its plan by June 30, according to court filings. Judge Brendan L. Shannon of the U.S. Bankruptcy Court for the District of Delaware already approved Cosi’s request for an expedited hearing on interim approval of its plan disclosures, setting the date for May 11. The Restaurant Revitalization Fund, part of the $1.9 trillion Covid relief package signed into law in March, provides restaurants and bars with up to $10 million from a $28.6 billion fund. The Small Business Administration, which administers the RRF, is now accepting applications for the program. The RRF is likely to be underfunded, meaning "applicants who do not submit their applications as soon as the window for applications opens will not be approved for the grant" because the money has dried up, Cosi said in an April 30, 2021 filing. The fast- casual chain previously tried for a Paycheck Protection Program loan but was thwarted when the SBA blocked bankrupt borrowers from applying. The restaurant's push to expedite its plan isn't surprising, as a shift in SBA policy regarding PPP applications is expected to push small, bankrupt companies toward faster plan approvals. The agency recently said businesses with court-confirmed plans aren't "presently involved" in bankruptcy and, thus, can apply for the loans. The SBA has taken a similar stance with respect to the RRF, according to agency guidance. Cosi should be entitled to the maximum $10 million from the RRF, according to its calculations. That amount would allow the company to reorganize in Chapter 11, rather than converting to Chapter 7 for a straight liquidation. Only its post-bankruptcy lenders would be paid under the latter scenario, it said. The plan, filed April 30, 2021 swaps pre-bankruptcy secured lenders’ $24 million of debt for 100% of new common stock in the reorganized company. Pre-bankruptcy shareholders would get nothing for their interests. Unsecured creditors would recover about 20% of their claims, assuming the company receives RRF funding at expected levels, Cosi said. Unsecured claims total about $10.6 million, according to Cosi’s disclosure statement. Cosi filed Chapter 11 in February 2020, its second bankruptcy filing since 2016. The company said it would shift its focus to catering services. The case is In re Cosi, Inc., Bankr. D. Del., No. 20-10417, disclosure statement filed 4/30/21. About Cosi Inc. Cosi, Inc. -- https://www.getcosi.com/ -- and its affiliates operate fast-casual restaurants under the COSI brand. COSI features flatbread made fresh throughout the day and specializes in a variety of made-to-order hot and cold sandwiches, salads, bowls, breakfast wraps, bagels, melts, soups, flatbread pizzas, snacks, desserts, and a large offering of handcrafted, coffee-based, and specialty beverages. Cosi, Inc. and its affiliates sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 20-10417) on Feb. 24, 2020. Cosi, Inc., was estimated to have $10 million to $50 million in assets and liabilities. Judge Brendan L. Shannon is the case judge. The Debtors tapped Cozen O'Connor as counsel. Omni Agent Solutions is the claims and noticing agent. COSI INC: Seeks Quick Confirmation of Plan ------------------------------------------ Cosi, Inc., and its debtor-affiliates ask the Court to conditionally approve their Disclosure Statement, as containing adequate information pursuant to Section 1125 of the Bankruptcy Code, and to conditionally confirm their Joint Plan of Reorganization. The Debtors are seeking to expedite the hearing on the Disclosure Statement and Plan confirmation. They propose to then apply for their grant, and schedule a hearing in late June or early July after a reasonable solicitation period to approve their Disclosure Statement and confirm their Plan on a final basis. The Debtors disclosed that they are on a time constraint along the road to confirmation of the Plan. Mark E. Felger, Esq., counsel for the Debtors at COZEN O'CONNOR, said that a typical plan confirmation process takes a minimum of 75 days. The Debtors do not have 75 days but a mere two weeks to be in a position to check the box certifying that they are operating under an approved plan of reorganization, or they will be shut out of the life-line, he said. The Debtors believe, however, that they will be able to meet all of the conditions to confirm their Plan, and they will be able to confirm and go effective on their plan, if, and only if, they are able to obtain the grant. Under the Debtors' calculations, they would be entitled to approximately $10 million under the Restaurant Revitalization program recently established by the Congress and is expected to open in early May. These are the proposed Balloting and Plan Solicitation deadlines: * May 18, 2021, as the deadline for distributing Solicitation Packages. * June 21, 2021, 5:00 p.m., prevailing Eastern Time, as the Voting Deadline. * June 21, 2021, 5:00 p.m., prevailing Eastern Time, as the Final Disclosure Statement/Plan Objection Deadline. * June 30, 2021 as the Confirmation Hearing Date. The Debtors request for an expedited hearing on the motion on May 11, 2021 at 10 a.m., Eastern Time. A copy of the motion is available at https://bit.ly/3beVnxJ from Omni Agent Solutions, claims agent. About Cosi Inc. Cosi, Inc. -- https://www.getcosi.com/ -- and its affiliates operate fast-casual restaurants under the COSI brand. COSI features flatbread made fresh throughout the day and specializes in a variety of made-to-order hot and cold sandwiches, salads, bowls, breakfast wraps, bagels, melts, soups, flatbread pizzas, snacks, desserts, and a large offering of handcrafted, coffee-based, and specialty beverages. Cosi, Inc. and its affiliates sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 20-10417) on Feb. 24, 2020. Cosi, Inc., was estimated to have $10 million to $50 million in assets and liabilities. Judge Brendan L. Shannon is the case judge. The Debtors tapped Cozen O'Connor as counsel. Omni Agent Solutions is the claims and noticing agent. COSI INC: Unsecured Creditors Get 20% Recovery Under Plan --------------------------------------------------------- Cosi, Inc., and its debtor-affiliates filed with the U.S. Bankruptcy Court for the District of Delaware a Joint Plan of Reorganization and a Disclosure Statement. The Plan will be funded by (i) capital contribution of $1 million from LIMAB LLC, the Existing Secured Lender, (ii) an anticipated grant to be available from the Restaurant Revitalization Fund (RRF) established under the Restaurant Revitalization Act of 2021, (iii) the Employee Retention Tax Credits of at least $490,000 and (iv) cash available from the operation of the Debtors' business and/or asset dispositions and settlements. The funds will also pay for post-bankruptcy operations. The Debtors intend to apply for the RRF grant upon entry of the Conditional Confirmation Order, and shall take all steps reasonably necessary to ensure that their application will be approved, and the RRF Grant received. The Debtors and/or the Reorganized Debtors intend to apply for Employee Retention Tax Credits, which they anticipate to receive after the Plan Confirmation. The Debtors' receipt of either the RRF Grant or an initial disbursement thereof shall be a condition to the occurrence of the Effective Date. The Debtors disclosed that one risk factor with the RRF Grant is that the funds in the RRF may be exhausted before the Debtors are able to obtain some or all of the RRF Grant, and it is unknown when, or whether, Congress may allocate additional funding to the RRF. Treatment of Claims under the Plan: Claims in Classes 1, 2, 6, and 7, and Interests in Class 8 are Impaired. Classes 1, 2, 6 and 7 can vote to accept or reject the Plan. * Class 1 Existing Secured Lender Claims. The Debtors believe that the estimated total of the Existing Secured Lender Claims as of the Effective Date will be approximately $24 million. After the Effective Date, Holders of Existing Secured Lender Claims, shall receive 100% of the New Common Stock, subject to dilution by any future issuance of New Common Stock, in full and final satisfaction, release, settlement, and discharge of the Existing Secured Lender Claims and any Prepetition Adequate Protection Rights. * Class 2 Rollup Note Claims. The Debtors believe that the estimated total of the Rollup Note Claims as of the Effective Date will be approximately $6.7 million, plus accrued interest and other obligations. Each Holder of a Rollup Note Claim shall receive payment in Cash in the amount of 20% of the Rollup Note Claim, payable as follows: 15.5% on the Effective Date, and 4.5% on the first anniversary of the Effective Date, except to the extent that a Holder of a Rollup Note Claim has agreed to less favorable treatment or has been paid previously. The distributions, which shall be in full and final satisfaction and discharge of the Rollup Note Claim, will be made after the Effective Date as practicable, and upon the Debtors' and/or Reorganized Debtors' receipt of a sufficient portion of the RRF Grant to enable them to make all distributions required under the Plan. The Plan contemplates making payments to all members of Classes 2, 5, and 6. * Class 6 General Unsecured Claims. The Debtors estimate total Allowed General Unsecured Claims of approximately $10.6 million as of the Effective Date. Each Holder of an Allowed General Unsecured Claim shall receive payment in Cash at 20% of the Allowed General Unsecured Claim, payable as follows: 15.5% on the Effective Date, and 4.5% on the first anniversary of the Effective Date, in full and final satisfaction, and discharge of the Allowed General Unsecured Claim. * Class 7 Intercompany Claims. On the Effective Date, all Intercompany Claims shall be cancelled, and Holders of Intercompany Claims shall not receive or retain any Property under the Plan. The Holders of Intercompany Claims in Class 7 are deemed to reject the Plan and are not entitled to vote to accept or reject the Plan. * Class 8 Old Common Stock Interests. The Holders of Old Common Stock Interests in Class 8 are deemed to reject the Plan and are not entitled to vote to accept or reject the Plan. On the Effective Date, all Old Common Stock shall be cancelled, and Holders of Old Common Stock Interests shall not receive or retain any Property under the Plan for their Old Common Stock Interests. Claims in Classes 3, 4, and 5 and Interests in Class 9 are unimpaired under the Plan. They consist of Class 3 Other Secured Claims, Class 4 Non-Tax Priority Claims, Class 5 Convenience Class Claims, and Class 9 Subsidiary Equity Interests. Unclassified types of Claims include (i) Administrative Expense Claims, (ii) Priority Tax Claims and Secured Tax Claims, (iii) DIP Financing Claims and Supplemental DIP Financing Claims. As of the Effective Date, all of the Debtors' executory contracts and unexpired leases which are listed on a schedule (the Assumed Contracts Schedule) to be filed with the Plan Supplement shall be deemed to be assumed in accordance with the provisions and requirements of Sections 365 and 1123 of the Bankruptcy Code. All executory contracts and unexpired leases not listed on the Assumed Contracts Schedule, and not assumed prior to the Confirmation Date or otherwise the subject of a motion to assume filed on or before the Confirmation Date, shall be rejected as of the Effective Date. A copy of the Disclosure Statement is available at https://bit.ly/337n2Me from Omni Agent Solutions, the Debtors' claims agent. Counsel for LIMAB LLC, the Debtors' Existing Secured Lender: Steven M. Abramowitz, Esq., Vinson & Elkins The Grace Building 1114 Avenue of the Americas, 32nd Floor, New York, NY 10036, Email: sabramowitz@velaw.com About Cosi Inc. Cosi, Inc. -- https://www.getcosi.com/ -- and its affiliates operate fast-casual restaurants under the COSI brand. COSI features flatbread made fresh throughout the day and specializes in a variety of made-to-order hot and cold sandwiches, salads, bowls, breakfast wraps, bagels, melts, soups, flatbread pizzas, snacks, desserts, and a large offering of handcrafted, coffee-based, and specialty beverages. Cosi, Inc. and its affiliates sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 20-10417) on Feb. 24, 2020. Cosi, Inc., was estimated to have $10 million to $50 million in assets and liabilities. Judge Brendan L. Shannon is the case judge. The Debtors tapped Cozen O'Connor as counsel. Omni Agent Solutions is the claims and noticing agent. COTTAGE CAR: Seeks to Hire Madoff & Khoury as Legal Counsel ----------------------------------------------------------- Cottage Car Wash, LLC seeks approval from the U.S. Bankruptcy Court for the District of Massachusetts to employ Madoff & Khoury, LLP to handle its Chapter 11 case. The hourly rates of Madoff & Khoury's attorneys and paralegals are as follows: Partner $395 Associate $295 Paralegals $150 The firm received a retainer in the amount of $11,738. David Madoff, Esq., at Madoff & Khoury, disclosed in a court filing that the members of the firm are "disinterested" within the meaning of Section 101(14) of the Bankruptcy Code. The firm can be reached through: David B. Madoff, Esq. Steffani M. Pelton, Esq. Madoff & Khoury LLP 124 Washington Street Foxboro, MA 02035 Phone: 508-543-0040 Fax: 508-543-0020 Email: madoff@mandkllp.com About Cottage Car Wash Cottage Car Wash, LLC, a privately held company in the car wash business based in Norfolk, Mass., filed a voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. D. Mass. Case No. 21-10596) on April 26, 2021. Michael Brabants, manager, signed the petition. At the time of the filing, the Debtor disclosed total assets of $916,000 and total liabilities of $1,481,676. Madoff & Khoury LLP serves as the Debtor's legal counsel. COTTAGE CAR: Wins Cash Collateral Access Thru June 30 ----------------------------------------------------- The U.S. Bankruptcy Court for the District of Massachusetts, Eastern Division, has authorized Cottage Car Wash, LLC to use cash collateral, in which LendingClub Bank National Association f/k/a Radius Bank, assert an interest. The Debtor requires the use of cash collateral to prevent severe disruptions of its operations. The Court says that on an interim basis through June 30, 2021, the Debtor is authorized to collect and use those prepetition assets in which the Secured Creditor claims a security interests, including any cash receipts, proceeds of prepetition accounts receivable, inventory and cash on hand, for the purposes and on the terms proposed in the Motion in the operation of its business as debtor-in-possession, in accordance with the budget. The Debtor is authorized to use cash collateral to pay any amounts necessary to avoid immediate and irreparable harm to the Debtor's estate, up to 10% in excess of the amounts set forth in the Budget. As adequate protection to the Secured Creditor for the Debtor's use of the Cash Collateral, the Debtor will: (a) grant the Secured Creditor a continuing replacement lien and security interest in all assets of the Debtor in which the Secured Creditor possessed a security interest as of the Petition Date, to the same validity and extent and priority that it would have had in the absence of the bankruptcy filing to secure any diminution in value of its collateral as a result of the use of cash collateral; and (b) make monthly adequate protection payments to the Secured Creditor in the amount of $5,263. The allocation and application of the payments will be subject to further Court review and order. The Debtor is also directed to maintain fire, hazard casualty, and comprehensive public liability insurance as is currently in effect. The hearing to consider the further use of cash collateral and adequate protection as proposed in the Motion and Stipulation will be scheduled via separate notice. A copy of the order is available for free at https://bit.ly/3tiXBlB from PacerMonitor.com. About Cottage Car Wash, LLC Cottage Car Wash, LLC is a Massachusetts Limited Liability Company that owns and operates a self-serve car wash at 36 Pine Street, Norfolk, Massachusetts. It has no employees and is run by its sole member, Michael Brabants. It was formed by Mr. Brabants in 2009, when it purchased a lot of land in Norfolk with the aim of building and operating a car wash. It took more than three years to obtain the necessary permits and build the car wash. It opened in March 2014, with higher-than-expected debt, in part caused by the delays. The Debtor sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. D. Mass. Case No. 21-10596) on April 26, 2021. In the petition signed by Michael Brabants, manager, the Debtor disclosed $916,000 in assets and $1,481,676 in liabilities. Judge Melvin S. Hoffman oversees the case. David B. Madoff, Esq. at MADOFF & KHOURY LLP is the Debtor's counsel. CRAVE BRANDS: Cash Collateral Access Extended to May 11 ------------------------------------------------------- The U.S. Bankruptcy Court for the Northern District of Illinois, Eastern Division, has entered an order extending the authority of Crave Brands, LLC and affiliates to use cash collateral through May 11, 2021. The extension will be on the same terms and conditions set forth in the Interim Order dated April 14, 2021. As previously reported by the Trouble Company Reporter, the Interim Order authorized the Debtors to use cash collateral, in which LQD Financial Corp. assert an interest, to pay actual, ordinary, and necessary expenses, in accordance with the budget subject to a weekly variance of 10% on a line item basis. As adequate protection, LQD is granted replacement liens and security interests on the Debtors' property and assets. The replacement liens will be in an amount equal to the aggregate post-petition cash collateral used. The protections and benefits provided in the order are not necessarily adequate protection within the meaning of section 361 of the Bankruptcy Code and LQD's rights to request and, if appropriate, obtain additional adequate protection are preserved. In addition, the Debtor will pay to LQD as soon as possible after receipt the Employee Retention Credit for application to the principal amount of the LQD Indebtedness. LQD is also granted a super-priority administrative claim for the amount by which the replacement lien proves to be inadequate and LQD will have all the rights accorded to it. A copy of the order is available for free at https://bit.ly/3ehyLhM from PacerMonitor.com. About Crave Brands LLC Crave Brands LLC sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. N.D. Ill. Case No. 21-04729) on April 9, 2021. In the petition signed by Steve Karfaridis, manager, the Debtor disclosed $50,000 in assets and $10 million in liabilities. Judge Timothy A. Barnes oversees the case. David A. Warfield, Esq. at THOMPSON COBURN LLP represents the Debtor as counsel. Matthew Brash has been appointed the Subchapter V Trustee. LQD Financial Corp., as creditor, is represented by William J. Factor, Esq. CRC BROADCASTING: Has Cash Collateral Access Until May 31 --------------------------------------------------------- Judge Paul Sala authorized CRC Broadcasting Company, Inc., to use cash collateral on an interim basis until May 31, 2021, pursuant to a one-month budget. The budget provided for $17,500 in total expenses for May 2021, which equaled the income projected for that month. The cash collateral is subject to an interest held by Desert Financial Federal Credit Union resulting from the loans Desert Financial extended to the Debtor pre-petition: * Loan number 2900000248 for $725,000 in principal amount, * Loan number 2900000249 for $90,000 in principal amount, * Loan number 2900000250 for $200,000 in principal amount, * Loan number 2900000422 for a principal balance of $650,000. The Debtor, in addition, guaranteed and cross-collateralized with its own assets the debts of sister company, CRC Media West, LLC, also a debtor under Chapter 11 of the Bankruptcy Code. The guaranty and cross-collateralization of the Debtor's assets is evidenced by Guaranty Agreements entered in connection with a Loan number 2900000251 from Desert Financial to CRC Media. The Debtor owes Desert Financial no less than $1,477,964 under the loan documents as of February 28, 2020 as a result of its own primary debts and the debts of CRC Media that it guaranteed and secured. The Debtor continues to be in default under the loan documents as of the Petition Date. By this Court order: * Desert Financial is granted replacement liens on all of the Debtor's property after the Petition Date to the extent of any diminution in the value of Desert Financial's pre-petition collateral from the Petition Date. * Desert Financial is granted a super-priority administrative expense claim under Section 507(b) of the Bankruptcy Code to the extent the Replacement Liens do not adequately protect Desert Financial for any diminution of collateral, including cash collateral. * the Debtor must remit to Desert Financial at least $8,000 in aggregate on or before June 3, 2021. A copy of the order is available for free at https://bit.ly/3vrEgAa from PacerMonitor.com. About CRC Broadcasting Co. CRC Broadcasting Company, Inc., a broadcast media company based in Scottsdale, Ariz., filed a voluntary petition under Chapter 11 of the Bankruptcy Code (Bankr. D. Ariz. Case No. 20-02349) on March 6, 2020, listing under $1 million in both assets and liabilities. Affiliate CRC Media West, LLC also filed for Chapter 11 petition (Bankr. D. Ariz. Case No. 20-02352) on March 6, 2020, listing under $1 million in both assets and liabilities. The cases are jointly administered. Judge Paul Sala oversees both cases. Allan D. NewDelman, Esq., at Allan D. NewDelman, P.C., is the Debtors' legal counsel. CRESTWOOD HOSPITALITY: Seeks to Tap Sacks Tierney as Legal Counsel ------------------------------------------------------------------ Crestwood Hospitality, LLC seeks approval from the U.S. Bankruptcy Court for the District of Arizona to employ Sacks Tierney, PA as its legal counsel. Sacks Tierney will render these legal services: (a) assist the Debtor in all matters associated with its Chapter 11 bankruptcy proceeding; (b) represent the Debtor in all hearings before the bankruptcy court; and (c) negotiate and resolve all issues related to the Debtor's Chapter 11 proceeding. The hourly rates of Sacks Tierney's attorneys and staff are as follows: Partners $370 - $550 Associates $250 - $370 Paralegal Assistants $125 - $245 As disclosed in court filings, Sacks Tierney is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. The firm can be reached through: Randy Nussbaum, Esq. Philip R. Rudd, Esq. Sierra M. Minder, Esq. Sacks Tierney PA 4250 N. Drinkwater Blvd., 4th Floor Scottsdale, AZ 85251-3693 Telephone: (480) 425-2600 Facsimile: (480) 970-4610 Email: Randy.Nussbaum@SacksTierney.com Philip.Rudd@SacksTierney.com Sierra.Minder@SacksTierney.com About Crestwood Hospitality Crestwood Hospitality, LLC is a Tucson, Ariz.-based company that operates in the hotels and motels industry. Crestwood Hospitality filed a voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. D. Ariz. Case No. 21-03091) on April 30, 2021. Sukhbinder Khangura, member and vice president, signed the petition. At the time of the filing, the Debtor disclosed $1 million to $10 million in assets and $10 million to $50 million in liabilities. Judge Brenda Moody Whinery oversees the case. Sacks Tierney, PA serves as the Debtor's legal counsel. CSC HOLDINGS: Moody's Rates New $1.5BB Sr. Guaranteed Notes 'Ba3' ----------------------------------------------------------------- Moody's Investors Service assigned a Ba3 rating to CSC Holdings, LLC's new $1.5 billion senior guaranteed notes (maturing 2031) and a B3 rating to CSC's new $500 million senior unsecured notes due 2031 (unguaranteed), collectively the "Refinancing Transaction". The Company's B1 Corporate Family Rating, B1-PD Probability of Default Rating, all existing instrument ratings and the stable outlook are unaffected by the proposed transaction. Moody's views the Refinancing Transaction as credit neutral, with no material change in pro forma leverage at close. Moody's expect CSC to use the net proceeds, and any incremental upsizing of the notes, to repay outstanding debt, including obligations drawn under the revolving credit facility. Any incremental leverage (net of repayment) will not materially change the credit profile or the proportional mix of secured and unsecured debt, or the resultant creditor claim priorities in the capital structure. Moody's expects the terms and conditions of the newly issued notes will be materially the same as existing notes. However, Moody's expect borrowing costs under the new notes to be lower. Assignments: Issuer: CSC Holdings, LLC Senior Unsecured Regular Bond/Debenture, Assigned B3 (LGD5) Gtd Senior Unsecured Regular Bond/Debenture, Assigned Ba3 (LGD3) Adjustment: LGD Senior Unsecured Regular Bond/Debenture, Adjusted to LGD5 from LGD6 RATINGS RATIONALE CSC Holdings, LLC's (CSC Holdings, B1 stable) credit profile is supported by its large size (near $10 billion in revenue) and somewhat diversified footprint, with good market position and favorable market dynamics, specifically strong broadband demand fueling growth and profitability. The business model is very predictable, with a monthly recurring base of revenue from a large base of residential and commercial customers. Strength is reflected in industry leading operating metrics including investment-grade like EBITDA per homes passed (EPH) and the Triple Play Equivalent (TPE) ratio. The Company has a high-speed network, superior to in-market peers across most of its footprint except where fiber competitors overlap like Verizon FIOS in the optimum geography. Residential broadband's strong revenue growth and profitability supports consolidated EBITDA margins in the mid 40% range and is a significant contributor to the Company's free cash flow (near $1.9 billion, Moody's adjusted at year end 2020). Moody's expect this strength to continue, supported by network investments and very good liquidity. The rating is constrained by a less than conservative financial policy that tolerates high leverage (near 5.8x, Moody's adjusted as of December 31, 2020), due to a financial policy that currently prioritizes dividends to its parent over debt repayment, which its parent uses to fund M&A and or dividends (sized near free cash flow, before dividends). Additionally, CSC Holdings' video and voice businesses are declining, under secular pressure and the Company is investing at a loss to ramp its wireless MVNO services to defend its broadband market position and participate in the 5G growth opportunity. The SGL-1 liquidity rating reflects very good liquidity supported by strong operating cash flow, a large revolving credit facility, substantial covenant headroom, and alternative liquidity. The company also benefits from a favorable maturity profile with limited maturities over the next 2 years. Moody's currently rates CSC's senior secured bank debt facilities Ba3 (LGD3), one notch above the B1 CFR. The secured debt has a stock pledge and is guaranteed by the operating subsidiaries of the Company. Bank lenders benefit from junior capital provided by the senior unsecured bonds at CSC (which have no guarantee). Moody's rate the senior unsecured guaranteed notes at CSC Ba3 (LGD3), pari- pasu with the senior secured creditors with the benefit of the same guarantee from the restricted subsidiaries (as the credit facility creditors) and Moody's view that the stock pledge for secured lenders provides no additional lift/benefit as the equity collateral would likely be worthless in a default scenario. Moody's rates CSC's senior unsecured (non-guaranteed) notes B3 (LGD5), two notches below the B1 CFR given the subordination in the Company's capital structure. The instrument ratings reflect the probability of default of the Company, as reflected in the B1-PD Probability of Default Rating, an average expected family recovery rate of 50% at default given the mix of secured and unsecured debt in the capital structure, and the particular instruments' ranking in the capital structure. Moody's maintains a Ba3 senior secured rating and a B3 senior unsecured rating on certain debt that was originally issued by Neptune Finco Corp., an acquisition vehicle used by Altice USA (CSC's ultimate parent company, unrated) to acquire the operating subsidiary D/B/A Cablevision. In 2015, Neptune was merged with and into CSC, which effectively assumed all Neptune obligations; however, Moody's internal databases continue to reflect Neptune as a debt issuer. The stable outlook reflects Moody's expectation that debt, revenue, and EBITDA will approach approximately $25-26 billion, $10.5-$11 billion, and up to $5 billion, respectively, over the next 12-18 months, with EBITDA margins in the mid 40% range and rising. Moody's expect free cash flows (before dividends) to average at least $1.7-$1.8 billion, after capital expenditures of up to $1.4 billion (mid-teens percent of revenue). Moody's expect the dividend payouts to be sized equal to or greater than free cash flows (before dividends). Moody's project leverage to be in the low to mid 5x range, and FCF/debt (before dividends) to be in the high single digit percent range. Note: all figures are Moody's adjusted over the next 12-18 months unless otherwise noted. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS Moody's could consider an upgrade if: -- Leverage (Moody's adjusted Debt/EBITDA) is sustained below 5.0x, and -- Free cash flow to debt (Moody's adjusted, before dividends) is sustained above 5.0% An upgrade would also be considered on maintaining very good liquidity, a stable subscriber base, and or a more conservative financial policy. Moody's could consider a downgrade if: -- Leverage (Moody's adjusted Debt/EBITDA) is sustained above 6.25x, or -- Free cash flow to debt (Moody's adjusted, before dividends) is sustained below 3% A downgrade could also be considered if the scale of the company declined, liquidity deteriorated, there was a material and unfavorable change in operating performance, or the company adopted a more aggressive financial policy. The principal methodology used in these ratings was Pay TV published in December 2018. Headquartered in Long Island City, New York, CSC Holdings, LLC passes nearly 9 million homes in 21 states, serving approximately 5 million residential and business customers and about 9.5 million subscribers. The Company is wholly owned by Altice USA, a public company majority owned and controlled by Patrick Drahi. Revenue for 2020 was approximately $9.9 billion. In 2020 Altice sold 49.99% of Lightpath Group (Cablevision Lightpath LLC and its subsidiaries), its fiber enterprise business, to Morgan Stanley Infrastructure Partners (MSIP) for an enterprise value of $3.2 billion. Altice retains a 50.01% interest in Lightpath Group, maintains control of the company, and fully consolidates its financial results. CYTODYN INC: Inks $28.5 Million Financing Deal With Uptown Capital ------------------------------------------------------------------ CytoDyn Inc. entered into a securities purchase agreement pursuant to which the Company issued a secured convertible promissory note with a two-year maturity to an accredited investor, Uptown Capital, LLC, a Utah limited liability company, in the initial principal amount of $28.5 million. Uptown Capital gave consideration of $25.0 million for the Note, reflecting original issue discount of $3.4 million and issuance costs of $0.1 million. The Company anticipates using the proceeds from the Note for general working capital purposes. The Investor is an affiliate of Iliad Research and Trading, L.P. and Streeterville Capital LLC, each of which has provided similar financing to the Company. In connection with the investment in the Note, the Company entered into a Security Agreement, pursuant to which all obligations owing to the Investor by the Company are secured by a security interest in all the assets of the Company, excluding the Company's intellectual property. Interest accrues on the outstanding balance of the Note at 10% per annum. Upon the occurrence of an Event of Default, interest accrues at the lesser of 22% per annum or the maximum rate permitted by applicable law. In addition, upon any Event of Default, the Investor may accelerate the outstanding balance payable under the Note, which will increase automatically upon such acceleration by 15%, 10% or 5%, depending on the nature of the Event of Default. The Investor may convert all or any part the outstanding balance of the Note into shares of Common Stock at an initial conversion price of $10.00 per share upon five trading days' notice, subject to certain adjustments and ownership limitations specified in the Note. In addition to standard anti-dilution adjustments, the conversion price of the Note is subject to full-ratchet anti-dilution protection, pursuant to which the conversion price will be automatically reduced to equal the effective price per share in any new offering by the Company of equity securities that have registration rights, are registered or become registered under the Securities Act of 1933, as amended. The Note provides for liquidated damages upon failure to deliver Common Stock within specified timeframes. The Investor may redeem any portion of the Note, at any time after six months from the issue date upon three trading days' notice, subject to a maximum monthly redemption amount of $7,000,000. The Note requires the Company to satisfy its redemption obligations in cash within three trading days of the Company's receipt of such notice. The Company may prepay the outstanding balance of the Note, in part or in full, at a 15% premium to par value, at any time upon fifteen trading days' notice. Pursuant to the terms of the Agreement and the Note, the Company must obtain the Investor's consent before assuming additional debt with aggregate net proceeds to the Company of less than $75 million, or before issuing any security which converts into the Company's common stock at a conversion or exchange rate that adjusts with the market price of the common stock. Upon any such approval, the outstanding principal balance of the Notes shall increase automatically by 5% upon the issuance of such additional debt or security. The Company agreed to use commercially reasonable efforts to file a Registration Statement on Form S-3 with the SEC within 60 days (or up to 120 days, if the Company meets the conditions for deferral set forth in the Agreement) registering a number of shares of Common Stock sufficient to convert the entire principal balance of the Note. About CytoDyn Inc. Headquartered in Vancouver, Washington, CytoDyn Inc. -- http://www.cytodyn.com-- is a late-stage biotechnology company focused on the clinical development and potential commercialization of leronlimab (PRO 140), a CCR5 antagonist to treat HIV infection, with the potential for multiple therapeutic indications. CytoDyn reported a net loss of $124.40 million for the year ended May 31, 2020, compared to a net loss of $56.19 million for the year ended May 31, 2019. As of Nov. 30, 2020, the Company had $143.76 million in total assets, $150.29 million in total liabilities, and a total stockholders' deficit of $6.53 million. Warren Averett, LLC, in Birmingham, Alabama, the Company's auditor since 2007, issued a "going concern" qualification in its report dated Aug. 14, 2020, citing that the Company incurred a net loss for the year ended May 31, 2020 and has an accumulated deficit of approximately $354,711,000 through May 31, 2020, which raises substantial doubt about its ability to continue as a going concern. DANA INC: Fitch Rates Proposed $400MM Unsec. Green Bonds 'BB+' -------------------------------------------------------------- Fitch Ratings has assigned a rating of 'BB+'/'RR4' to Dana Incorporated's proposed issuance of $400 million in senior unsecured green bonds due 2030. DAN's Long-Term Issuer Default Rating (IDR) is 'BB+', and the Rating Outlook is Stable. Dana was placed on Under Criteria Observation (UCO) on April 9, 2021, following the conversion of Fitch's "Exposure Draft: Corporates Recovery Ratings and Instrument Ratings Criteria" to final. The UCO assignment indicates that an existing instrument and/or Recovery Rating (RR) may change as a direct result of the final criteria. However, the 'BB+'/'RR4' rating assigned to the proposed green bond is not affected by the criteria change. KEY RATING DRIVERS Ratings and Outlook: Dana's ratings and Stable Outlook reflect improving global end-market conditions as the effects of the coronavirus pandemic wane, and steps the company has taken to reduce debt, increase margins and grow FCF. Although some lingering effects of the pandemic could affect's business in the near term, Fitch believes Dana will be relatively less affected than some other suppliers due to stronger growth expected in its particular end markets. Fitch also expects Dana to be relatively less affected by the global microchip shortage due to the company's focus on the commercial vehicle, off-highway and full-frame light truck end-markets. Green Bonds: Dana intends to allocate an amount equal to the proceeds from the bond offering to finance or refinance eligible green projects, as outlined in the bonds' prospectus supplement. Examples of green projects include investments in vehicle electrification technologies, investments in renewable energy projects at Dana's facilities, and investments to reduce water use and treat wastewater. Dana has committed to publishing an annual report detailing progress on its green investments as long as the notes are outstanding. It has also retained an outside firm that will confirm the bonds are aligned with International Capital Market Association 2018 Green Bond Principles and Loan Market Association 2021 Green Loan Principles. Focus on Debt Reduction: Debt reduction has been a key focus for Dana over the past several years as the company looks to achieve a credit profile consistent with investment-grade ratings. The company has a net leverage (net debt/adjusted EBITDA, according to its calculation methodology) target of about 1.0x, which it hopes to achieve within the next several years. Positive FCF: Fitch expects Dana's FCF to increase in 2021, even with the reinstatement of common dividends starting in 1Q21 and higher planned capex. Dana's post-dividend FCF margin (as calculated by Fitch) declined to 0.4% in 2020 after running in the 1.5%-1.8% range for several years. Fitch expects Dana's post-dividend FCF margin to increase to around 2.0% in 2021 and potentially rise toward 2.5% in 2022 as EBITDA rises and cash interest expense declines. Fitch expects capex as a percentage of revenue to run in the 4.0%-4.5% range over the next several years, with capex at the higher end of that range in 2021. Declining Leverage: As a result of improving end-market conditions and lower expected debt, Fitch now expects Dana's gross EBITDA leverage (gross debt/EBITDA, as calculated by Fitch) to decline toward the mid-2x range by YE 2021 after peaking at 4.2x at YE 2020. Consistent with the company's stated target of reducing net leverage to about 1.0x, Fitch expects the company will target excess cash toward debt reduction. Fitch expects FFO leverage to decline toward 3.0x at YE 2021 and potentially to below 2.5x by YE 2022 after rising to 5.6x at YE 2020. Improving Coverage Metrics: Fitch expects Dana's FFO interest coverage to rise toward the mid-6x range by YE 2021 after falling to 3.4x at YE 2020. Fitch expects FFO interest coverage could rise further, to above 8.0x by YE 2022, on a combination of higher FFO and declining interest expense as the company looks for opportunities to reduce debt. DERIVATION SUMMARY Dana has a relatively strong competitive position focusing primarily on driveline systems for light, commercial and off-road vehicles. It also manufactures sealing and thermal products for vehicle powertrains and drivetrains. Dana's driveline business competes directly with the driveline businesses of American Axle & Manufacturing Holdings, Inc. and Meritor, Inc. (BB-/Stable), although American Axle focuses on light vehicles, while Meritor focuses on commercial and off-road vehicles. From a revenue perspective, Dana is similar in size to American Axle, although American Axle's driveline business is a little larger than Dana's light vehicle driveline business. Compared with Meritor, Dana has roughly twice the annual revenue overall, and Dana 's commercial and off-highway vehicle driveline segments are a little larger overall than Meritor's commercial truck and industrial segment. Dana's EBITDA margins are typically in line with auto suppliers in the low 'BBB' range. However, EBITDA leverage is more consistent with auto and capital goods suppliers in the 'BB' range, such as Allison Transmission Holdings, Inc. (BB/Stable), Meritor or The Goodyear Tire & Rubber Company (BB-/Negative). KEY ASSUMPTIONS Fitch's key assumptions within the Agency's rating case for the issuer include: -- Global light vehicle production rises by 6% in 2021, including an 8% increase in the U.S., with further recovery seen in subsequent years; -- Global commercial vehicle and off-highway markets also recover in the mid to high single-digit range in 2021 overall, with a somewhat mixed outlook that varies by region and end market, with further recovery also seen in subsequent years; -- Capex runs at about 4.0%-4.5% of revenue over the next several years, relatively consistent with historical levels; -- Post-dividend FCF margins generally run in the 2.0%-3.5% range over the next several years, despite reinstatement of the common dividend; -- The company applies excess cash toward debt reduction over the next few years; -- The company maintains a solid liquidity position, including cash and credit facility availability, over the next several years. RATING SENSITIVITIES Factors that could, individually or collectively, lead to positive rating action/upgrade: -- Sustained gross EBITDA leverage below 2.0x; -- Sustained post-dividend FCF margin above 2.0%; -- Sustained FFO leverage below 2.5x; -- Sustained FFO interest coverage above 5.5x. Factors that could, individually or collectively, lead to negative rating action/downgrade: -- A severe decline in global vehicle production that leads to reduced demand for Dana's products; -- A debt-funded acquisition that leads to weaker credit metrics for a prolonged period; -- Sustained gross EBITDA leverage above 2.5x; -- Sustained FCF margin below 1.0%; -- Sustained EBITDA margin below 10%; -- Sustained FFO leverage above 3.5x; -- Sustained FFO interest coverage below 3.0x. 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 Strong Liquidity: As of March 31, 2021, Dana had $509 million of cash, cash equivalents and marketable securities. In addition to its cash on hand, Dana maintains additional liquidity through a $1.15 billion secured revolver guaranteed by the company's wholly owned U.S. subsidiaries and secured by substantially all of the assets of Dana and its guarantor subsidiaries. The revolver expires in 2026. As of March 31, 2021, there were no borrowings on the revolver, but $21 million of the available capacity was used to back LOCs, leaving about $1.13 billion in available capacity. Based on the seasonality in Dana's business, as of March 31, 2021, Fitch treated $100 million of Dana's cash and cash equivalents as not readily available for the purpose of calculating net metrics. This is an amount Fitch estimates Dana would need to hold to cover seasonal changes in operating cash flow, maintenance capex and common dividends without resorting to temporary borrowing. Debt Structure: Dana's debt structure primarily consists of borrowings on its secured credit facility, which includes the term Loan B and revolver, and senior unsecured notes issued by both Dana and its Dana Financing subsidiary. 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. DANA INC: Moody's Rates New $400MM Sr. Unsecured Notes 'B2' ----------------------------------------------------------- Moody's Investors Service assigned a B2 rating to Dana Incorporated's new $400 million senior unsecured notes. All other ratings are unaffected including the Ba3 corporate family rating and Baa3 senior secured rating. The rating outlook is negative. Dana has labeled the bonds as green bonds given its intention to use the proceeds for recently completed or future eligible green projects such as clean transportation, renewable energy, sustainable water and wastewater management or green buildings. The proceeds from the proposed notes will be used to help repay the 2024 senior unsecured notes. RATINGS RATIONALE Dana's ratings reflect a strong competitive position as a key, global supplier of drive-line products and thermal sealants for light vehicle and off-road vehicles. The product mix is weighted towards light trucks and SUVs in North America, a segment that continues to grow as a percentage of overall vehicle production levels. Moody's adjusted debt-to-EBITDA is currently in the mid-5x range but expected to fall steadily to below 4x by year-end 2021. Prior to 2020, the EBITDA margin was consistently in the low-double digit range and should approach that level again in 2021 with Moody's expectation for continued end market stability leading to improved earnings and cash flow. The negative outlook reflects a more measured rebound in results that should accelerate in the latter half of 2021, positioning Dana for a sharper uptick in results for 2022 and beyond. The SGL-1 Speculative Grade Liquidity Rating indicates very good liquidity with Moody's expectation for Dana to maintain a solid cash position and ample availability under the upsized $1.15 billion revolving credit facility set to expire 2026. At March 31, 2020, Dana had cash and marketable securities of approximately $510 million and near full availability under the revolving credit facility. Moody's anticipates free cash flow generation to rebound in 2021 even with higher working capital and capital expenditures needed for growth. Moody's took the following rating action on Dana Incorporated: Senior Unsecured Regular Bond/Debenture, assigned at B2 (LGD5) The following rating for Dana Incorporated was unaffected, but an LGD adjustment has been made: Existing Senior Secured Bank Credit Facility, at Baa3 to (LGD1) from (LGD2) FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS The ratings could be upgraded with expectations of sustained revenue growth leading to EBITA-to-interest over 3.5x, debt-to-EBITDA of 3x or below and consistent and significant free cash flow, while maintaining a very good liquidity profile. Other factors supporting an upgrade would be continued cost structure improvements to better position the company to manage through cyclicality and continued discipline in return of capital to shareholders. Ratings could be downgraded if Moody's believes that through the second-half of 2021 Dana's EBITA-to-interest coverage is expected in the 2x range or debt-to-EBITDA is sustained at or above 4x. Other developments that could lead to downward rating pressure include deteriorating liquidity and aggressive debt-funded acquisitions or shareholder returns that result in leverage remaining elevated. Dana's role in the automotive and commercial vehicle industries exposes it to material environmental risks arising from increasing regulations on carbon emissions. Automotive manufacturers and commercial fleet operators (particularly in the off-highway markets) continue to introduce electrified products to meet increasingly stringent regulatory requirements. Dana has strategically and aggressively acquired electrification technology and electrified product offerings to complement its own branded product offerings. The principal methodology used in this rating was Automotive Supplier Methodology published in January 2020. Dana Incorporated is a global manufacturer of drive systems (axles, driveshafts, transmissions), sealing solutions (gaskets, seals, cam covers, oil pan modules) and thermal-management technologies (transmission and engine oil cooling, battery and electronics cooling) serving OEMs in the light vehicle, commercial vehicle and off-highway markets. Revenues for the latest twelve months ended March 31, 2021 were approximately $7.4 billion. DELRAY BEACH: Gets Interim OK to Hire Roshawn Banks as Counsel -------------------------------------------------------------- Delray Beach National Church of God Inc. received interim approval from the U.S. Bankruptcy Court for the Southern District of Florida to employ Roshawn Banks, Esq., an attorney at The All Law Center, PA, to handle its Chapter 11 case. Mr. Banks will render these legal services: (a) advise the Debtor regarding its powers and duties in the continued management of its business operations; (b) advise the Debtor regarding its responsibilities in complying with the U.S. trustee's operating guidelines and reporting requirements and with the rules of the court; (c) prepare legal papers; (d) protect the Debtor's interest in all matters pending before the court; and (e) represent the Debtor in negotiation with its creditors in the preparation of a Chapter 11 plan. The Debtor paid the sum of $6,000 for the pre-bankruptcy services provided by the attorney. Mr. Banks disclosed in a court filing that the firm is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. The attorney can be reached at: Roshawn Banks, Esq. The All Law Center, PA Bond Law Office P.O. Box 25978 Fort Lauderdale, FL 33320 Telephone: (954) 747-1843 Email: RBanks@thealllawcenter.com About Delray Beach National Church of God Delray Beach National Church of God, Inc. filed a voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Fla. Case No. 21-13777) on April 20, 2021, listing under $1 million in both assets and liabilities. Pastor Evaughan Lane signed the petition. Judge Erik P. Kimball oversees the case. Roshawn Banks, Esq., at The All Law Center, PA, serves as the Debtor's legal counsel. DEWIT DAIRY: Unsecured Creditors to Recover 64% to 82% in Plan -------------------------------------------------------------- Dewit Dairy filed a First Amended Disclosure Statement explaining its Plan. Pursuant to the Plan, classes entitled to priority will be paid in full. The Debtor anticipates paying 100% of secured creditors' allowed claims, and between 64% and 82% of all non-insider unsecured creditors' allowed claims, depending on the potential resolution of claim objections and negotiations with creditors. Class 1 Claims shall be paid in accordance with court order (for administrative claims). For other classes, the Debtor anticipates paying these classes from the sale of its assets. Upon the Effective Date all assets of the Bankruptcy Estate shall vest in the Reorganized Debtor for liquidation and payment to creditors as outlined. It is not anticipated that the Reorganized Debtor will retain any assets or continue any operations after the liquidation of assets and payments to creditors. The assets to be sold or otherwise liquidated by the Debtor include the (a) real property located in Wendell, Idaho; (b) personal property (dairy equipment) located at the Wendell facility; (c) personal property (irrigation equipment) located at the Wendell facility; (d) personal property (other equipment) located at the Wendell facility; (e) milk basis and equity interests in Magic Valley Quality Milk Producers coop. The Debtor continues to liquidate the equipment in its possession. The Debtor currently holds approximately $4,051,151 from the sale of the real property (and associated personal property), $54,000 from prior lease payments that are now unencumbered, and anticipates at least an additional $100,000 from the sale of remaining equipment, for a total available for distribution of $4,205,151. Holders of General Unsecured Claims in Class 6 shall receive a pro rata distribution of all proceeds from the sale of real or personal property that are not paid to secured creditors. Payments to this Class shall be deferred until all payments have been made to the secured creditors. The Debtor anticipates that payments to this Class will be made approximately 60-90 days after confirmation, depending on the final liquidation of personal property. Class 8 (Debtor's equity security holders) shall retain their equity security interest in the Reorganized Debtor on the same percentage interests as currently held. A copy of the Disclosure Statement is available for free at https://bit.ly/3gYgYho from PacerMonitor.com. About Dewit Dairy Dewit Dairy operates a dairy farm in Wendell, Idaho. Dewit Dairy sought protection for relief under Chapter 11 of the Bankruptcy Code (Bankr. D. Idaho Case No. 20-40734) on Sept. 18, 2020. At the time of filing, the Debtor was estimated to have $10,000,001 to $50,000,000 in assets and $1,000,001 to $10,000,000 million in liabilities. Matthew Todd Christensen, Esq., at Angstman Johnson, PLLC, serves as the Debtor's legal counsel. DONALD ANTHONY DELLA: Ramseys Buying Cresson Property for $49K -------------------------------------------------------------- Donald Anthony Della asks the U.S. Bankruptcy Court for the Western District of Pennsylvania to authorize the sale of the real property and improvements thereon located in the Borough of Cresson, County of Cambria, Commonwealth of Pennsylvania, identified by Cambria County Tax Map Number 15-014. -111.000, commonly known as 412 2nd Street, Cresson, Pennsylvania, to John and Kathy Ramsey for $49,000, subject to higher and better offers. A hearing on the Motion is set for May 18, 2021, at 10:00 a.m. Respondent Cambria County is a government entity with notice to Thomas C. Chernisky, President Commissioner, Cambria County Courthouse, 200 South Center Street, Ebensburg, PA 15931, with additional notice to counsel, William G. Barbin, Esquire, Gleason Barbin & Markovitz, LLP, 206 Main St., Johnstown, PA 15901-1509. Respondent Cambria County Tax Claim Bureau ("TCB") is a government agency with a mailing address in care of JoAnne Ranck, Executive Director, 200 South Center Street, Ebensburg, PA 15931, with notice to counsel, Thomas A. Swope, III, Esquire, Neugebauer & Swope, PC, P.O. Box 270, Ebensburg, PA 15931-0270. Respondent Cresson Borough is a government entity with a mailing address of 631 Second Street, Cresson, PA 16630. Respondent Genetco, Inc. is a corporate entity with a mailing address of 711 Union Parkway, Rononkoma, NY 11779, with notice to counsel, Benjamin J. Lewis, Esquire, Amato and Keating, P.C., 107 North Commerce Way, Bethlehem, PA 18017. A review of the Pennsylvania Department of State website indicates that Genetco, Inc. has not registered with the Commonwealth. Respondent Penn Cambria School District is a government entity with a mailing address in care of William Marshall, Superintendent, 201 6th Street, Cresson, PA 16630. The Debtor's assets include, inter alia, the Premises. The Premises consists of a single-family home. The Debtor's investigation into this matter reveals that the following parties have a lien against the Premises: (i) Cambria County Tax Claim Bureau Statutory delinquent real estate tax lien – 2020 school district taxes ($794.84 per POC 8); (ii) Cresson Borough - Current year real estate taxes; and (iii) Genetco, Inc. - Judgment lien filed at 2020-3632. Per Proof of Claim Number 2, the lien of Genetco, Inc. has an approximate balance of $20,000. The Premises is property of the estate. The Debtor advises that this parcel of real estate, along with various other parcels owned by the Debtor, have been listed for sale for some period of time. The Debtor has received an offer to purchase the Premises from the Buyers, 1905 Shel Mar Drive, Ijamsville, MD 21754 for a total price of $49,000. Said offer was brought to the Debtor by his Court approved realtor, Lisa Hess of Lang Real Estate. Ms. Hess was the Debtor's realtor prior to the filing of the instant case and, by Order of Court dated April 21, 2021, acts as the Estate's realtor. The realtor advises that the Premises has been marketed for sale for a substantial period of time. In accord with the Listing Agreement and the Order of Court dated April 21, 2021, the realtor is entitled to a commission on the sale equivalent to 5% of the purchase price or the sum of $3,500 whichever is greater. Based on the offer being presented today, the realtor would be entitled to a commission of $3,500. In the event higher and better offers are received at the time of the hearing on the instant motion, the realtor's commission will be based solely on the offer presented and not on any higher amount. The sale of the Premises will be a sale of the Premises in "as is, where is" condition, without representations or warranties of any kind whatsoever. While the market is the best indicator of the value of the Premises, in his petition and schedules, the Debtor opined that the value of the Premises was approximately $50,000. As indicated on the Agreement of Sale, the purchase contains a mortgage contingency while waiving various inspection contingencies. The Debtor believes and therefore avers that the best interests of the estate and its creditors will be served by the Court, pursuant to 11 U.S.C. Sections 363(b) and (f), authorizing the sale of the Premises, free and clear of all third-party interests, liens, claims, charges and/or encumbrances against the same, specifically including but not limited to those of all parties named as Respondents, if any. To assure that the sale is a sale for the market value of the Premises, higher and better offers for said Premises will be accepted at the time of the hearing on the sale of said Premises. The successful buyer will be required to deposit a nonrefundable deposit in the amount of 10% of the purchase price at the time of the approval of the sale by the Court, with the balance to be paid at closing, which will occur on or before 30 days from the date the Order of Sale becomes final, time being of the essence, with all such payments to be paid to the counsel for the Debtor or to the closing agent. Possession will be delivered at closing, which will occur within said time frame at a mutually agreeable time at the offices of Spence, Custer, Saylor, Wolfe and Rose, LLC, 1067 Menoher Boulevard, Johnstown, PA 15905, or such other location as may be agreed upon by the parties. Title will be conveyed by DIP's Special Warranty Deed. The Debtor is specifically authorized to convey the Premises and execute any and all documents necessary to effectuate the transfer of the Premises including but not limited to settlement statements and/or Closing Disclosures. He has not promised, nor has it been promised, any consideration for the sale proposed, except as set forth. In the event of the failure of the purchaser to close within the required time frame, (or such extensions, not to exceed 30 days as the Debtor, in its sole and exclusive discretion, may accord to the purchaser), for other than the inability/refusal of the Debtor to close, the Debtor may, at its option, declare a default, retain the deposit for the benefit of the estate, and re-sell the Premises, in which case the purchaser will be liable for any deficiency, unless said failure or refusal to close is the result of the failure of the Debtor/Estate to have complied with the terms of the Motion and related Order. The proceeds of the sale of the Premises will be used as follows, to wit: a. The following lien(s)/claim(s): Genetco, Inc.; b. Delinquent real estate taxes, if any; c. Current real estate taxes, pro-rated to the date of closing; d. The costs of sale, specifically including but not limited to payment for any Court filing fees, advertising, printing, mailing and notice fees; Debtor/the Estate's counsel fees incurred in filing and drafting the sale motion, representing the estate at the hearing and obtaining an order authorizing the sale, deed preparation fees and closing on the same and other such closing costs as may be properly incurred to effect said closing; e. The Court approved realtor commission in amount of $3,500; and f. The "net" proceeds from the closing as identified on the Settlement Statement and/or Closing Disclosure to counsel for the Debtor, Spence, Custer, Saylor, Wolfe & Rose, LLC, to be held in escrow pending further Order of Court. A copy of the Agreement is available at https://tinyurl.com/un24hn69 from PacerMonitor.com free of charge. Donald Anthony Della sought Chapter 11 protection (Bankr. W.D. Pa. Case No. 21-70103) on March 15, 2021. The Debtor tapped Kevin J. Petak, Esq., at Spence, Custer, Saylor, Wolfe & Rose, LLC as counsel. DOUBLE D GROUP: To Seek Plan Confirmation on June 15 ---------------------------------------------------- Judge Natalie M. Cox approved on a conditional basis the Disclosure Statement explaining the Plan of The Double D Group, LLC, as containing adequate information pursuant to Local Rule 3017. Judge Cox established these dates and deadlines: * June 1, 2021 at 5 p.m. (Pacific Time) as the Voting Deadline, * June 15, 2021 at 9:30 a.m. (Pacific Time) as the confirmation hearing, * June 1, 2021 is the date by which any response or objection to the final approval of the Disclosure Statement and confirmation of the Plan must be served on the Debtor, * June 7, 2021 as the date by which any reply to an objection must be filed. A copy of the order is available for free at https://bit.ly/3tc2zAJ from PacerMonitor.com. About The Double D Group The Double D Group, LLC, sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Nev. Case No. 21-10343) on Jan. 26, 2021. Jose Pihardo, the managing member, 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. Judge Natalie M. Cox oversees the case. Fennemore Craig, P.C., is the Debtor's legal counsel. EARTHWORKS & SALES: Wins Cash Collateral Access ----------------------------------------------- The U.S. Bankruptcy Court for the Western District of Pennsylvania has authorized Earthworx & Sales, LLC to use cash collateral in which Commercial Credit Group, Inc. asserts an interest. The Debtor requires the use of cash collateral to preserve its assets and fund its business operations. The Debtor is permitted to use cash collateral on an interim basis subject to the terms and conditions of the Interim Order. The Debtor may use cash collateral during the Interim Cash Collateral period to make payment of ordinary and necessary operating expenses and other administrative expenses in accordance with the terms of Cash Collateral Motion. CCG is granted these adequate protection for the Debtor's use of cash collateral: a. Commencing on May 15, 2021, and continuing each successive month or before the fifteenth of the month thereafter, the Debtor offers to pay CCG $4,200 as an adequate protection payment for the Debtor's use of the equipment collateral. All adequate protection payments will be sent to: CCG, 400 Essjay Road, Ste. 340, Williamsville, NY 14221. b. Subject to a final order authorizing cash collateral, CCG is provided with a replacement lien on all property acquired after commencement of the case. c. The Debtor and CCG are authorized to continue work out a consensual and permanent cash collateral agreement and order. d. CCG is granted a replacement lien on the Debtor's Post-petition lien on the Debtor's assets to the extent of the pre-petition lien it held on the Debtor's assets on the Petition Date. e. The Debtor will at all times maintain such insurance on the Equipment Collateral as is required under the Security Agreement with one or more insurance companies and shall name CCG as sole loss payee on such insurance policies. The Debtor will provide CCG with written evidence of adequate insurance immediately upon entry of the Agreed Order, and upon request thereafter. f. As of the Petition Date, the Debtor owed to fully secured creditor, CCG the amount of $217,359.26 plus continuing interest, attorneys' fees, and other charges. The Indebtedness is owed absolutely and unconditionally from Debtor to CCG, without defense, offset or counterclaim. The Indebtedness is fully secured within the meaning of 11 U.S.C. section 506(b). g. Except as expressly modified, the terms and conditions of the Notes and all related loan and security documents will remain in full force and effect and are incorporated by reference in the order. h. If the Debtor fails to timely make any adequate protection payment to CCG as required by the Order, CCG will give the Debtor and its counsel written notice of such default and the Debtor will then have 10 days from the date of the written notice to cure the default. Any such notice will be given to the Debtor by overnight or first-class mail at 250 Shadow Oaks Lane, Waynesburg, PA 15370 and will be effective on the date of its deposit with the U.S. Postal Service or overnight mail service. The foregoing written notice to the Debtor's counsel will be made at dcalaiaro@cvlaw.com and apratt@c-vlaw.com. In the event of a second default, CCG will give the Debtor, and its counsel, written notice of such default and the Debtor will then have five business days from the date of the written notice to cure the default. In the event the Debtor fails to timely cure its default, or if the Debtor defaults for a third time under the Order, any automatic stay in effect under the Bankruptcy Code will be deemed immediately modified and lifted to allow CCG relief from the automatic stay to exercise its state law and contractual rights in the Equipment Collateral without further notice or hearing. i. If the automatic stay lifts as it related to the Equipment Collateral, or if the case is dismissed for any reason, the Debtor will immediately surrender possession of the Retained Collateral to CCG and otherwise reasonably cooperate with CCG in its efforts to recover possession thereof. A final hearing on the matter is scheduled for May 27, 2021 at 11 a.m. via Zoom video conference. A copy of the order is available for free at https://bit.ly/3h584yu from PacerMonitor.com. About Earthworx & Sales, LLC Earthworx & Sales, LLC sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. W.D. Penn. Case No 21-20534 ) on March 11, 2021. In the petition signed by Paul Howard, managing member, the Debtor disclosed up to $1 million in assets and up to $500,000 in liabilities. Judge Gregory L. Taddonio oversees the case. CALAIARO VALENCIK is the Debtor's counsel. Commercial Credit Group, Inc., as lender, is represented by: Michael F.J. Romano, Esq. ROMANO, GARUBO & ARGENTIERI COUNSELORS AT LAW, LLC P.O. Box 456, 52 Newton Avenue Woodbury, NJ 08096 Tel: (856) 384-1515 E-mail: mromano@rgalegal.com EKSO BIONICS: Posts $3.7-Mil. Net Loss for Quarter Ended March 31 ----------------------------------------------------------------- Ekso Bionics Holdings, Inc. filed with the Securities and Exchange Commission its Quarterly Report on Form 10-Q disclosing a net loss of $3.67 million on $1.91 million of revenue for the three months ended March 31, 2021, compared to a net loss of $2.53 million on $1.47 million of revenue for the three months ended March 31, 2020. As of March 31, 2021, the Company had $56.50 million in total assets, $15.53 million in total liabilities, and $40.97 million in total stockholders' equity. "Our commercial strategy is gaining traction in our target markets as we are seeing a positive customer response for our subscription model and continued momentum with our network strategy," said Jack Peurach, president and chief executive officer of Ekso Bionics. "By reducing the sales cycle and customer capital barriers, our subscription model is helping our team facilitate an increased number of multi-unit orders with top network operators globally, and we are seeing this success translate to our industrial segment. Supported by our solid financial position, we remain focused on expanding customer awareness and engagement of our innovative solutions while maximizing our selling opportunities in both the medical and industrial segments." Gross profit for the quarter ended March 31, 2021 was $1.2 million, compared to $0.6 million in the same period in 2020, representing a record gross margin of approximately 65% in the first quarter of 2021, compared to a gross margin for the same period in 2020 of 43%. The overall increase in gross margin is primarily due to higher average selling prices on the Company's EksoNR devices, an increased proportion of EksoHealth sales, lower production costs of EVO compared to the previous generation vest, and higher service margins. Sales and marketing expenses for the quarter ended March 31, 2021 were $1.8 million, a decrease of $0.7 million, or approximately 29%, compared to the same period in 2020. The decrease was primarily due to lower employee compensation, selling, general marketing and trade show expenses. Research and development expenses for the quarter ended March 31, 2021 were $0.6 million, compared to $0.7 million for the same period in 2020, a decrease of $0.1 million. The decrease was primarily due to lower employee compensation and product development activity expenses. General and administrative expenses for the quarter ended March 31, 2021 were $2.0 million, compared to $2.2 million for the same period in 2020, a decrease of $0.2 million, or approximately 10%. The decrease was primarily due to lower employee compensation and outside legal expenses. Gain on warrant liabilities for the quarter ended March 31, 2021 associated with the revaluation of warrants issued in 2019, 2020 and 2021 was de minimis, compared to a $2.5 million gain associated with the revaluation of warrants issued in 2015, 2019 and 2020 for the same period in 2020. Cash on hand at March 31, 2021 was $49.5 million, compared to $12.9 million at Dec. 31, 2020. For the quarter ended March 31, 2021, the Company used $2.0 million of cash in operations, compared to $1.7 million for the same period in 2020. A full-text copy of the Form 10-Q is available for free at: https://www.sec.gov/Archives/edgar/data/1549084/000154908421000025/0001549084-21-000025-index.htm About Ekso Bionics Ekso Bionics -- http://www.eksobionics.com-- is a developer of exoskeleton solutions that amplify human potential by supporting or enhancing strength, endurance and mobility across medical and industrial applications. Founded in 2005, the Company continues to build upon its expertise to design some of the most cutting-edge, innovative wearable robots available on the market. The Company is headquartered in the Bay Area and is listed on the Nasdaq CapitalMarket under the symbol EKSO. Ekso Bionics reported a net loss of $15.83 million for the year ended Dec. 31, 2020, compared to a net loss of $12.13 million for the year ended Dec. 31, 2019. As of Dec. 31, 2020, the Company had $20.60 million in total assets, $16.16 million in total liabilities, and $4.43 million in total stockholders' equity. ELDERHOME LAND: Seeks to Hire Gordon & Simmons as Legal Counsel --------------------------------------------------------------- ElderHome Land, LLC and Burtonsville Crossing, LLC seek approval from the U.S. Bankruptcy Court for the District of Maryland to employ Gordon & Simmons, LLC as special counsel. The Debtors need the firm's legal assistance to prosecute claims against Millenium Investment Group, LLC, a major creditor, which asserts a lien against their real properties. Gordon & Simmons will be paid at these rates: Attorneys $225 to $325 per hour Paralegals $45 to $110 per hour The firm will also be reimbursed for out-of-pocket expenses incurred. As disclosed in court filings, Gordon & Simmons is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code. The firm can be reached at: Gordon & Simmons, LLC 1050 Key Pkwy, Suite 101 Frederick, MD 21702 Tel: (301) 662-9122 ElderHome Land and Burtonsville Crossing Burtonsville Crossing, LLC and ElderHome Land, LLC sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Md. Lead Case No. 21-10492) on Jan. 25, 2021. At the time of the filing, the Debtors had between $1 million and $10 million in both assets and liabilities. Judge Maria Ellena Chavez-Ruark oversees the cases. McNamee, Hosea, Jernigan, Kim, Greenan & Lynch, PA and Gordon & Simmons, LLC serve as the Debtors' bankruptcy counsel and special counsel, respectively. ELECTRONIC DATA: Wins Cash Collateral Access Thru May 21 -------------------------------------------------------- The U.S. Bankruptcy Court for the Middle District of North Carolina, Greensboro Division, has authorized Electronic Data Magnetics, Inc. to use cash collateral on an interim basis through May 21, 2021. The Debtor requires the immediate use of Cash Collateral to complete existing orders and work-in-process and to enhance the prospects for a successful reorganization. Truist Bank has made one or more prepetition loans and has made financial accommodations to the Debtor on which Truist contends the Debtor is obligated to Truist in an amount in excess of $3,500,000. As security for the Truist Debt -- excluding the Payroll Protection Program loan -- Truist asserts a valid and perfected security interest in and lien upon, among other things, all accounts, equipment, inventory, and general intangibles of the Debtor, and the proceeds thereof, all as further described and set forth in certain prepetition loan and security agreements described in the Cash Collateral Motion. The SBA has made a prepetition loan to the Debtor in the original principal amount of $150,000. As security for the SBA Debt, the SBA asserts a valid and perfected security interest in and lien upon, among other things, all accounts of the Debtor, and the proceeds thereof, all as further described and set forth in the prepetition loan and security documents. Pursuant to the SBA Debt, the Debtor is obligated to pay the SBA $731 per month, beginning May 28, 2021. Prior to, on, and after the Petition Date, the Debtor has received and collected, and continues to receive and collect cash proceeds from the Prepetition Collateral, which Truist and the SBA assert constitutes their cash collateral. As adequate protection, Truist and the SBA are granted a valid, attached, choate, enforceable, perfected and continuing security interest in and lien upon, all postpetition assets of the Debtor that is of the same character and type, and to the same extent, as the liens and encumbrances that their security interests imposed upon the Debtor's assets prepetition. The priority of said security interest in and liens upon the Postpetition Collateral will be the same priority as exists among Truist, the SBA, the Debtor, and all other creditors or claimants against the Debtor's bankruptcy estate, in and upon the Prepetition Collateral. As additional adequate protection for Truist's interest in Cash Collateral, the Debtor will pay to Truist monthly adequate protection payments in an amount equal it its non-default rate of interest with respect to the First Note and the Second Note as those terms are defined in the Cash Collateral Motion. The Debtor is not required to pay interest with respect to the Payment Protection Program loan by Truist to the Debtor. As additional adequate protection for the SBA's interest in Cash Collateral, the Debtor will keep the SBA Debt current. An interim hearing on the matter is scheduled for May 20 at 2 p.m. A copy of the order is available for free at https://bit.ly/33bOJUn from PacerMonitor.com. About Electronic Data Magnetics Electronic Data Magnetics manufactures and reproduces magnetic and optical media. The Company is a manufacturer of technically advanced printed products used in a variety of markets including, airlines, mass transit agencies, toll roads, parking institutions, betting slips, printing for US GPO, tabulating cards, and RFID tags. Electronic Data Magnetics sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. M.D.N.C. Case No. 21-10222) on April 22, 2021. In the petition signed by R. Richard Hallman, president and CEO, the Debtor disclosed up to $10 million in both assets and liabilities. Judge Lena M. James oversees the case. James C. Lanik, Esq. at WALDREP WALL BABCOCK & BAILEY PLLC is the Debtor's counsel. Truist Bank, as lender, is represented by BELL, DAVIS & PITT, P.A. ELECTROTEK CORPORATION: June 15 Disclosure Statement Hearing Set ---------------------------------------------------------------- Electrotek Corporation filed with the U.S. Bankruptcy Court for the Northern District of Texas a Disclosure Statement and a Plan. On April 29, 2021, the Court ordered that: * June 15, 2021, at 2:00 p.m. via WebEx Video Conference before the Honorable Michelle V. Larson, United States Bankruptcy Court is the hearing to consider the approval of the disclosure statement. * June 8, 2021, is fixed as the last day for filing and serving written objections to the disclosure statement. A full-text copy of the order dated April 29, 2021, is available at https://bit.ly/3aZBeeT from PacerMonitor.com at no charge. Attorneys for the Debtor: Joyce W. Lindauer Kerry S. Alleyne Guy H. Holman Joyce W. Lindauer Attorney, PLLC 1412 Main Street, Suite 500 Dallas, Texas 75202 Telephone: (972) 503-4033 Facsimile: (972) 503-4034 About Electrotek Corporation Electrotek Corporation, a privately held company that manufactures electrical equipment and component-based in Carrollton, Texas, filed a voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. N.D. Tex. Case No. 21-30409) on March 8, 2021. Mike Swerdlow, chief financial officer, signed the petition. In the petition, the Debtor had estimated assets of between $1 million and $10 million and estimated liabilities of between $10 million and $50 million. Judge Michelle V. Larson oversees the case. Joyce W. Lindauer Attorney, PLLC serves as the Debtor's counsel. ELITE PHARMACEUTICALS: Names Marc Bregman as CFO ------------------------------------------------ Elite Pharmaceuticals, Inc. has appointed Marc Bregman, CPA, as chief financial officer, effective May 17, 2021. Mr. Bregman will report to Elite's President and CEO, Nasrat Hakim. Mr. Bregman has more than 27 years of financial and operational experience, including positions as controller at Langan Engineering & Environmental Services and controller at Chemtrade Logistics. He held corporate financial positions at Chemetall and National Starch & Chemical Company and was a supervisor and senior auditor at Ernst & Young. Mr. Bregman brings experience in financial accounting, financial planning & analysis, governance & compliance, financial auditing, Sarbanes-Oxley Act (SOX) compliance, and cost accounting. "Marc is a great addition to Elite's senior leadership team. Marc's wealth of highly relevant experience and exemplary skills in financial and operational leadership will be an enormous benefit to help Elite in meeting our current and future goals as we grow our business," said Nasrat Hakim. "We welcome Marc to our team." Mr. Bregman has a Bachelor's degree in Accounting from William Paterson College and a Master of Science in Business degree from the Martin Tuchman School of Management at the New Jersey Institute of Technology. He is a Certified Public Accountant (CPA). Pursuant to the terms of the Employment Letter, commencing on May 17, 2021, Mr. Bregman became an at-will employee of the Registrant as its chief financial officer. Mr. Bregman will fulfill his responsibilities as chief financial officer, and he will receive an annual base salary of $187,000, payable in accordance with the Company's payroll practices. Pursuant to the Employment Letter, Mr. Bregman agrees to not knowingly undertake or engage in any employment, occupation, or business enterprise that is, directly or indirectly, adverse to the interest of the Registrant. Upon approval by the Board of Directors of Elite, Mr. Bregman will be granted stock options to purchase 300,000 ELTP Shares. The options will vest over a three-year period, commencing one year from the date of issuance. The strike price will be equal to the closing price of the Company's stock as traded on the OTC Bulletin Board (symbol ELTP) on the first day of employment. About Elite Pharmaceuticals Elite Pharmaceuticals, Inc. -- http://www.elitepharma.com-- is a specialty pharmaceutical company which is developing a pipeline of niche generic products. Elite specializes in oral sustained and controlled release drug products which have high barriers to entry. Elite owns multiple generic products which have been licensed to Lannett Company, Glenmark Pharmaceuticals, Inc. and TAGI Pharma. Elite operates a cGMP and DEA registered facility for research, development, and manufacturing located in Northvale, NJ. Elite reported a net loss attributable to common shareholders of $2.24 million for the year ended March 31, 2020, to a net loss attributable to common shareholders of $9.28 million for the year ended March 31, 2019, and a net loss attributable to common shareholders of $3.67 million for the year ended March 31, 2018. As of Dec. 31, 2020, the Company had $28.66 million in total assets, $12.03 million in total liabilities, and $16.63 million in total shareholders' equity. EMERGENT BIOSOLUTIONS: Moody's Alters Outlook on Ba2 CFR to Neg. ---------------------------------------------------------------- Moody's Investors Service affirmed the ratings of Emergent BioSolutions Inc. including the Ba2 Corporate Family Rating, the Ba2-PD Probability of Default Rating and the Ba3 senior unsecured rating. At the same time, Moody's revised the outlook to negative from stable. The Speculative Grade Liquidity Rating remains unchanged at SGL-1. The revision in the outlook to negative reflects increasing business risk related to compliance problems at Emergent's Bayview, Maryland facility that is involved in COVID-19 vaccine production. Although the company is taking swift corrective steps, timing of resolution is uncertain, and these problems may also jeopardize momentum in the company's contract development and manufacturing organization (CDMO) business. At the same time, Emergent faces greater scrutiny on other parts of its business including its ongoing role in supplying anthrax vaccines to the US Strategic National Stockpile. In addition, Moody's believes that weak share price performance raises event risk. Despite these challenges, the affirmation reflects Moody's expectations that problems at the Bayview facility are addressable. In addition, the affirmation reflects Emergent's low financial leverage. Emergent's gross debt/EBITDA was approximately 1.3x as of March 31, 2021, and liquidity is strong, with over $500 million of cash on hand. The rating affirmation also reflects certain social considerations that are positive to Emergent's credit profile. Emergent plays a niche role in addressing public health threats including pandemics and potential bioterrorism incidents. Moody's believes that Emergent's Bayview facility remains important in expanding COVID-19 vaccine production capacity to continue US vaccination efforts. The company's role in pandemic preparedness and its manufacturing capabilities led to contracts with the US government and various vaccine developers, bringing significant revenues to Emergent that enhanced its credit quality. COVID-19 vaccine-related revenues will continue in 2021, although at a lower and less certain pace than the company's original expectations. The timing and amount will also depend on resolution of the manufacturing challenges. Ratings affirmed: Corporate Family Rating, Ba2 Probability of Default Rating, Ba2-PD Senior unsecured notes, Ba3 (LGD5) Outlook actions: Revised to negative from stable RATINGS RATIONALE Emergent's Ba2 Corporate Family Rating reflects its niche position developing and manufacturing products that treat public health threats. Areas of focus include public health outbreaks such as COVID-19, vaccines for military and civilian use, travel health, and the US opioid epidemic. Moody's anticipates steady ongoing growth in Emergent's anthrax and smallpox vaccines supplied to the US Strategic National Stockpile, presuming no material changes to the government's ordering patterns. The CDMO business remains an important growth driver as Emergent aims to continue growth outside of its COVID-19 business, which is likely to ebb in 2022. As that occurs, Moody's anticipates that Emergent will sustain modest financial leverage, with debt/EBITDA in the range of 2.5x-3.5x using Moody's calculations. In addition to manufacturing compliance challenges, key credit risks include modest scale compared to global pharmaceutical companies, with somewhat limited diversity at the product and customer level. Contracting with the US government subjects Emergent to compliance with numerous laws and regulations, and cash flow volatility associated with ordering patterns. There is also risk that changes in the government's strategic priorities or budgetary constraints reduce demand for Emergent's products. The SGL-1 Speculative Grade Liquidity Rating reflects Moody's expectation that Emergent will maintain very good liquidity based on positive free cash flow, availability under the $600 million revolving credit agreement expiring in 2023, and ample cushion under financial maintenance covenants in the term loan and revolver. These include net debt/EBITDA of below 4.5x, and interest coverage (EBITDA less maintenance capex divided by interest cost and principal payments) of greater than 2.5x. The outlook is negative, reflecting higher business risks stemming from manufacturing compliance challenges. Until these issues are resolved, Emergent's credit profile will also be more sensitive to any unforeseen setbacks in other parts of the company's business. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS Factors that could lead to a downgrade include escalation of manufacturing compliance challenges, delays in anthrax or smallpox vaccine purchase orders from the US government, or material litigation. Quantitatively, debt/EBITDA sustained above 3.5x could also result in a downgrade although a downgrade is possible based solely on the qualitative factors listed above. Factors that could lead to an upgrade include successful resolution of manufacturing compliance challenges, increased scale and diversity, and good momentum in non-COVID business lines including other vaccines and other CDMO contracts. Quantitatively, debt/EBITDA sustained below 2.5x would support an upgrade. Headquartered in Gaithersburg, Maryland, Emergent BioSolutions Inc. is a life sciences company that provides pharmaceuticals, vaccines, medical devices and contract manufacturing services related to public health threats affecting civilian and military populations. Revenues for the 12 months ended March 31, 2021 totaled approximately $1.7 billion. The principal methodology used in these ratings was Pharmaceutical Industry published in June 2017. ENGINEERED MACHINERY: Moody's Affirms 'B3' CFR Amid Foodmate Deal ----------------------------------------------------------------- Moody's Investors Service affirmed Engineered Machinery Holdings, Inc.'s (dba Duravant) B3 corporate family rating, B3-PD probability of default rating, B2 senior secured first lien term loan rating and Caa2 senior secured second lien term loan rating. Concurrently, Moody's assigned a B2 rating on the company's $235 million revolving credit facility that expires in 2026, and the existing rating on $160 million revolver expiring in 2022 will be withdrawn at transaction close. Moody's also assigned a B2 rating on the EUR denominated $570 million first lien term loan and Caa2 rating on the $175 million second lien term loan. Proceeds from these debt issuances will be used to fund acquisition of Foodmate, working capital requirements, balance sheet cash and other general purposes. The outlook is stable. "Foodmate's acquisition will increase debt and ensuing leverage, but the company's successful track record of deleveraging, good growth prospects and strong liquidity mitigates the financial risk", said Shirley Singh, Moody's lead analyst for the company. Leverage on pro forma basis will increase to 6.9x from 6.0x debt-to-EBITDA as of December 2020. Moody's anticipates that favorable backlog trends, strong execution on acquisition and cost discipline will result in leverage falling below 6.5x by the end of 2021. In addition, the company has good liquidity further bolstered by recent revolver upsize to $235 million. The following rating actions were taken: Assignments: Issuer: Engineered Machinery Holdings, Inc. Senior Secured 1st Lien Bank Credit Facility, Assigned B2 (LGD3) Senior Secured 2nd Lien Bank Credit Facility, Assigned Caa2 (LGD6) Affirmations: Issuer: Engineered Machinery Holdings, Inc. Corporate Family Rating, Affirmed B3 Probability of Default Rating, Affirmed B3-PD Senior Secured 1st Lien Term Loan, Affirmed B2 (LGD3) Senior Secured 2nd Lien Bank Credit Facility, Affirmed Caa2 (LGD6) Outlook Actions: Issuer: Engineered Machinery Holdings, Inc. Outlook, Remains Stable RATINGS RATIONALE Duravant's B3 CFR reflects the company's elevated leverage with debt-to-EBITDA of close to 7.0x (on proforma basis as of December 2020) and inherent cyclicality of the business. The company's credit metrics exhibit volatility due to its aggressive growth strategy with periodic debt-financed acquisitions. Even so, Moody's notes the company's ability to rapidly deleverage its balance sheet through combination of earnings growth and debt reduction. The ratings are also supported by the company's strong profitability with EBITDA margins in excess of 30% and low capital needs that translates to strong cash flow generation. The company benefits from its defendable niche position in the specialized machinery with long-established customer relationships. In addition, the company's favorable exposure to food and beverage and e-commerce sector as well as growing presence in aftermarket businesses supports the ratings. The stable outlook reflects Moody's expectation that the company will be able to de-lever rapidly through solid earnings growth as well as maintain good liquidity over the next 12-18 months. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS Ratings could be upgraded should the operating performance and financial policy support debt-to-EBITDA below 6.0x and EBITA-to-interest expense above 2.0x on a sustained basis. Ratings could be downgraded if there is a deterioration in Duravant's earnings as a result business integration issues, weaker operating environment or competitive pressures. A downgrade could be prompted if adjusted debt-to-EBITDA is sustained above 7.5x, EBITA-to-interest falls below 1.25x or liquidity weakens. The principal methodology used in these ratings was Manufacturing Methodology published in March 2020. Engineered Machinery Holdings, Inc. is the indirect parent of Duravant LLC. Headquartered in Downers Grove, Illinois, Duravant designs and assembles packaging, material handling and food processing equipment for a number of industries, including food and beverage, consumer products, e-commerce and distribution, retail, and agriculture and produce. Duravant is owned by affiliates of Warburg Pincus, LLC. Sales in fiscal 2020 were $797 million. FIREBALL REALTY: Court OKs Sale, Nixes Cash Collateral Access Bid ----------------------------------------------------------------- Judge Michael A. Fagone denied the request of Fireball Realty LLC to use cash collateral due to reasons stated on record at the April 27, 2021 the hearing. In a separate order, the Court authorized the Debtor to sell its property at 16 South Willow Street, Manchester, New Hampshire, to Charles Sargent, Sr. in a private sale for $720,000 free and clear of all liens, claims and interests to the fullest extent permitted under Bankruptcy Code Section 363, without advertising or competitive bidding. Primary Bank holds or claims to hold first priority mortgages with respect to the cash collateral derived from the Manchester Property. The Primary First Priority Mortgages and Rent Assignments secure the payment of approximately $814,000, which is evidenced by promissory notes in the original principal amounts of $817,000. Primary also holds or claims to hold a second, blanket mortgage of the Property and the rents thereof as security for the payment and performance of the Primary Notes. The Property has three commercial units. In its Cash Collateral Motion, the Debtor said the Property has an estimated reorganization value of $502,656 and an estimated liquidation value of $315,859, which is 70% of the reorganization value. The present loan balance owed to Primary Bank is $565,793. These Record Lienholders hold or claim to hold junior liens of record on some or all of the Primary Collateral: -- Charles R. Sargent, Senior, who is the holder of a second priority mortgage of record on certain of the Primary Collateral, and -- Flare Investments, LLC, which appears to be the holder of an avoidable attachment lien of record on all of the Debtor's real estate. To date, no junior Record Lienholder has claimed in this case that its Record Lien is senior to the Primary First and Second Priority Mortgages. The Debtor has said Primary shall be deemed to be and treated as the First Priority Record Lienholder with respect to the Primary Collateral and the cash collateral derived therefrom. In its motion, the Debtor said it would not spend or use more than $6,646.91 of the Primary Cash Collateral during the period between May 1, 2021 and July 31, 2021, inclusive, without the written consent of Primary, as appropriate. Moreover, the Cash Collateral will be used solely and exclusively for the purpose of paying the costs and expenses incurred by the Debtor in the ordinary course of business to the extent provided for the in Primary Bank budget and such other costs and expenses as may be authorized in writing by Primary, as appropriate. The Debtor proposed to provide Primary Bank and the other Record Lienholders with adequate protection for any loss or diminution in value of the cash collateral securing their claims to the extent such claims qualify as secured claims under Bankruptcy Code Section 506. Primary Bank will be paid the sums of $1,929.71 and $826.86 per month as adequate protection payments beginning on August 1, 2019 [sic]. * * * The Sale order provides that the Debtor shall pay from the Sale proceeds the customary and usual, out-of-pocket closing costs and expenses incurred by the Debtor in connection with the Sale, such as Transfer Taxes and recording fees; pay in full from the proceeds of the Sale the real estate taxes assessed against the Subject Property by the City of Manchester as of the Sale, plus any accrued interest thereon, which are to be determined; and pay Primary Bank $720,000 from the proceeds of the Sale. There was a hearing set for April 27 to consider confirmation of the Debtor's Amended Chapter 11 Plan. The Court has yet to issue a ruling on the matter. About Fireball Realty, LLC Fireball Realty LLC is a real estate agency in Manchester, New Hampshire. The Debtor sought Chapter 11 protection (Bankr. D. N.H. Case No. 19-10922) on June 28, 2019. The Debtor estimated assets and liabilities in the range of $1 million to $10 million. The Debtor tapped William S. Gannon, Esq., at William S. Gannon PLLC as counsel. The petition was signed by Charles R. Sargent, Jr., member. FLEXPOINT SENSOR: Incurs $607K Net Loss in 2020 ----------------------------------------------- Flexpoint Sensor Systems, Inc. filed with the Securities and Exchange Commission its Annual Report on Form 10-K disclosing a net loss of $607,066 on $99,438 of total revenue for the year ended Dec. 31, 2020, compared to a net loss of $575,058 on $833,036 of total revenue for the year ended Dec. 31, 2019. As of Dec. 31, 2020, the Company had $4.92 million in total assets, $2.95 million in total liabilities, and $1.97 million in total stockholders' equity. Salt Lake City, Utah-based Sadler, Gibb & Associates, LLC, the Company's auditor since 2012, issued a "going concern" qualification in its report dated March 31, 2021, citing that the Company has suffered recurring losses from operations and has a net capital deficiency which raises substantial doubt about its ability to continue as a going concern. A full-text copy of the Form 10-K is available for free at: https://www.sec.gov/Archives/edgar/data/925660/000101041221000004/f2020flexpoint10-kv9.htm About Flexpoint Sensor Headquartered in Draper, Utah, Flexpoint Sensor Systems, Inc. -- www.flexpoint.com -- is principally engaged in designing, engineering and manufacturing bend sensor technology and products using its patented Bend Sensor technology, a flexible potentiometer technology. FREDDIE MAC: Reports Net Income of $2.8 Billion for First Quarter ----------------------------------------------------------------- Federal Home Loan Mortgage Corporation filed with the Securities and Exchange Commission its Quarterly Report on Form 10-Q disclosing net income of $2.77 billion on $5.27 billion of net revenues for the quarter ended March 31, 2021, compared to net income of $2.91 billion on $5.02 billion of net revenues for the quarter ended March 31, 2020. As of March 31, 2021, the Company had $2.74 trillion in total assets, $2.72 trillion in total liabilities, and $18.79 billion in total equity. "Freddie Mac continued to support homebuyers and renters, providing $377 billion of liquidity for home purchases, refinancings, and the multifamily market in the first quarter of 2021. We have also helped hundreds of thousands of families stay in their homes through our foreclosure and eviction prevention programs. We are proud of our role in maintaining a vibrant housing market while providing critical assistance to borrowers and lenders during the pandemic," said Christian M. Lown, chief financial officer. A full-text copy of the Form 10-Q is available for free at: https://www.sec.gov/ix?doc=/Archives/edgar/data/1026214/000102621421000049/fmcc-20210331.htm About Freddie Mac Federal National Mortgage Association (Freddie Mac) is a GSE chartered by Congress in 1970. The Company's public mission is to provide liquidity, stability, and affordability to the U.S. housing market. Freddie Mac does this primarily by purchasing residential mortgage loans originated by lenders. In most instances, it packages these loans into guaranteed mortgage-related securities, which are sold in the global capital markets and transfer interest-rate and liquidity risks to third-party investors. In addition, the Company transfers mortgage credit risk exposure to third-party investors through its credit risk transfer programs, which include securities- and insurance-based offerings. The Company also invests in mortgage loans and mortgage-related securities. The Company does not originate loans or lend money directly to mortgage borrowers. Since September 2008, Freddie Mac has been operating under conservatorship with FHFA as Conservator. The support provided by Treasury pursuant to the Purchase Agreement enables the company to maintain access to the debt markets and have adequate liquidity to conduct its normal business operations. The amount of funding available to Freddie Mac under the Purchase Agreement was $140.2 billion at March 31, 2021. Due to changes to the terms of the senior preferred stock pursuant to the January 2021 Letter Agreement, the company will not be required to pay a dividend to Treasury until it has built sufficient capital to meet the capital requirements and buffers set forth in the Enterprise Regulatory Capital Framework (ERCF). As a result, the company was not required to pay a dividend to Treasury on the senior preferred stock in March 2021. As the company builds capital during this period, the quarterly increases in its Net Worth Amount have been, and will continue to be, added to the aggregate liquidation preference of the senior preferred stock. The liquidation preference of the senior preferred stock increased to $89.1 billion on March 31, 2021 based on the $2.5 billion increase in the Net Worth Amount during the fourth quarter of 2020, and will increase to $91.4 billion on June 30, 2021 based on the $2.4 billion increase in the Net Worth Amount during the first quarter of 2021. FRESH BEGINNING: Seeks to Hire Wolff & Orenstein as Legal Counsel ----------------------------------------------------------------- Fresh Beginning Trust seeks approval from the U.S. Bankruptcy Court for the District of Maryland to employ Wolff & Orenstein, LLC as its legal counsel. Wolff & Orenstein will render these legal services: (a) represent the Debtor at the initial debtor interview and creditors' meeting and advise the Debtor in connection with the preparation of reorganization plans and related documents; (b) advise the Debtor concerning the negotiation and documentation of financing agreements, debt restructuring and related transactions; (c) prepare legal papers; and (d) perform all other legal services necessary to administer the Debtor's Chapter 11 case. The hourly rates of Wolff & Orenstein's attorneys and staff are as follows: Members $490 Associates $275 Paralegals $200 Office Assistants $150 The retainer fee is $31,480. Michael Wolff, Esq., an attorney at Wolff & Orenstein, disclosed in a court filing that his firm is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. The firm can be reached through: Michael G. Wolff, Esq. Wolff & Orenstein, LLC 15245 Shady Grove Road Suite 465 North Rockville, MD 20850 Telephone: (301) 250-7232 Email: mwolff@wolawgroup.com About Fresh Beginning Trust Fresh Beginning Trust filed its voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. D. Md. Case No. 21-12789) on April 26, 2021. At the time of the filing, the Debtor disclosed $1 million to $10 million in both assets and liabilities. Wolff & Orenstein, LLC serves as the Debtor's legal counsel. FRONTERA HOLDINGS: Court Confirms Reorganization Plan ----------------------------------------------------- Judge Marvin Isgur has entered an order confirming the Plan of Frontera Holdings LLC, et al. All objections and all reservations of rights pertaining to Confirmation that have not been withdrawn, waived, or settled are overruled on the merits. Subsequent to posting the Plan on March 22, 2021, the Debtors made certain modifications to the Plan (the "Modifications"). Pursuant to section 1127 of the Bankruptcy Code, the Modifications do not otherwise adversely affect or change the treatment of any Claim or Interest under the Plan. After giving effect to the Modifications, the Plan continues to satisfy the requirements of sections 1122 and 1123 of the Bankruptcy Code. Under Section 1126(f) of the Bankruptcy Code, Holders of Claims in Class 1 (Other Secured Claims), Class 2 (Other Priority Claims), and Class 5 (General Unsecured Claims) are Unimpaired and conclusively deemed to have accepted the Plan. Holders of Claims in Class 6 (Intercompany Claims) and Holders of Interests in Class 7 (Intercompany Interests) are Unimpaired and conclusively deemed to have accepted the Plan (to the extent reinstated), or are Impaired and deemed to reject the Plan (to the extent cancelled), and, in either event, are not entitled to vote to accept or reject the Plan. Nevertheless, the Debtors served Holders of all nonvoting Claims and Interests (other than Intercompany Claims and Intercompany Interests) with the Confirmation Hearing Notice and the Non-Voting Status Notice and Opt-Out Form. As set forth in the Plan and the Disclosure Statement, Holders of Claims in Classes 3 and 4 (collectively, the "Voting Classes") were eligible to vote to accept or reject the Plan in accordance with the Solicitation and Voting Procedures. Holders of Claims in Classes 1, 2 and 5 are Unimpaired and conclusively presumed to accept the Plan and, therefore, did not vote to accept or reject the Plan. Holders of Claims or Interests in Classes 6 and 7 are Unimpaired and conclusively presumed to have accepted the Plan (to the extent reinstated) or are impaired and deemed to reject the Plan (to the extent cancelled and released), and, in either event, are not entitled to vote to accept or reject the Plan. The Debtors were not required to solicit votes from Holders of Claims and Interests in Class 8, which are impaired and deemed to reject the Plan. As evidenced by the Voting Report, Classes 3 and 4 overwhelmingly voted to accept the Plan. The Plan is confirmable because it satisfies sections 1129(a)(10) and 1129(b) of the Bankruptcy Code. Frontera Holdings LLC, et al., submitted a First Amended Joint Chapter 11 Plan of Reorganization. All DIP Facility Claims will be allowed in full in an amount equal to (i) the principal amount outstanding under the DIP Credit Agreement on the Effective Date, (ii) all accrued and unpaid interest thereon to the date of payment, and (iii) all accrued and unpaid fees, costs, expenses, noncontingent indemnification obligations, and any and all other amounts payable under the DIP Credit Agreement. The Plan will treat claims as follows: * Class 3 - OpCo Claims. The OpCo Claims shall be allowed in the principal amount of $757,746,241 with respect to the Term Loan Claims, in the principal amount of $35,000,000 with respect to the Revolving Credit Loan Claims, and $12,532,216 with respect to Obligations under the Secured Non-Commodity Hedge Agreements. Each such Holder shall receive its Pro Rata share of and/or interest in (A) 12.5% of the New Equity Interests, subject to dilution by the Management Incentive Plan (if any) and the exercise of the New Warrants; and (B) the New Second Lien Facility. Class 3 is impaired. * Class 4 - HoldCo Notes Claims totaling $160,000,000. Each Allowed HoldCo Notes Claim, each such Holder shall receive its Pro Rata share of the New Warrants, and the proceeds of the Consenting Sponsor Cash Payment in cash. Class 4 is impaired. * Class 5 - General Unsecured Claims. Each such Holder shall receive, with the consent of the Required Consenting Lenders (such consent not to be unreasonably delayed, conditioned, or withheld), either reinstatement of such Allowed General Unsecured Claim and satisfaction thereof in full either (A) on the Effective Date or (B) in the ordinary course of business in accordance with the terms and conditions of the particular transaction giving rise to such Allowed General Unsecured Claim or such other treatment rendering its Allowed General Unsecured Claim Unimpaired in accordance with section 1124 of the Bankruptcy Code. Class 5 is unimpaired. The Debtors shall fund distributions under the Plan, as applicable, with (a) the New Equity Interests; (b) the New Warrants; (c) the New First Lien Facility; (d) the New Second Lien Facility; and (e) the Debtors' Cash on hand (including the proceeds of the Consenting Sponsor Cash Payment). Co-Counsel to the Debtors: Joshua A. Sussberg, P.C. Matthew C. Fagen KIRKLAND & ELLIS LLP KIRKLAND & ELLIS INTERNATIONAL LLP 601 Lexington Avenue New York, New York 10022 Telephone: (212) 446-4800 Facsimile: (212) 446-4900 Matthew D. Cavenaugh Genevieve M. Graham Vienna F. Anaya Victoria Argeroplos JACKSON WALKER LLP 1401 McKinney Street, Suite 1900 Houston, Texas 77010 Telephone: (713) 752-4200 Facsimile: (713) 752-4221 A copy of the Order is available at https://bit.ly/3u7jtS8 from Primeclerk, the claims agent. About Frontera Holdings Frontera Holdings, LLC operates a 526-MW combined-cycle natural gas plant near Mission, Texas, and exports power to Mexico. On Feb. 3, 2021, Frontera Holdings LLC and five affiliated debtors each filed a voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Texas Lead Case No. No. 21-30354) to seek confirmation of a debt-for-equity plan that would reduce debt by $800 million. At the time of the filing, Frontera Holdings had estimated assets of between $100 million and $500 million and liabilities of between $1 billion and $10 billion. Judge Marvin Isgur oversees the cases. The Debtors tapped Kirkland & Ellis and Jackson Walker L.L.P. as their legal counsel, Alvarez & Marsal as financial advisor, and PJT Partners LP as investment banker. Prime Clerk LLC is the claims agent. The term loan lenders' advisors include Houlihan Lokey Inc. and Akin Gump Strauss Hauer & Feld LLP. The noteholders' advisors include Silver Foundry, LP and Morgan, Lewis & Bockius LLP. FRONTIER COMMUNICATIONS: Fitch Assigns 'BB-' LT IDR, Outlook Stable ------------------------------------------------------------------- Fitch Ratings has assigned a 'BB-' Long-Term Issuer Default Rating (IDR) to Frontier Communications Holdings, LLC (Delaware) and its subsidiaries with a Stable Outlook. Frontier assumed the debt of Frontier Communications Corporation (Corp) at the latter's emergence from bankruptcy on April 30, 2021. Through the completion of restructuring transactions, Corp's direct, first-tier subsidiaries and other directly held assets were transferred to Frontier. Following the satisfaction of the pre-petition senior unsecured noteholders' claims, Corp will dissolve and cease to exist as a legal entity. Fitch has withdrawn Corp's 'BB-(EXP)' IDR. Fitch has assigned a 'BB+'/'RR2' rating to Frontier's senior secured first-lien revolving credit facility, term loan and notes. The company's senior secured second-lien notes have been assigned a 'BB-'/'RR4' rating. Fitch's "Corporates Recovery Ratings and Instrument Ratings Criteria" was updated on April 9, 2021, leading to the change in the Recovery Ratings on the first-lien debt, and the ratings and Recovery Ratings for the second-lien debt and certain subsidiary unsecured debt from the prior Expected ratings. A complete list of rating actions follows at the end of this release. The 'BB+(EXP)'/'RR1' rating assigned to Corp's $1.25 billion first-lien term loan has been withdrawn as the first-lien term loan facility was assumed by Frontier at emergence and upsized to $1.475 billion and has been assigned a 'BB+'/'RR2' rating. KEY RATING DRIVERS Low Leverage Upon Emergence from Bankruptcy: Frontier's 'BB-' IDR and Stable Outlook is supported by relatively low leverage for the rating and relatively low leverage compared with other telecom operators in Fitch's U.S. telecom universe. Fitch expects gross leverage of 2.9x at YE 2021 and net leverage of 2.3x. With much lower rural broadband support in 2022, gross leverage could rise by approximately 0.5x. Following emergence, Frontier's cash generation will improve materially following a reduction in interest expense of more than $1 billion annually. Fitch believes the company will have the opportunity to increase investments in key strategic areas, including fiber to the home and greater fiber investment to support enterprise and wholesale services, including fiber to the tower. The rating is constrained by the near-term expected decline in legacy revenues and the need to continue to take costs out of the business. Capital Allocation: Frontier emerged from bankruptcy on April 30, 2021. The current holders of the senior unsecured debt have become the new owners of the company as a result of the plan of reorganization. The capital-allocation policy remains uncertain as the new board of directors will be installed upon the emergence from bankruptcy. The new board may consider more aggressive investment plans, as well as more fully articulate capital structure policies. The company and parties to the restructuring support agreement RSA targeted a relatively low net leverage ratio of less than 3.0x based on the level of debt at emergence. Challenging Operating Environment: The rating incorporates a challenging operating environment for wireline operators. Fitch expects Frontier's revenue trends to remain negative in the next couple of years on an organic basis. The expiration of Connect America Fund II (CAF II) funding at the end of 2021 will affect the company. Fitch expects this latter effect to be mitigated by the next generation of broadband support through the Rural Digital Opportunity Fund (RDOF). Fitch's updated assumptions include $37 million annually won in the RDOF auction. Fitch's prior assumptions excluded any potential funding from this program. The de-emphasis of products, such as certain video offerings, will affect revenues but will have a far lower effect on EBITDA margins given programming cost offsets. FCF and Debt: Fitch estimates FCF will be around $300 million-$400 million in 2021. FCF is expected to be pressured in 2022 due to the expiration of CAF II funding and the potential for increasing capital spending on fiber investments. The effect on FCF due to the expiration of CAF II funding is mitigated by additional broadband funding support. Following the emergence from bankruptcy, Frontier will have a much more tenable capital structure. Asset Sales: In May 2020, Frontier sold operations in Washington, Oregon, Idaho and Montana -- the Northwest operations -- to WaveDivision Capital, LLC for $1.35 billion in cash. This cash, combined with existing cash, is being used to settle claims in bankruptcy. Secured Debt Notching: For rated entities with IDRs of 'BB-' or above, Fitch does not perform a bespoke analysis of recovery upon default for each issuance. Instead, Fitch uses notching guidance whereby an issuer's first-lien secured debt can be notched upward one or to two rating levels. Frontier parent secured first-lien debt is notched up two levels from the Long-Term IDR to 'BB+'/'RR2'. The recovery is limited to 'RR2' given the first-lien debt is primarily secured by equity pledges and there is material subsidiary-level debt. The first mortgage bonds of Frontier Southwest Inc. are also notched up two levels from the IDR to 'BB+'/'RR1', the security provided by a first lien on substantially all of its assets supporting the 'RR1' recovery. Nonfirst-Lien Debt Notching: For corporate entities rated 'BB-' and above, the ratings assigned to an issuer's nonfirst-lien debt (second lien, unsecured and subordinated debt) are capped at 'RR4' and there is no notching above the IDR. This leads to 'BB-'/'RR4' ratings for Frontier's second-lien debt and subsidiary unsecured debt, except for Frontier Florida LLC. The 'B+'/'RR5' rating assigned to Frontier Florida's unsecured debt reflects that Frontier Florida is a guarantor of Frontier's secured credit facility. Parent-Subsidiary Relationship: Fitch linked Frontier's IDRs to its operating subsidiaries based on strong operational ties. DERIVATION SUMMARY Frontier has a higher exposure to the more volatile residential market compared with wireline peer Lumen Technologies, Inc. (BB/Stable), and to some extent Windstream Services, LLC (not rated by Fitch). Incumbent wireline operators within the residential market face wireless substitution and competition from cable operators, including Comcast Corp. (A-/Stable) and Charter Communications Inc. (Fitch rates Charter's indirect subsidiary, CCO Holdings, LLC BB+/Stable). Cheaper alternative offerings, such as voice over internet protocol and over-the-top video services provide additional challenges. Incumbent wireline operators had modest success with bundling broadband and satellite video service offerings in response to these threats. Frontier needs to improve its competitive position in the enterprise market. In this market, Frontier is smaller than AT&T Inc. (BBB+/Stable), Verizon Communications Inc. (A-/Stable) and Lumen. All three companies have an advantage with national or multinational companies given their extensive footprints in the U.S. and abroad. Compared with Frontier, AT&T and Verizon have wireless offerings that provide more service diversification. Fitch expects Frontier's gross leverage to be slightly lower than AT&T and Verizon follow its emergence from bankruptcy and the two larger operators large C-Band spectrum investments made in 2021. KEY ASSUMPTIONS Fitch's key assumptions within its rating case for the issuer include: -- Revenues decline just above 10% in 2021, reflecting the sale of the Pacific Northwest properties on May 1, 2020 and secular effects. Revenue declines in 2022 due to the loss of CAF II revenues in 2022. Revenue declines slow as the company continues to focus on fiber and increasing fiber broadband penetration; -- The EBITDA margin declines from the high 30% range in 2020 and 2021 to the mid-30% range in 2022. The loss of CAF II funding further lowers EBITDA margins in 2022. Pressure in 2022 is partly offset by new rural broadband subsidies; -- Capital spending reflects company plans of approximately $1.2 billion in 2021. Capital intensity increases thereafter as the company focuses on its longer term modernization plan; -- Cash taxes are nominal in 2021-2024. RATING SENSITIVITIES Factors that could, individually or collectively, lead to positive rating action/upgrade: -- Gross leverage, defined as total debt with equity credit/operating EBITDA, expected to be sustained at or below 3.0x, with FFO leverage of 3.0x, while consistently generating positive FCF margins in the midsingle digits; -- Greater certainty around the company's capital allocation given the new shareholder base upon emergence; -- Successful execution on cost-reduction plans; -- Consistent gains in revenues from anticipated investments in fiber and broadband product areas; -- Demonstrating stable EBITDA and FCF growth. Factors that could, individually or collectively, lead to negative rating action/downgrade: -- A weakening of operating results, including deteriorating margins and an inability to stabilize revenue erosion in key product areas or offset EBITDA pressure through cost reductions; -- Discretionary management decisions, including but not limited to execution of M&A activity that increases gross leverage beyond 4.5x, with FFO leverage of 4.5x in the absence of a credible deleveraging plan. 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 Frontier ended 2020 with a substantial amount of liquidity, with $1.829 billion of unrestricted cash. At emergence, the company distributed approximately $1.3 billion of the cash balance to the pre-petition senior unsecured noteholders. Cash balances will also include approximately $225 million from an incremental exit term loan facility. The incremental term loan, plus an undrawn $625 million credit facility, will provide the company with $850 million of liquidity as required under the plan of reorganization, and total liquidity of more than $1.2 billion. First-lien debt totals approximately $4.2 billion, second-lien debt totals $1.75 billion and subsidiary debt totals $856 million. The second-lien debt amount includes $750 million of second-lien takeback debt. Other than the revolver maturity in 2025, there are no major maturities until 2027. ESG CONSIDERATIONS Fitch has revised Frontier's ESG Relevance Score for Management Strategy to '3' from '4'. The score of '4' was related to operational challenges following the close of the Verizon transaction in 2016 that resulted in elevated subscriber churn and weaker than expected revenue, which had a negative impact on the credit profile. 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. FRONTIER COMMUNICATIONS: Moody's Rates $750MM 2nd Lien Notes 'Caa2' ------------------------------------------------------------------- Moody's Investors Service has assigned a Caa2 to Frontier Communications Holdings, LLC's $750 million of second lien secured notes due 2029, which are being issued as takeback debt to holders of the company's approximately $11 billion of prepetition senior unsecured debt under terms of the company's Plan of Reorganization (PoR) associated with its emergence from bankruptcy on April 30, 2021. All debt that Moody's previously rated at Frontier Communications Corporation will be transferred to Frontier Communications Holdings, LLC, the new domestic entity that succeeds to the business and operations of Frontier Communications Corporation as debtor in possession pursuant to bankruptcy exit under the PoR. Frontier Communications Corporation ceases to exist as an entity at bankruptcy exit. This takeback debt is equal in priority ranking to the company's Caa2 rated existing second lien secured notes, which were formerly debtor-in-possession-to-Exit (DIP-to-Exit) second lien secured notes until today's conversion at bankruptcy emergence. All other ratings, including Frontier's B3 corporate family rating (CFR) and stable outlook, are unchanged. Frontier's PoR was confirmed on August 27, 2020 by the US Bankruptcy Court for the Southern District of New York. The company's emergence today follows the receipt of all necessary state regulatory approvals. Through this bankruptcy process Frontier reduced its prepetition senior unsecured funded debt by approximately $11 billion and annual interest expense by over $1 billion. Prepetition holders of that senior unsecured debt receive new common stock, cash and takeback debt of $750 million of second lien secured notes. Frontier's existing B3 rated $1.475 billion first lien term loan, B3 rated $2.7 billion first lien secured notes and $625 million first lien revolving credit facility (unrated) are pari passu. The parent of Frontier, Frontier Communications Parent, Inc. (Frontier Parent), will remain a publicly traded company at bankruptcy exit through the public listing of new common stock issued to prepetition unsecured debtholders pursuant to the PoR. Frontier Parent's new common stock is expected to commence trading on the NASDAQ stock exchange on May 4, 2021 under the ticker FYBR. Assignments: Issuer: Frontier Communications Holdings, LLC 2nd Lien Senior Secured Regular Bond/Debenture, Assigned Caa2 (LGD6) LGD Adjustments: LGD 2nd Lien Senior Secured Regular Bond/Debenture Adjusted to (LGD6) from (LGD5) RATINGS RATIONALE Frontier's B3 CFR rating reflects the high execution risks post-bankruptcy of the company's modernization plan across its operating segments to reverse continuing revenue and EBITDA declines. Moody's expects revenue and EBITDA contraction will be in excess of Frontier's rated peers through at least year-end 2022; this applies even on a pro forma basis that excludes the company's northwest US operations sold on May 1, 2020. Moody's believes Frontier's modernization plan is steadily solidifying as a pilot fiber buildout program targeting 60,000 home passings and completed at year-end 2020 provided greater insight into customer demand. Moody's expects stepped-up capital investments through 2028 with capital intensity peaking in 2022. Underscoring the upfront nature and immensity of its turnaround effort the company plans almost $7 billion of total capital spending for the five-year period from 2020 to 2024, a portion of which will target the conversion of 3.3 million locations out of the 12 million broadband-capable copper locations currently passed to fiber passings. This substantial effort will target multiple states across Frontier's footprint for network upgrades, with a focus on the larger markets in Connecticut, California, Texas and Florida. As Frontier has historically endured high new customer churn, a critical element of the company's success-based investing stage -- the extending of upgraded fiber networks laterally to new customer locations -- is dependent upon effective customer targeting to better achieve economic paybacks and longer and higher value customer relationships. The modernization plan will need to incorporate significantly improved customer care efficiencies to proactively reduce churn, enhance sales force capabilities and productivity and reduce operational costs, including field costs. Despite a reduced debt load after its emergence from bankruptcy, Frontier will continue to operate at a competitive disadvantage versus cable, fiber overbuilder and wireless competitors in the bulk of its market footprint until meaningful network upgrades bolster its value proposition. Evidence of good execution on this metric will be steady market share expansion followed by sustained revenue and EBITDA growth. Until then, Frontier's broadband speeds and competitive value proposition to both consumer and commercial customers is largely limited by a legacy copper network spanning almost 80% of 14 million broadband-capable homes passed in its 25 state footprint, which includes about 3 million fiber home passings and 1.2 million fiber broadband subscribers currently. Frontier also faces continued steady top line and margin pressures in its commercial and wholesale business segments, which comprise about 50% of overall revenue. Operational enhancements include new leadership, including the December 15, 2020 appointment of Nick Jeffery as the company's next CEO effective March 4, 2021, consultant hires, sales force and account management structural changes and a greater prioritizing of strategic product offerings. While strengthened financial flexibility will afford Frontier a longer turnaround runway than it had pre-bankruptcy, strengthening its existing core business will require deft operational skills in the face of high single-digit revenue declines accompanied by strong EBITDA pressures through at least 2022. The company's debt leverage (Moody's adjusted) will increase from projected lower levels at bankruptcy exit today of around 3x to nearer 4x by year-end 2022, which only heightens the need for steady and timely strategic execution success. Frontier's financial policy includes a long term, sustainable net leverage target (company defined) of under 3x, the prioritization of reinvestment of discretionary cash flow into its business versus shareholder friendly actions and potential asset optimizations through non-core dispositions, but such potential optimizations would not be anticipated until the later years of the current modernization plan. The instrument ratings reflect the probability of default of Frontier, as reflected in the B3-PD probability of default rating, an average expected family recovery rate of 50% at default, and the loss given default (LGD) assessment of the debt instruments in the capital structure based on a priority of claims. The first lien term loan and first lien secured notes are rated B3 (LGD4), in line with the B3 CFR, reflecting the benefits from a first lien pledge of stock of certain subsidiaries of Frontier which represent approximately 90% of Frontier's total EBITDA and 80% of Frontier's total assets, and guarantees from a subset of these subsidiaries (although the guarantor details are not disclosed). Based on a priority of claim waterfall, Moody's ranks the first lien revolving credit facility (unrated), first lien term loan and first lien secured notes behind structurally senior pension and trade payables of various operating subsidiaries. The first lien revolving credit facility, first lien term loan and first lien secured notes are ranked ahead of second lien secured debt. Moody's views Frontier's liquidity as good. At bankruptcy emergence the company has $715 million of balance sheet cash, consistent with public disclosures, and $535 million of available borrowing capacity on its $625 million first lien revolving credit facility (unrated), net of outstanding letters of credit issued under the facility. Reduced prepetition interest helps support moderate free cash flow generation in 2021 but Moody's expects free cash flow to be around negative $350 million in 2022 due to stepped-up capital spending and contracting revenue over the next several years. The company is expected to have high capital spending (Moody's adjusted) of approximately $1.3 billion in 2021 and $1.7 billion in 2022. Moody's expects Frontier to have sufficient liquidity such that it will not need to draw down its revolver through year-end 2022 to fund its front-loaded capital spending ambitions. As there is a high level of uncertainty regarding Frontier's ability to deliver sustained operational improvements through network investment, any shortfalls in expectations for future free cash flow generation would limit financial flexibility and likely impair the company's ability to maintain its planned pace of network upgrades. With the bankruptcy emergence prepetition senior unsecured debt holders have the bulk of economic and voting control over Frontier's strategic decisions as its modernization plan is implemented. The stable outlook reflects Moody's expectations over the next 12-18 months for continuing high single-digit revenue and EBITDA declines, slightly decreasing EBITDA margins, moderate but slightly increasing debt/EBITDA (Moody's adjusted) and moderate free cash flow generation initially. Good liquidity and the company's ability to smooth out early peaks in planned discretionary capital spending further supports the stable outlook. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS: Given the company's current competitive positioning, network upgrade execution risks and uncertainties regarding share growth traction across its end markets, upward pressure is limited but could develop should Frontier's free cash flow to debt (Moody's adjusted) track towards mid single-digit levels as a percentage of Moody's adjusted debt on a sustainable basis. An upgrade would also require steady market share capture gains across the company's network footprint in both consumer and commercial end markets over several years, consolidated revenue and EBITDA growth and maintenance of a good liquidity profile. Downward pressure on the rating could arise should the company's liquidity deteriorate or should execution of its share capture and growth strategy materially stall or weaken. The principal methodology used in these ratings was Telecommunications Service Providers published in January 2017. Frontier is an Incumbent Local Exchange Carrier (ILEC) headquartered in Norwalk, CT and the fourth largest wireline telecommunications company in the US. Frontier generated $7.0 billion of revenue in the last 12 months ended December 31, 2020, which excludes revenue from northwest operations sold in May 2020. FRONTIER COMMUNICATIONS: S&P Assigns 'B-' ICR, Outlook Stable ------------------------------------------------------------- S&P Global Ratings assigned a 'B-' issuer credit rating and stable outlook to U.S.-based telecommunications provider Frontier Communications Corp. S&P said, "We also assigned a 'B+' issue-level rating and '1' recovery rating to the company's secured first-lien debt. The '1' recovery rating indicates our expectation for very high (90%-100%; rounded estimate: 90%) recovery in the event of payment default. At the same time, we assigned a 'CCC+' issue-level rating and '5' recovery rating to the company's second-lien debt. "We also assigned a 'B-' issuer credit rating and stable outlook to Frontier Communications Holdings LLC. Concurrent with its emergence from bankruptcy, Frontier Communications Corp. will transfer all of the stock and directly held assets to Frontier Communications Holdings LLC. This entity will also assume all of its debt. "The stable outlook reflects our view that although secular industry declines will contribute to lower earnings, adjusted leverage will be supportive of the rating, in the mid-3x to low-4x area over the next year." Frontier faces sharp revenue and EBITDA declines over the next couple of years, and its prospects to reverse these trends depend on successful execution of its fiber network upgrade plan.Frontier faces intense competition for broadband service in its markets from incumbent cable operators, which, combined with fiber overbuilders, overlap with about 90% of the company's footprint. Cable operators have upgraded their networks to DOCIS 3.1 and are able to offer download speeds of 1 gigabit per second (Gbps). In comparison, Frontier can only offer 1 Gbps of broadband service with fiber-to-the-home (FTTH) to one-fifth of the homes it passes. Moreover, the company is only capable of providing lower broadband speeds of up to 50 megabits (Mbps) per second across most of its footprint. Frontier's significant exposure to legacy copper-based infrastructure suggests it will continue to lose broadband subscribers to cable at a high rate over the next couple of years. While it has plans to modernize its network, reversing its weak operating and financial performance will take time and there is the potential for execution missteps along the way. Even assuming successful execution, it will take years before revenue contributions from its network upgrades are sufficient to offset the declines of its voice, video, and copper-based broadband revenue. Still, S&P believes the deployment of fiber will improve Frontier's competitiveness and provides opportunities for the company to grow its broadband market share longer term. S&P said, "We expect Frontier to prioritize network upgrades and employ a data-centric approach, which should help it improve profitability over time. We expect Frontier to adopt a strategy similar to its wireline peers such as Windstream and Consolidated and allocate the majority of its cash flow to investments in FTTH. Despite the near-term pressure on cash flow caused by its declining revenue, high-fixed cost base and increased investment, we believe Frontier needs to make these investments to compete with incumbent cable operators longer term and stabilize top-line degradation. Frontier completed 60,000 FTTH builds under a pilot program in 2020 and plans to upgrade about 495,000 homes this year. Its longer-term plan is to pass around 3 million more homes with fiber, covering more than 40% of its footprint by 2031. We believe this will position the company to grow its broadband market share, reverse top-line and EBITDA declines, and improve profitability longer term. In addition to deploying FTTH, we expect the company's turnaround initiatives to include scaling back offerings of its less profitable services such as linear video and very low speed broadband." Despite the reduction in debt as the company emerges from bankruptcy, leverage remains elevated. Frontier's reorganization includes the elimination of about $11 billion of debt relative to pre-bankruptcy levels. S&P said, "While the company's adjusted leverage is substantially lower, in the mid-3x area upon emergence from about 6x when it entered bankruptcy last year, it is still elevated given the ongoing declines of its voice, video, and copper-based broadband revenue and reduced government subsidies as the Rural Digital Opportunity Fund (RDOF) replaces the Connect America Fund (CAF) II, in our view. We expect that Frontier's adjusted debt to EBITDA will be in the mid-3x area this year, increasing to the low-4x area in 2022 and remaining at this level for at least the next few years. We believe the company will be challenged to improve leverage over the next few years because of earnings declines and negative free operating cash flow (FOCF) due to increased network investments. Still, we believe these investments, if executed well, could enable Frontier to reduce leverage longer term once its investment cycle winds down, although we currently do not incorporate this in our base-case forecast." S&P said, "The stable outlook reflects our view that although secular industry declines should contribute to lower earnings over the next couple of years, adjusted leverage will be supportive of the rating, in the mid-3x to low-4x area over the next two years. "We could lower the ratings if aggressive competition or execution missteps constrain Frontier's ability to improve its operating trends, such that EBITDA declines persist, FOCF is weaker than we expect, and leverage rises over time with narrow prospects for improvement, leading us to assess the capital structure as unsustainable. We could also lower the rating if we believe the company will face a near-term liquidity crunch. "Over the longer term, we could raise our ratings on Frontier if it profitably captures broadband share in its markets while growing EBITDA and improving FOCF." An upgrade would require Frontier to improve FOCF to debt to above 5% and sustain leverage below 4x. This could occur longer term if the company increases its network investments and successfully executes its fiber expansion strategy while improving operational efficiency. GARRETT MOTION: CEO Survives Bankruptcy Fight With Centerbridge --------------------------------------------------------------- Steven Church of Bloomberg News reports that Garrett Motion Inc.'s chief executive led the auto-parts maker into bankruptcy, provoked its private equity shareholders by trying to cancel their stock and backed a lawsuit against the company's former owner and biggest creditor. But when the company exited bankruptcy on Friday, Olivier Rabiller was still on the job, with a chance to earn stock options and other performance awards that would be handed out by a new board dominated by the very groups he battled for months, including some who sought his dismissal. On April 30, 2021, Garrett emerged from its Chapter 11 restructuring with new financing and a strong balance sheet to strengthen its long-term competitive position and provide the resources and flexibility to solidify the company's technology leadership. As part of this process, Garrett was able to remain a publicly-traded company (Nasdaq: GTX) with the support of its new sponsors. Chapter 11 Exit Olivier Rabiller, President and Chief Executive Officer of Garrett, said, "Emergence is a significant achievement for Garrett, and I'm pleased that the restructuring received support from all of our constituencies, including senior lenders, senior noteholders, the Official Creditors Committee, Honeywell, a majority of common stockholders and the Official Equity Committee. Lenders and pre-petition creditors were paid in full, and Garrett operated without interruption throughout the reorganization, providing customers with the same high-quality products and services they have come to expect and maintaining strong partnerships with valued suppliers. Most importantly, Garrett has emerged with a new financing and capital structure that we believe will support our long-term viability and provide the resources and flexibility to accelerate our technology development." Mr. Rabiller added, "I would also like to extend my gratitude to our employees, without whom Garrett could not have achieved this milestone and delivered solid financial results in 2020 in a challenging COVID environment. I am excited to begin the next chapter in our development with a highly qualified Board of Directors and the support of Centerbridge and Oaktree." At emergence, Garrett will have approximately 65,035,801 million shares of new common stock issued and outstanding. In addition, Garrett will have approximately 247,771,428 million shares of new Convertible Series A Preferred Stock outstanding, which is convertible into common stock and votes on an as-converted basis with common stock. The plan of reorganization also eliminates the previous asbestos indemnity and all related liabilities to Honeywell incurred by Garrett in its 2018 spin-off, and settles all litigation between Garrett and Honeywell. The elimination of the 30-year indemnity substantially reduces Garrett's effective leverage and increases its operational, financial and strategic flexibility. In return for elimination of the indemnity, upon emergence, Garrett made an initial cash payment to Honeywell of $375 million and issued to Honeywell Series B Preferred Stock that entitles Honeywell to certain cash payments from 2022 to 2030. The Series B Preferred stock is repayable at any time at a present value (which is approximately $584 million as of the date of emergence using the agreed discount rate of 7.25%). The Company has also obtained a $1.25 billion equivalent term loan, alongside a new $300 million revolving credit facility. The restructuring will substantially decrease Garrett’s long-term debt and improve its maturity profile. About Garrett Motion Based in Switzerland, Garrett Motion Inc. (NYSE: GTX) designs, manufactures, and sells highly engineered turbocharger and electric-boosting technologies for light and commercial vehicle original equipment manufacturers and the global vehicle and independent aftermarket. Garrett Motion and its affiliates sought Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 20-12212) on Sept. 20, 2020. Garrett disclosed $2.066 billion in assets and $4.169 billion in liabilities as of June 30, 2020. The Debtors tapped Sullivan & Cromwell LLP as counsel, Quinn Emanuel Urquhart & Sullivan LLP as co-counsel, Perella Weinberg Partners, and Morgan Stanley & Co. LLC as investment bankers, and AlixPartners LP as restructuring advisor. Kurtzman Carson Consultants LLC is the claims agent. On October 5, 2020, the U.S. Trustee for Region 2 appointed an official committee of unsecured creditors in the Debtors' Chapter 11 cases. White & Case LLP and Conway MacKenzie, LLC, serve as the creditors' committee's legal counsel and financial advisor, respectively. The U.S. Trustee also appointed an official committee to represent equity security holders in the Debtors' cases. The equity committee tapped Glenn Agre Bergman & Fuentes LLP as its legal counsel, MAEVA Group LLC as a financial advisor, and Cowen and Company, LLC as an investment banker. Centerbridge Partners, L.P., and Oaktree Capital Management, L.P., as Plan Sponsors are represented in the case by Milbank as legal counsel and Houlihan Lokey, Inc., as financial advisor. Kirkland & Ellis is legal counsel to Honeywell, and TRS Advisors LLC and Centerview Partners LLC are its financial advisors. Jones Day is s legal counsel to each Additional Investor, and Rothschild & Co. is their financial advisor. Fried, Frank, Harris, Shriver & Jacobson LLP, is the legal counsel and Ducera Partners LLC, is the financial advisor to The Baupost Group, LLC. Ropes & Gray LLP is the legal counsel, and Moelis & Co., the financial advisor to the Consenting Noteholders. Gibson, Dunn & Crutcher LLP, is the legal counsel and PJT Partners LP the financial advisor to the Consenting Lenders. GATEWAY REST: Wins Cash Collateral Access ----------------------------------------- The U.S. Bankruptcy Court for the Northern District of Georgia, Gainesville Division, has authorized Gateway Rest Group, LLC to use cash collateral on a final basis and provide adequate protection. The Debtor alleges that a need exists for the Debtor to continue use of the Cash Collateral to fund critical operations of the Business. The Debtor is a borrower under a loan from Jax Fairfield Financial, LLC, which may assert a security interest in certain of the Debtor's personal property. As of the Petition Date, the amount owed to the Lender is approximately $700,000. The revenue from the Business may constitute Cash Collateral as that term is defined in 11 U.S.C. section 363. The Debtor believes that the Lender may assert an interest in the Cash Collateral. To provide adequate protection for the Debtor's use of the Cash Collateral, the Lender and any other secured creditor, to the extent they hold valid liens, security interests, or rights of setoff as of the Petition Date under applicable law, are granted valid and properly-perfected liens subject to the Carve-Out, on all property acquired by the Debtor after the Petition Date that is the same or similar nature, kind, or character as each party's respective pre-petition collateral, to the extent of any diminution in the value of the Cash Collateral, except that no such replacement liens will attach to the proceeds of any avoidance actions under Chapter 5 of the Bankruptcy Code. The Adequate Protection Liens will be deemed automatically valid and perfected upon entry of the Order. The Carve-Out means (i) all fees required to be paid to the Clerk of the Bankruptcy Court and to the Office of the United States Trustee under 28 U.S.C. section 1930(a); (ii) prior to the delivery of a Carve Out Notice, to the extent allowed at any time by the Bankruptcy Court and subject to the Budget, all accrued and unpaid fees and expenses incurred by professionals retained by the Debtor; (iii) after the date of the delivery of a Carve Out Notice, to the extent allowed by the Bankruptcy Court and subject to the Budget, all unpaid fees and expenses incurred by the Retained Professionals in an aggregate amount not to exceed $10,000. For purposes of the foregoing, "Carve Out Notice" will mean a written notice delivered by the Lender to counsel to the Debtor and the United States Trustee, which notice may be delivered following the occurrence of any of the following: (a) confirmation of a chapter 11 plan in the case; (b) conversion of this case to a case under chapter 7 of the Bankruptcy Code; (c) dismissal of the case; (d) a sale of substantially all of the Debtor's assets, or (e) appointment of a chapter 11 trustee in the case. All amounts of the Carve-Out that have not been funded as of the date of the Carve-Out Notice will be required to be funded from the proceeds of the Lender's Collateral. The Carve-Out will be senior to all liens and claims and any and all other forms of adequate protection, liens, security interests, and other claims granted herein to the Lender or any other party. A copy of the order is available for free at https://bit.ly/3vJrQE7 from PacerMonitor.com. About Gateway Rest Group, LLC Gateway Rest Group, LLC operates in the restaurant industry. Gateway Rest Group sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. N.D. Ga. Case No. 21-20317) on March 24, 2021. In the petition signed by Chittranjan Thakkar, manager, the Debtor disclosed up to $50,000 in assets and up to $10 million in liabilities. Judge James R. Sacca oversees the case. William A. Rountree, Esq. at ROUNTREE, LEITMAN & KLEIN, LLC is the Debtor's counsel. GEE ACQUISITION: S&P Assigns 'CCC+' ICR on Debt Reduction --------------------------------------------------------- S&P Global Ratings assigned its 'CCC+' issuer credit rating to GEE Acquisition Holdings Corp. (d/b/a Global Eagle Entertainment) because it is dependent on favorable business conditions to meet its financial obligations. S&P said, "We also assigned our 'B-' issue-level and '2' recovery ratings to the $205 million exit and our 'CCC-' issue-level and '6' recovery ratings to the second-lien takeback facility. "The stable outlook reflects our view that Global Eagle has adequate liquidity to meet its financial obligations over the next year, but that debt-to-EBITDA will remain above our upgrade trigger of 6x over the next year." Global Eagle has emerged from bankruptcy with substantially lower debt. The capital structure includes a $205 million priority term exit facility due in 2025 and a $170 million secured takeback facility due in 2026. However, S&P Global Ratings expects EBITDA of up to $20 million in 2021 due to the unprecedented reduction in travel, resulting in weak credit metrics over the next year including debt-to-EBITDA above 15x. The rating reflects uncertainty around the pace of recovery in Global Eagle's earnings and cash flow, which could result in tightening liquidity in 2022 if conditions do not improve significantly. S&P said, "Despite the company's reduction of more than $500 million of debt upon its emergence from bankruptcy, we believe depressed levels of air travel and lack of cruise sailings will likely pressure all three of Global Eagle's business segments until a meaningful recovery of leisure travel in both air and sea occurs. Global Eagle generated roughly 30% of its 2020 revenues from in-flight connectivity (IFC) services and roughly another 30% from its Media & Content (M&C) segment, which provides in-flight entertainment to commercial airlines. We expect the pandemic's negative effect on revenues to continue into 2021, and possibly beyond, as revenue is highly correlated to commercial air travel levels. Therefore, in our base-case scenario, we project the company will burn through about $15 million-$40 million in cash over the next year before approaching breaking even in 2022." Airlines' path to recovery is determined by the evolution of the pandemic and vaccination efforts, but pre-pandemic levels of travel are unlikely until at least 2024. A strengthening economy will help, but its effect is secondary to the immunity outlook. S&P said, "The impressive efficacy of vaccines and accelerating, albeit uneven, vaccination campaigns suggest that greater consumer interest in flying, when it comes, could be strong and we expect a surge of bookings for summer travel. We see significant pent-up demand for vacation and visiting friends and relatives, so domestic leisure travel is likely to pick up first." Business air travel and international travel will take longer to return. This is a positive for GEE given its concentration with domestic leisure airline com.spglobal.ratings.services.article.services.news.xsd.MarkedData@58f5cb15, although much of its M&C business is derived from global travel. S&P said, "We believe there remains high, albeit moderating, uncertainty about the evolution of the coronavirus pandemic and its economic effects. As the situation evolves, we will update our assumptions and estimates accordingly. We expect 2021 commercial air traffic relative to 2019 still 40%-60% lower, 20%-30% lower in 2022, and 10%-15% lower in 2023. Therefore, we expect that Global Eagle's revenue, EBITDA, and cash flows could begin to improve, but that it could take 2-4 years to ramp back toward pre-pandemic levels." Cruise ships could face continued delays, placing pressure on any path to recovery (which we assume starts in 2022). Cruises remain largely suspended through the first half of 2021 and S&P assumes operators will resume sailings in a phased manner sometime in the third quarter of 2021. Phased resumption of operations may help cruise operators better align supply and demand, target easily accessible home ports, and better manage itineraries. Also, operators may limit destinations and cruise lengths because of continued port closures and local governments and health authority restrictions. However, customers may find the revisions less desirable and may grow weary of social distancing and mask and testing requirements, resulting in low occupancy. Still, S&P sees signs of pent-up demand. Increased booking volumes in recent periods despite relatively sparse marketing indicate to us demand for cruise travel and that consumers will resume cruising once regulatory restrictions are lifted. Additionally, about 65% of cruise passengers are repeat customers, which should aid recovery in 2022. Once global air traffic recovers, Global Eagle could benefit from the niche IFC market, which has room for growth. The aviation connectivity business (about 30% of 2020 revenues) has significant growth potential because about 70% of non-U.S aircraft are uncommitted. While there is intense competition from several players, including Viasat, Panasonic, Thales, Intelsat, and Inmarsat, we believe customers are likely to award new business based primarily on pricing and reliability of service. S&P also believes Global Eagle's media relationships with airlines could benefit the company. Unlike competitors like Viasat that own their own satellites, Global Eagle leases its capacity from wholesale providers, which highlights its dependency for favorable lease terms. However, due to the substantial amount of excess capacity likely coming available, lack of ownership is less important in a declining pricing environment, which we expect will persist for the next several years. S&P said, "The stable outlook reflects our view that Global Eagle will grow its earnings and improve cash generation over the next year but that credit metrics are likely to remain weak through 2021. "We could lower our ratings on Global Eagle if travel conditions recovery slower we expect such that the company's liquidity position worsened and we believed that it would likely default or enter into a debt restructuring in the next 12 months. "We could raise our rating if we believe that the company will improve its EBITDA and cash flow following a rebound in global travel, such that debt to EBITDA approaches 6x with a credible path for continued improvement." GEE HOLDINGS: Moody's Assigns Caa1 CFR on Bankruptcy Emergence -------------------------------------------------------------- Moody's Investors Service assigned a Caa1 corporate family rating and a Caa1-PD probability of default rating to GEE Holdings 2 LLC ("Global Eagle"). Concurrently, Moody's assigned a B2 rating to the $205 million priority exit facility due 2025 and a Caa2 to the $170 million takeback facility due 2026 both issued at GEE Holdings 2 LLC. The outlook is stable. The rating action comes on the back of Global Eagle emerging from chapter 11 in April 2021 having reduced its pre-bankruptcy debt quantum by more than 50%. Assignments: Issuer: GEE Holdings 2 LLC Probability of Default Rating, Assigned Caa1-PD LT Corporate Family Rating, Assigned Caa1 $205M Senior Secured Priority Term Loan, Assigned B2 (LGD2) $170M Senior Secured Takeback Term Loan, Assigned Caa2 (LGD4) Outlook Actions: Issuer: GEE Holdings 2 LLC Outlook, Assigned Stable RATINGS RATIONALE Global Eagle's Caa1 CFR reflects the ongoing disruption to the company's main operations in 2021 as a result of a resurgence in COVID-19 in Q4 2020 and Q1 2021. This has meant that Global Eagle's end-markets continue to face intense pressures and will continue to operate at very reduced operations in 2021. In 2021, the company is expected to generate modest EBITDA (adjusted for one off costs), resulting in leverage of double digit in 2021 and free cash flow of around negative $50 million. The Caa1 CFR also reflects the potential for Global Eagle's operations to rebound in 2022 on the back of expected improvement as US and worldwide vaccinations ramp up and allow the leisure air travel as well as the cruise industries to progressively improve from the second half of 2021 albeit at varying paces. This could mean a sharp reduction in leverage in 2022 to between 5x and 7x depending on one-off cost adjustments to EBITDA. Global Eagle generates revenue in two segments: Connectivity and Media & Content. Connectivity is centered around two main activities: a) Inflight Connectivity (IFC) where the company provides satellite-based WiFi to short-haul flights mostly within the US, this segment is heavily reliant on Southwest airlines as Global Eagle's largest customer. Revenues are largely based on a fixed monthly recurring charge by operating aircraft connected. In 2020 IFC's revenue declined to $127 million from $180 million in 2019. This segment has potential to rebound faster given its focus on the US where vaccination rates are going at one of the fastest paces in the world as well as consumer expectation for IFC becoming a norm in the US; and b) Maritime and Government (M&G) through which Global Eagle provides connectivity and entertainment solutions for maritime (yachts and cruise ships), government, energy (oil rigs) and shipping vessels. Revenue is also generated on a fixed monthly rate basis with some revenue sharing agreements for some cruise passenger WiFi usage. In 2020 revenue for M&G declined to $122 million vs. $170 million in 2019. Media and Content provides in-flight entertainment (IFE) and content solutions to mostly long-haul flights which have been slower to recover given continuing travel bans and very low business travel which usually accounts for a large proportion of long-haul segments. In its M&C operations, Global Eagle estimates that it has a 60% share of the addressable market. Here the revenue model has historically been reliant on the number of flight segments flown, although the company is transitioning M&C to its IRIS product which is sold on a subscription basis. In 2020 revenue from M&C declined by nearly 60% to $130 million vs. $309 million in 2019. M&G and M&C are likely to recover slower than IFC given their focus on international travel and tourism which are likely to start to recover later in 2021 or in H1 2022. In addition for M&C, airlines cost focus, concerns about long-term impact of COVID-19 on business travel as well as the new movie production lull in 2020 is likely to lead to weaker recovery. Global Eagle's liquidity is adequate over the next four quarters, supported by a cash balance of around $65 million at exit of Chapter 11 as well as a $12.5 million line of credit facility and the ability of the company to PIK around $11.5 million of its cash interest for the first two years. Any delay in the recovery of the company's end markets could put material pressure on the liquidity profile. The company's new facilities agreement also carve-out a $35-$40 million basket for a potential super-priority revolving credit facility. The company's capex is expected to be around $20 million in 2021, half of which will be for growth projects. In 2021, Moody's expect the company to generate $50 million of negative free cash flow. The instrument ratings reflect the probability of default of the company, as reflected in the Caa1-PD Probability of Default Rating, an average expected family recovery rate of 50% at default, and the particular instruments' ranking in the capital structure. The B2 rating on the $205 million priority facility due 2025 reflects the potential for the company to add super priority secured debt to capital structure, and the fact that it ranks ahead of the Caa2 rated $170 million second lien Takeback facility due 2026. The stable outlook reflects Moody's expectations that the company's leverage will improve gradually through 2022 as the majority of Global Eagle's end-markets go through a protracted but steady recovery. The stable outlook assumes that leverage will trend to below 7x in 2022. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS Moody's could downgrade Global Eagle's ratings should the company's operations not recover in line with current expectations leading to leverage remaining well above 7x in 2022 or should free cash flow generation be weaker than anticipated. And upgrade to the ratings is unlikely until visibility over a sustained recovery in Global Eagle's end-markets is established. An upgrade would also require the company to improve liquidity and maintain leverage well below 6x. With headquarters in Los Angeles, California, Global Eagle Entertainment Inc. is a provider of connectivity and content to the worldwide travel industry. The company operates through two segments Connectivity and Media & Content. The company generated revenue of $377 million in 2020. The principal methodology used in these ratings was Business and Consumer Service Industry published in October 2016. GENOCEA BIOSCIENCES: Incurs $12 Million Net Loss in First Quarter ----------------------------------------------------------------- Genocea Biosciences, Inc. filed with the Securities and Exchange Commission its Quarterly Report on Form 10-Q disclosing a net loss of $11.98 million for the three months ended March 31, 2021, compared to a net loss of $12.85 million for the three months ended March 31, 2020. As of March 31, 2021, the Company had $83.94 million in total assets, $82.18 million in total liabilities, and $1.76 million in total stockholders' equity. Genocea had available cash and cash equivalents of $66.0 million at March 31, 2021. In addition, the Company used cash of $12.4 million in its operating activities for the three months ended March 31, 2021. Genocea's available cash and cash equivalents at March 31, 2021 are expected to fund operations for a period of at least a year from the date the financial statements are issued. Since the Company's inception in 2006, the Company has funded operations primarily through proceeds from issuances of common stock and long-term debt. A full-text copy of the Form 10-Q is available for free at: https://www.sec.gov/ix?doc=/Archives/edgar/data/1457612/000145761221000063/gnca-20210331.htm About Genocea Biosciences Headquartered in Cambridge, Massachusetts, Genocea -- http://www.genocea.com-- is a biopharmaceutical company developing personalized cancer immunotherapies. The Company uses its proprietary discovery platform, ATLAS, to profile CD4+ and CD8+T cell (or cellular) immune responses to tumor antigens. Genocea reported a net loss of $43.71 million for the year ended Dec. 31, 2020, compared to a net loss of $38.95 million for the year ended Dec. 31, 2019. As of Dec. 31, 2020, the Company had $98.49 million in total assets, $89.51 million in total liabilities, and $8.98 million in total stockholders' equity. GENTIVA HEALTH: Moody's Puts B1 CFR Under Review for Upgrade ------------------------------------------------------------ Moody's Investors Service placed the ratings of Gentiva Health Services, Inc. (New)'s (dba Kindred at Home, or KAH) on review for upgrade. Ratings placed on review for upgrade include the B1 Corporate Family Rating, B1-PD Probability of Default Rating, and B1 on the first lien senior secured credit facilities. The review for upgrade reflects Humana Inc.'s (Baa3 senior unsecured debt, stable) plan to acquire the 60% share of KAH that it does not already own. Humana's total consideration for KAH will be approximately $5.7 billion, for a total enterprise value of approximately $8.1 billion, which includes Humana's existing equity value of $2.4 billion. The acquisition is anticipated to be near fully debt funded and is expected to close in the second half of 2021. Humana is also considering strategic alternatives for KAH's hospice and community care assets. The review for upgrade reflects Moody's expectation that if the acquisition by Humana is completed, then KAH will become part of a larger, more diversified, higher rated company. The review for upgrade also reflects KAH's strong stand-alone performance and the favorable fundamental outlook for the business. Moody's will also consider the impact to the credit profile of a possible spin off or sale of the hospice and community care assets. Lastly, Moody's will assess Humana's treatment of KAH's debt and the level of support, if any, that Humana provides. If all of KAH's debt is repaid, Moody's will withdraw all ratings of Gentiva Health Services, Inc. at the transaction's close. Ratings placed on review for upgrade include: Gentiva Health Services, Inc. (New) Corporate Family Rating, currently rated B1 Probability of Default Rating, currently rated B1-PD Senior secured first lien credit facilities currently rated B1 (LGD3) Outlook action: Outlook, changed to ratings under review from Stable. RATINGS RATIONALE / FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS KAH's B1 CFR (on review for upgrade) reflects the company's moderate financial leverage, with debt/EBITDA in the mid-4 times range for the year ended December 31, 2020. The rating is constrained by the high exposure to Medicare and Medicaid in the home care and hospice businesses as well as the considerable risk of adverse government reimbursement changes. Further, Moody's anticipates that the company will continue to be acquisitive as it expands its home care and hospice businesses. Supporting the B1 rating is Humana's ownership stake in KAH, as Moody's believes the risk of aggressive debt funded dividends is low given Humana's eventual full ownership of the company. Further, KAH has minimal capital expenditures and cash taxes due to large net operating losses (NOLs), which allows KAH to generate substantial free cash flow. Lastly, the rating is supported by KAH's good scale, with roughly $3 billion of revenue, in an industry with good long-term demand fundamentals. Moody's anticipates very good liquidity supported by an undrawn $350 million revolving credit facility, other than $79.9 million in outstanding LCs at Fiscal Year end December 31, 2020, and consistently positive free cash flow. Moody's considers coronavirus to be a social risk given the risk to human health and safety. Aside from coronavirus, KAH faces other social risks as well, such as the rising concerns around the access and affordability of healthcare services. However, Moody's does not consider home health to face the same level of social risk as hospitals because care at home is viewed as an affordable alternative to hospitals or skilled nursing facilities. Further, given its high percentage of revenue generated from Medicare and Medicaid, KAH is exposed to regulatory changes. KAH is also exposed to wage inflation, particularly as it must maintain a large workforce with both skilled labor (nurses, therapists), of which there are shortages, and unskilled labor, which is experiencing rising minimum wage in certain markets. In terms of governance, KAH is owned by private equity sponsors, but Moody's expects considerably more conservative financial policies under full Humana ownership. The ratings could be upgraded if the company is expected to sustain debt/EBITDA below 4.5x. Additionally, continued growth without operating disruptions or margin decline would be required for an upgrade. The ratings could be downgraded if there is material weakening of liquidity or if the company is not expected to generate consistently positive free cash flow. Additionally, the rating could be downgraded if leverage is not expected to remain below 5.5x. Gentiva Health Services (doing business as Kindred at Home) is one of the largest home health and hospice operators in the US. Fiscal year end December 31, 2020 revenues are approximately $3 billion. The principal methodology used in these ratings was Business and Consumer Service Industry published in October 2016. GLACIAL MATERIALS: Creditor Seeks Correction of Claim Amount ------------------------------------------------------------ DT Equipment, LLC filed an objection to the Disclosure Statement accompanying the Plan of Glacial Materials, LLC. DT said it objects to the Disclosure Statement as it relates to the amount to be paid in the DT Claim. DT submits that the Disclosure Statement should be amended to reflect the correct amount of the DT Claim to $679,630. A copy of the objection is available for free at https://bit.ly/3nOJdAE from PacerMonitor.com. About Glacial Materials Glacial Materials, LLC, based in Buffalo, N.Y., sought Chapter 11 protection (Bankr. W.D.N.Y. Case No. 16-10907) on May 5, 2016, is represented by Robert B. Gleichenhaus, Esq., at Gleichenhaus, Marchese & Weishaar, P.C., in Buffalo, N.Y., and estimated its assets and debts at less than $10 million at the time of the filing. GLENVIEW HEALTH: Seeks to Tap Kerrick Bachert as Special Counsel ---------------------------------------------------------------- Glenview Health Care Facility, Inc. seeks approval from the U.S. Bankruptcy Court for the Western District of Kentucky to employ Kerrick Bachert PSC as special counsel. The Debtor needs the assistance of a special counsel in connection with the sale of its real estate and nursing home facility operations in Glasgow, Ky. The hourly rates of Kerrick Bachert's attorneys and staff are as follows: Partners $300 Associates $250 Paralegals $160 Scott Bachert, Esq., a member of Kerrick Bachert, disclosed in a court filing that his firm is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. The firm can be reached through: Scott A. Bachert, Esq. Kerrick Bachert PSC 1025 State Street P.O. Box 9547 Bowling Green, KY 42102-9547 Telephone: (270) 782-8160 Email: sbachert@kerricklaw.com About Glenview Health Care Facility Glenview Health Care Facility, Inc. owns and operates a small health care facility that provides nursing home services in Glasgow, Ky. Glenview Health Care Facility sought relief under Chapter 11 of the Bankruptcy Code (Bankr. W.D. Ky. Case No. 19-10795) on Aug. 1, 2019. At the time of the filing, the Debtor disclosed between $1 million and $10 million in both assets and liabilities. Judge Joan A. Lloyd oversees the case. The Debtor tapped Mark H. Flener, Esq., as legal counsel and Kerrick Bachert PSC as special counsel. GREENSILL CAPITAL: Seeks to Hire Matthew Tocks as CRO ----------------------------------------------------- Greensill Capital Inc. seeks approval from the U.S. Bankruptcy Court for the Southern District of New York to employ Matthew Tocks as chief restructuring officer. Mr. Tocks was the head of workouts and restructuring at Greensill Capital and served in that role between September 2020 and April 2021. Mr. Tocks' services include: a. directing the operation of the Debtor, including without limitation, being designated as an authorized signatory for the Debtor to execute all documents and agreements; b. reporting directly to the board of directors, attending meetings of the board, and taking all actions related thereto; c. directing the preparation of financial information; d. assisting with short-term cash management procedures and liquidity forecasting, including developing and maintaining the Debtor's cash flow forecasts and budgets delivered to the lender under the post-petition debtor-in-possession financing facilities; e. approving all material cash disbursements, in coordination with the Debtor's obligations under the DIP facility; f. approving sales of assets in the ordinary course and authorizing motions and applications for the sale of assets outside of the ordinary course of business needing bankruptcy court approval; g. overseeing the process governing the sale of the Debtor's 100% equity interest in Finacity Corporation; h. assisting the Debtor and its advisors with the due diligence process for the Finacity sale and discussions with potential bidders in connection therewith; i. assisting the Debtor and its advisors in seeking obtaining court approval for the Finacity sale and closing such sale to the successful bidder; j. managing the claims reconciliation process; k. attending hearings, meetings, and other events related to the Chapter 11 case as the Debtor's representative; l. retaining or terminating employees, contractors and non-legal professionals employed by the Debtor; m. directing the preparation of information, including any reports and the schedules needed for the Chapter 11 case, and having access to all of the Debtor's controlled materials necessary for such preparation; n. participating in meetings with third parties and their respective representatives on all material matters related to the Debtor and the administration of the case; o. assisting in the administration of the Debtor's Chapter 11 case, including, but not limited to, developing and confirming a Chapter 11 plan; and p. other restructuring services. The firm will be paid as follows: a. Base Salary. The CRO will receive a base salary of $250,000 per annum, paid monthly in arrears. b. Sale Payment. In the event an eligible Finacity sale transaction occurs during the term or within 18 months after the term unless the term is terminated by the Debtor for cause or by the CRO, the Debtor shall pay the CRO from the proceeds of the sale closing, an amount equal to (i) 3.0 percent of cash proceeds in excess of $3.5 million until cash proceeds equal the aggregate amount of (x) allowed administrative expenses and (y) allowed claims of unsecured creditors, provided, however, that the "claims threshold" shall not include any claims or interests of any affiliates of the Debtor; plus (ii) 4.0 percent of cash proceeds in excess of the claims threshold. The Debtor's obligation to make the sale payment is contingent upon and subject to the approval of the court. c. Notice Pay. Following the termination of the CRO at the conclusion of the term, if terminated by the Debtor without cause, the CRO shall be entitled to receive an amount equal to $62,500, in lieu of the three months' notice period as set forth in the existing employment agreement. The CRO will be paid in a lump sum contingent upon, and pursuant to the Chapter 11 plan. The CRO will also be reimbursed for out-of-pocket expenses incurred. As disclosed in court filings, Mr. Tocks is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code. About Greensill Capital Greensill is an independent financial services firm and principal investor group based in the United Kingdom and Australia. It offers structures trade finance, working capital optimization, specialty financing and contract monetization. Greensill Capital Pty is the parent company for the Greensill Group. Greensill began to unravel in March 2021 when its main insurer stopped providing credit insurance on US$4.1 billion of debt in portfolios it had created for clients including Swiss bank Credit Suisse. Greensill Capital (UK) Limited and Greensill Capital Management Company (UK) Limited filed for insolvency in Britain on March 8, 2021. Matthew James Byrnes, Philip Campbell-Wilson and Michael McCann of Grant Thornton were appointed as administrators. Greensill Capital Pty Ltd. filed insolvency proceedings in Australia. Matt Byrnes, Phil Campbell-Wilson, and Michael McCann of Grant Thornton Australia Ltd, were appointed as voluntary administrators in Australia. Greensill Capital Inc. filed for Chapter 11 bankruptcy (Bankr. S.D.N.Y. Case No. 21-10561) on March 25, 2021. Jill M. Frizzley, director, signed the petition. In the petition, the Debtor listed assets of between $10 million and $50 million and liabilities of between $50 million and $100 million. The case is handled by Judge Michael E. Wiles. The Debtor tapped Segal & Segal LLP as bankruptcy counsel, Mayer Brown LLP as special counsel, and GLC Advisors & Co., LLC and GLCA Securities, LLC as investment bankers and financial advisors. Matthew Tocks is the chief restructuring officer. The U.S. Trustee for Region 2 appointed an official committee of unsecured creditors on April 7, 2021. The committee is represented by George P. Angelich, Esq. GREENSILL CAPITAL: Seeks to Hire Mayer Brown as Special Counsel --------------------------------------------------------------- Greensill Capital Inc. seeks approval from the U.S. Bankruptcy Court for the Southern District of New York to employ Mayer Brown, LLP as special counsel. The Debtor needs the firm's legal services in connection with its ongoing efforts to sell 100 percent of its equity interests in Finacity Corporation. Mayer Brown will be paid at these rates: Partners $865 to $1200 per hour Associates $505 to $805 per hour Paralegals $400 per hour Prior to the petition date, the firm received from the Debtor a retainer in the amount of $30,000. The firm will also be reimbursed for out-of-pocket expenses incurred. Charles Regan, Jr., Esq., a partner at Mayer Brown, 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: Charles F. Regan, Jr., Esq. Mayer Brown LLP 71 South Wacker Drive Chicago, IL 60606 Tel: (312) 701-7997/(312) 701 7329 Email: cregan@mayerbrown.com About Greensill Capital Greensill is an independent financial services firm and principal investor group based in the United Kingdom and Australia. It offers structures trade finance, working capital optimization, specialty financing and contract monetization. Greensill Capital Pty is the parent company for the Greensill Group. Greensill began to unravel in March 2021 when its main insurer stopped providing credit insurance on US$4.1 billion of debt in portfolios it had created for clients including Swiss bank Credit Suisse. Greensill Capital (UK) Limited and Greensill Capital Management Company (UK) Limited filed for insolvency in Britain on March 8, 2021. Matthew James Byrnes, Philip Campbell-Wilson and Michael McCann of Grant Thornton were appointed as administrators. Greensill Capital Pty Ltd. filed insolvency proceedings in Australia. Matt Byrnes, Phil Campbell-Wilson, and Michael McCann of Grant Thornton Australia Ltd, were appointed as voluntary administrators in Australia. Greensill Capital Inc. filed for Chapter 11 bankruptcy (Bankr. S.D.N.Y. Case No. 21-10561) on March 25, 2021. Jill M. Frizzley, director, signed the petition. In the petition, the Debtor listed assets of between $10 million and $50 million and liabilities of between $50 million and $100 million. The case is handled by Judge Michael E. Wiles. The Debtor tapped Segal & Segal LLP as bankruptcy counsel, Mayer Brown LLP as special counsel, and GLC Advisors & Co., LLC and GLCA Securities, LLC as investment bankers and financial advisors. Matthew Tocks is the chief restructuring officer. The U.S. Trustee for Region 2 appointed an official committee of unsecured creditors on April 7, 2021. The committee is represented by George P. Angelich, Esq. GREENSILL CAPITAL: Seeks to Hire Togut Segal as Legal Counsel ------------------------------------------------------------- Greensill Capital Inc. seeks approval from the U.S. Bankruptcy Court for the Southern District of New York to employ Togut Segal & Segal LLP as legal counsel. The firm's services include: a. advising the Debtor regarding its powers and duties under the Bankruptcy Code; b. preparing and filing legal papers; c. attending meetings and negotiating with representatives of creditors and other parties-in-interest; d. preparing and filing the Debtor's schedules of assets and liabilities and statement of financial affairs; e. seeking court approval for the retention of professionals needed in the Debtor's Chapter 11 case; f. reconciling and, if appropriate, objecting to claims filed against the Debtor in its bankruptcy case; g. effectuating the assumption, assignment and rejection, as appropriate, of executory contracts and unexpired leases; h. negotiating, consummating, and seeking court approval of the transaction involving the sale of the Debtor's 100% equity interest in Finacity Corporation; i. negotiating a Chapter 11 plan and seeking confirmation of the plan; j. appearing before the bankruptcy court and any appellate courts in connection with restructuring matters; k. responding to inquiries and calls from creditors and their legal counsel; and l. other legal services necessary to administer the case. Togut Segal & Segal will be paid at hourly rates ranging from $890 to $1,270 for partners, $795 to $975 for counsel, $435 to $830 for associates, and $195 to $400 for paralegals and law clerks. The firm will also be reimbursed for out-of-pocket expenses incurred. The retainer fee is $200,000. Kyle Ortiz, Esq., a partner at Togut Segal & Segal, 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: Kyle J. Ortiz, Esq. Togut Segal & Segal LLP One Penn Plaza New York, NY 10119 Tel: (212) 594-5000 About Greensill Capital Greensill is an independent financial services firm and principal investor group based in the United Kingdom and Australia. It offers structures trade finance, working capital optimization, specialty financing and contract monetization. Greensill Capital Pty is the parent company for the Greensill Group. Greensill began to unravel in March 2021 when its main insurer stopped providing credit insurance on US$4.1 billion of debt in portfolios it had created for clients including Swiss bank Credit Suisse. Greensill Capital (UK) Limited and Greensill Capital Management Company (UK) Limited filed for insolvency in Britain on March 8, 2021. Matthew James Byrnes, Philip Campbell-Wilson and Michael McCann of Grant Thornton were appointed as administrators. Greensill Capital Pty Ltd. filed insolvency proceedings in Australia. Matt Byrnes, Phil Campbell-Wilson, and Michael McCann of Grant Thornton Australia Ltd, were appointed as voluntary administrators in Australia. Greensill Capital Inc. filed for Chapter 11 bankruptcy (Bankr. S.D.N.Y. Case No. 21-10561) on March 25, 2021. Jill M. Frizzley, director, signed the petition. In the petition, the Debtor listed assets of between $10 million and $50 million and liabilities of between $50 million and $100 million. The case is handled by Judge Michael E. Wiles. The Debtor tapped Segal & Segal LLP as bankruptcy counsel, Mayer Brown LLP as special counsel, and GLC Advisors & Co., LLC and GLCA Securities, LLC as investment bankers and financial advisors. Matthew Tocks is the chief restructuring officer. The U.S. Trustee for Region 2 appointed an official committee of unsecured creditors on April 7, 2021. The committee is represented by George P. Angelich, Esq. GREIF INC: Moody's Alters Outlook on Ba2 CFR to Stable ------------------------------------------------------ Moody's Investors Service affirmed Greif, Inc.'s Ba2 corporate family rating and its Ba2-PD probability of default rating and revised the rating outlook to stable from negative. Moody's also affirmed all instrument ratings and upgraded the Speculative Grade Liquidity Rating to SGL-1 from SGL-2. "The stable outlook reflects Moody's view that earnings and credit metrics will improve in 2021 as the global economy recovers from the coronavirus pandemic and the company continues to pay down debt from free cash flow and the proceeds of the completed timberland sale," said Anastasija Johnson, senior credit officer at Moody's. Affirmations: Issuer: Greif, Inc. Corporate Family Rating, Affirmed Ba2 Probability of Default Rating, Affirmed Ba2-PD Senior Unsecured Regular Bond/Debenture, Affirmed B1 (LGD5) Issuer: Greif Luxembourg Finance SCA Gtd. Senior Unsecured Regular Bond/Debenture, Affirmed Ba3 (LGD5) Upgrades: Issuer: Greif, Inc. Speculative Grade Liquidity Rating, Upgraded to SGL-1 from SGL-2 Outlook Actions: Issuer: Greif, Inc. Outlook, Changed To Stable From Negative Issuer: Greif Luxembourg Finance SCA Outlook, Changed To Stable From Negative RATINGS RATIONALE Greif's Ba2 rating reflects the company's scale, leadership market positions in most of its products and broad geographic and operational diversity. While the company serves diverse end markets, the majority of them are cyclical and were impacted by the coronavirus pandemic. Greif generates approximately 60% from global industrial packaging, including steel, fiber and plastic drums and rigid and flexible containers, and the rest from paper packaging and services (land management contributes marginal sales and EBITDA, but timberland holdings can be used as an alternative source of liquidity). The credit profile is also constrained by slow deleveraging after a transformative acquisition in 2019, although management has completed asset sales to lower debt and held dividends flat while earnings underperformed. The credit profile incorporates Moody's expectation that performance will improve in 2021 as the global economy recovers from the coronavirus pandemic and management pursues price increases to offset raw material and other cost inflation. Moody's expect strong growth in global industrial packaging as economy improves and continued growth in paperboard sales and packaging driven by continued e-commerce demand. Margins will be pressured by higher steel, resin and recycled fiber, freight and energy costs, but completed cost reduction in the global packaging segment and announced price increases in the paper segment, should offset some of these increases. Moody's expect the company to continue to generate free cash flow and apply it to debt reduction along with proceeds from asset divestitures. Moody's expect leverage to decline to about 4.0x in 2021 and 3.7x in 2022 Greif's SGL-1 speculative grade liquidity rating indicates a very good liquidity profile. The company had approximately $101 million of cash on hand, some of which is held overseas, but can be repatriated. Greif's liquidity is supported by $420.9 million of availability under its $800 million revolving multi-currency senior secured credit facility which expires on February 11, 2024. The company has entered into a delayed draw term loan to pay down the Euro200 million 7.375% senior notes due in July 2021. Greif also maintains a $250 million domestic trade accounts receivable securitization facility and trade receivables securitization facilities in Europe (EUR100 million), which tend to be renewed on an annual basis. The secured credit facilities have maximum leverage and minimum interest coverage covenants. The leverage covenant steps down to 4.25x in January 2022, but the company is expected to remain in compliance with its covenant. The credit facilities are not secured by Greif's timberland holdings (approximately 175,000 acres following the recent sale to Weyerhaeuser), so the company has a meaningful source of alternate liquidity (between $300-$325 million of estimated market value). The stable outlook reflects expectations that earnings and leverage metrics will improve in 2021. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS The rating could be upgraded if the company sustainably improves credit metrics with the context of a stable operating and competitive environment. An upgrade would be contingent upon the maintenance of sound financial policies. Specifically, the rating could be upgraded if debt/EBITDA is below 3.5x, EBITDA/Interest is above 5.8x and free cash flow to debt is above 8%. The ratings could be downgraded if there is deterioration in the competitive or operating environment. Specifically, the rating could be downgraded if debt to EBITDA remains over 4.2x , EBITDA to interest declines below 4.8x and free cash flow falls below 6%. Moody's view companies that manufacture packaging materials as having moderate environmental risk, that is broadly manageable. Moody's believes the company has established expertise in complying with these risks and has incorporated procedures to address them in its operational planning and business models. Moody's view Greif as well positioned to adjust to increasing regulatory and consumer focus on environmental issues, including improving recyclability and reducing waste, due to its diversified product mix, including recycled and virgin fiber. Greif is a publicly-listed industrial packaging company, but the Dempsey family controls approximately 70% of the voting rights and has effectively 3 out of 10 board seats. The company has a conservative net leverage target 2-2.5x and has pledged to use free cash flow to reduce debt, while maintaining the current level of dividends until the company reaches its leverage target. The company has delayed the time when it expects to reach its net leverage target to 2023. The company has grown both organically and through acquisitions and Moody's would expect it to continue to pursue bolt on acquisitions. The principal methodology used in these ratings was Packaging Manufacturers: Metal, Glass and Plastic Containers Methodology published in September 2020. GRIDDY ENERGY: Committee Seeks to Tap McDermott as Legal Counsel ---------------------------------------------------------------- The official committee of unsecured creditors appointed in the Chapter 11 case of Griddy Energy, LLC seeks approval from the U.S. Bankruptcy Court for the Southern District of Texas to employ McDermott Will & Emery, LLP as its legal counsel. McDermott will render these legal services: (a) advise the committee regarding its rights, duties and powers in the Debtor's Chapter 11 case; (b) assist the committee in its consultations with the Debtor regarding the administration of the case; (c) assist the committee in its investigation of the acts, conduct, assets, liabilities and financial condition of the Debtor; (d) assist the committee regarding the proposed Chapter 11 plan; (e) advise the committee regarding the Debtor's relationships with its vendors and suppliers; (f) assist the committee in analyzing the claims of creditors; (g) represent the committee in matters generally arising in the case; (h) appear before the bankruptcy court and, as applicable, any other federal, state or appellate court on behalf of the committee; (i) prepare pleadings; and (j) perform such other legal services as may be required by the committee. McDermott's standard hourly rates for attorneys that may work on this matter range as follows: Partners $945 - $1,575 Associates $580 - $960 Non-lawyer Professionals $70 - $1,080 The firm has agreed to charge the committee for its legal services on a capped blended hourly rate of $850 per hour. In addition, McDermott will seek reimbursement for expenses incurred. Charles Gibbs, Esq., a partner at McDermott, 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 through: Charles R. Gibbs, Esq. McDermott Will & Emery LLP 2501 North Harwood Street, Suite 1900 Dallas, TX 75201 Telephone: (214) 295-8000 Facsimile: (972) 232-3098 About Griddy Energy California startup Griddy Energy, LLC is a 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 the winter storm in February 2021 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 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. Texas Case No. 21-30923) on Mar. 15, 2021. Roop Bhullar, chief financial officer, signed the petition. At the time of the filing, the Debtor disclosed $1 million to $10 million in assets and $10 million to $50 million in liabilities. Judge Marvin Isgur oversees the case. The Debtor tapped Baker Botts LLP as legal counsel and Crestline Solutions, LLC and Scott PLLC as public affairs advisors. Stretto is the claims agent. On March 31, 2021, the U.S. Trustee for Region 7 appointed an official committee of unsecured creditors. The committee tapped McDermott Will & Emery, LLP as legal counsel and Province, LLC as financial advisor. GRIDDY ENERGY: Committee Taps Province LLC as Financial Advisor --------------------------------------------------------------- The official committee of unsecured creditors appointed in the Chapter 11 case of Griddy Energy, LLC seeks approval from the U.S. Bankruptcy Court for the Southern District of Texas to employ Province, LLC as its financial advisor. Province will render these services: (a) analyze any valuations or appraisals performed by the Debtor or on its behalf within the past 12 months; (b) provide forensic accounting expertise; (c) coordinate with the Debtor to review the operating performance relative to the cash collateral budget; (d) assist counsel to the committee in the initial investigation of the validity of liens; (e) analyze the Debtor's current and historical business operations, financial results and financing arrangements; (f) investigate any potential causes of action or fraudulent transfers; (g) analyze the potential for additional sources of recovery to the Debtor's estates; (h) review the financial aspects of any disclosure statement and plan of reorganization; (i) develop a liquidation or waterfall analysis and valuation; (j) represent the committee in negotiations; (k) address any related financial and business issues; (l) attend meetings of creditors and confer with representatives of the committee, the Debtor and their legal counsel; (m) report to the committee and its legal counsel regularly; and (n) testify at court hearings. The hourly rates of Province's professionals range as follows: Managing Directors and Principals $740 - $1,050 Vice Presidents, Directors, and Senior Directors $520 - $740 Analysts, Associates, and Senior Associates $250 - $520 Paraprofessionals $185 - $225 In addition, Province will seek reimbursement for expenses incurred. David Dunn, a principal at Province, 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 through: David Dunn Province LLC 2360 Corporate Circle, Suite 330 Henderson, NV 89074 Telephone: (702) 685-5555 Email: ddunn@provincefirm.com About Griddy Energy California startup Griddy Energy, LLC is a 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 the winter storm in February 2021 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 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. Texas Case No. 21-30923) on Mar. 15, 2021. Roop Bhullar, chief financial officer, signed the petition. At the time of the filing, the Debtor disclosed $1 million to $10 million in assets and $10 million to $50 million in liabilities. Judge Marvin Isgur oversees the case. The Debtor tapped Baker Botts LLP as legal counsel and Crestline Solutions, LLC and Scott PLLC as public affairs advisors. Stretto is the claims agent. On March 31, 2021, the U.S. Trustee for Region 7 appointed an official committee of unsecured creditors. The committee tapped McDermott Will & Emery, LLP as legal counsel and Province, LLC as financial advisor. GRIFFIN HEALTH: S&P Affirms 'BB+' Rating on 2019 Revenue Bonds -------------------------------------------------------------- S&P Global Ratings revised its outlook to stable from negative and affirmed its 'BB+' long-term rating on the Connecticut Health & Educational Facilities Authority's series 2019 revenue bonds, issued on behalf of Griffin Health Services (GHSC). "The revision to stable reflects our view of GHSC's improved operating performance through fiscal 2020 and the three-month interim period ended Dec. 31, 2020, as the hospital weatheredOVID-19 pressures," said S&P Global credit analyst Matthew O'Connor. "We revised GHSC's outlook to negative from stable on April 21, 2020, as part of a multi-credit action we took on a group of health care organizations that we rate speculative grade or that had low unrestricted reserves, the former applying to GHSC." Management noted that volumes began to rebound in the summer and fall months following the mandatory shutdown, supporting improved year-end operations, and good interim performance with limited CARES revenue through the interim period. The operational improvements supported improved results following a softer fiscal 2019 as a result of one-time items associated with implementation of a new electronic medical record system, which weighed on performance. The rating also reflects an enterprise profile that maintains a healthy market share and good payor mix, offset by the small primary service area (PSA) population, considerable outmigration to competitors in the secondary service area and high concentration of admissions within the top 10 physicians. HENRY ANESTHESIA: Wins Cash Collateral Access Thru May 31 --------------------------------------------------------- The U.S. Bankruptcy Court for the Northern District of Georgia, Atlanta Division, has issued a ninth interim order authorizing Henry Anesthesia Associates, LLC to use cash collateral on an interim basis through May 31, 2021. The Debtor is authorized to use cash collateral in accordance with the budget and on the terms contained in the Interim Cash Collateral Order and the Order or as further extended by order of the Court or consent of the Debtor and Respondents unless earlier terminated in accordance with the terms of the Interim Cash Collateral Order. In the event the Debtor seeks to assign its contracts with (i) South Atlanta Ambulatory Surgical Center, or (ii) Regenerative Orthopaedics Surgery Center, LLC during the term of the Order, the Debtor will deposit any purchase price received from such transaction in a trust account maintained by the Subchapter V Trustee for the Case to be held in trust until further order of the Court. Commencing on May 3, 2021, the Subchapter V Trustee will take over control of the Debtor's bank accounts and have sole check writing and disbursement authority for the term of the Order. All other terms and conditions of the Interim Cash Collateral Order shall remain in full force and effect except as modified in the Ninth Interim Order. A copy of the order and the Debtor's May budget is available for free at https://bit.ly/2QTEzoG from PacerMonitor.com, projecting total income of $155,050 and total expenses of $183,690. About Henry Anesthesia Associates, LLC Henry Anesthesia Associates LLC is a Stockbridge, Ga.-based for-profit limited liability company, which provides anesthesiology services. Henry Anesthesia Associates filed a Chapter 11 petition (Bankr. N.D. Ga. Case No. 20-68477) on July 28, 2020. It first sought bankruptcy protection (Bankr. N.D. Ga. Case No. 19-64159) on Sept. 6, 2019. In the petition signed by Kenneth Mims, M.D., manager, the Debtor disclosed assets of up to $10 million in both assets and liabilities. Judge Lisa Ritchey Craig presides over the case. The Debtor tapped Jones & Walden, LLC as its bankruptcy counsel and Moorman and Pieschel, LLC as its corporate counsel. SMS Financial Strategic Investments, LLC is represented by Beth E. Rogers, Esq. at Rogers Law Offices. HERITAGE RAIL: Trustee Selling Scenic View to TSRA for $300K ------------------------------------------------------------ Tom Connolly, the Chapter 11 Trustee of Heritage Rail Leasing, LLC, asks the U.S. Bankruptcy Court for the District of Colorado to authorize the sale of SLRG 511 ("Scenic View") to Texas State Railroad Authority for $300,000, subject to higher and better offers. Heritage owns rail cars, locomotives, rolling stock and equipment that it used in connection with its rail car leasing business. The Trustee has continued to respond to inquiries from prospective purchasers of Heritage's assets. After considering available options within the context of the current economic environment and the status of Heritage's operations, the Trustee determined in his business judgment to sell SLRG 511 ("Scenic View") to the Buyer under section 363 of the Bankruptcy Code, subject to higher and better bids. Prior to the bankruptcy case, Heritage leased Scenic View to Texas & Eastern Railroad, LLC on an annual basis for use by Texas & Eastern in its excursion trains. Texas & Eastern was in possession of Scenic View when this bankruptcy case was commenced and informed the Trustee that it desired to continue to use Scenic View in its excursion train activity. On Jan. 12, 2021, the Trustee and Texas & Eastern executed an Extension of Lease Agreement for a one-year extension of the lease term to Feb. 1, 2022. After arms'-length negotiations, the Trustee negotiated a sale of Scenic View to the Buyer at a purchase price of $300,000 on the terms set forth in the Motion and in the purchase agreement, subject to higher and better bids. Big Shoulders Capital, LLC has asserted it has first priority security interest in Scenic View pursuant to a Loan and Security Agreement between Heritage and Big Shoulders dated Feb. 27, 2017 (as amended). The Trustee understands that Big Shoulders has consented to his sale of Scenic View subject to a carve out of 20% of the net purchase price of Scenic View less closing costs, including any applicable storage fees to remain with the Heritage estate free and clear of any Big Shoulders' lien, with rights otherwise reserved. Upon information and belief of the Trustee, Scenic View is not otherwise subject to any security interest, claim or lien. The Trustee has investigated the fair market value of Scenic View by speaking with industry sources, persons familiar with Scenic View and Big Shoulders. Based on this investigation, he has determined that the Purchase Price represents fair market value. He now seeks authority to further market-test the transaction contemplated by the Purchase Agreement to obtain the highest or best offer for Scenic View. By the Motion, the Trustee seeks entry of an order (a) approving the sale of Scenic View, subject to the Lease, and otherwise free and clear of all liens, claims, encumbrances, and interests, including (without limitation) specifically those of Big Shoulders and those of any affiliated entity of Heritage, if any, to either (i) Texas State Railroad, or (ii) the party who submits the highest or best bid, and (b) finding the successful purchaser is a "good faith" purchaser under Bankruptcy Code section 363(m). The Trustee and the Buyer have negotiated the key terms of the sale of Scenic View, and have executed the Purchase Agreement, which remains subject to the Court's approval. The material terms of the Purchase Agreement are: a. Purchase Price: $300,000 b. The Trustee will convey title to Scenic View to the successful purchaser free and clear of all liens, claims and encumbrances, but subject to the remaining term of the Lease. c. The Purchase Agreement is subject to, and will not become effective, until it is approved in its entirety by final, written, non-appealable Order of the Court. d. Texas State Railroad will accept Scenic View at closing on an "as is, where is" basis. e. The closing will occur no later than 10 business days after which Court approval provided herein is effective and not subject to a stay, or upon such other day upon which the parties reasonably agree. The Trustee does not believe that Court-approved formal bidding procedures or a break up fee are needed in light of the simplicity of the proposed transaction. Instead, he asks that any competing bids for Scenic View be received by deadline to object to the Motion. Any parties submitting a competing bid that wish to inspect Scenic View will be required to comply with all relevant inspection procedures and pay any necessary inspection fees. If any objections or competing bids are received, the Trustee will hold an auction and bidding can occur at that auction. Any competing bid for Scenic View should be on the same terms as the Purchase Agreement (other than the purchase prices) and be accompanied by a 5% earnest money deposit and show ability to close. Initial overbids must be at least 5% more than the Purchase Price. Finally, the Trustee requests that any order approving the sale of Scenic View be effective immediately, thereby waiving the 14-day stay imposed by Bankruptcy Rules 6004. The waiver of the 14-day stay is necessary for the sale of Scenic View to close and the funding to be received as expeditiously as possible. A copy of the Agreement is available at https://tinyurl.com/4t59u853 from PacerMonitor.com free of charge. About Heritage Rail Leasing Heritage Rail Leasing, LLC leases rail rolling stocks, locomotives and track equipment. On Aug. 21, 2020, Portland Vancouver Junction & Railroad Inc., Vizion Marketing LLC and D.L. Paradeau Marketing LLC filed a Chapter 11 involuntary petition against Heritage Rail Leasing. The creditors are represented by Michael J. Pankow, Esq., at Brownstein Hyatt Farber Schreck, LLP. Judge Thomas B. McNamara oversees the case. L&G Law Group LLP and Moglia Advisors serve as the Debtor's legal counsel and restructuring advisor, respectively. Alex Moglia of Moglia Advisors is the Debtor's chief restructuring officer. On Oct. 19, 2020, the Office of the U.S. Trustee appointed a committee to represent unsecured creditors in the Debtor's Chapter 11 case. The committee is represented by Goldstein & McClintock LLLP and the Law Offices of Douglas T. Tabachnik, P.C. On Oct. 28, 2020, the Court approved the appointment of Tom H. Connolly as the Debtor's Chapter 11 trustee. The trustee tapped Brownstein Hyatt Farber Schreck, LLP as his counsel. HERTZ CORP: GSP Transportation Buying Assets for $138.2 Million --------------------------------------------------------------- The Hertz Corp. and its affiliates ask the U.S. Bankruptcy Court for the District of Delaware to authorize them to sell Hertz Corp.'s assets to GSP Transportation, Inc. The Assets to be sold are comprised of (a) 15 airport locations, (b) 34 fixed base operator ("FBO") locations, (c) 36 off-airport locations, and (d) certain other vehicle maintenance and servicing locations. GSP will provide aggregate cash consideration of approximately $6.2 million plus the appraised value of the real estate associated with the Locations. That aggregate cash consideration is comprised of: a. $5 million cash payment, of which $1.5 million is due at close, $1.5 million is due upon the Debtors' exit from Chapter 11, and $2 million is due when air travel volume and related car rental volume returns to 2019 levels or Sept. 30, 2025, whichever is earlier; b. Approximately $1.2 million for the non-fleet assets (e.g., car wash systems and IT equipment) associated with the Locations, representing the estimated net book value as of the time of transfer; and c. The appraised value of the real estate associated with the Locations. In addition, GSP will pay to the Debtors approximately $132 million for the sale of approximately 5,000 vehicles associated with the Locations, representing the estimated Manheim Market Report ("MMR") value as of the time of transfer. A hearing on the Motion is set for May 18, 2021, at 10:30 a.m. (ET). The Objection Deadline is May 7, 2021, at 5:00 p.m. (ET). The Debtors' network of airport and off-airport locations is the backbone of their business. As part of these Chapter 11 Cases, the Debtors have implemented many initiatives to restructure that network to maximize the value of their business. One such initiative is the divestiture of certain of their locations to operators who will continue to operate those locations under the Debtors’ various brands as franchisees. The divestiture of corporate run locations to franchisees will result in, among other things, two key benefits to the Debtors and their estates. First, it will maintain the Debtors' points of distribution in the divested locations and revenue associated with the locations in the form of franchise royalties. Second, it will allow the Debtors to eliminate costs associated with directly operating the divested locations. Accordingly, the Debtors have determined that divesting certain locations to franchisees is in the best interests of their estates. In the fall of 2020, the Debtors began a marketing process to solicit offers for the purchase of certain of their locations to be operated as franchises. In furtherance of this process, on Oct. 8, 2020, the Court entered the Sale Procedures Order, which approved procedures to govern and expedite the sale of locations to franchisees. By the Motion the Debtors seek, pursuant to the Sale Procedures Order, to sell to GSP: (a) 15 airport locations, (b) 34 fixed base operator ("FBO") locations, (c) 36 off-airport locations, and (d) certain other vehicle maintenance and servicing locations. GSP is a long-time franchisee of the Debtors that has a proven record of success operating Hertz, Dollar, and Thrifty franchises. Accordingly, the Debtors are confident in GSP's ability to successfully operate the locations proposed to be divested, represent their brands, and generate royalties. Indeed, as part of the transaction, GSP has agreed to enter into new franchise agreements covering both the to-be-acquired locations as well as GSP's existing locations, bringing royalty rates at those existing locations up to the prevailing rate. Additionally, the transaction will result in a $5 million cash payment to the Debtors in three installments, the purchase of some of the fleet associated with the locations at market rates, and the purchase of facilities and equipment at the locations at Debtors’ net book value. Pursuant to the Sale Procedures Order, the Debtors are authorized to market franchise assets and enter into the APA without conducting an auction with related credit bid procedures. The APA is the result of the marketing process authorized under the Sale Procedures Order. The Debtors believe that the Sale Transaction will maximize value and is in the best interests of their estates. They do not contemplate conducting an auction for the sale of the Assets. The Assets were marketed by the Debtors to existing franchisees in accordance with the Sale Procedures Order, and GSP made the highest offer and is best positioned to purchase and perate the Locations. The Debtors therefore request that the Court approves the sale. Certain of the Assets are collateral securing the Debtors' prepetition secured debt facilities and the postpetition debtor-in-possession financing ("DIP Facility"). The Debtors believe that the following additional parties also have liens on the assets: First Lien Lenders, Second Lien Lenders, and other potential lienholders identified on Exhibit B. The Debtors seek authority to sell the Assets free and clear of all Encumbrances, with such Encumbrances to attach to the proceeds of the sale. Pursuant to the terms of the DIP Facility, the Debtors are permitted to retain such proceeds for general corporate purposes. The proceeds received from the vehicle sales will be used to pay down the HVF II ABS Facility as required under the applicable loan documents. In connection with the sale of the assets, the Debtors propose to assume and assign to GSP the Assigned Contracts listed on Exhibit 2 to the Proposed Order. Hertz will pay all cure costs due with respect to the Assigned Contracts. By the Motion, pursuant to sections 105(a), 363, and 365 of the Bankruptcy Code and Rules 6004, 6006, and 9014 of the Bankruptcy Rules, the Debtors ask entry of the Proposed Order: (i) approving the sale of the Assets to the Purchaser free and clear of all Encumbrances (except as otherwise provided in the Asset Purchase Agreement) in accordance with the terms and conditions of the Asset Purchase Agreement; (ii) authorizing the assumption and assignment of the Assigned Contracts listed on Exhibit 2 to the Proposed Order; (iii) authorizing the consummation of the Sale Transaction contemplated by the Asset Purchase Agreement; and (iv) granting related relief. Finally, to implement the foregoing successfully, and given the nature of the relief requested herein and the deadlines in the APA, the Debtors respectfully request a finding that (x) the notice requirements under Bankruptcy Rules 6004(a) and 6006(c) are met, and (y) the 14-days stay under Bankruptcy Rules 6004(h) and 6006(d) are waived. A copy of the Agreement and the Exhibits is available at https://tinyurl.com/tqaukqwl from PacerMonitor.com free of charge. The Purchaser: GSP TRANSPORTATION, INC. 2429 HWY 14 S. Greer, SC 29650 Attn: Jeff Schoepfel E-mail: jeff.schoepfel@thriftysc.com The Purchaser is represented by: TALLEY LAW FIRM, P.A. Attn: Scott Talley, Esq. 134 Oakland Avenue Spartanburg, SC 29302 E-mail: scott@talleylawfirm.com About Hertz Corp. Hertz Corp. and its subsidiaries -- http://www.hertz.com-- operate a worldwide vehicle rental business under the Hertz, Dollar, and Thrifty brands, with car rental locations in North America, Europe, Latin America, Africa, Asia, Australia, the Caribbean, the Middle East, and New Zealand. They also operate a vehicle leasing and fleet management solutions business. On May 22, 2020, The Hertz Corporation and certain of its U.S. and Canadian subsidiaries and affiliates filed voluntary petitions for reorganization under Chapter 11 in the U.S. Bankruptcy Court for the District of Delaware (Bankr. D. Del. Case No. 20-11218). Judge Mary F. Walrath oversees the cases. The Debtors have tapped White & Case LLP as their bankruptcy counsel, Richards, Layton & Finger, P.A. as local counsel, Moelis & Co. as investment banker, and FTI Consulting as financial advisor. The Debtors also retained the services of Boston Consulting Group to assist the Debtors in the development of their business plan. Prime Clerk LLC is the claims agent. The U.S. Trustee for Regions 3 and 9 appointed a Committee to represent unsecured creditors in Debtors' Chapter 11 cases. The Committee has tapped Kramer Levin Naftalis & Frankel LLP as its bankruptcy counsel, Benesch Friedlander Coplan & Aronoff LLP as Delaware counsel, UBS Securities LLC as investment banker, and Berkeley Research Group, LLC as financial advisor. Ernst & Young LLP provides audit and tax services to the Committee. HR NORTH DALE: Seeks to Hire Johnson Pope as Legal Counsel ---------------------------------------------------------- HR North Dale Mabry, LLC seeks approval from the U.S. Bankruptcy Court for the Middle District of Florida to employ Johnson Pope Bokor Ruppel & Burns, LLP as legal counsel. The firm will provide these services: a. give the Debtor legal advice with respect to its duties and obligations under the Bankruptcy Code; b. take necessary steps to analyze and pursue any avoidance actions; c. prepare legal papers required in the Debtor's Chapter 11 case; d. assist the Debtor in taking all legally appropriate steps to effectuate compliance with the Bankruptcy Code; and e. perform all other legal services for the Debtor which may be necessary, including closings of sales of the Debtor's real properties. Johnson Pope will be paid at these rates: Attorneys $325 to $450 per hour Paralegals $180 to $205 per hour Legal Assistants $75 to $105 per hour The firm will also be reimbursed for out-of-pocket expenses incurred. The retainer fee is $20,000. Angelina Lim, Esq., a partner at Johnson Pope, disclosed in a court filing that her firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code. The firm can be reached at: Angelina E. Lim, Esq. Johnson Pope Bokor Ruppel & Burns, LLP 401 E. Jackson Street, Suite 3100 Tampa, FL 33602 Tel: (813) 225-2500 Fax: (813) 223-7118 Email: Angelina@jpfirm.com About HR North Dale Mabry HR North Dale Mabry, LLC sought protection under Chapter 11 of the Bankruptcy Code (Bankr. M.D. Fla. Case No. 21-01958) on April 21, 2021. Claire Clement, manager, signed the petition. In its petition, the Debtor disclosed assets of between $1 million and $10 million and liabilities of the same range. Johnson Pope Bokor Ruppel & Burns, LLP is the Debtor's legal counsel. ILLINOIS SPORTS: S&P Affirms 'BB+' on State Tax-Supported Bonds --------------------------------------------------------------- S&P Global Ratings revised the outlook to stable from negative and affirmed its 'BB+' rating on the Illinois Sports Facilities Authority's (ISFA) state tax-supported bonds. "The stable outlook reflects ISFA management's intention to recommend to the board the approval of a chairman's certificate sufficient to cover debt service; state COVID-19 social distancing restrictions lifting in planned phases; and reduced, but expected stable, reserve levels," said S&P Global Ratings credit analyst Geoff Buswick. Still considered, however, are the continued weak collections in hotel tax revenues and S&P's expectation that the coming fiscal 2022 will see further operational challenges at the authority. The speculative-grade rating also incorporates the fiscal 2021 action of the ISFA board not fully requesting an amount sufficient to cover debt service and then drawing on reserves to benefit another entity while facing a pandemic. Other key credit considerations include: -- A large and diverse statewide economic generating pledged hotel taxes; -- S&P views that the tax revenue securing the bonds has demonstrated moderate volatility, with some historical declines but that increased in the nine years prior to the pandemic; -- A pre-pandemic history of strong annual debt service coverage and an adequate 1.35x additional bonds test, which may resume over time; and -- S&P views that the general creditworthiness of Illinois partially offsets the credit strengths given the close linkages to the state. S&P said, "The rating also reflects our opinion of state-level governance risks that we view as being above the sector norms due to the constitutional limits the state faces to modify its rising pension costs, and that the state is not contributing to meet static funding, limiting current and future budgetary flexibility. However, we view the state's environmental risks as in line with our view of the sector. Our rating reflects our view that the COVID-19 pandemic's impact on the state's economy, budget, and forecast is a social rating factor elevating the public health and safety issues." The social risks are lessening broadly across the state, but for ISFA, the health and safety measures will impair needed revenues from both hotel occupancy and large group gatherings. The persistently weak statewide hotel tax revenue collections, should they not improve as expected, could lead to further reserve draws, and virus variants could extend the weakened credit profile. With pledged revenues down meaningfully year to date in fiscal 2021, compared with the same period in fiscal 2020, the pace of recovery in statewide hotel tax receipts could be slow and lasting. Should ISFA need to further draw on reserves without a plan to replenish them, or fail to request a chairman's certificate to fully cover debt service, S&P could lower the rating. If economic recovery leads to pledged revenue coverage improving through stronger statewide hotel tax collections, non-pledged reserve levels begin to be replenished, and ISFA continues to request and receive state appropriations sufficient to cover more than annual debt service requirements, S&P could consider an upgrade. INDUSTRIAL REPAIR: Wins Cash Collateral Access ---------------------------------------------- The U.S. Bankruptcy Court for the Northern District of Ohio has authorized Industrial Repair and Manufacturing, Inc. to use the cash collateral of First Security Bank of Nevada and Buckeye State Bank on an interim basis, and provide adequate protection. The Debtor is authorized to use cash collateral to pay all ordinary and necessary expenses consistent with the Debtor's budget, with a variance of 10%. As adequate protection for the Debtor's use of cash collateral, FSBN will be entitled to receive a monthly payment of $18.156.93. FSBN is also granted a postpetition perfected security interest to the same extent and with the same priority as FSBN held on a prepetition basis in the Debtor's property. The FSBN Replacement Lien will be deemed to be perfected immediately upon the entry of the Court of the Interim Order without the need for filing any further documentation. In addition, FSBN is authorized, and the stay of 11 U.S.C. section 362 is lifted so as to allow FSBN to file any documentation it deems appropriate and necessary to perfect the interest. The Debtor will not make any payments to BSB, but BSB is granted a post-petition perfected security interest under section 361(2) to the same extent and with the same priority as BSB held on a prepetition basis in the Debtor's property. The BSB Replacement Lien will be deemed to be perfected immediately upon the entry of the Interim Order by the Court without the need for filing any further documentation. As additional adequate protection, the Debtor will maintain insurance on all its property and pay appropriate taxes and account for all cash use. These events constitute Events of Default: (a) The confirmation, conversion or dismissal of this Chapter 11 case; (b) The Debtor's unauthorized use of the Cash Collateral; (c) The Debtor ceasing operation of its business as a Debtor-In-Possession under the Bankruptcy Code; (d) Entry of a Court Order terminating the Cash Collateral Order for cause; (e) Entry of an order granting either FSBN or FSB relief from the automatic stay; or (f) July 1, 2021. A further hearing on the use of cash collateral is scheduled for June 24, 2021 at 1:30 p.m. A copy of the order and the Debtor's budget for May and June is available for free at https://bit.ly/3aPaiya from PacerMonitor.com. The Debtor projects total revenues of $220,740 and total expenses of $179,783 for the two-month period. About Industrial Repair and Manufacturing Industrial Repair and Manufacturing, Inc. provides warehousing and storage services. It is the fee simple owner of a storage warehouse located at 265 Rogers St., Delta, Ohio, valued at $1.42 million. Industrial Repair and Manufacturing filed its voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. N.D. Ohio Case No. 21-30505) on March 26, 2021. Peggy Toedter, treasurer, signed the petition. At the time of filing, the Debtor disclosed $1,926,975 in assets and $5,756,050 in liabilities. Judge Mary Ann Whipple oversees the case. Steven L. Diller, Esq., at Diller and Rice, LLC, serves as the Debtor's counsel. First Security Bank of Nevada, as creditor, is represented by: Jeffrey R. Sylvester, Esq. SYLVESTER & POLEDNAK LTD. 1731 Village Center Circle Las Vegas, NV 89134 Tel: 702-952-5200 Email: Jeff@SylvesterPolednak.com Buckeye State Bank, as creditor, is represented by: Scott N. Schaeffer, Esq. KEMP, SCHAEFFER & ROWE CO., LPA 88 West Mound Street Columbus, OH 43215 Tel: (614) 224-2678 Fax:(614)469-7170 Email: scott@ksrlegal.com ISAGENIX WORLDWIDE: S&P Raises ICR to 'B-' on EBITDA Growth ----------------------------------------------------------- S&P Global Ratings raised its issuer credit rating on U.S.-based Isagenix Worldwide Inc. to 'B-' from 'SD'. Concurrently, S&P raised its issue-level rating on the $40 million revolver due 2023 to 'B+' from 'CCC' and revised the recovery rating to '1' from '3' to reflect the lower debt claims at emergence after the company cumulatively repurchased a material portion of its term loan at prices well below par. S&P said, "Our issue-level rating on the $375 million term loan due 2025 remains 'D' because we believe further debt repurchases at prices well below par are possible given the continued distressed trading price. We would reassess subject to the company's operating performance and trading price of its bank debt, as well as its commitment to no further debt repurchases." The negative outlook reflects the potential for a lower rating over the next 12 months if the company cannot retain its distributors and customers, particularly as the economy reopens and competitive headwinds reemerge in the post-pandemic environment, such that the capital structure becomes unsustainable. The company's operating performance has improved and we expect modest top line and EBITDA growth in 2021. The company's operating performance has improved over the past year, partly benefiting from a demand surge associated with greater focus on health and nutrition. In addition, a desire for part-time income as unemployment increased and work-from-home models proliferated encouraged new distributors to join. The number of customers and distributors have increased year over year. S&P expects both the topline and EBITDA to grow modestly in 2021, driven by continued demand as customers focus on health and wellness. S&P expects adjusted leverage to stay in the low-5x area and free cash flow of around $30 million in 2021. S&P expects the company to remain in compliance with its financial maintenance covenant over the next year. Isagenix has around $20 million of liquidity including cash and revolver availability. The amendment to the credit agreement relaxed the financial maintenance covenant and S&P expects the company to remain in compliance with its covenants, though cushion could tighten if demand falls well short of our expectations. The company has no near-term maturities, with its revolver due June 2023 and term loan due June 2025. An uncertain post-pandemic environment could affect operating performance. There are still many uncertainties, including that pandemic-driven benefits could dissipate as the economy reopens. Before the pandemic, Isagenix's performance deteriorated substantially; it's possible these same factors--including competition for gig economy workers and escalating competition from competitors, including Amazon--could again impair EBITDA. In addition, as vaccination progress continues and more people return to work, the need for part-time income could lessen. It is also possible that new product launches may not resonate with customers. S&P said, "Our ratings continue to reflect the risks associated with operating a multilevel direct sales business model and its participation in the highly competitive weight loss industry. We have incorporated the risks associated with operating a multilevel marketing (MLM) direct sales business model, which includes potential unfavorable legal, regulatory, and reputational developments, the need to maintain and adequately compensate the sales associate base, and high customer turnover. The company also participates in the highly competitive weight loss industry and has high product concentration. In particular, Isagenix is highly dependent on the IsaLean Shake, a weight-loss product that accounts for more than half of sales and is manufactured by only a few suppliers. Although we believe its product recall history has been limited, it's still a risk, especially given its outsourced business model." The negative outlook reflects the potential for a lower rating over the next 12 months if the company cannot retain its distributors and customers, leading to a resumption of EBITDA declines that began before the pandemic amid escalating competitive headwinds. S&P could lower its rating if the company's operating performance starts to deteriorate, leading to weaker free cash flow generation and EBITDA interest coverage, and resulting in an unsustainable capital structure. This could happen due to: -- The inability to retain distributors and customers as economic conditions improve; -- Increasing competition from the gig economy and Amazon; or -- Unsuccessful product launches. S&P could revise its outlook to stable if: -- Isagenix continues to improve its operating performance in line with S&P's expectation as the economy reopens; -- It retains its customer and distributor base; -- EBITDA interest coverage remains above 2x; and -- It maintains double-digit forecast covenant cushion. ITT HOLDINGS: Fitch Affirms 'BB+' LT IDR, Outlook Stable -------------------------------------------------------- Fitch Ratings has affirmed the ratings of ITT Holdings LLC (ITT, or opco) including the Long-Term Issuer Default Rating (IDR) at 'BB+', and the senior unsecured notes at 'BB+'/'RR4'. Fitch has also removed the ratings from Under Criteria Observation (UCO) and affirmed the IDR of RS Ivy Holdco, Inc. (RS Ivy or hodco) at 'BB', and the senior secured rating at 'BB'/'RR4'. Fitch's revised Corporates Recovery Ratings and Instrument Ratings Criteria recognizes the ratings of RS Ivy (holdco) are structurally subordinated ITT (opco). The Rating Outlook for both entities is Stable. The ratings of RS Ivy have been removed from UCO, where they were placed following the publication of the updated recovery ratings criteria on April 9, 2021. The Stable Outlooks reflect Fitch's view that ITT's operations should continue to provide steady cash flows over the forecast period as utilization rates are expected to remain in the 90's% over the forecast period. Dividend payments to RS Ivy are expected to adequately service the term loan. As several fully contracted growth projects are slated to be complete by YE 2021, consolidated leverage is expected to improve below 6.0x by YE 2022. KEY RATING DRIVERS Leverage Remains Elevated in 2021: Fitch calculated the consolidated leverage of ITT and RS Ivy of 6.2x at YE 2020. On a standalone basis, ITT's leverage was 4.3x, elevated from historical leverage in the 3.5x-4.0x range. 2020 EBITDA benefited from deep contango conditions which are not expected to be repeatedin 2021. With the combination of higher levels of capex in 2021 and tapered EBITDA expectations, YE 2021 consolidated and ITT standalone leverage are expected to tick up to 6.3x and 4.4x, respectively. Once new growth projects come in service in 2022, leverage is expected to decline below 6.0x on a consolidated basis and closer to 4.0x on a standalone basis. Strong Utilization: ITT tended to have utilization in the low 90's% regardless of the cost of commodities it stores until 2018 and 2019. Then utilization rates fell in the 80's%, and ITT took steps to repurpose some liquid storage capacity on the Lower Mississippi River (LMR). These efforts, along with demand resulting from changes in market conditions driven by the coronavirus pandemic, brought utilization rates up such that the average during 4Q20 was almost 95%, up from 86% at the end of 2019. Parent Subsidiary Linkage: Fitch evaluates the holding company and operating company on a consolidated basis given the holding company's full reliance on the operating company to service its debt. There is a link between ITT and RS Ivy with a strong subsidiary and a weak parent. Legal ties are considered to be weak as ITT does not provide upstream guarantees, and there are provisions that restrict payments as well as intercompany loans. Operational ties are also considered weak since ITT has its own management team, a decentralized treasury and its own operations. Given the stronger credit profile at ITT, Fitch notches its rating up one from the consolidated credit profile. Strategically Located Assets: ITT has the competitive advantage of having strategically located bulk liquid terminal facilities with significant market share in its two primary locations: the New York Harbor (NYH) and on the Lower Mississippi River (LMR). Storage assets in NYH are focused on gasoline and distillates while storage in the LMR is more focused on heavy and residual oil, petrochemicals, and palm oils. New Projects Drive Growth: In February 2020, ITT entered into a long-term lease agreement with Diamond Green Diesel a joint venture (JV) owned by Darling Ingredients Inc. and, a subsidiary of Valero Energy Corporation (VLO; BBB/Negative). The JV will use ITT's St. Rose terminal and expand its renewable diesel facility in Norco, LA. ITT will repurpose 790,000 barrels of storage capacity so it can hold renewable diesel and its feedstock. ITT will also build two five-mile pipelines to connect the two assets. The project will require a significant amount of growth capex and is expected to be in service in late 2021. The company also has a number of other smaller projects underway. Structural Subordination: RS Ivy's ratings reflect that the senior secured term loan is structurally subordinated to the outstanding debt at ITT and is solely reliant on the dividend distributions from ITT for debt service repayment. Cash flow generated at its operating subsidiary ITT is prioritized to service debt and interest payments for ITT's debt obligations. The term loan is secured by pledged equity interest in ITT and is junior to the subsidiaries in recovery claims should a credit event default occur at ITT. Under Fitch's parent-subsidiary linkage analysis, RS Ivy also exhibits a weaker credit profile relative to the subsidiary Opco given the cash flow structure and provisions around ITT's distribution. Diverse Customers and Tariff Structure: ITT has a diverse mix of customers and estimates that nearly two-thirds of its revenues come from its top 20 customers, the majority of which are investment grade. Its customers pay in advance for storage regardless of whether or not product is stored. Contracted rates typically increase according to annual inflation indices (CPI). Furthermore, ITT typically passes through costs for heating and other services to its customers for a profit. The weighted average contract life is 2.1 years as of December 2020. This will increase once the long-term lease agreement with Diamond Green Diesel begins operations. Limited Asset Diversity: Fitch's concerns include a lack of diversified assets, ITT's concentration of assets in two locations, risk of contract rates declining when they come up for renewal and ownership by a financial institution designed to distribute dividends to common shareholders. DERIVATION SUMMARY On a consolidated basis, Fitch views ITT/RS Ivy as a 'BB' category entity with a competitive advantage from strategic locations in the New York Harbor and Lower Mississippi River. The rating also reflects steady cash flow generation and leverage that is expected to be around 6.3x at the end of YE 2021. ITT is notched up one level from the consolidated credit profile to 'BB+'. The rating reflects ITT's history of generating fairly steady cash flow, and leverage on a stand-alone basis is expected to be approximately 4.4x at the end of 2021 and trend to around 4.0x by the end of 2022. ITT is higher rated than peer TransMontaigne Partners LLC (TLP; BB/Stable), a terminaling company operating in 20 U.S. states, with slightly less capacity than its closest comparable within Fitch's midstream coverage universe. Both companies operate diversified petroleum liquids storage assets strategically located across the U.S. Both companies have assets that make up critical portions of the regional petroleum value chain where operated, although ITT is viewed as having a much stronger presence in its two markets. ITT is roughly 13% larger than TLP by storage capacity. Leverage at TLP is expected to decline toward 4.0x over the forecast horizon while ITT/RS Ivy is expected to have leverage around 6.3x at the end of 2021. ITT's credit profile greatly benefits from the having EBITDA that is approximately double the size of TLP. ITT/RS Ivy's leverage profile and cash flow generation is significantly better than the consolidated profile for Tallgrass Energy Partners, LP (Opco)/Prairie ECI Acquiror LP (Holdco). Fitch forecasts Tallgrass to have YE 2021 leverage of 7.5x (which is proportionally consolidated for Rockies Express Pipeline LLC). Its consolidated credit profile is deemed to be 'B+', its Holdco's IDR is 'B+' and the Opco, Tallgrass is 'BB-'. ITT's 'BB+' rating reflects its competitive advantage of its strategic locations and also factors in its small size and scale versus other similarly rated issuers. Buckeye Partners LP (BPL; BB/Stable) has much greater size, scale and diversity than ITT. Both ITT and Buckeye have financial sponsors, but leverage at ITT is much lower on a stand-alone basis. NuStar is rated 'BB-' and is larger and more diverse than ITT/RS Ivy with approximately 36% of EBITDA from storage, 62% from pipelines and 2% for fuels marketing. Leverage is expected to be 5.6x-6.1x by YE 2021, which is in line with, or better than, forecast consolidated leverage at ITT/RS Ivy. However, NuStar's FFO interest coverage is much weaker versus other 'BB' issuers such as ITT/ RS Ivy and Buckeye. KEY ASSUMPTIONS Fitch's key assumptions within its rating case for the issuer include: -- Utilization rates remain in the 90's; -- Revenues grow significantly in 2022 as a result of large projects coming online; -- EBITDA margins are forecast to be approximately 52% in line with historical rates; -- On a consolidated basis, leverage will be approximately 6.3x at YE 2021. RATING SENSITIVITIES Factors that could, individually or collectively, lead to positive rating action/upgrade: -- Consolidated leverage (consolidated debt with equity credit to-consolidated operating EBITDA) that is expected to be below 5.5x on a sustained basis; -- A geographic expansion and/or asset diversification, by a series of acquisitions or incremental growth projects, that significantly increased ITT's cash flow generation. Factors that could, individually or collectively, lead to negative rating action/downgrade: -- Consolidated leverage (consolidated debt with equity credit to-consolidated operating EBITDA) is expected to be above 7.0x on a sustained basis; -- Low storage utilization at ITT below 90% that results in EBITDA deterioration on a sustained basis. BEST/WORST CASE RATING SCENARIO International scale credit ratings of Non-Financial Corporate issuers have a best-case rating upgrade scenario (defined as the 99th percentile of rating transitions, measured in a positive direction) of three notches over a three-year rating horizon; and a worst-case rating downgrade scenario (defined as the 99th percentile of rating transitions, measured in a negative direction) of four notches over three years. The complete span of best- and worst-case scenario credit ratings for all rating categories ranges from 'AAA' to 'D'. Best- and worst-case scenario credit ratings are based on historical performance. LIQUIDITY AND DEBT STRUCTURE Adequate Liquidity: As of December 2020, ITT had almost $32 million of cash on the balance sheet. There were no outstanding borrowings on its $600 million senior unsecured revolving credit facility due in December 2023 and $3 million in LOC. ITT also has manageable maturity profile, with its nearest debt maturity being its unsecured revolver expiring in 2023 and $325 million senior unsecured notes due in 2025. Liquidity Needs Limited: RS Ivy is a holding company with little liquidity needs. Fitch expects dividends to RS Ivy from ITT to be sufficient to support interest payments and its mandatory amortization and minimum debt-service coverage ratio of 1.1x for the forecast period. RS Ivy must maintain six months of interest and amortization for the term loan in the DSRA until consolidated total net leverage ratio is less than 4.5x. SUMMARY OF FINANCIAL ADJUSTMENTS Fitch removed a $39 million termination payment from ITT's 2019 revenues and adjusted EBITDA. A standard multiple of 8.0x is applied to operating lease expense to derive lease-equivalent debt. ESG CONSIDERATIONS ITT has an ESG Relevance Score of '4' for Group Structure and Financial Transparency. This is due to its sponsor, RS Ivy Holdco, Inc., and the potential for less financial flexibility. This has a negative impact on the credit profile and is relevant to the rating in conjunction with other factors. Unless otherwise disclosed in this section, the highest level of ESG credit relevance is a score of '3'. This means ESG issues are credit-neutral or have only a minimal credit impact on the entity, either due to their nature or the way in which they are being managed by the entity. J.J.W. METAL: Unsecured Creditors to Recover 50% in Plan -------------------------------------------------------- J.J.W. Metal Corp. filed with the Bankruptcy Court a Plan of Reorganization and a Disclosure Statement. The Debtor will effect payment of Administrative Expense Claims, Priority Tax Claims, Allowed Secured and General Unsecured Claims from the cash flows generated from its operations and the cash accumulated during the pendency of the case. Holders of Allowed General Unsecured Claims in Class 6 aggregating $672,610 will be paid 50% of their claims on the Effective Date in full satisfaction thereof. Claims of Debtor's Insiders will be subordinated to the other general unsecured claims and paid 50% thereof, only after making the payments to all other creditors of this Class. Members of Classes 5 and 6 are impaired under the Plan and are entitled to vote. Class 5 Claims pertain to other holders of Cure Claims from Assumed Executory Contracts. Post-confirmation, the Debtor's management will consist of its president, Mr. Jorge Rodríguez Quinones with a monthly compensation of $1,330, and its Treasurer, Mr. Jorge Camejo Rodriguez with a monthly compensation of $1,330. Both receive fringe benefits such as vehicles expenses reimbursement, health plan, and the payment of their cellular phone. A copy of the Disclosure Statement is available for free at https://bit.ly/3gRn8zU from PacerMonitor.com. About J.J.W. Metal Corp. J.J.W. Metal Corp. sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D.P.R. Case No. 20-04536) on Nov. 23, 2020. J.J.W. Metal President Jorge Rodriguez Quinones signed the petition. At the time of filing, the Debtor disclosed total assets of $1,649,341 and total liabilities of $1,750,865. Judge Edward A. Godoy oversees the case. The Debtor tapped Charles A. Cuprill, P.S.C., Law Offices as its legal counsel and Luis R. Carrasquillo & Co. P.S.C. as its financial consultant. Gino Negretti Lavergne, Esq., and Frank Inserni Milam, Esq., serve as the Debtor's special counsel. JILL ACQUISITION: Moody's Withdraws Caa3 Rating on Secured Loan --------------------------------------------------------------- Moody's Investors Service has withdrawn the rating on Jill Acquisition LLC's (J.Jill) senior secured term loan due 2022. Withdrawals: Issuer: Jill Acquisition LLC Senior Secured Term Loan, Withdrawn , previously rated Caa3 (LGD5) RATINGS RATIONALE Moody's has decided to withdraw the ratings for its own business reasons. J.Jill's Caa2 corporate family rating, Caa2-PD probability of default rating and Caa1 rating on the senior secured term loan due 2024 are unaffected. JTS TRUCKING: To Sell Remaining Assets for $325K in Plan -------------------------------------------------------- JTS Trucking LLC filed a Chapter 11 Plan of Liquidation and a Disclosure Statement. The Debtor intends to liquidate its assets pursuant to the Plan. The Debtor intends to sell its remaining assets to Elite Milwright Fabrication, LLC for $325,000, subject to Court approval. During the Debtor's Chapter 11 case, the Debtor leased its remaining assets to Elite Milwright. The unsecured claims in the Debtor's case are estimated to be $56,532, plus any unsecured portion of claims alleged to be secured. The Debtor proposes to pay each of the unsecured claimholders the allowed amount of their claim from its pro rata share of the remaining proceeds from the liquidation of the Debtor's remaining assets and from the net proceeds from the Debtor's expected litigation against Atlantic Southern Construction, Inc., and Jason Cahela after payment in full of all allowed administrative expenses, allowed priority claims and allowed secured claims. Atlantic Southern Construction and Jason Cahela have wrongfully filed a lis pendens upon the Debtor's estate. A copy of the Disclosure Statement is available for free at https://bit.ly/3vAAHb1 from PacerMonitor.com. About JTS Trucking JTS Trucking LLC, a trucking company based in Albertville, Alabama, sought protection under Chapter 11 of the Bankruptcy Court (Bankr. N.D. Ala. Case No. 20-40423) on March 6, 2020, listing under $1 million in both assets and liabilities. The petition was signed by Susan M. Lowden, its member. The Debtor tapped Harry P. Long, Esq., at the Law Offices of Harry P. Long, LLC as its counsel; Bill Massey and MDA Professional Group, PC as its accountants; and Kevin Lowery and RE/MAX The Real Estate Group as broker and property manager for the Debtor's estate. K&N PARENT: Moody's Raises CFR to Caa2 & Alters Outlook to Stable ----------------------------------------------------------------- Moody's Investors Service has upgraded K&N Parent, Inc.'s corporate family rating to Caa2 from Caa3, probability of default rating to Caa2-PD from Caa3-PD, senior secured first lien credit facilities to Caa1 from Caa2 and second lien term loan to Caa3 from Ca. The rating outlook is stable. The rating upgrades reflect Moody's view of a somewhat lowered risk of default although liquidity is still weak. Strong demand for K&N's products will contribute to earnings growth in 2021 and as a result, Moody's views financial leverage, albeit high at about 8x debt/EBITDA at end of 2020, to be on a trajectory to more sustainable levels. K&N has been reliant on external capital sources to offset sizeable cash outlays relating to the relocation of its manufacturing facilities. Although Moody's expect these cash outlays to materially reduce in the back half of 2021 as the relocation completes, it remains to be seen whether K&N can generate sufficient free cash flow going forward. The following rating actions were taken: Upgrades: Issuer: K&N Parent, Inc. Corporate Family Rating, Upgraded to Caa2 from Caa3 Probability of Default Rating, Upgraded to Caa2-PD from Caa3-PD Senior Secured 1st Lien Bank Credit Facility, Upgraded to Caa1 (LGD3) from Caa2 (LGD3) Senior Secured 2nd Lien Bank Credit Facility, Upgraded to Caa3 (LGD5) from Ca (LGD5) Outlook Actions: Issuer: K&N Parent, Inc. Outlook, Changed To Stable From Negative RATINGS RATIONALE K&N's ratings reflect its limited revenue scale with discretionary products, high financial leverage, and weak liquidity resulting from continually negative free cash flow. Contributing to K&N's cash burn over the last couple of years has been the company's ongoing relocation of its production and distribution facilities, which has prompted several capital infusions from the company's equity sponsor as well as additional financing arrangements to fund the cash shortfall. The completion of the relocation is expected to occur in 2021, and going forward Moody's expects the quality of K&N's reported earnings to improve as duplicative operating costs roll off and free cash flow to increase as capital spend normalizes to maintenance levels. K&N's operating performance prior to 2020 had weakened as a result of unfavorable shifts in its product and channel mix along with higher unabsorbed costs. During 2020, new executive management revamped and differentiated the company's product offerings, narrowed the focus of customer relationships and improved the company's e-commerce presence, all of which resulted in substantial revenue growth and increased market share. Moody's expects K&N's revenue growth to continue in 2021 in the mid-teens range along with more moderate earnings expansion as higher volumes will be somewhat offset by increased labor and freight costs. Moody's believes that K&N could enact price actions to mitigate higher input costs. K&N's liquidity is expected to remain weak. The company's total liquidity is essentially its cash position at quarter-end March 2021, which has been supported by several capital infusions over the last 18 months, full draw-down of its $40 million revolver due 2023, and most recently during 1Q 2021, a sale-leaseback of equipment and borrowings under a new A/R facility. These external liquidity sources have been necessary to cover negative free cash flow totaling about $62 million over 2019 and 2020. Moody's expects K&N's cash burn to continue in 2021 at about $20 million before improving to at least breakeven free cash flow in 2022 as capital spend reduces to maintenance levels. K&N is subject to a springing first lien net leverage ratio for its $40 million revolver, which Moody's expects to remain fully drawn through 2021. The company is expected to remain in compliance with this covenant, which is scheduled for quarterly step-downs of 0.25x from 8.5x at end of 2020. As a supplier primarily to the automotive aftermarket, Moody's views environmental risk as it pertains to carbon transition to be low compared to the broader auto supplier sector. The stable outlook reflects expectations that improving operating performance should maintain financial leverage below 8x debt/EBITDA and lower capital spend should lead to at least breakeven free cash flow in 2022. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS K&N's ratings could be upgraded if the company maintains an adequate liquidity profile reflected by reduced reliance on external capital sources and free cash flow generation approaching break even. In addition, the ratings could be upgraded should K&N demonstrate improvement in reported earnings and debt/EBITDA approaches 7x. The ratings could be downgraded if K&N's liquidity deteriorates, or if Moody's does not expect the cash from operations to be materially improved by the third quarter of 2021 or the financial leverage is such that there is the potential for a distressed debt restructuring. The principal methodology used in these ratings was Automotive Supplier Methodology published in January 2020. K-MAC HOLDINGS: Moody's Affirms B3 CFR & Alters Outlook to Stable ----------------------------------------------------------------- Moody's Investors Service affirmed the B3 corporate family rating and B3-PD probability of default rating of K-Mac Holdings Corp. In addition, Moody's affirmed K-Mac's B2 first lien senior secured bank facility ratings and Caa2 second lien senior secured bank facility rating. The outlook was changed to stable from negative. The affirmation and outlook change to stable reflects K-Mac's positive operating performance despite ongoing government restrictions imposed as a result of the coronavirus pandemic, and Moody's expectation for further growth over the next twelve months as government restrictions continue to ease and consumers increase their spending on food-away from home. K-Mac's restaurant portfolio is comprised of Taco Bell restaurants, which boast a solid track record of same store sales growth, and its drive through capabilities have helped more than offset the in store dining restrictions. As a result, debt-to-EBITDA declined from about 6.0 times at year-end 2019 to around 5.0 times for the year-end 2020. Nevertheless, the affirmation reflects governance considerations, particularly the company's private equity ownership and potential for a more aggressive financial strategy leading to an increase in leverage. Affirmations: Issuer: K-Mac Holdings Corp Probability of Default Rating, Affirmed B3-PD Corporate Family Rating, Affirmed B3 Senior Secured 1st Lien Bank Credit Facility, Affirmed B2 (LGD3) Senior Secured 2nd Lien Bank Credit Facility, Affirmed Caa2 (LGD5) Outlook Actions: Issuer: K-Mac Holdings Corp Outlook, Changed To Stable From Negative RATINGS RATIONALE K-Mac Holdings Corp's B3 CFR is constrained by high, but improved leverage relative to the company's modest size and scale measured by total number of restaurants and revenue, as well as its concentration in predominantly one brand. Additionally, geographic concentration in the south central region of the US, notably Oklahoma, Arkansas and Missouri, as well as aggressive financial strategies with a history of debt and cash financed dividends constrain the company. The rating is supported by the strength, value proposition, and high level of awareness of the Taco Bell brand which has helped drive a solid track record of same store sales growth at K-Mac, and good liquidity. K-Mac's private ownership is a rating factor given the potential implications from both a capital structure and operating perspective. Financial policies are always a key concern of privately-owned companies with regards to the potential for higher leverage, extractions of cash flow via dividends, or more aggressive growth strategies. Restaurants are deeply entwined with sustainability, social and environmental concerns given their operating model with regards to sourcing food and packaging, as well as having an extensive labor force and constant consumer interaction. While these may not directly impact the credit, these factors could impact brand image and result in a more positive view of the brand overall. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS The stable outlook reflects K-Mac's good liquidity and improved credit metrics which provide it with some cushion to withstand the risk of a potentially leveraging event given its private equity ownership. Factors that could result in an upgrade include sustained improvement in credit metrics, and increased size, scale, and geographic diversification. A higher rating would require debt to EBITDA sustained under 5.5 times and EBIT coverage of interest expense near 1.75 times. A downgrade could occur if operating performance sustainably weakens or if financial strategies become more aggressive, such as debt financed dividends, were instituted. Specific metrics include Debt/EBITDA sustained above 6.25 times or EBIT to interest falls below 1.25 times. K-Mac Holdings Corp, headquartered in Fayetteville, Arkansas, owns and operates approximately 307 Taco Bell restaurants throughout the south central region of the US. Revenue for the FYE ended December 29, 2020 is approximately $473 million. K-Mac is majority owned by Lee Equity Opportunities Fund, L.P. The principal methodology used in these ratings was Restaurant Industry published in January 2018. L&L WINGS: Wins Cash Collateral Access Thru May 19 -------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of New York has authorized L&L Wings, Inc. to use the cash collateral of TD Bank, N.A. on an interim basis in accordance with the budget through May 19, 2021. The Debtor said it does not have sufficient available sources of working capital and financing to carry on the operations of its business without the use of Cash Collateral. The Debtor said its ability to pay employees and operating costs is essential to its continued viability. The Debtor's need to access Cash Collateral is immediate. The Court held that the Debtor's authority to use Cash Collateral is limited to payment of the authorized expenses pursuant to the budget, subject to a 10% variance, and for no other purpose without the prior written consent of TD Bank or further order of the Court. The Debtor will immediately, and will continue to, segregate, remit, and deposit all Cash Collateral in the Debtor's accounts, possession, custody, or control, and which the Debtor may receive in the future in separate post-petition bank accounts established for the Debtor at TD Bank. Unless extended further with the written consent of TD Bank, the authorization granted to the Debtor will terminate immediately upon the earliest to occur of: (i) May 19, 2021; (ii) the entry of an order dismissing the Case, (iii) the entry of an order converting the Case to a case under Chapter 7; (iv) the entry of an order appointing a trustee or an examiner with expanded powers with respect to the Debtor's estate; (v) entry of an order reversing, vacating, or otherwise amending, supplementing, or modifying this Order, (vi) entry of an order granting relief from the automatic stay to any creditor (other than TD Bank) holding or asserting a lien in the TD Prepetition Collateral, or (vii) the Debtor's breach or failure to comply with any term or provision of the Interim Order. Notwithstanding any such termination, the rights and obligations of the Debtor and the rights, claims, liens, priorities, and other benefits and protections afforded to TD Bank under this Order will remain unimpaired and unaffected by any such termination and will survive any such termination. As adequate protection for the Debtor's use of cash collateral, TD Bank will have, and is granted, effective as of the Petition Date, valid, binding, enforceable, and automatically perfected post-petition liens that are co-extensive with the TD Prepetition Liens without the necessity of the execution by the Debtor of security agreements, control agreements, pledge agreements, financing statements, mortgages, or other similar documents, on all property. The Replacement Liens are being given to the extent of any decrease in value of the TD Prepetition Collateral or Cash Collateral. The Replacement Liens will be effective and perfected as of the date of the entry of the Interim Order and without the necessity of the execution by the Debtor of any security agreement, pledge agreement, financing statement or any other documents and will have the same validity, priority, and enforceability as TD Bank's liens and security interests in and on the TD Prepetition Collateral on the Petition Date. Notwithstanding the liens and security interests of TD Bank under the Loan Documents, the TD Prepetition Collateral may be used by the Debtor, if sufficient unencumbered funds are not available from the Debtor's estates, to pay: (a) the statutory fees of the United States Trustee pursuant to 28 U.S.C. section 1930(a) and 31 U.S.C. Section 3717; and (b) the allowed fees and expenses of any Chapter 7 trustee under Bankruptcy Code section 726(b), including without limitation the allowed fees and expenses of the Chapter 7 trustee's professionals, in aggregate amount not to exceed $20,000. There will be no Carve-Out obligations with respect to fees and expenses incurred in connection with any challenge to the validity, extent, priority, perfection and enforceability of the liens, mortgages and security interests granted to TD Bank by the Debtor prior to the Petition Date. To the extent the Replacement Liens granted to TD Bank in the Interim Order do not provide TD Bank with adequate protection of its interests in the Cash Collateral, TD Bank will, pursuant to Bankruptcy Section 507(b), have an allowed administrative expense claim in the Case ahead of and senior to any and all other administrative expense claims to the extent of any postpetition Diminution in Value. The hearing to consider entry of any Final Order is scheduled for May 18 at 11:30 a.m. A copy of the order is available for free at https://bit.ly/3ukLEx9 from PacerMonitor.com. About L&L Wings, Inc. L&L Wings, Inc. is a retailer of beachwear and beach sundry items. It operates 26 stores throughout North Carolina, South Carolina, Florida, Texas, and California. L&L Wings sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D. N.Y. Case No. 21-10795) on April 24, 2021. In the petition signed by Ariel Levy, president, the Debtor disclosed up to $50 million in assets and up to $100 million in liabilities. Judge Shelley C. Chapman oversees the case. DAVIDOFF HUTCHER & CITRON LLP is the Debtor's counsel. LAURENTIAN BANK: S&P Rates Additional Tier 1 Capital Notes 'BB-' ---------------------------------------------------------------- S&P Global Ratings assigned its 'BB-' issue-level rating to Laurentian Bank of Canada's (LBC; BBB/Stable/A-2) Canadian dollar-denominated additional Tier I structure limited recourse capital notes. Under this structure, a trust has been established where the bank is the sole beneficiary. Investors of the notes will have recourse only to the assets held by the trust. At the same time, S&P Global Ratings assigned its 'BB-' issue-level rating to the bank's preferred shares, which will reside in the trust. In accordance with S&P's criteria for hybrid and other capital instruments, the rating reflects its analysis of the proposed instrument, and its assessment of LBC's 'bbb' stand-alone credit profile (SACP). The 'BB-' issue rating is four notches below LBC's SACP, incorporating: -- A deduction of one notch, the minimum downward notching from the SACP under our criteria for subordinated debt, reflecting contractual subordination; -- A deduction of two additional notches, reflecting that the coupon payments are fully cancellable, at the issuer's discretion; and -- A deduction of an additional notch to reflect that this subordinated note features a (mandatory) contingent conversion (non-viability contingent capital [NVCC]) trigger. Should a trigger event occur (as defined by the Office of the Superintendent of Financial Institutions' [OSFI] guideline for Capital Adequacy Requirements), each preferred share held in the limited recourse trust will automatically and immediately be converted, without the holder's consent, into a number of fully paid and freely tradable common shares of the bank, determined in accordance with a conversion formula. The following constitute trigger events: -- OSFI advises the bank that it is of the opinion that the bank has ceased, or is about to cease, to be viable and that, after the conversion of all contingent capital instruments and taking into account any other relevant factors, it is reasonably likely that the viability of the bank will be restored or maintained; or -- A federal or provincial government in Canada publicly announces that the bank has accepted or agreed to accept a capital injection, or equivalent support, from the government or a political subdivision or agent or agency without which the bank would have been determined by OSFI to be non-viable. The notes are rated the same as LBC's NVCC preferred shares, as S&P would expect the probability of default of the former to be similar to that of the latter. This is despite the notes ranking ahead of the bank's preferred shares in an insolvency or wind-up--because this preference is only relevant to loss given default; our ratings focus chiefly on probability of default. The cancellability of the notes' coupons, without causing a default or wind-up of the bank, and with no material restriction, represents a degree of loss-absorption capacity. Although LBC has the option to redeem the notes after a certain period, S&P understands this period will be no less than five years after the date of issuance, and it sees no structural incentive to redeem the notes at the first call date--implying a degree of longevity. This combination of features leads it to assess the equity content of these notes as intermediate. S&P Global Ratings' 'BB-' rating on the bank's preferred shares, which will reside with the trust, reflects the rating on the bank's outstanding NVCC preferred shares in accordance with its criteria for hybrid and other capital instruments. Although the notching for this instrument is identical to that on the proposed notes, the distinguishing factors are the risk of regulatory intervention and the deferral risk over the life of the instrument. LEE'S FOODSERVICE: Court Denies Bid to Access Cash Collateral ------------------------------------------------------------- The Bankruptcy Court denied the request of Lee's Foodservice Parts & Repairs, Inc., to use cash collateral for reasons stated on the record. The Debtor, now known as LPFR Winddown, Inc., has a pending motion for dismissal of its Chapter 11 case. A hearing on the dismissal bid has been set for May 27, 2021, at 11:00 a.m. via Zoom. On April 2, the Court approved the sale of the Debtor's assets to Refrigeration and Equipment Sales, LLC. About Lee's Foodservice Founded in 1998, Lee's Foodservice Parts & Repairs, Inc. -- https://www.leesfoodservice.com/ -- provides commercial foodservice and commercial kitchen repair, installation, and maintenance in the Chicago, Milwaukee, and Northwest Indiana areas. Lee's Foodservice sought protection under Chapter 11 of the Bankruptcy Code (Bankr. N.D. Ill. Case No. 20-03086) on Feb. 3, 2020. It previously sought bankruptcy protection on March 11, 2013 (N.D. Ill. Case No. 13-09454). In the petition signed by Brian Anderson, president, the Debtor was estimated to have $1 million to $10 million in assets and $1 million to $10 million in liabilities. Judge Lashonda A. Hunt oversees the case. The Debtor tapped Angela M. Snell, Esq., at FactorLaw, as its legal counsel. LINEAR MOLD: Seeks to Hire Strobl Sharp as Legal Counsel -------------------------------------------------------- Linear Mold & Engineering, LLC seeks approval from the U.S. Bankruptcy Court for the Eastern District of Michigan to employ Strobl Sharp, PLLC to handle its Chapter 11 case. Strobl Sharp will be paid at the rate of $340 to $395 per hour for attorneys and $185 to $295 per hour for associates. The firm will also be reimbursed for out-of-pocket expenses incurred. Lynn Brimer, Esq., a partner at Strobl Sharp, 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 M. Brimer, Esq. Strobl Sharp PLLC 300 East Long Lake Road, Suite 200 Bloomfield Hills, MI 48304-2376 Tel: (248) 540-2300 Fax: (248) 205-2786 Email: lbrimer@stroblpc.com About Linear Mold & Engineering Linear Mold & Engineering, LLC was incorporated on May 23, 2003, as a full-service plastics mold tooling and production service provider. Linear Mold sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. E.D. Mich. Case No. 21-42617) on March 26, 2021. In the petition signed by John Tenbusch, chief executive officer, the Debtor disclosed $1,565,224 in assets and $3,149,145 in liabilities. Lynn M. Brimer, Esq., at Strobl Sharp PLLC is the Debtor's legal counsel. LIVINGSTON INT'L: S&P Alters Outlook to Stable, Affirms 'B-' LT ICR ------------------------------------------------------------------- S&P Global Ratings revised its outlook on Livingston International Inc. to stable from negative. At the same time, S&P Global Ratings affirmed its ratings on Livingston, including its 'B-' long-term issuer credit rating on the company. The stable outlook reflects S&P Global Ratings' expectation that Livingston will generate earnings and cash flow growth over the next two years, with modest improvement in its credit measures and liquidity. Livingston showed resilience to sharply weaker macroeconomic conditions in 2020, with operating results modestly above our previous estimates. Livingston generated earnings in 2020 that modestly exceeded our estimates, with lower-than-expected sensitivity to the recession in Canada and the U.S. The company provides customs brokerage and compliance services, which are heavily influenced by trade volumes that were negatively affected by the COVID-19 pandemic--particularly in the second and third quarters. S&P said, "Livingston's EBITDA exceeded our estimates set at the outset of the pandemic, and did not substantially diverge from our pre-pandemic forecasts. We attribute this in part to government wage subsidies, but also to efficiency initiatives implemented by the company that mitigate the impact of lower volumes and preserve margins. In our view, there is now far less downside risk to Livingston's earnings and credit measures than we previously envisioned." S&P said, "We estimate the company's EBITDA will gradually improve through 2022, with modestly positive free operating cash flow (FOCF) generation. We forecast Livingston's adjusted funds from operations (FFO)-to-cash interest coverage at close to 2x and adjusted debt to EBITDA at about 6x over this period. The expected rebound in real GDP in Canada and the U.S. underpins our revenue growth assumptions, with continued benefits from efficiency and productivity initiatives (albeit, with no further government support). We believe the company has greater flexibility to fund its fixed charges, notably interest expenses on its U.S.-dollar-denominated debt, and capital expenditures (capex), thereby limiting downside rating risk. "The affirmation incorporates our view of Livingston's flexible cost structure and adequate liquidity.We expect the company to maintain relatively stable EBITDA margins, due in part to its flexible cost structure. In our view, Livingston's scalable, low-asset-based business model enabled the company to respond to volume declines relatively quickly last year (with the vast majority of its employees working from home). Livingston's services are classified as essential and remain operational during the current lockdown in Ontario. The company has long-standing relationships with its clients; the average tenure of the company's top 100 customs brokerage clients in Canada is more than 20 years, and more than 10 years in the U.S. The breadth of established customers and solid market share (notably in Canada) is incorporated into our prospective earnings and cash flow estimates. However, we acknowledge the highly fragmented and competitive nature of the North American customs brokerage business, which can limit upside to pricing. "We continue to assess Livingston's liquidity as adequate. The company has only modest debt amortization requirements (about C$4 million annually) on its first-lien term loan due 2026. Livingston must also maintain a first-lien net leverage ratio below 6.5x under its C$220 million revolving credit facility (due 2024), which we don't expect to be an issue. Moreover, we assume the company will generate FOCF over the next two years, which provides additional financial flexibility. "We have assumed the company will increase its capex to fund growth initiatives, including investments to accelerate the digitization of its services. We believe it will have sufficient funding capacity from internally generated cash flow rather than increased debt. However, we do not envision a material improvement in liquidity or credit measures relative to our estimates, based on our view of the financial policies of Livingston's controlling shareholder (Platinum Equity Capital Partners). "The stable outlook reflects our expectation that Livingston will generate improved earnings and cash flow over the next two years, led by the expected rebound in macroeconomic conditions and trade in Canada and the U.S. We also estimate the company's debt levels will remain relatively stable, contributing to FFO cash interest of close to 2x and adjusted debt to EBITDA of about 6x. "We could lower our ratings within the next 12 months if we expect Livingston to generate negative FOCF or adjusted FFO-to-cash interest coverage below 1.5x. In our view, this could occur if the recovery in North American trade is far less than expected, leading to weaker revenue and earnings. Higher debt, which could result from earnings pressure or unexpected cash outflows, could also lead us to conclude that Livingston's financial commitments are unsustainable in the long term. "We could raise our ratings on Livingston within the next 12 months if we expect the company to sustain adjusted FFO-to-cash interest coverage above 2x and adjusted debt to EBITDA near 5x. We believe this could occur from stronger-than-expected earnings and cash flow and positive free cash flow generation, and financial policies that support these credit measures on a sustained basis." LS MOTORCARS: Seeks Approval to Hire Carlo Ramirez as Accountant ---------------------------------------------------------------- LS Motorcars, LLC seeks approval from the U.S. Bankruptcy Court for the Eastern District of Texas to employ Carlo Ramirez, an accountant practicing in Dallas, Texas. The Debtor needs the assistance of an accountant to prepare its tax returns. Mr. Ramirez will be paid at a monthly rate of $600. Mr. Ramirez disclosed in a court filing that he is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. About LS Motorcars LS Motorcars, LLC's business consists of the ownership and operation of an automobile sales lot. LS Motorcars sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. E.D. Texas Case No. 21-40441) on March 26, 2021. In the petition signed by Robert Morales, manager, the Debtor disclosed up to $50,000 in assets and $1 million to $10 million in liabilities. Judge Brenda T Rhoades oversees the case. The Debtor tapped Eric A. Liepins, Esq., as legal counsel and Carlo Ramirez as accountant. LSB INDUSTRIES: Incurs $13.3 Million Net Loss in First Quarter -------------------------------------------------------------- LSB Industries, Inc. filed with the Securities and Exchange Commission its Quarterly Report on Form 10-Q disclosing a net loss of $13.28 million on $98.12 million of net sales for the three months ended March 31, 2021, compared to a net loss of $19.45 million on $83.41 million of net sales for the three months ended March 31, 2020. As of March 31, 2021, the Company had $1.05 billion in total assets, $124.32 million in total current liabilities, $463.67 million in long-term debt, $20.24 million in noncurrent operating lease liabilities, $6.33 million in other noncurrent accrued and other liabilities, $31.27 million in deferred income taxes, $282.12 million in redeemable preferred stock, $127.04 million in total stockholders' equity. As of March 31, 2021, the Company's total cash position was $14.2 million. Additionally, LSB had approximately $41.8 million of borrowing availability under its Working Capital Revolver resulting in total liquidity of approximately $56.0 million. Total long-term debt, including the current portion, was $481.8 million at March 31, 2021 compared to $484.2 million at Dec. 31, 2020. The aggregate liquidation value of the Series E Redeemable Preferred at March 31, 2021, inclusive of accrued dividends of $147.7 million, was $287.5 million. Interest expense for the first quarter of 2021 was $12.4 million compared to $13.5 million for the same period in 2020. Capital expenditures were approximately $6.1 million in the first quarter of 2021. For the full year of 2021, total capital expenditures related to capital work to be performed in 2021 are expected to be approximately $30 million, inclusive of investments for margin enhancement purposes. Net cash provided by operating activities was $12.7 million for the first quarter of 2021 compared to net cash used of $2.2 million for the same period of 2020, a change of $14.9 million. Net cash used by investing activities was $5.9 million for the first quarter of 2021 compared to $10.6 million for the same period of 2020, a change of approximately $4.6 million. Net cash used by financing activities was $8.8 million for the first quarter of 2021 compared to net cash provided of $27.4 million for the same period of 2020, a change of $36.2 million. The Company said, "We currently have a revolving credit facility, our Working Capital Revolver Loan, with a borrowing base of $65 million. As of March 31, 2021, our Working Capital Revolver Loan was undrawn and had approximately $41.8 million of availability." "For the full year of 2021, we expect capital expenditures to be approximately $30 million, which includes approximately $5 million for margin enhancement projects. The remaining capital spending is planned for reliability and maintenance capital projects." "We believe that the combination of our cash on hand, the availability on our revolving credit facility, and our cash flow from operations will be sufficient to fund our anticipated liquidity needs for the next twelve months." Management's Comments "We generated year-over-year improvement in net sales and adjusted EBITDA in the first quarter despite historically cold weather-induced shutdowns of two of our facilities in February," stated Mark Behrman, LSB Industries' president and CEO. "All things considered, it was a good start to the year, and we expect to benefit in the coming quarters from the strong nitrogen industry dynamics being driven by robust agricultural demand and price improvement and the recovery of our industrial end markets as the pandemic's effects on the economy subside. "We've succeeded over the past several years at strengthening the fundamental aspects of our business, including our manufacturing reliability and efficiency, supply chain management, sales and marketing, and logistics. While improving these core requirements for success in the chemical industry, we've also kept our eye on where the industry is going in the long-term. In this regard, we have identified the clean energy market as a significant opportunity for us given our capacity to become a producer of "green ammonia." "We view this as a growth platform for our business and believe that current ammonia producers are best positioned to be leaders in this market as it develops due to our ability to leverage our existing knowledge in ammonia manufacturing, handling, storage, and logistics. To assist us in pursuing this opportunity, we have recently hired a senior professional who will focus on developing and executing our strategy. We are very excited about the opportunities ahead of us in 2021 and look forward to providing updates on key initiatives and developments as we move through the year." A full-text copy of the Form 10-Q is available for free at: https://www.sec.gov/ix?doc=/Archives/edgar/data/60714/000156459021021940/lxu-10q_20210331.htm About LSB Industries Headquartered in Oklahoma City, Oklahoma, LSB Industries, Inc. -- http://www.lsbindustries.com-- manufactures and sells chemical products for the agricultural, mining, and industrial markets. The Company owns and operates facilities in Cherokee, Alabama, El Dorado, Arkansas and Pryor, Oklahoma, and operates a facility for a global chemical company in Baytown, Texas. LSB's products are sold through distributors and directly to end customers throughout the United States. * * * As reported by the TCR on Aug. 5, 2020, S&P Global Ratings lowered its issuer credit rating on LSB Industries to 'CCC' from 'CCC+'. "The negative outlook reflects our view that LSB will continue to be affected by lower agriculture selling prices and the impact of COVID-19 on its industrial end markets. As a result of weaker EBITDA for 2020 and 2021, we continue to view its leverage as unsustainable. We expect leverage to remain high, with debt to EBITDA well into the double-digits over the next 12 months," S&P said. In November 2016, Moody's Investors Service downgraded LSB's corporate family rating (CFR) to 'Caa1' from 'B3', its probability of default rating to 'Caa1-PD' from 'B3-PD', and the $375 million guaranteed senior secured notes to 'Caa1' from 'B3'. LSB's 'Caa1' CFR rating reflects Moody's expectations that the combined uncertainty over operational reliability and the compressed margins, resulting from the low nitrogen fertilizer pricing environment, could result in continued weak financial metrics for a protracted period. MAJORDRIVE HOLDINGS IV: Moody's Assigns First Time 'B3' CFR ----------------------------------------------------------- Moody's Investors Service assigned ratings to MajorDrive Holdings IV, LLC., parent company of Club Car, LLC. These include a B3 corporate family rating and a B3-PD probability of default rating. Moody's also assigned a B2 to the proposed $775 million first lien term loan, and a Caa2 rating to $450 million of senior unsecured notes. The rating outlook is stable. These are first-time ratings for Club Car. Proceeds from the term loan and notes, along with $500 million in new equity, will be used to fund the acquisition of the company by financial sponsor Platinum Equity Advisors, LLC, from the company's current parent, Ingersoll Rand, Inc. Club Car will have high financial leverage as a consequence of this financing, which reflects high corporate governance risk. Assignments: Issuer: MajorDrive Holdings IV, LLC Probability of Default Rating, Assigned B3-PD LT Corporate Family Rating, Assigned B3 $775M Senior Secured Term Loan, Assigned B2 (LGD3) $450M Senior Unsecured Notes, Assigned Caa2 (LGD5) Outlook Actions: Issuer: MajorDrive Holdings IV, LLC Outlook, Assigned Stable RATINGS RATIONALE Club Car's B3 CFR reflects the high leverage that will ensue from the debt-funded acquisition of the company by Platinum. On total debt of approximately $1.2 billion, Moody's estimates Club Car's 2021 pro forma leverage at above 8x debt-to-EBITDA. Such high leverage, if maintained over several years, would limit the company's ability to invest in growth over that time. Over the longer term, persistently-high leverage would present difficulties in potential re-financing activities. It is therefore critical that the company reduces leverage through earnings growth along with the application of substantially all free cash flow toward debt repayment over the next two years to achieve leverage ratios under 7x. As well, as a spinoff from its current parent Ingersoll Rand, the B3 rating reflects Club Car's lack of operating history as an independent company. This adds uncertainty to the timing and degree to which Club Car can stand up independent operations while at the same time achieving cost savings as planned. Additionally, Club Car's ratings are constrained by its limited product offerings when compared to more diversified peers, with high exposure to the US consumer market -- the golf segment in particular. However, Moody's recognizes Club Car's leadership within its markets that temper many of the risks. Club Car is one of only three major competitors in the golf and consumer low speed vehicle markets, along with a smaller offering to commercial customers. Club Car's premium brand offering helps the company to protect and grow its competitive position in key markets. This supports Moody's expectations that the company will sustain EBITA margins of 12% to 13% over the next few years. Moreover, on Moody's expectations of steady revenue growth, these margins will produce solid free cash flow over that period. This will allow Club Car to repay substantial amounts of the term loan, which will help reduce debt-to-EBITDA to close to 6x by 2023. Moody's assesses Club Car's liquidity as good. Although the company will have only minimal cash balances on close of the Platinum acquisition, Moody's expects that Club Car will generate free cash of $40 million to $60 million annually over the next few years, Club Car will likely have full access to its $100 million revolving credit facility as Moody's expects little or no drawings over that time. This facility has a springing fixed charge coverage covenant that will only apply in the event of minimal availability. It is therefore not likely to be tested over the next few years. The stable outlook reflects Moody's expectations of good demand for Club Car's vehicles over the next two years. This will support modest sales growth in the second half of 2021 and 2022. Moody's expects that Club Car will experience modest integration costs, without material disruption in business after its separation from Ingersoll Rand. The first lien term loan is rated B2, one notch higher than the CFR, reflecting the loss absorption provided by second lien debt and other unsecured liabilities in the event of default per Moody's Loss Given Default for Speculative-Grade Companies methodology. The Caa2 rating on the notes reflects that class of debt's junior position to a significant amount of first lien debt in the capital structure and the substantial loss that would be incurred by noteholders in a default. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS Moody's could upgrade Club Car's ratings if the company repays debt to levels that allow the company to sustain debt-to-EBITDA below 6x. As well, the company would need to demonstrate conservative financial policies to warrant an upgrade, with no material distribution of cash to owners. Club Car will also need to maintain is solid market positions and margin to support an upgrade. Ratings could be downgraded if operating results fall short of plans, possibly due to difficulties setting up standalone operations or unexpected weakening in demand for Club Car's vehicles over the next two years. Diminishing earnings or free cash flow at breakeven levels or below could also prompt a downgrade, as this would impair the company's ability to de-lever. As well, ratings could be downgraded if the company makes a material distribution of capital to its owners before establishing lower leverage. Following are some of the preliminary credit agreement terms, which remain subject to market acceptance. As proposed, Moody's expects the new credit facility to provide covenant flexibility that if utilized could negatively impact creditors. Notable terms include the following: Incremental debt capacity on the term loan is up to the greater of closing date adjusted EBITDA and 100% of LTM pro forma adjusted EBITDA, plus unlimited amounts that are subject to, for first lien debt, first lien net leverage no worse than at closing. Amounts up to $100 million may be incurred with an earlier maturity date than the initial term loan. There are no express "blocker" provisions which prohibit the transfer of specified assets to unrestricted subsidiaries; such transfers are permitted subject to carve-out capacity and other conditions. Non-wholly-owned subsidiaries are not required to provide guarantees; dividends or transfers resulting in partial ownership of subsidiary guarantors could jeopardize guarantees, with no explicit protective provisions limiting such guarantee releases. There are no express protective provisions prohibiting an up-tiering transaction. The proposed terms and the final terms of the credit agreement may be materially different.. The principal methodology used in these ratings was Manufacturing Methodology published in March 2020. Headquartered in Augusta, Georgia, Club Car is a manufacturer of golf carts and other low-speed vehicles and related aftermarket parts and services. Revenue are approximately $900 million. MICROVISION INC: Incurs $6.2 Million Net Loss in First Quarter -------------------------------------------------------------- MicroVision, Inc. filed with the Securities and Exchange Commission its Quarterly Report on Form 10-Q disclosing a net loss of $6.23 million on $479,000 of total revenue for the three months ended March 31, 2021, compared to a net loss of $4.93 million on $1.47 million of total revenue for the three months ended March 31, 2020. As of March 31, 2021, the Company had $79.61 million in total assets, $11.65 million in total liabilities, and $67.96 million in total shareholders' equity. The Company ended the first quarter of 2021 with $75.3 million in cash and cash equivalents, compared to $16.9 million at the end of the fourth quarter of 2020. "We remain on track in advancing our automotive lidar development program as the Company completed its A-Sample lidar hardware and development platform on schedule," said Sumit Sharma, chief executive officer of MicroVision. "We are prepared and plan to share key performance data with potential customers, partners or parties interested in a strategic transaction. We expect that a version of this first-generation long-range lidar sensor, after internal and external validation, reliability and compliance testing, could be available for sale, in initial quantities, in the third or fourth quarter of 2021 as we previously reported. Additionally, with the recent completion of two At-the-Market equity raises, we believe the Company is in a strong financial position which enhances our ability to negotiate with potential strategic partners." The Company has incurred significant losses since inception. The Company has funded 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. "Based on our current operating plan, 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 reductions in our research and development projects, staff, operating costs, and capital expenditures," the Company said in the filing. A full-text copy of the Form 10-Q is available for free at: https://www.sec.gov/Archives/edgar/data/65770/000113626121000060/form10q.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. 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. MINNESOTA SCHOOL: Unsecureds Will Get 100% of Claims in Joint Plan ------------------------------------------------------------------ Debtors Minnesota School of Business, Inc., and Globe University, Inc., and James A. Bartholomew, in his capacity as Chapter 11 Trustee, (Chapter 11 Trustee, and together with the Debtors, the "Proponents"), submitted a Modified Disclosure Statement in support of Modified Joint Plan of Reorganization dated April 29, 2021. 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 ("Funding 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. As of the Filing Date, the Debtors had cash on hand of approximately $3.2 million. The Chapter 11 Trustee estimates that cash on hand as of the Effective Date will be $2.650 Million. In addition, MSB subsidiaries own and operate commercial real property. Prior to the shutdown of the school operations, the commercial properties mainly housed the school operations, but are now leased to unrelated third-party tenants and in some cases to non-debtor affiliates. The Debtors estimate that the subsidiaries will have a net equity value—as of the Effective Date on a liquidation basis and net of secured debt, commissions, and closing fees—of $24.866 Million. Class 1 consists of all Allowed claims arising against the Debtors from that certain Business Loan Agreement dated December 12, 2016, as amended and/or renewed, between (i) Lake Area Bank, as lender, and (ii) MSB and MSB Holdings – Lakeville, LLC, as coborrowers (the "Lake Area Bank Loan"). As of the Effective Date, the Lake Area Bank Loan will continue to be paid in accordance with the terms of the applicable loan documents and MSB will reaffirm its obligations. Class 2 consists of all Allowed claims against the Debtors arising from that certain Business Loan Agreement dated December 30, 2013, as amended December 30, 2018, between (i) Home Federal Savings Bank, as lender, and (ii) MSB, Globe, and MSB Holdings – Rochester, LLC, as co-borrowers, and that certain Reserve Account Agreement dated December 23, 2016 (together, the "Home Federal Loan"). Home Federal Savings Bank shall retain its interest in the Reserve Account. As of the Effective Date, the Home Federal Loan will continue to be paid in accordance with the terms of the applicable loan documents and MSB will reaffirm its obligations thereunder. Class 3 consists of General Unsecured Claims. Each holder of an Allowed General Unsecured Claim shall receive on account of, and in full and complete settlement, release and discharge of such Claim, payment in full in cash on the later of (i) five days after Substantial Consummation; (ii) the date on which such General Unsecured Claim becomes Allowed or as soon thereafter as practicable; or (iii) such other date as may be ordered by the Bankruptcy Court. This Class shall be paid at 100% of Allowed Claim. The Plan is conditioned upon 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. All parties have agreed in principle to the terms of the Settlement Agreement, but the Department of Education needs to provide final approval prior to the Voting Deadline. Under the Settlement Agreement, the settling parties' have agreed to the following: The Department of Education will receive the DOE 2nd Claim in the amount of $7,000,000. The State will reduce its existing allowed claim to $15,601,879. The Department of Education will discharge all of the 920 Restitution Claimants' Federal Loan Obligations totaling approximately $23 Million. The Allowed Claims will be paid in full within five days after Substantial Consummation. Upon payment in full of all claims, the parties have agreement to provide full mutual releases of all other claims and causes of action. The State's Revised Claim of $15,601,879 is, in large part, a result of the discharge of 920 Restitution Claimants' Federal Loan Obligations totaling approximately $23 Million pursuant to the terms of the Settlement Agreement. The State's Revised Claim represents the usury loan claims plus the aggregation of student restitution payments received by the Debtors from all sources other than federal student loans. The Debtors will fund the Plan from the Funding Sources. In order to be fully funded, the Disbursing Account must receive cash from the Debtors within 30 days after the Effective Date ("Funding Deadline") in the total amount sufficient to pay (i) the Allowed General Unsecured Claims existing as of the Effective Date in the approximate amount of $23,698,840; (ii) all Allowed Administrative and Priority Claims as of the Effective Date; and (iii) a reserve in an amount sufficient to pay in full all estimated Administrative Claims and any Contested Claims in the event such claims become Allowed. A full-text copy of the Modified Disclosure Statement dated April 29, 2021, is available at https://bit.ly/2QIGb4R from PacerMonitor.com at no charge. 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 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. MPR SUMMERS: Court Confirms Plan of Reorganization -------------------------------------------------- Judge Michael A. Fagone confirmed the Plan of Reorganization of MPR Summers, d/b/a Maine Teen Camp. The Court ruled, among others, that BSB shall have an Allowed Secured Claim for $81,544 in full and final satisfaction of the Class One Claims as of the Effective Date, plus reasonable attorney's fees of up to $13,000 in aggregate. BSB shall receive monthly payments equal to the amount of BSB's Allowed Secured Claim amortized over five years from the Effective Date, plus applicable interests. The Court made modifications to other claims as well. In full satisfaction of Class 3 claims, the Debtor will make three payments on a pro rata basis to holders of unsecured claims in Class 3 on or before the 10th day of each of: (i) the last day of the 12th month after the Effective Date; (ii) the last day of the 24th month after the Effective Date; and (i) the last day of the 36th month after the Effective Date. Each of the three pro rata payments will be equal to the amount of projected disposal income as of the end of the month prior to the day on which such payment became due. Class 3 w2ill not be paid interest. A copy of the order is available for free at https://bit.ly/3nHaFA1 from PacerMonitor.com. About MPR Summers MPR Summers d/b/a Maine Teen Camp -- https://teencamp.com/ -- is an accredited summer camp created exclusively for teenagers. The Debtor filed a Chapter 11 bankruptcy petition (Bankr. D. Me. Case No. 20-20388) on Oct. 20, 2020. In the petition signed by Matthew Pines, treasurer and stockholder, the Debtor was estimated to have assets between $100,000 and $500,000 and liabilities between $1 million and $10 million. BERNSTEIN, SHUR, SAWYER & NELSON, P.A., is the Debtor's counsel. MRO HOLDINGS: Moody's Raises CFR to B3 & Alters Outlook to Stable ----------------------------------------------------------------- Moody's Investors Service upgraded its ratings for MRO Holdings, Inc ("MROH"), including its corporate family rating to B3 from Caa1 and its Probability of Default rating to B3-PD from Caa1-PD. Concurrently, Moody's upgraded the company's senior secured term loan to B3 from Caa1. Moody's also changed the company's ratings outlook to stable from negative. RATINGS RATIONALE The upgrades reflect Moody's expectations of improving commercial aerospace traffic volumes that will result in increasing demand for maintenance, repair and overhaul (MRO) services. Moody's expects this higher demand to translate into earnings growth and a gradual strengthening of credit metrics over the balance of 2021 and into 2022. The B3 corporate family rating balances MROH's small size and elevated financial leverage (debt-to-EBITDA of 7x as of December 2020) against the company's growing presence as a provider of airframe MRO services. Moody's expects an improving operating environment coupled with MROH's growing capacity to support healthy topline and earnings growth along with positive, albeit modest, free cash generation. Moody's also favorably considers the contracted and relatively predictable nature of time-based requirements for airframe MRO work, as well as the company's low-cost labor force which improves competitive positioning in a labor-intensive industry. Moody's regards the coronavirus outbreak as a social risk under its ESG framework, given the substantial implications for public health and safety. MROH remains vulnerable to shifts in market demand and changing sentiment in these unprecedented operating conditions. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS Factors that could lead to an upgrade include consistent earnings growth, debt-to-EBITDA sustained below 5.5x, and positive cash generation with FCF-to-debt at least in the low single-digits Factors that could lead to a downgrade include the loss of a large customer, an inability to grow earnings, weakening liquidity, or if Moody's expects debt-to-EBITDA to remain above 7x. Any leveraging debt-financed acquisitions or shareholder distributions over the near-term could also result in a downgrade. The following summarizes Moody's rating actions and ratings: Upgrades: Issuer: MRO Holdings, Inc Corporate Family Rating, Upgraded to B3 from Caa1 Probability of Default Rating, Upgraded to B3-PD from Caa1-PD Senior secured term loan due 2026, Upgraded to B3 (LGD3) from Caa1 (LGD3) Outlook Actions: Issuer: MRO Holdings, Inc Outlook, Changed To Stable From Negative MRO Holdings, Inc is a provider of maintenance, repair and overhaul services to airline and freight carrying customers in North America. The company owns and operates two MRO facilities based in El Salvador ("Aeroman") and Florida, US ("Flightstar") and also has rights to capacity at TechOps Mexico's operations (a joint venture between Delta Airlines and Aeromexico). Revenues for the twelve months ended December 2020 were around $400 million. The principal methodology used in these ratings was Aerospace and Defense Methodology published in July 2020. MSCI INC: Moody's Hikes CFR to Ba1, Outlook Remains Stable ---------------------------------------------------------- Moody's Investors Service upgraded MSCI Inc.'s corporate family rating to Ba1 from Ba2, probability of default rating to Ba1-PD from Ba2-PD and senior unsecured rating to Ba1 from Ba2. The speculative grade liquidity rating remains unchanged at SGL-1. The outlook remains stable. RATINGS RATIONALE "Increased revenue size, very high profit rates, Moody's expectations for ongoing institutional investor interest in its custom factor indices, including ESG-focused ones, and predictable although still opportunistic financial strategies lead to the upgrade to Ba1," said Edmond DeForest, Moody's Vice President and Senior Credit Officer. The Ba1 CFR is supported by a growing, recurring subscription base of investment risk management and decision support tools and equity index products. Revenue of almost $1.75 billion for the 12 months ended March 31, 2021 is small compared to many other service industry issuers also rated at Ba1. However, high EBITA margins of around 50% and solid free cash flow to debt anticipated to be around 13%, provide ratings support. Moody's expects EBITDA of over $1 billion and EBITDA less capital expenditures to interest expense around 6 times, driven by growth in institutional investment strategies including equity exchange traded funds using its widely-referenced international equity indices, and steady subscriber retention rates around 95%. Index revenues could be volatile because they are correlated to the popularity of passive investment strategies and the value of assets under management ("AUM") in exchanged-traded funds linked to its indexes. MSCI has some customer concentration. Moody's expects its largest customer will account for over 10% of total revenues and over 50% of AUM-based ETF fees, while the top 10 customers will be about 25% of revenue. All financial metrics cited reflect Moody's standard adjustments. MSCI is a service provider to sophisticated financial market businesses, so there are limited environmental and social risks. Governance risk is considered moderate as Moody's anticipates MSCI may incur additional debt to maintain cash return levels in excess of internally generated free cash flow, temporarily driving debt to EBITDA above 4 times. Debt-funded acquisitions are also a risk, although the pace and scale of M&A has been moderate historically. The SGL-1 speculative grade liquidity rating reflects Moody's assessment of MSCI's liquidity profile as very good. Moody's expects MSCI will maintain over $500 million of cash and cash equivalents. The company had $1.7 billion of cash as of March 31, 2021. Additional liquidity support is provided by free cash flow of about $300 million and full availability of the $500 million unsecured revolving credit facility, $32.5 million of which expires in 2024 and the remainder in 2026. The upgrade to Ba1 from Ba2 of the senior unsecured ratings reflects both the upgrade of the PDR to Ba1-PD from Ba2-PD and a loss given default assessment of LGD4. The rated debt is unsecured and guaranteed by all existing and subsequently acquired material domestic subsidiaries of MSCI. The stable outlook reflects Moody's expectations for 8% revenue growth, EBITA margins above 50% and debt to EBITDA to remain around 3.5 times. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS The ratings could be upgraded if revenue scale expands, customer and industry scope widens and revenue and profits become less sensitive to changes in global equity market valuations. Quantitatively, positive rating pressure could develop if Moody's expects debt to EBITDA will remain below 3.0 times and free cash flow to debt will stay above 10%. The ratings could be downgraded if Moody's notes a meaningful increase in competition, MSCI's client retention rates deteriorate or a more difficult pricing environment evolves. The ratings could also be downgraded if Moody's anticipates low revenue growth, a substantial erosion in rates of profitability, debt to EBITDA sustained above 4.0 times, or free cash flow to debt under 8%. Issuer: MSCI Inc. Corporate Family Rating, Upgraded to Ba1 from Ba2 Probability of Default Rating, Upgraded to Ba1-PD from Ba2-PD Senior Unsecured Bank Credit Facility, Upgraded to Ba1 (LGD4) from Ba2 (LGD4) Senior Unsecured Regular Bond/Debenture, Upgraded to Ba1 (LGD4) from Ba2 (LGD4) Speculative Grade Liquidity Rating, Unchanged at SGL-1 Outlook, Remains Stable The principal methodology used in these ratings was Business and Consumer Service Industry published in October 2016. MSCI is a global provider of investment risk and decision support tools, including indices and portfolio risk and performance analytics products and services. Moody's expects revenues of about $2.0 billion in 2021. MSCI INC: New 2031 Unsecured Notes No Impact on Moody's Ba1 CFR --------------------------------------------------------------- Moody's Investors Service said that since MSCI Inc.'s proposed senior unsecured notes due 2031 will raise financial leverage, the plan is considered a negative credit development. However, Moody's expects the cash raised will likely be used to repay other debt with higher interest rates when those debts become callable. For instance, Moody's expects the proposed notes will carry an interest rate that is much lower than the rate on its soon-to-be-callable 5.375% unsecured notes due 2027. While the stated use of proceeds for the proposed notes is general corporate purposes, MSCI's large cash balance of $1.7 billion pro forma for the transaction suggests that financial leverage will decline once the company repays other debt. So, despite the initial leverage increase, the ratings, including the Ba1 CFR and senior unsecured ratings, as well as the stable outlook, remain unchanged at this time. MSCI Inc. is a global provider of investment risk and decision support tools, including indices and portfolio risk and performance analytics products and services. Moody's expects revenues of about $2.0 billion in 2021. MSCI INC: S&P Rates New $500MM Senior Unsecured Notes 'BB+' ----------------------------------------------------------- S&P Global Ratings assigned its 'BB+' issue-level rating and '3' recovery rating to New York-based index and analytics provider MSCI Inc.'s proposed $500 million senior unsecured notes. As with its existing senior notes, MSCI Inc. will be the issuer. The company will use the $500 million of proceeds from these notes for general corporate purposes, opportunistic share repurchases, or bolt-on acquisitions and cash on hand to pay the fees associated with the offering. The '3' recovery rating indicates our expectation for meaningful recovery (50%-70%; rounded estimate: 55%) in the event of a default. S&P's 'BB+' issuer credit rating on MSCI is unaffected by this issuance. S&P said, "The stable outlook reflects our view that MSCI's leadership position in its core markets and large recurring revenue base will support a consistent operating performance over the next 12 months. Specifically, we expect the company to manage its financial risk in line with its 3.0x-3.5x gross leverage target." MTS SYSTEMS: Moody's Withdraws B1 CFR After Amphenol Acquisition ---------------------------------------------------------------- Moody's Investors Service has withdrawn all debt ratings of MTS Systems Corporation after the company was acquired by Amphenol Corporation, a leading designer and producer of highly engineered electrical, electronic and fiber optic connectors, interconnect systems, antennas, sensors and sensor-based products. RATINGS RATIONALE Pursuant to the terms of the transaction, all rated debt at MTS was repaid at closing. Moody's took the following rating actions on MTS Systems Corporation: Corporate Family Rating -- Withdrawn, previously B1 Probability of Default Rating -- Withdrawn, previously B1-PD Senior Secured Revolving Credit Facility -- Withdrawn, previously Ba2 (LGD2) Senior Secured Term Loan B -- Withdrawn, previously Ba2 (LGD2) Speculative Grade Liquidity Rating -- Withdrawn, previously SGL-2 Outlook -- Changed to Rating Withdrawn from Stable MTS Systems Corporation is a global supplier of high-performance test and measurement systems and sensors. The test & simulation segment provides testing solutions (hardware and software) that simulate forces and motions that customers expect their products to encounter while in use. The sensors segment provides products used to automate industrial machinery and equipment for improved safety and end-user productivity. Revenues for the fiscal year ended October 3, 2020 were nearly $830 million. NATIONAL RIFLE: Has No Debt, Says NYAG Final Plea in Tossing Ch. 11 ------------------------------------------------------------------- Law360 reports that the New York Attorney General's Office made its closing argument Monday, May 3, 2021, in its bid to have the National Rifle Association's Chapter 11 case tossed from a Texas bankruptcy court, saying the organization doesn't have any financial issues to justify its insolvency proceeding. During a virtual hearing, Gerrit M. Pronske of Spencer Fane LLP said on behalf of the attorney general that the NRA's own statements made at the time of the filing of its Chapter 11 petition in January 2021 belie the true reason for the commencement of the bankruptcy case, which was to "dump New York" to escape an unfavorable regulatory environment. About National Rifle Association of America 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. Texas 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. NEAL PROPERTIES: Seeks to Hire New Woodridge as Realtor ------------------------------------------------------- Neal Properties, LLC seeks approval from the U.S. Bankruptcy Court for the Southern District of West Virginia to employ New Woodridge, LLC. The Debtor requires a realtor to assist in the sale of its golf course in Mineral Wells, W.Va., and other properties, including fixture and equipment. New Woodridge will be paid a 6 percent commission on the sales price and reimbursed for out-of-pocket expenses incurred. Jon Cavendish, a partner at New Woodridge, 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: Jon Cavendish New Woodridge, LLC 3818 MacCorkle Ave SE Charleston, WV 25304 Tel: (304) 925-7000 About Neal Properties Neal Properties, LLC sought protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D. W.Va. Case No. 20-60042) on April 24, 2020. At the time of the filing, the Debtor disclosed assets of between $500,001 and $1 million and liabilities of the same range. Judge Frank W. Volk Usdj oversees the case. Caldwell & Riffee is the Debtor's legal counsel. NEAL STUBBS: May 6 Hearing on Sale of Two County 5 Osa Properties ----------------------------------------------------------------- Judge Roberta A. Colton of the U.S. Bankruptcy Court for the Middle District of Florida will convene a hearing on May 6, 2021, at 1:00 p.m. (EDT) to consider Neal A. Stubbs' sale of the following real properties: a. the 100-acre propety located in District 4 Bahia Ballena, County 5 Osa, in the Province of Puntarenas, Costa Rica, referred to as Inversiones Tropicals Fuente De Escalares, to Dennis Morozov for $945,000; and b. the 15-acre property located in District 4 Bahia Ballena, County 5 Osa, in the Province of Puntarenas, Costa Rica, referred to as Que Vista, to Monica Everett for $650,000. Effective March 16, 2020, and continuing until further notice, Judges in all Divisions will conduct all preliminary and non-evidentiary hearings by telephone. For Judges Colton and Williamson, parties should arrange a telephone appearance through Court Solutions (www.court-solutions.com). For Judges Delano, Funk, Jackson, Jennemann, McEwen, and Vaughan, parties should arrange a telephonic appearance through Court Call (866-582-6878). Neal A. Stubbs sought Chapter 11 protection (Bankr. M.D. Fla. Case No. 13-11303) on Aug. 26, 2013. The Court has confirmed the Debtor's Plan of Reorganization (together with modifications) which calls for a 100% distribution for allowed claims. NSG HOLDINGS: Moody's Hikes Rating on 2025 Secured Notes From Ba1 ----------------------------------------------------------------- Moody's Investors Service has upgraded the rating on NSG Holdings LLC's (NSGH) senior secured notes due December 15, 2025 to Baa3 from Ba1. The rating outlook is changed to stable from positive. RATINGS RATIONALE The rating upgrade to Baa3 is prompted by NSGH's continued deleveraging and strong financial performance as outstanding debt amortizes and management has no intention to raise additional debt until the maturity of the outstanding debt. NSGH's credit metrics continue to remain strong for the last five years with an average debt service coverage ratio above 2.0x and power CFO/debt on average close to 30%. The rating upgrade recognizes the value of the issuer's natural gas hedging strategy which greatly reduces NSGH's exposure to changing commodity prices. The stability of the contracted cash flows of the underlying assets will continue to support credit metrics consistent with an investment grade credit profile. Debt service coverage will likely decline modestly to around 1.7x on average under Moody's base case as scheduled debt amortization increases. NSGH's five natural gas-fired facilities are fully contracted to credit worthy investment grade counterparties, mostly to Duke Energy Florida, LLC. (A3 stable), maturing through 2023-2027. The facilities have a track record of good operational performance with availability factors of 95% (2011-2020). These positive considerations are balanced against the above-market nature of the power purchase agreements (PPAs), the concentration of cash flows in Florida and exposure to Duke Energy Florida, the maturity of some of the PPAs before the debt maturity reducing the degree of project diversification, a moderate level of structural subordination, and the lack of tangible asset and PPA contract security as collateral for bondholders. NSGH's assets have a solid operating track record but all facilities are aging making re-contacting the assets difficult. NSGH's liquidity profile is solid, benefiting from a 6-month debt service reserve covered by a letter of credit in addition to unrestricted and restricted cash reserves on balance sheet. As of September 30, 2020, NSGH had unrestricted cash on balance sheet of $15.7 million and restricted cash of $89.0 million. RATING OUTLOOK The stable outlook reflects Moody's expectation that NSG's assets will continue to operate without major operational outages and combined with scheduled debt amortization will support a continued deleveraging until maturity of the senior secured notes and a DSCR of on average of at least 1.7x. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATING -- Further upside rating pressure is limited but could arise if: -- Successful re-contracting of operating assets before maturity of the debt -- DSCR above 2.5x -- Debt/EBITDA below 1.0x The rating could be downgraded if: -- DSCR declines to 1.5x -- Leverage increasing above 2.5x debt/EBITDA -- Operational risks increase at operating facilities LEGAL SECURITY Bondholders benefit from typical project finance features such as a 6-month debt service reserve and a cash flow waterfall. However, NSGH is a pure holding company and bondholders do not benefit from any asset pledges on NSGH's facilities or the existing PPA contracts. NSGH also has an unrated $140.2 million senior secured term loan at the holding company level that ranks pari passu to NSH's senior secured notes as well as project level debt of $20.8 million outstanding at Orange Cogen Funding Corporation (Baa1 stable, which matures March 2022). The senior secured notes and NSGH's credit facilities (as amended as of August 31, 2016) are secured pari passu by a perfected first priority lien in all of the sponsor's equity interests in NSGH, all NSGH's equity interests in its first tier subsidiary guarantors, all of the first tier subsidiary guarantor's equity interests in their direct subsidiaries, and all accounts of NSGH and each of the subsidiary guarantors. The credit facilities agreement includes a 1.2x minimum DSCR restricted payment covenant. PROFILE NSG Holdings LLC (NSGH) owns a portfolio of five gas-fired power generation facilities representing net aggregate nominal capacity of 1,004 MW located in Florida and Nevada which is 100% contracted to investment grade offtakers with various maturities through 2023-2027. The principal methodology used in this rating was Power Generation Projects Methodology published in July 2020. OAKVIEW CROSSING: Unsecureds to Fully Recover Claim Sans Interest ----------------------------------------------------------------- Oakview Crossing of Hartwell, LLC, filed a Plan of Liquidation and a Disclosure Statement. The Plan provides for the distribution of the proceeds from Debtor's liquidation of its assets. Each Holder of an Allowed Claim in Classes 1A, 1B, 1C, 2, and 3 is entitled to vote either to accept or to reject the Plan. Class 1A is a claim of United Community Bank for $1,221,885. Class 1B is an $800,000 claim by the City of Hartwell. Class 1C is that of Mary K. Jackson and the Estate of John Carey Kid, II, estimated for $1,458,143. Class 2 is the priority real estate tax claim. Each holder of an allowed General Unsecured Claim will receive payment in full of its claim without interest upon the Effective Date of the Plan. Class 3 general unsecured claims total $653,843. A copy of the Disclosure Statement is available for free at https://bit.ly/2Rme23b from PacerMonitor.com. About Oakview Crossing of Hartwell Oakview Crossing of Hartwell, LLC, is a single asset real estate debtor (as defined in 11 U.S.C. Section 101(51B)). It owns a single tract of real property consisting of 39.88 acres of land in Hart County, Ga. Oakview Crossing of Hartwell filed its voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. M.D. Ga. Case No. 20-30720) on Oct. 4, 2020. C. William Kidd, the Debtor's manager, signed the petition. At the time of filing, the Debtor estimated $1 million to $10 million in both assets and liabilities. Judge James P. Smith oversees the case. Kelley & Clements, LLP, serves as the Debtor's legal counsel. PEAK PROPERTY: Gets OK to Hire Your Castle Real Estate as Broker ---------------------------------------------------------------- Peak Property Group, LLC received approval from the U.S. Bankruptcy Court for the District of Colorado to employ Your Castle Real Estate, Inc. and its broker, Melissa Bollacker, to list, market, and sell its properties located at 2700 S. Holly St., Denver, Colo. Your Castle Real Estate will receive a total commission of 6 percent of the gross selling price for each property. As disclosed in court filings, Your Castle Real Estate is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. The firm can be reached through: Melissa Bollacker Your Castle Real Estate, Inc. 2755 South Locust Street, Suite 150 Denver, CO 80222 Telephone: (303) 962-4272 About Peak Property Group Peak Property Group LLC owns four properties in Denver, Colo., and La Quinta, Calif., having an aggregate comparable sale value of $1.09 million. Peak Property Group sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Colo. Case No. 20-16088) on Sept. 12, 2020. Kip Korthuis, sole member, signed the petition. At the time of the filing, the Debtor disclosed $1,102,686 in assets and $1,685,781 in liabilities. Judge Kimberley H. Tyson oversees the case. Shilliday Law, PC is the Debtor's legal counsel. PH BEAUTY III: Moody's Alters Outlook on Caa1 CFR to Stable ----------------------------------------------------------- Moody's Investors Service affirmed pH Beauty Holdings III, Inc.'s Corporate Family Rating at Caa1, its Probability of Default Rating at Caa1-PD, Its senior secured first lien credit facility ratings at B3 and its 2nd lien term loan at Caa3. At the same time, the rating outlook was changed to stable from negative. These rating actions reflect Moody's expectation that pH Beauty's will generate positive free cash flow in full year 2020 and in the next several years. It also reflects Moody's expectation for leverage improvement, although Debt to EBITDA leverage remains high at around 7.8x as of LTM ended September 2020 due to earnings weakness, in part reflecting specialty retail store, such as Sephora and Ulta, closures. Earnings were weaker than expected, although the company's major distribution channels -- mass market retailers and drug stores -- remained open even at the height of the coronavirus pandemic. Demand for the company's cosmetic accessories have been weak since consumers who sheltered at home during the pandemic had less need to apply color cosmetics. Demand for the company's bath and recently acquired skin tanning solution products was better than expected, as consumers focused on self-care. pH Beauty acquired Moody's Are Lux Limited (dba Future Beauty Labs) for $60.5 million in May 2020. The transaction was financed with a $20 million add on to its first lien term loan, $37.5 million of equity and $3 million of cash on hand. Future Beauty Labs ("FBL") markets tanning solutions to consumers at low, mid and premium price points. Moody's expects year-end 2020 debt to EBITDA to remain high at close to 8x. The stable outlook reflects Moody's expectation for better top line and operating growth and gradual leverage improvement as the economic environment stabilizes and consumers return to their regular activities away from the home. The following ratings/assessments are affected by the action: Ratings Affirmed: Issuer: pH Beauty Holdings III, Inc. Corporate Family Rating, Affirmed at Caa1 Probability of Default Rating, Affirmed at Caa1-PD GTD Senior Secured 1st Lien Term Loan, Affirmed at B3 (LGD3) GTD Senior Secured 1st Lien Revolving Credit Facility, Affirmed at B3 (LGD3) GTD Senior Secured 2nd Lien Term Loan, Affirmed at Caa3 (LGD5) Outlook Actions: Issuer: pH Beauty Holdings III, Inc. Outlook, Changed To Stable From Negative RATINGS RATIONALE The Caa1 CFR reflects pH Beauty's high financial leverage with Moody's adjusted debt/EBITDA of 7.8x as of LTM September, its small scale, and event risk related to its majority ownership by a financial sponsor. The cosmetic accessories, facial skin care, and tanning solution industries are also highly competitive, and demand for these products is vulnerable to weakness in household income, retailers' shelf space allocation and marketing support. pH Beauty faces steep competition from branded product companies that are significantly larger, more diverse, financially stronger, and which have much greater investment capacity. These factors are partially balanced by the expectation that the company's will generate positive free cash flow. The rating is also supported by pH Beauty's adequate liquidity and Moody's expectation that distribution gains and product development will help support earnings growth over the next 12 to 18 months. ENVIRONMENTAL SOCIAL AND GOVERNANCE CONSIDERATIONS The coronavirus outbreak, the government measures put in place to contain it, and the weak global economic outlook continue to disrupt economies and credit markets across sectors and regions. Moody's analysis has considered the effect on the performance of consumer sectors from the current weak U.S. economic activity and a gradual recovery for the coming months. Although an economic recovery is underway, it is tenuous, and its continuation will be closely tied to containment of the virus. As a result, the degree of uncertainty around Moody's forecasts is unusually high. Moody's regards the coronavirus outbreak as a social risk under its ESG framework, given the substantial implications for public health and safety. Social risk is a factor for pH Beauty because it sells products that appeal to customers almost entirely due to "social" considerations. To the extent that social customs and mores change, it could have an impact -- positive or negative -- on the company's sales and earnings. In terms of Environmental, considerations, the company faces similar risks to other consumer products firms particularly around packaging. Packaging typically uses a lot of resources, such as energy, water, chemicals, petroleum, minerals, wood and fibers to produce. Its manufacture often generates air emissions including greenhouse gases, heavy metals and particulates, as well as wastewater and/or sludge containing toxic contaminants. The most important governance considerations are related to its financial policies. Moody's view pH Beauty's financial policies as aggressive given its appetite for debt financed acquisitions. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS The ratings could be downgraded if pH Beauty experiences declining profitability or other operating weakness or fails to generate positive free cash flow. Debt funded acquisitions, shareholder distributions, or other actions that prevent the company from reducing leverage, or a deterioration in liquidity could also result in a downgrade. An upgrade could be considered if pH Beauty demonstrates a track record of profitable growth, reduces Moody's adjusted debt-to-EBITDA to below 6.0x, and maintains good liquidity. The principal methodology used in these ratings was Consumer Packaged Goods Methodology published in February 2020. pH Beauty is a designer of cosmetic accessories, bath accessories and facial skin care products. Key brands include Real Techniques, EcoTools, Freeman and Future Beauty Labs. The company is owned by Yellow Wood Partners, and generates roughly $223 million in annual revenues. PIAGGIO AMERICA: Gets Approval to Tap Holland & Knight as Counsel ----------------------------------------------------------------- Piaggio America, Inc. received approval from the U.S. Bankruptcy Court for the Southern District of Florida to employ Holland & Knight LLP as its legal counsel. The firm will render these legal services: (a) advise the Debtor regarding its powers and duties in the continued management and operation of its business and properties; (b) advise the Debtor regarding its responsibilities in complying with the U.S. trustee's operating guidelines and reporting requirements and with the rules of the court; (c) prepare legal papers; (d) protect the Debtor's interest in all matters pending before the court; (e) represent the Debtor in negotiation with its creditors in the preparation of a Chapter 11 plan; (f) attend meetings and negotiate with representatives of creditors and other parties-in-interest and advise and consult on the conduct of the Debtor's Chapter 11 case; (g) advise the Debtor in connection with any contemplated sales of assets or business combinations; (h) advise the Debtor in connection with post-petition financing, emergence financing and capital structure; (i) advise the Debtor on unexpired leases and executory contracts; (j) advise the Debtor on legal issues arising in or relating to its ordinary course of business; (k) protect and preserve the Debtor's estate; (l) negotiate and prepare a plan of reorganization and seek confirmation of such plan; (m) attend meetings with third parties and participate in negotiations; (n) appear before the bankruptcy court, any appellate courts, and the U.S. trustee; and (o) perform all other necessary legal services in connection with the case. The hourly rates of the firm's attorneys who will work primarily in this case are as follows: Joaquin J. Alemany $595 Edward M. Fitzgerald $440 Kathleen St. John $425 Arthur E. Rosenberg $715 Holland & Knight received $200,000 from the Debtor on April 13. The firm used $46,112.24 to fully pay down outstanding pre-bankruptcy attorneys' fees and disbursements, leaving a retainer balance of $162,192.55. Arthur Rosenberg, Esq., a partner at Holland & Knight, disclosed in a court filing that his firm is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. The firm can be reached through: Joaquin J. Alemany, Esq. Holland & Knight LLP 701 Brickell Avenue, Suite 3300 Miami, FL 33131 Telephone: (305) 789-7763 Facsimile: (305) 789-7799 Email: joaquin.alemany@hklaw.com - and – Edward M. Fitzgerald, Esq. Holland & Knight LLP 200 S. Orange Avenue, Suite 2600 Orlando, FL 32801 Telephone: (407) 425-8500 Facsimile: (407) 244-5288 Email: edward.fitzgerald@hklaw.com - and – Arthur E. Rosenberg, Esq. Holland & Knight LLP 31 West 52nd Street New York, NY 10019 Telephone: (212) 513-3200 Facsimile: (212) 385-9010 Email: arthur.rosenberg@hklaw.com About Piaggio America Piaggio America Inc. -- http://www.piaggioaerospace.it/-- is in the business of aerospace product and parts manufacturing. It designs, develops and supports unmanned aerial systems, business, special missions and ISR aircraft and aero engines. Piaggio America filed its voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Calif. Case No. 21-13491) on April 13, 2021. Paolo Ferreri, chief executive officer, signed the petition. In the petition, the Debtor disclosed $1 million to $10 million in assets and $10 million to $50 million in liabilities. Judge Erik P. Kimball presides over the case. Holland & Knight, LLP and Sonoran Capital Advisors, LLC serve as the Debtor's legal counsel and financial advisor, respectively. PROJECT ACCELERATE: Moody's Alters Outlook on Caa1 CFR to Stable ---------------------------------------------------------------- Moody's Investors Service changed the ratings outlook for Project Accelerate Parent, LLC (ABC Fitness Solutions) to stable from negative. At the same time, Moody's affirmed ABC Fitness Solutions' Corporate Family Rating of Caa1, Probability of Default Rating of Caa1-PD and Caa1 rating on the senior secured bank credit facilities. "The change in the outlook to stable reflects the expected recovery in ABC Fitness Solutions' revenue and profitability over the next 12 months supported by the coronavirus vaccines rollout and reopening of fitness clubs", said Mariya Moore, Moody's analyst. Affirmations: Issuer: Project Accelerate Parent, LLC Corporate Family Rating, Affirmed Caa1 Probability of Default Rating, Affirmed Caa1-PD Senior Secured Bank Credit Facility, Affirmed Caa1 (LGD4) Outlook Actions: Issuer: Project Accelerate Parent, LLC Outlook, Changed To Stable From Negative RATINGS RATIONALE The Caa1 CFR reflects ABC Fitness Solutions' very high leverage with adjusted debt/EBITDA of over 12x (expensing software development costs) and negative free cash flow, resulting from a 30% decline in revenue and a 50% contraction of EBITDA in 2020 (preliminary results). After hitting the trough in Q2 2020, the company's topline and profitability have been recovering quarter over quarter. Moody's anticipates a strong rebound in revenue in 2021; however, the economic environment for fitness clubs remains challenging. There is high uncertainty of the timing of paid membership levels recovering to pre-pandemic levels. At the same time, Moody's expects ABC Fitness Solutions to increase investments in sales, marketing and research and development that would strengthen its club management platform and services and accelerate revenue growth. These investments will weigh on the company's operating profit growth in 2021 and slowdown the deleveraging. ABC Fitness Solutions benefits from its strong relationships with the fastest growing fitness club chains and high customer retention rates. The mission critical and low cost nature of its software and billing services also support the rating. In the past twelve months, ABC Fitness Solutions completed three acquisitions (GymSales, Trainerize and Fitness BI) that helped the company to create an integrated suite of solutions for club management, including member acquisition, member management, member engagement, club administration, reporting and analytics, and revenue-cycle management. Moody's expects these purchases to be highly accretive, which should help drive the company's revenue growth. Funded with a combination of cash equity and company's cash, these acquisitions had a positive impact on leverage. The stable outlook reflects Moody's expectation for a significant recovery in ABC Fitness Solutions' revenue and profitability over the next 12 months, as well as adequate liquidity. Moody's projects leverage to remain around current levels in 2021, but to improve to around 8x by the end of 2022 as the fitness industry continues to recover from the pandemic. ABC Fitness Solutions' adequate liquidity is supported by $33 million of unrestricted cash and availability under a $50 million revolving credit facility due January 2023 ($25 million undrawn). These sources of liquidity will be sufficient to cover a $3.8 million mandatory term loan amortization, estimated deferred considerations for the past acquisitions and projected negative free cash flow over the next 12 months. The company amended its credit agreement and received relief for its springing leverage covenant for a period through April 1, 2022 and established a minimum $10 million liquidity (consisting of unrestricted cash and unused revolver) requirement during the covenant relief period. The coronavirus outbreak, the government measures put in place to contain it, and the weak global economic outlook continue to disrupt economies and credit markets across sectors and regions. Although an economic recovery is underway, it is tenuous and its continuation will be closely tied to containment of the virus. As a result, the degree of uncertainty around Moody's forecasts is unusually high. Moody's regards the coronavirus outbreak as a social risk under Moody's ESG framework, given the substantial implications for public health and safety. Specifically, the weaknesses in ABC Fitness Solutions' credit profile, including its exposure to discretionary consumer spending have left it vulnerable to shifts in market sentiment in these unprecedented operating conditions and the company remains vulnerable to the ongoing coronavirus pandemic and social distancing measures. Moody's expects the coronavirus concern for fitness clubs will gradually ease over the next year once a growing share of the public has been vaccinated. Governance considerations include the company's private equity ownership. Companies owned by private equity sponsors tend to have aggressive financial policies favoring very high leverage, shareholder-friendly policies and limited financial disclosures. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS The ratings could be upgraded if ABC Fitness Solutions' revenue and earnings improve materially leading to a reduction in leverage with Moody's adjusted debt/EBITDA trending toward 7.5x, while producing positive free cash flow. The ratings could be downgraded if Moody's expects ABC Fitness Solutions' operating performance or liquidity will deteriorate, deleveraging will be delayed beyond 2022, or ability to service the company's debt becomes impaired. The principal methodology used in these ratings was Business and Consumer Service Industry published in October 2016. Based in Sherwood, Arkansas, and controlled by financial sponsor Thoma Bravo, ABC Fitness Solutions provides gym, health club, and fitness studio management and billing software and services to clients in the U.S, Mexico, and Canada. Pro forma revenue in 2020 was $161 million. PROPULSION ACQUISITION: Moody's Withdraws Caa1 Corp. Family Rating ------------------------------------------------------------------ Moody's Investors Service has withdrawn Propulsion Acquisition, LLC's (dba Belcan) Caa1 corporate family rating, Caa1-PD probability of default rating and Caa1 senior secured bank credit facility rating. Prior to the withdrawal the outlook on the ratings was negative. The following ratings were withdrawn: Issuer: Propulsion Acquisition, LLC Probability of Default Rating, Withdrawn , previously rated Caa1-PD Corporate Family Rating, Withdrawn , previously rated Caa1 Senior Secured Bank Credit Facility, Withdrawn , previously rated Caa1 (LGD3) Outlook Actions: Issuer: Propulsion Acquisition, LLC Outlook, Changed To Rating Withdrawn From Negative RATINGS RATIONALE Moody's has decided to withdraw the ratings because of inadequate information to monitor the ratings, due to the issuer's decision to cease participation in the rating process. Headquartered in Cincinnati, Ohio, Propulsion Acquisition, LLC (dba Belcan) provides engineering services, technical staffing solutions and information technology services to customers in a wide variety of end-markets including propulsion, avionics, chemical, heavy equipment, automotive, government, and energy. Belcan is owned by AE Industrial Partners. Reported revenue for twelve months ended September 2020 was $650 million. PURDUE PHARMA: Aug. 9 Hearing on $4.5-Bil. Sacklers Plan -------------------------------------------------------- Purdue Pharma L.P. and its debtor-subsidiaries filed with the Bankruptcy Court a First Amended Chapter 11 Plan and a corresponding Disclosure Statement. The Plan significantly improves on the initial settlement framework that was in place at the commencement of the Debtors' Chapter 11 cases, 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, Marshall S. Huebner, Esq, at DAVIS POLK & WARDWELL LLP, counsel for the Debtors related. Some $225 million of this sum, he said, has been paid by the shareholders to satisfy their civil settlement with the United States Department of Justice, leaving $4.275 billion for the creditors in this bankruptcy case. The increase in the recovery from the shareholders directly increases by $1.275 billion the amount of funds that can be directed towards abatement. As a result, it is expected that approximately $5 billion in value will be provided to trusts. An additional $700 to $750 million will be provided to a trust that will make distributions to qualified personal injury claimants. According to a preliminary analysis performed by the Ad Hoc Group of Individual Victims, a qualified personal injury claimant will likely receive between $3,500 and $48,000 in distributions from the PI Trust, subject to reduction on account of trust and attorney fees and expenses, depending on the severity of the injuries suffered. The distributions may be paid out in installments because the PI Trust will be funded in installments over five years. The PI Trust will examine the evidence provided with each claim form to determine recoveries, which are expected to range from $3,500 to $48,000. A holder of a PI Claim may receive, at his or her election, whether to receive Easy Payment of an estimated $3,500, or a base-plus-level award that varies depending on the severity of injury. Choosing the Easy Payment option will get you money sooner, but it means that you will receive only $3,500 and no more, the counsel noted. The Debtors disclosed that of the more than 614,000 proofs of claim filed in their cases, only 10% of the claims did state an amount, aggregating over $140 trillion. The 90% of the claims, or over 550,000 proofs of claim, did not state a claim amount. The vast majority of the filed Proofs of Claim assert unsecured opioid litigation claims. Classes of Claims Under the Plan Under the Plan, holders of Claims in Classes 3, 4, 5, 6, 7, 8, 9, 10 and 11(c) are impaired and are entitled to vote to accept or reject the Plan. They include Class 7 Third-Party Payor Claims, Class 8 Ratepayer Claims, Class 9 NAS Monitoring Claims, Class 10 PI Claims Class and (c) Other General Unsecured Claims. The Unclassified Claims include (i) Class 3 Federal Government Unsecured Claims, (ii) Class 4 Non-Federal Domestic Governmental Claims (iii) Class 5 Tribe Claims, (iv) Class 6 Hospital Claims. Ballots that are eligible to vote on the Plan must be received by the Solicitation Agent no later than 4 p.m. (prevailing Eastern Time) on July 14, 2021. The Confirmation Hearing will take place on August 9, 2021 at 10 a.m. (prevailing Eastern Time). The Plan provides that the vast majority of the Debtors' assets will be dedicated to programs to abate the opioid crisis, into abatement trusts. Each of these abatement trusts will require that the funds be dedicated exclusively to opioid abatement efforts: * Hospital Claims and the Hospital Trust. All funds received from the Hospital Trust by any holder of a Hospital Claim must be used for or applied to abatement purposes. * Third-Party Payor Claims and the TPP Trust. * NAS Monitoring Trust and Grants. In addition to the personal injury claims of NAS children, NAS children may also have claims against the Debtors relating to medical monitoring support, educational support, vocational support, familial support or similar related relief, and not for an alleged personal injury suffered by a NAS child. The funds will not be distributed to NAS children or their guardians but shall instead be used to make grants to organizations that combat the effects of NAS. * Public Creditor Trusts. The settlement framework provides for the establishment of two public creditor trusts, which will receive the remainder of the approximately $5 billion in value to be provided for abatement. Specifically, 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. * National Opioid Abatement Trust. The funds distributed to the NOAT under the Plan will be allocated to each state for use within that state based on a detailed mediation and settlement framework for the NOAT. * Tribe Trust. The Tribes will use the tribal allocation of Abatement Funds for programs on the approved list of abatement strategies, and also for culturally appropriate activities, practices, teachings or ceremonies that are, in the judgment of a tribe or tribal health organization, aimed at or supportive of remediation and abatement of the opioid crisis within a tribal community. A key component of the Debtors' Plan is the releases granted to the Debtors in consideration for their contributions to the Estates both prior to and after the Petition Date. The parties being released by the Debtors through standard debtor releases include, collectively, (i) the Debtors, (ii) the Plan Administration Trust, (iii) NewCo, (iv) TopCo, (v) the Master Disbursement Trust, the Supporting Claimants, the Creditors' Committee and the Creditors' Committee's members and each of their respective professionals, solely in their respective capacities as such. Under the Plan, the Releasing Parties will be deemed to provide a full and complete discharge and release to the Released Parties and their respective property and successors and assigns from any and all Causes of Action whatsoever, in addition to ordinary and customary Debtor releases and exculpations. On the Effective Date, Purdue Pharma will cease to exist. All of the Debtors' businesses -- 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) and approximately $200 million of cash will be transferred directly or indirectly to NewCo, a newly created company, which will be indirectly owned by two of the opioid abatement trusts, NOAT and the Tribe Trust. NewCo will be governed by a board of seven disinterested and independent NewCo Managers. The Ad Hoc Committee and the MSGE Group, in consultation with the Debtors and the Creditors' Committee, will select the initial NewCo Managers, pursuant to a selection process and is subject to observation by the Department Of Justice. A copy of the Amended Disclosure Statement is available for free at https://bit.ly/3taUuMr from Prime Clerk, claims agent. 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 facing the Company. The Company's consolidated balance sheet at Aug. 31, 2019, showed $1.972 billion in assets and $562 million in liabilities. U.S. Bankruptcy Judge Robert Drain, in White Plains, New York, has been assigned to oversee Purdue's Chapter 11 case. Davis Polk & Wardwell LLP and Dechert LLP are serving as legal counsel to Purdue. PJT Partners is serving as investment banker, and AlixPartners is serving as financial advisor. Prime Clerk LLC puis the claims agent. PURDUE PHARMA: Non-Consenting States Say Plan Unconfirmable ----------------------------------------------------------- The Ad Hoc Group of Non-Consenting States objects to the motion of Purdue Pharma L.P., et al. to approve the adequacy of information in the Disclosure Statement for First Amended Chapter 11 Plan. The Debtors' proposed Disclosure Statement purports to describe an end to a long journey to address the opioid crisis in America and the role that the Debtors and their controlling shareholders and families played in creating it. The reality, however, is that the Plan fails to hold those responsible shareholders appropriately accountable and instead proposes that this Court override the independent sovereign judgments of the Attorneys General of each Non-Consenting State as to what is required to achieve accountability within their respective States. Yet, despite their own admitted guilt, the Debtors seek to cram down an unconfirmable plan that, among other things, would absolve non-Debtor wrongdoers in exchange for the stretched-out payment of only a tiny fraction of their independent liability, unlawful gains, and current wealth, over the objection of Attorneys General from 24 States and the District of Columbia, representing 53% of the U.S. population. The Plan also is unconfirmable as a matter of law because it proposes an improper classification scheme under Bankruptcy Code section 1122 combining the States and political subdivisions, clearly a scheme to advance the Debtors' cramdown aspirations. The Debtors seek approval of the Disclosure Statement for a Plan that is patently unconfirmable because it (1) impermissibly imposes non-consensual releases of State police power claims against the Sackler Families and others; and (2) improperly puts the States in the same class as their political subdivisions. If the Disclosure Statement is approved, the Debtors will incur millions of dollars in fees and expenses unnecessarily by soliciting votes on a Plan that cannot be confirmed. Moreover, solicitation of the Plan is premature because there remain unresolved disputes within and between creditor constituencies that must be wrapped up for creditors to make an informed decision on the Plan. This includes resolutions with holders of the Hospital Claims, the private health insurers referred to as third-party payors or the personal injury claimants, the U.S. Department of Justice, and the UCC. Counsel to the Ad Hoc Group of Non-Consenting States: PILLSBURY WINTHROP SHAW PITTMAN LLP Andrew M. Troop Hugh M. McDonald Andrew V. Alfano Melissa S. Pettit 31 West 52nd Street New York, NY 10019 Tel: (212) 858-1000 E-mail: andrew.troop@pillsburylaw.com hugh.mcdonald@pillsburylaw.com andrew.alfano@pillsburylaw.com melissa.pettit@pillsburylaw.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 facing the Company. The Company's consolidated balance sheet at Aug. 31, 2019, showed $1.972 billion in assets and $562 million in liabilities. U.S. Bankruptcy Judge Robert Drain, in White Plains, New York, has been assigned to oversee Purdue's Chapter 11 case. Davis Polk & Wardwell LLP and Dechert LLP are serving as legal counsel to Purdue. PJT Partners is serving as investment banker, and AlixPartners is serving as financial advisor. Prime Clerk LLC is the claims agent. PURDUE PHARMA: PSD Creditors Say Disclosures Remain Inadequate -------------------------------------------------------------- The Public School District Creditors, in their individual and representative capacities, submit the supplement to the objection of the Public School District Creditors to the Motion of Debtors Purdue Pharma L.P., et al. to Approve the Adequacy of Information in the Disclosure Statement. The School District Creditors claim that the Second Plan Supplement makes no provision whatever for funding of the special education programs and supplemental educational services that are so critical to meeting the developmental and educational needs of opioid-impacted children. This exclusion of public school districts from the NOAT distributions underscores the fundamental inequity of the Debtors' proposed plan of reorganization. The School District Creditors point out that patent errors and inconsistencies identified by the Public School District Creditors have not been corrected. The Debtors still have not filed a complete disclosure statement and still have not filed a plan of reorganization that includes the terms of the Sackler release. The School District Creditors assert that the Amended Disclosure Statement remains inadequate. Other deficiencies identified by the Public School District Creditors also remain unaddressed. Not only is the Amended Disclosure Statement substantially incomplete, but the Debtors have actually inserted additional placeholders for information still to come. The School District Creditors further assert that the Amended Plan remains unconfirmable as written. The Amended Plan continues to lump the public school districts together with all of the other non-federal domestic governmental claimants, even while other creditor constituencies—Tribe Claims, Hospital Claims, Third-Party Payor Claims, Ratepayer Claims, NAS Monitoring Claims and PI Claims—have been given their own respective classes. Attorneys for the Public School District Creditors: Eric B. Fisher BINDER & SCHWARTZ LLP 366 Madison Avenue, 6th Floor New York, New York 10017 Tel: (212) 510-7008 Fax: (212) 510-7299 efisher@binderschwartz.com Matthew J. Piers Charles D. Wysong Emily R. Brown Margaret Truesdale HUGHES SOCOL PIERS RESNICK & DYM, LTD. 70 W. Madison Street, Suite 4000 Chicago, IL 60602 Tel: (312) 580-0100 Fax: (312) 580-1994 mpiers@hsplegal.com cwysong@hsplegal.com ebrown@hsplegal.com mtruesdale@hsplegal.com Cyrus Mehri Steve Skalet Joshua Karsh Aisha Rich MEHRI & SKALET, PLLC 1250 Connecticut Ave., NW, Suite 300 Washington, D.C. 20036 Tel: (202) 822-5100 Fax: (202) 822-4997 cmehri@findjustice.com sskalet@findjustice.com jkarsh@findjustice.com arich@findjustice.com Wayne Hogan Leslie Goller TERRELL HOGAN YEGELWEL, P.A. 233 E. Bay Street, 8th Floor Jacksonville, FL 32202 Tel.: (904) 722-2228 hogan@terrellhogan.com lgoller@terrellhogan.com Neil Henrichsen Dawn Stewart HENRICHSEN LAW GROUP, PLLC 1440 G. Street, NW Washington, D.C. 20005 Tel.: (202) 423-3649 Fax: (202) 379-9792 E-mail: nhenrichsen@hslawyers.com dstewart@hslawyers.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 facing the Company. The Company's consolidated balance sheet at Aug. 31, 2019, showed $1.972 billion in assets and $562 million in liabilities. U.S. Bankruptcy Judge Robert Drain, in White Plains, New York, has been assigned to oversee Purdue's Chapter 11 case. Davis Polk & Wardwell LLP and Dechert LLP are serving as legal counsel to Purdue. PJT Partners is serving as investment banker, and AlixPartners is serving as financial advisor. Prime Clerk LLC is the claims agent. PURE FISHING: S&P Affirms 'CCC+' Rating on First-Lien Term Loan --------------------------------------------------------------- S&P Global Ratings affirmed its 'CCC+' issue-level rating on Pure Fishing's first-lien senior secured term loan due 2025. S&P's '3' recovery rating on the loan is unchanged, indicating its expectation for meaningful recovery (50%-70%; rounded estimate: 55%) in the event of a payment default. S&P said, "The incremental first-lien debt in the company's capital structure has reduced the recovery prospects for its first-lien lenders, though the decline was not significant enough to lead us to revise our recovery rating or lower our issue-level rating because the incremental value from the acquisition will partially offset the rise in its debt." In April 2021, Pure Fishing issued approximately $205 million of incremental first-lien term loans, as well as $50 million of incremental (unrated) second-lien term loans, to fund its acquisition of Plano Synergy Holdings Inc., a manufacturer of outdoor recreation equipment with brands specializing in fishing, hunting, and archery. Shortly thereafter, Pure Fishing sold Plano's hunting and archery brands for approximately $75 million but retained the Plano and Frabill fishing equipment brands, as well as Caboodles and Creative Options, which specialize in cosmetics and crafts storage. S&P believes the acquisition will modestly increase Pure Fishing's already very high anticipated leverage because we estimate that it paid approximately 10x Plano's 2021 EBITDA net of the cash it received from the sale of the hunting and archery brands. S&P said, "In our updated base-case forecast, we expect the company's revenue to increase by the mid-single digit percent area in 2021 pro forma for the acquisition as the company continues to experience high demand for its fishing products while social distancing measures remain in place. We assume Pure Fishing's revenue could decline by as much as 10% in 2022 due to a pull-back in the demand for its fishing products, which could begin as early as the second half of this year once the U.S. achieves widespread immunization and alternative forms of entertainment become available to consumers. We expect the company's S&P Global Ratings-adjusted EBITDA margin to improve to the 14%-15% range on an increase in its gross margin and the realization of a modest amount of cost synergies from the Plano acquisition. Incorporating our assumptions and our expectation that the company will use the proceeds from the sale of Plano's hunting and archery brands to repay debt, we believe its leverage will remain elevated with S&P Global Ratings-adjusted debt to EBITDA in the mid-7x range in 2021 and possibly above 8x in 2022. "Our 'CCC+' issuer credit rating on Pure Fishing reflects our forecast for very high leverage through 2022 and our belief that its capital structure may become unsustainable if there is unexpected volatility in the demand for fishing equipment or it experiences an inadvertent operating misstep over the next two years. Incorporating the company's $42 million of cash as of Dec. 31, 2020, and our base-case assumptions for operating performance and good availability under its asset-backed lending (ABL) facility, we believe the company will have adequate liquidity over at least the next 12 months. Therefore, our outlook is stable because we believe that a near-term default is unlikely. However, given our forecast for Pure Fishing's leverage to remain very high through 2022, we could revise our outlook to negative or lower our ratings over the next several months if we believe the assumed pull back in fishing equipment demand will cause its revenue, EBITDA, and cash flow to materially underperform our base-case assumptions and lead it to make significant draws on its ABL facility. Alternatively, we could lower our ratings if we believe a default or restructuring is likely over the next 12 months." ISSUE RATINGS--RECOVERY ANALYSIS Key analytical factors -- S&P's 'CCC+' issue-level rating and '3' recovery rating on Pure Fishing's first-lien term loan due 2025 indicate its expectation for meaningful (50%-70%; rounded estimate: 55%) recovery for lenders in the event of a payment default. -- S&P's simulated default scenario contemplates a default occurring in 2022 due to a ¬¬¬substantial retail inventory correction and a significant pullback in the demand for the company's fishing products. -- S&P has valued the company as a going concern using a 6x multiple of its projected emergence EBITDA. Simulated default assumptions -- Simulated year of default: 2022 -- Emergence EBITDA: $78 million -- EBITDA multiple: 6x -- ABL facility: 60% drawn at default Simplified waterfall -- Net enterprise value (after 5% administrative expenses): $450 million -- Obligor/nonobligor valuation split: 82%/18% -- Estimated priority claims (ABL facility): $78 million -- Value available to first-lien term loan claim: $344 million -- Estimated first-lien term loan claim: $600 million --Recovery expectations: 50%-70% (rounded estimate: 55%) -- Estimated second-lien term loan claim: $242 million -- Estimated value available for second-lien lenders: $0 Note: All debt amounts include six months of prepetition interest. QUINCY REAL ESTATE: Taps Jason Conrad of EXIT Realty as Broker -------------------------------------------------------------- Quincy Real Estate Company, Inc. seeks approval from the U.S. Bankruptcy Court for the Northern District of Iowa to employ Jason Conrad, a real estate broker at EXIT Realty Dubuque, to market its real property. Mr. Conrad will receive a 6 percent commission if he finds a buyer for the property or a 2 percent commission if the buyer is procured by the Debtor or its agents. As disclosed in court filings, Mr. Conrad is a "disinterested professional" and does not hold equity interest in the Debtor or any of its affiliated companies. Mr. Conrad can be reached at: Jason Conrad EXIT Realty Dubuque 1200 Cedar Cross Rd. Dubuque, IA 52003 Telephone: (563) 231-7738 About Quincy Real Estate Company Quincy Real Estate Company, Inc. sought protection under Chapter 11 of the Bankruptcy Code (Bankr. N.D. Iowa Case No. 21-00201) on March 18, 2021. At the time of the filing, the Debtor disclosed assets of between $500,001 and $1 million and liabilities of the same range. Judge Thad J. Collins oversees the case. The Debtor is represented by the Law Offices of Robert J. Murphy. REALOGY GROUP: S&P Alters Outlook to Positive, Affirms 'BB+' ICR ---------------------------------------------------------------- S&P Global Ratings revised the outlook to positive from stable and affirmed the 'B+' issuer credit rating on New Jersey–based real estate franchisor and broker Realogy Group LLC. S&P said, "We also raised the issue-level rating on the second-lien secured notes to 'BB-' from 'B+' and revised the recovery rating on the debt to '2' from '3' to reflect lower level of higher-ranking first-lien debt in our recovery waterfall analysis. "The positive outlook reflects our expectation that we could raise our ratings on Realogy over the next 12 months if we become increasingly confident that adjusted leverage will be sustained in the low-4x area while maintaining its strong liquidity position." "Realogy's home sale indicators for March and April reflect strong momentum as it enters the peak home-buying season. We believe Realogy is well-positioned to take share in the near term due to its exposure to the high-end market and expanding agent base. While tight inventory could pressure volumes, we believe that risk is skewed toward the entry-level market." In March, Realogy's open order transaction volumes were up 70% compared with 2020. In April, open and closed transaction volumes were up about 45% and 50%, respectively, compared with 2019. For the recent quarter, Realogy reported 44% growth in home sale transaction volume (sides and price), above the National Realtor Association's) reported 28%. Realogy's use of cash to repay debt indicates its commitment to deleverage. S&P said, "We believe Realogy is likely to maintain leverage at current levels, prioritizing excess cash for growth investments in the near term. However, operating performance has limited visibility and can be highly volatile, and the company has a track record of large share repurchases. We note, the company's covenant period for its restricted payments ends June 30, 2021, which could result in debt-funded share repurchases at the end of the year if operating performance continues at its strong trajectory." S&P said, "The positive outlook reflects our expectation that we could raise our ratings on Realogy over the next 12 months if we become increasingly confident that adjusted leverage will be sustained in the low-4x while maintaining its strong liquidity. "We could raise our ratings if Realogy's adjusted leverage stayed in the low-4x area and the company generated free operating cash flow (FOCF) to debt of more than 10%." This could occur if: -- Economic and industry conditions supported a favorable U.S. residential housing market, such that the company demonstrated year-over-year revenue growth through improved volume and price. -- Agent retention rates were stable. -- Prudent expense management resulted in margin and FOCF growth. -- Demonstrated track record of maintaining prudent capital allocation policies. -- The company repaid or extended the 2023 maturities. S&P could revise the outlook to stable if leverage increased and were to approach the mid-4x area. In this scenario: -- Economic and industry conditions delayed a recovery, leading to negligible revenue growth, primarily due to lower volumes or agent attrition from increased competition. -- The company engaged in debt-funded share repurchases, dividends, or non-accretive mergers and acquisitions. -- The company were unable to extend or repay the 2023 maturities. RED BIRD: Seeks to Hire Gorfine, Schiller & Gardyn as Tax Advisor ----------------------------------------------------------------- Red Bird Liquidating Corporation and Alouette Holdings, Inc. seek approval from the U.S. Bankruptcy Court for the Eastern District of Virginia to employ Gorfine, Schiller & Gardyn, PA as tax advisor. The firm will provide services related to the preparation and filing of the Debtors' final tax returns and any additional financial accounting or other services deemed necessary to efficiently and orderly wind down the Debtors' business and affairs. The firm will receive a flat fee of $28,000 for its services, including its out-of-pocket expenses incurred. John Lyons, a member of Gorfine, Schiller & Gardyn, 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 through: John K. Lyons Gorfine, Schiller & Gardyn, PA 19833 Leitersburg Pike, Suite 2 Hagerstown, MD 21742 Telephone: (301) 739-9000/(410) 517-6850 Facsimile: (301) 739-8345 Email: jlyons@gsg-cpa.com About Red Bird Liquidating Corporation Red Bird Liquidating Corporation filed a voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. E.D. Va. Case No. 19-36275) on Dec. 2, 2019. Its affiliate, Alouette Holdings, Inc., filed a voluntary Chapter 11 petition (Bankr. E.D. Va. Case No. 19-36126) on Nov. 20, 2019. The cases are jointly administered under Case No. 19-36275. At the time of the filing, Red Bird had between $1 million and $10 million in both assets and liabilities. Judge Kevin R Huennekens oversees the cases. Whiteford, Taylor & Preston, LLP and Woods Rogers, PLC serve as the Debtors' legal counsel. Gorfine, Schiller & Gardyn, PA is the Debtors' tax advisor. RIC METUCHEN: Seeks to Hire Schneck Law as Special Counsel ---------------------------------------------------------- RIC Metuchen, LLC seeks approval from the U.S. Bankruptcy Court for the District of New Jersey to employ Schneck Law Group, LLC as special counsel. The Debtor needs the firm's legal assistance to file an appeal of the tax assessment against its property located at 16 Pearl St., Metuchen, N.J. Schneck Law Group will be paid a contingency fee of 25 percent of the amount of the total tax savings. Michael Schneck, Esq., a partner at Schneck Law Group, 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: Michael I. Schneck, Esq. Schneck Law Group, LLC 301 South Livingston Avenue, Suite 105 Livingston, NJ 07039 Tel: (973) 533-9300 Email: mschneck@schnecklaw.com About RIC Metuchen RIC Metuchen, LLC is a single asset real estate debtor (as defined in 11 U.S.C. Section 101(51B)). It is the fee simple owner of a property located at 16 Pearl St., Metuchen, N.J., having a comparable sale value of $1.46 million. RIC Metuchen sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D.N.J. Case No. 21-12075) on March 15, 2021. Peter Klein, sole member of 100% owner Realty Investment Capital NJX, LLC, signed the petition. In the petition, the Debtor disclosed assets of $1,464,035 and liabilities of $970,399. Boyle & Valenti Law P.C. and Schneck Law Group, LLC serve as the Debtor's bankruptcy counsel and special counsel, respectively. RIVERBEND ENVIRONMENTAL: Unsecureds' Recovery Unknown in Plan ------------------------------------------------------------- Riverbend Environmental Services, LLC, filed with the Bankruptcy Court a Chapter 11 Plan and a Disclosure Statement. The Plan is a liquidating plan under Chapter 11. The Debtor will continue its efforts to pursue its insurance claim in connection with the damage to the landfill. It will review the possibility of avoidance claims and causes of action and it will continue working on contract claims as well. In the fall of 2020 the Debtor sold to Greenway Environmental Services substantially all of its assets, including real estate and buildings that comprised its landfill operations and many of its personal assets. Greenway has been operating the landfill as record of title owner since the closing occurred in November 13, 2020. Under the terms of the Sale Order, Greenway operated the Debtor's assets for a period of time and eventually exercised its right under the Sale Agreement. On the Effective Date, each executory contract and unexpired lease in which the Debtor is a party that has not been assumed or rejected in connection with the Plan before the confirmation, with Court approval, shall be deemed rejected. General Unsecured Creditors in Class 4 will receive all remaining funds that the Debtor has after payment of administrative expenses class and the priority class. A copy of the Disclosure Statement is available for free at https://bit.ly/338KbOv from PacerMonitor.com. About Riverbend Environmental Services Riverbend Environmental Services, LLC, based in Fayette, MS, sought Chapter 11 protection (Bankr. S.D. Miss. Case No. 19-03828) on Oct. 25, 2019. In the petition signed by Jackie McInnis, manager, the Debtor was estimated to have $10 million to $50 million in assets and $1 million to $10 million in liabilities. The Hon. Katharine M. Samson oversees the case. Craig M. Geno, Esq., of the Law Offices of Craig M. Geno, PLLC, serves as bankruptcy counsel to the Debtor. Watkins & Eager, PLLC is special counsel. RKJ HOTEL: Seeks to Hire Horwath HTL as Valuation Expert -------------------------------------------------------- RKJ Hotel Management, LLC seeks approval from the U.S. Bankruptcy Court for the District of Nevada to employ Horwath HTL, a valuation expert based in Norfolk, Va. The Debtor requires a valuation expert to conduct an appraisal of its hotel and property located at 31500 Wick Road, Romulus, Mich., respond to objections to the valuation, and testify before the court. Horwath HTL will be paid at the rate of $450 per hour and a retainer of $10,020. The firm will also receive reimbursement for out-of-pocket expenses incurred. Michael Cummings, a partner at Horwath HTL, 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: Michael Cummings Horwath HTL 999 Waterside Drive, Suite 1200 Norfolk, VI 23510 Tel: (757) 623-1400 Email: mcummings@horwathhtl.com About RKJ Hotel Management RKJ Hotel Management, LLC sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Nev. Case No. 21-10593) on Feb. 9, 2021. Jeff Katofsky, member and authorized representative, signed the petition. In the petition, the Debtor disclosed assets of between $10 million and $50 million and liabilities of the same range. Judge Natalie M. Cox oversees the case. The Debtor tapped Garman Turner Gordon, LLP as its legal counsel. ROBERT F. TAMBONE: Cowans Buying Wenham Property for $3.185 Million ------------------------------------------------------------------- Robert F. Tambone asks the U.S. Bankruptcy Court for the District of Massachusetts to authorize the private sale of all of his right, title, and interest in the real property located at 57 Walnut Road, in Wenham, Massachusetts, to Tyler W. Cowan and Courtney M. Cowan or their nominee for the sum of $3.185 million, in accordance with the terms of their Purchase and Sale Agreement, subject to higher and better offers. The Debtor has been engaged in real estate development and property management for more than 40 years. Over the course of the years, it has established a series of entities to develop and/or manage properties including Atlantic Tambone, Inc., Atlantic Tambone Management, LLC, Wenham Pines, LLC, Billchelm Realty LLC, Billchelm Realty 70, LLC, and JRT Realty LLC. Atlantic Tambone Management, LLC ("Atlantic Tambone") is a real estate management company that manages property. It formerly managed the Boxborough Properties and currently manages other commercial properties. Atlantic Tambone, Inc. is a real estate developer. Wenham Pines, LLC is the owner of a 24-unit over 55 residential condominium development in Wenham, Massachusetts. In connection with the development of the Wenham Property, Wenham Pines is obligated to First Boston Construction Holdings, LLC pursuant to a Commercial Real Estate Term Loan Agreement, in the principal amount of approximately $3.5 million dollars. The Debtor executed a personal guaranty to First Boston that is secured by a second mortgage against the Property, which is his personal residence. Billchelm Realty LLC and Billchelm Realty 70, LLC owned adjoining commercial office buildings in Boxborough, Massachusetts. The Billchelm Entities borrowed money from Unibank for Savings and granted Unibank mortgages on the Boxborough Properties to secure the amounts borrowed. As of the Petition Date, the Billchelm Entities owed Unibank approximately $12 million. The Debtor executed a limited guarantee of Unibank's loan to the Billchelm Entities. Unibank recently conducted a foreclose sale of the Boxborough Properties at which Unibank was the sole bidder and purchased the Boxborough Properties. The Debtor disputes Unibank's claim against him. JRT Realty LLC owned a commercial property located in Lynnfield Massachusetts, which was sold to a third party in 2019. The Debtor owns all of the membership interests in JRT, apass-through tax entity, and the Internal Revenue Service has asserted claims against him arising from capital gains taxes arising from the sale of JRT's property. The chapter 11 filing was precipitated by collection actions brought by Unibank on account of the Debtor's guaranty of the loan to the Billchelm Entities. he Debtor and his non-debtor spouse are the owners of the Property as tenants by the entirety. The Property consists of a seven-bedroom, 5 full bath, and three half-bath single family home with 8,986 square feet of living area and a parking garage. The Property is situated on approximately 15 acres of land. The Court previously authorized the Debtor to employ Alle Cutler and J. Barrett & Co. as his real estate broker to assist him with the marketing and sale of the Property. ith the assistance of the Broker, the Debtor has been marketing the Property since well prior to the Petition Date. Prior to accepting this offer, the Debtor has received no other acceptable offers. The Property is subject to a first and second mortgage. After payment of costs of sale and brokers' commissions in the approximate amount of $160,000, the holders of the first and second mortgage totaling approximately $2,900,000, and the Debtor's non-debtor spouse on account of her interest in the Property, the sale will generate approximately $37,500 in unencumbered funds for the Debtor, who has claimed a homestead on the Property. The sale of the Property will permit the Debtor to reduce his living costs by a significant amount. Pursuant to the Sale Motion, the Debtor asks Court approval to sell his right, title, and interest in and to the Property to the Purchasers. He asks that the sale convey title to the Property free and clear of any liens, claims, encumbrances and interests. In accordance with the terms of the Sale Agreement, the Purchasers will pay to the Debtor and his spouse on the closing date, which is to occur no later than June 30, 2021, the Purchase Price in the amount of $3,185,000, payable as follows: (i) $1,000 paid with the Offer to Purchase; (ii) $158,250 paid with the execution of the Sale Agreement; and (iii) $3,025,750 paid at the time of delivery of the deed. The sale is not subject to a financing contingency or to further due diligence. Pursuant to the Sale Agreement, the Property will be sold in "as is" and "where is" condition, and the Debtor is not making any representations or warranties whatsoever, either express or implied, with respect to the Property except as may be set forth in the Sale Agreement. The Debtor further asks that, to the extent that there is an auction for the Property, if the sale of the Property is not completed by the highest bidder, the Court authorizes him to close upon the sale of the Property to the next highest bidder. Concurrently with the Motion, the Debtor has filed a motion asking approval of certain bidding procedures and seeking approval of the Purchasers' request for a breakup fee in theevent that they are not the successful purchasers. The Court's approval of the bidding procedures and the timing of the sale process are conditions of the Purchasers' obligation to close under the Sale Agreement. While advance approval of the Bid Procedures is not required under MLBR 6004, advance approval is also a condition of the Purchasers' obligations to close under the Sale Agreement. Approval of the Private Sale is subject to the submission of higher and better offers. Counteroffers must be in an amount not less than 5% greater than the Purchase Price, or $3,344,250. Counteroffers: (a) must be accompanied by a deposit equal to $167,212.50 and made payable to the Debtor; (b) must include an executed purchase and sale agreement upon terms substantially consistent with or more favorable than the terms of the Sale Agreement; (c) must not be subject to further due diligence and must not contain any other conditions precedent to the consummation of the sale other than those provided in the Sale Agreement; and (d) must state that the competing bidder is prepared to consummate the purchase within the same time period provided by the Sale Agreement. In the event of a timely counteroffer, each interested bidder will have an opportunity to participate in an auction before the Court by open auction. The Court may modify the method of sale set forth in the notice at or prior to the hearing on the proposed sale. Any competing bidder will demonstrate to the Debtor's reasonable satisfaction that it is financially able to consummate the sale. The Deposit submitted by the highest bidder will be forfeited to the Estate if the highest bidder fails to complete the sale by the date ordered by the Court. The Court may take evidence at any hearing on approval of the sale to resolve issues of fact. The Debtor requests a waiver of the 14-day stay provided by Rule 60040 of the Federal Rules of Bankruptcy Procedure. The inclusion of the waiver is a condition to the Purchasers' obligation to perform under the Sale Agreement, in connection with the Purchasers' stated desire to have certainty regarding the sale. The Debtor requests authority to pay all costs of sale, including the Broker's commission, customary closing costs and expenses and the allowed amounts due to the first and second mortgage holders from the gross proceeds of the sale of the Property and to allocate the net proceeds between the Debtor and his non-Debtor spouse. A copy of the Agreement is available at https://tinyurl.com/bwsm6uan from PacerMonitor.com free of charge. Robert F. Tambone sought Chapter 11 protection (Bankr. D. Mass. Case No. 20-11378) on June 22, 2020. The Debtor tapped Kathleen Cruickshank, Esq., ROYAL BLUE: Seeks to Use Cash Thru May 12 in Amended Motion ----------------------------------------------------------- Royal Blue Realty Holdings, Inc., filed an amended motion seeking the Bankruptcy Court's approval to use cash collateral in the ordinary course of the business, first on an interim basis through May 12, 2021, and then on a final basis from May 13 through the course of its Chapter 11 case. The Debtor's projected profit and loss from May 2021 through July 2021 provided for $7,000 in total expenses after reimbursements by Net Lessee of $85,325. The Debtor also asked the Court for authority to provide adequate protection to Deutsche Bank National Trust Company. Deutsche Bank is the trustee of the mortgage trusts (the American Home Mortgage Assets Trust 2007-1 and American Home Mortgage Assets Trust 2006-6), to which the Debtor's pre-petition notes and mortgages, securing certain residential loans, were assigned. The mortgage trusts were formed by American Home Mortgage (AHM) when it went bankrupt in 2007. The Trustee or its affiliate was also making warehouse loans that allowed AHM to make and package the loans for the trusts, which the Trustee or its affiliate underwrote. The Trustee alleged that the Debtor has stopped making payments to AHM. In 2009 and 2010, the Trustee commenced eight foreclosure actions, and in or about 2015, the Trustee commenced three more foreclosure actions. In 2016, the Trustee commenced a 12th action. The Debtor materially disputes the validity and enforceability of the mortgages. According to the Debtor, Deutsche Bank has no interest in its cash and cash equivalents. The Debtor said it is filing the motion out of abundance of caution. Interim hearing on the request will be on May 12, 2021 at 10 a.m. Final hearing is set for June 15 at 10 a.m. A copy of the amended motion is available for free at https://bit.ly/3u3IJc5 from PacerMonitor.com. About Royal Blue Realty Holdings Royal Blue Realty Holdings, Inc., holding business at 162-174 Christopher Street, New York, New York, is primarily engaged in renting and leasing real estate properties. Royal Blue filed a Chapter 11 petition (Bankr. S.D.N.Y. Case No. 21-10802) on April 26, 2021. As of the Petition Date, the Debtor estimated between $1 million to $10 million in assets, and between $10 million to $50 million in liabilities. The petition was signed by Andrew Nichols, chief restructuring officer. DAVIDOFF HUTCHER & CITRON LLP represents the Debtor as counsel. Judge Hon. Lisa G. Beckerman oversees the case. SABON HOLDINGS: Unsec. Creditors to Recover 15% to 18% in Plan -------------------------------------------------------------- Sabon Holdings and its affiliated Debtors filed a Second Amended Joint Plan of Reorganization and a corresponding Disclosure Statement. The Plan provides for the satisfaction of all allowed administrative claims after the Effective Date. As to each administrative claim allowed thereafter, payment will be made as soon as practicable. The Plan also provides for the satisfaction of all priority tax indebtedness either in cash or over a five-year period in installments. The Debtors estimate, based on the filed claims, its schedules and giving effect to the rejection of leases, that there are approximately $2,000,370 in general unsecured claims. These general unsecured claims will be satisfied with payment of each creditor's pro rata share of $400,000, minus the payment of priority claims, if any, or approximately 15% to 18% of each creditor's claim. The cash distributions contemplated by the Plan shall be funded by cash generated in the operation of the Reorganized Debtors' business and by the purchase of new shares in the Reorganized Debtors by the Debtor's parent company, Groupe Rocher Holdings US Corporation, Inc., (GRHUS) for $400,000 on or before the Effective Date, plus additional funding from GRHUS in the amounts necessary to pay the operating expenses of the Reorganized Debtors and the Plan payments. GRHUS is waiving any rights to distributions on the GRHUS Claim for approximately $10,283,527. GRHUS has provided DIP financing to the Debtors during the Chapter 11 cases and the amount of Cash to be paid by GRHUS for the purchase price of the new shares shall be reduced by the amount owed under the DIP Financing Facility as of the Effective Date and GRHUS will not seek repayment of the DIP Financing Facility. A copy of the Amended Disclosure Statement is available for free at https://bit.ly/3udewqZ from PacerMonitor.com. About Sabon Holdings Sabon Holdings distributes personal care products. It offers, among other items, bath balls, foams, mineral powders, body scrubs, shower gels, milky soaps, deodorants, perfumes, massage oil, body lotions, hand soaps, scrubs and exfoliants, moisturizers, hand sanitizers, lip care, and eye care products. Sabon Holdings LLC and its affiliates filed voluntary petitions for relief under Chapter 11 of the Bankruptcy Code (Bankr. S.D.N.Y. Lead Case No. 20-11320) on May 29, 2020. The petitions were signed by Yale Scott Bogen, CRO. At the time of the filing, Sabon Holdings LLC disclosed total assets of $140,094 and total liabilities of $10,283,527. Judge James L. Garrity, Jr., oversees the cases. The Debtors tapped Smith, Gambrell & Russell, LLP as counsel; Development Specialists, Inc., as restructuring advisor; and Eshel, Aminov & Partners LLP as certified public accountant. SATELLITE RESTAURANTS: Trustee Selling All Assets to CCK for $300K ------------------------------------------------------------------ Scott Miller, the Subchapter V trustee appointed in the Chapter 11 case of Satellite Restaurants Inc. Crabcake Factory USA, asks the U.S. Bankruptcy Court for the District of Maryland to authorize the sale of substantially all assets to CCK Holdings, LLC, for $300,000, subject to overbid. The Debtor owns and operates a bar and restaurant in Ocean City, Maryland, known as the Crabcake Factory. It also provides shipping and has internet sales of its crab cake products and sells a limited amount of apparel and logo products. The Crabcake Factory has been in business for almost 25 years, but the COVID-19 pandemic has substantially harmed the Debtor's bar and dine-in business. Throughout the pandemic, the Debtor's management and personnel have worked tirelessly to continue operations and promote its carryout and curbside service as alternatives. The Debtor also promoted internet sales to supplement its income. Compounding the Debtor's difficulties was the failure of its prior accountant to properly account, prepare and file various tax returns. This resulted in inadequate support for its back office. During the past summer, with the assistance of counsel and new accounting support, substantial work was undertaken to put into place improved accounting procedures to facilitate orderly accounting and necessary tax filings. Finally, a wage and hour class action lawsuit filed by former employees (prior to August of 2019) also caused legal fees and expenses that could not be supported, and which necessitated the restructuring that a Chapter 11 reorganization offers. The Debtor has determined that a sale of assets pursuant to 11 U.S.C. Section 363 is necessary, appropriate and in the best interests of creditors and the economic administration of justice in the case. The Debtor's assets consist primarily of (i) its systems and processes to manage its restaurant business, work in progress, and furniture, fixtures, and equipment used in its business operations, (ii) the right to receive royalties pursuant to a certain contract, (iii) all other tangible and intangible assets associated with the Debtor’s business operations, and (iv) any claims against third parties including claims against certain officers, directors, agents, accountants, and/or other representatives of the Debtor that the Debtor may hold for avoidable transfers made by the Debtor to or for the benefit of such transferees during the applicable period preceding the filing of the Bankruptcy Case. The Debtor, with the assistance of its advisors, has determined in its business judgment that the sale of substantially all of its Assets, including the assumption and assignment of certain executory contracts and unexpired leases related thereto, to the highest and best bidder will maximize the benefit to the Debtor's estate, creditors and other parties in interest. Specifically, the Debtor has contacted a number of restaurateurs, entrepreneurs, and investors familiar with the seasonal restaurant market in Ocean City, Maryland, and the seafood industry in particular. The circumstances surrounding the COVID-19 pandemic have presented significant barriers and limitations on new investment in the Debtor’s industry. Notwithstanding these challenges, including the Debtor's involvement in Chapter 11 proceedings, the Debtor has found a qualified proposed investor. The Debtor has, subject to Court approval, entered into an Asset Purchase Agreement with the Purchaser. The Asset Purchase Agreement calls for the Purchaser to make a one-time payment of $300,000 in exchange for the Assets. A critical date pertaining to the Debtor's business is the upcoming holiday, Memorial Day Weekend. The Purchaser has requested, and the Debtor has agreed, to seek expedited approval in order to consummate the sale prior to this holiday. The proposed Bidding Procedures are proposed to meet this timeline. In the event the Sale is not consummated by the time, the Purchaser has a right to terminate the Stalking Horse Agreement, which may jeopardize the Sale. The Stalking Horse Agreement does not require Purchaser to hire any employees of the Debtor; yet, it is believed that the Purchaser intends to hire many employees of the Debtor, including some management, and has achieved agreement (in principle) for John Joseph Brooks to continue to hold the liquor license until it can be transferred to a designee of the Purchaser in exchange for management-level employment. The Debtor asks Orders from the Court (i) approving and authorizing it to enter into the Asset Purchase Agreement with the Purchaser, subject to higher and better bids, for the purpose of establishing a minimum acceptable bid for the Assets, (ii) approving payment of a "break-up fee" in the amount of 6% of the Stalking Horse Bid reasonable and actual attorneys' fees, incurred in connection with the Agreement, not to exceed an additional $7,000, as reasonable and beneficial to the Debtor's estate in the event the Stalking Horse Bid is not the successful purchaser, (iii) approving the Debtor's proposed bidding procedures, (iv) authorizing Alex Cooper to conduct an auction of the Assets, (v) authorizing the assumption and assignment of certain executory contracts and unexpired leases, with related notices and cures, and (vi) following the auction and determination of the successful bidder (a) approving the sale of the Assets to the successful bidder free and clear of all liens, claims, encumbrances, and other interests, (b) and granting certain related relief. Contemporaneously with the filing of the Sale Motion, the Debtor filed an Application to Employ and Compensate Alex Cooper Auctioneers, Inc. as Auctioneer, and its Bid Procedures Motion, which, among other things, seeks approval of procedures governing the Sale. As more particularly described in the Application to Employ, the Debtor has proposed Alex Cooper Auctioneers, Inc. as an auctioneer to facilitate the marketing and sale of the Assets. The Debtor intends to utilize Purchaser's offer as a stalking horse bid in order to "test" the offer in the market. The Purchaser's offer will be the "reserve" bid upon which Alex Cooper will auction the Assets. In the event Alex Cooper achieves a higher and better bid, it will have earned its commission, which will be due upon sale of the Assets, and the Debtor's estate will have been benefited by Alex Cooper's employment. Subject to Court approval, the Bid Procedures set forth the timeline pursuant to which the Debtor intends to consummate the Sale. Important milestones set forth therein include, without limitation, that (a) potential bidders are required to submit for qualification on or before 5:00 p.m. (ET) on May 14, 2021, (b) if more than one Qualified Bid is received, an auction will be held on May 17, 2021, beginning at 10:00 a.m. and continue for a period of 24 hours thereafter, and (c) a hearing to approve the Sale (and resolve outstanding objections related thereto) will take place on May 20, 2021, at 1:00 p.m. The principal terms and conditions of the Stalking Horse Agreement are: a. Purchase Price: The aggregate amount to be paid by Purchaser to Seller for the Assets is $300,000. An earnest money deposit of $100,000 will be deposited by the Purchaser on or before the Effective Date of the Agreement. b. Assets: The Purchaser will purchase, acquire and accept from the Seller, free and clear of Liens, all of (i) its systems and processes to manage its restaurant business, work in progress, and furniture, fixtures, and equipment used in its business operations, (ii) the right to receive royalties pursuant to certain contracts, (iii) all other tangible intangible assets associated with the Debtor's business operations, and (iv) any claims against third parties; and (v) cash. The Parties acknowledge that the amount of Cash may fluctuate between the Effective Date and Closing and, in any event, said Cash will convey to the Purchaser at Closing. At closing, the Purchaser gets all Cash. However, if, and only if, there is more than $25,000 in available cash, the excess cash up to $75,000 in excess cash is paid to the Debtor as a Purchase Price Enhancement, but its availability to the Debtor is subject to the following: 1. The Debtor may pay professional fees from the Purchase Price Enhancement that are Court approved prior to the expiration of 15 days after closing; 2. The Debtor's use of the Purchase Price Enhancement is limited to a maximum sum of $75,000 of Court allowed professional fees (understanding that the Court could allow less); 3. The Debtor's use of the $75,000 Purchase Price Enhancement is expressly limited to and dedicated for the payment of only those professional fees allowed by the Court approved prior to the expiration of 15 days of the Closing so that Purchaser may close the reconciliation promptly; 4. The availability of the $75,000 Purchase Price Enhancement is contingent upon the existence of more than $25,000 of available cash being first available at Closing (since Purchaser keeps the first $25,000); and 5. That all cash at Closing in excess of (i) the first $25,000 which goes to Purchaser, and (ii) the Purchase Price Enhancement of no more than $75,000, is exclusively the Purchaser’s cash as purchased. c. Contingency: The Closing (and Court approval of the same) must occur by May 27, 2021. d. The Purchaser's obligation to close on the transactions contemplated in the Agreement is not subject to financing. The Closing will be held within five days after the date all conditions to the parties' obligations under the Agreement have been satisfied. e. Assumed Contracts: At Closing, the Seller will transfer and assign to the Purchaser those Contracts that are scheduled to be assumed by the Purchaser. The Debtor submits that there is no security interest in the Assets and therefore no secured creditors that must consent. To facilitate and effect the Sale, the Debtor seeks to assume and assign the executory contracts and unexpired leases identified in the Stalking Horse Agreement, including, but not limited to, a Royalty Contract and two non-residential leases for (a) the property located at 12000 Coastal Highway, Ocean City, Maryland where the Debtor conducts its principal business, and (b) Suite "Q" located at 11805 Coastal Highway, Ocean City, Maryland 21842, to the purchaser of the Assets (be it the Purchaser or any Successful Bidder, as the case may be) to the extent required in connection with the Sale. The Debtor further requests, and the proposed Sale and Assignment Order provides, that the Debtor be authorized to change the name of the Bankruptcy Case to remove all references to "Crabcake Factory," and that it cease using the name "Crabcake Factory" from and after Closing. Pursuant to Local Rule 9013-2, the Debtor states that, in lieu of submitting a memorandum in support of this Sale Motion, it will rely solely upon the grounds and authorities set forth. A copy of the Agreement is available at https://tinyurl.com/yrvxcwhw from PacerMonitor.com free of charge. The Purchaser: CCK HOLDINGS, LLC c/o Steve Joyce 3315 Collins Avenue Unit 5B Miami Beach, FL 33140 The Purchaser is represented by: HIRSCHLER FLEISCHER, PC Attn: Lawrence A. Katz 2070 Greensboro Drive, Suite 700 Tysons, VA 22102 About Satellite Restaurants Inc. Crabcake Factory USA Satellite Restaurants Inc. Crabcake Factory USA filed a voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. D. Md. Case No. 20-19282) on Oct. 14, 2020, listing under $1 million in both assets and liabilities. Judge Maria Ellena Chavez-Ruark oversees the case. Paul Sweeney, Esq., at Yumkas, Vidmar, Sweeney & Mulrenin, LLC serves as the Debtor's legal counsel. On Oct. 14, 2020, the U.S. Trustee for Region 4 appointed Scott W. Miller as Subchapter V trustee. Mr. Miller tapped Odin, Feldman & Pittleman, PC as his legal counsel. SCIENTIFIC GAMES: Amends Employment Contract With Senior VP ----------------------------------------------------------- Scientific Games Corporation entered into an amendment to its employment agreement with Michael F. Winterscheidt, senior vice president and chief accounting officer, which provides that all time-vesting equity awards with respect to the common stock of the company held by Mr. Winterscheidt that were granted before March 20, 2021 will immediately vest on Nov. 30, 2021, subject to Mr. Winterscheidt's continuous employment with the company through such date. About Scientific Games Based in Las Vegas, Nevada, Scientific Games Corporation (NASDAQ:SGMS) -- http://www.scientificgames.com-- is a developer of technology-based products and services and associated content for the worldwide gaming, lottery, social and digital gaming industries. Its portfolio of revenue-generating activities primarily includes supplying gaming machines and game content, casino-management systems and table game products and services to licensed gaming entities; providing instant and draw-based lottery products, lottery systems and lottery content and services to lottery operators; providing social casino solutions to retail consumers and regulated gaming entities, as applicable; and providing a comprehensive suite of digital RMG and sports wagering solutions, distribution platforms, content, products and services. Scientific Games reported a net loss of $548 million for the year ended Dec. 31, 2020, compared to a net loss of $118 million for the year ended Dec. 31, 2019. As of Dec. 31, 2020, the Company had $7.98 billion in total assets, $10.51 billion in total liabilities, and a total stockholders' deficit of $2.52 billion. SCOUTCAM INC: Incurs $4.7 Million Net Loss in 2020 -------------------------------------------------- Scoutcam Inc. filed with the Securities and Exchange Commission its Annual Report on Form 10-K disclosing a net loss of $4.67 million on $491,000 of revenues for the year ended Dec. 31, 2020, compared to a net loss of $1.83 million on $309,000 of revenues for the year ended Dec. 31, 2019. As of Dec. 31, 2020, the Company had $5.89 million in total assets, $1.93 million in total liabilities, and $3.96 million in total shareholders' equity. Tel Aviv, Israel-based Brightman Almagor Zohar & Co., the Company's auditor since 2020, issued a "going concern" qualification in its report dated March 31, 2021, citing that the Company's accumulated losses and the additional funds needed to maintain its operations raise substantial doubt about its ability to continue as a going concern. A full-text copy of the Form 10-K is available for free at: https://www.sec.gov/Archives/edgar/data/1577445/000149315221007463/form10-k.htm About Scoutcam Inc. Headquartered in Omer, Israel, Scoutcam Inc. is engaged in the development, production and marketing of innovative miniaturized imaging equipment known as its micro ScoutCam technology for use in medical procedures as well as various applications in other industries. The Company's current business model is that of a B2B approach, in which the Company seeks to identify target businesses interested in integrating its micro ScoutCam technology, or commissioning individual projects using its technology. SLIM DOLLAR: June 4 Plan Confirmation Hearing Set ------------------------------------------------- On April 28, 2021, debtor Slim Dollar Realty Associates, LLC filed with the U.S. Bankruptcy Court for the District of New Hampshire an Amended Disclosure Statement with respect to the Plan. On April 29, 2021, Judge Bruce A. Harwood approved the Disclosure Statement and ordered that: * May 28, 2021, is fixed as the last day for filing written acceptances or rejections of the Plan. * May 28, 2021, is fixed as the last day for filing and serving written objections to confirmation of the Plan. * June 4, 2021, at 9:00 a.m. at the United States Bankruptcy Court, Courtroom A, Warren B. Rudman U.S. Courthouse, 55 Pleasant Street, Concord, New Hampshire is the hearing on confirmation of the Plan. A full-text copy of the order dated April 29, 2021, is available at https://bit.ly/2RoAOHK from PacerMonitor.com at no charge. The Debtor is represented by: Eleanor Wm. Dahar, Esq. Victor W. Dahar, P.A. 20 Merrimack Street Manchester, NH 03101 Phone: (603) 622-6595 About Slim Dollar Realty Associates Slim Dollar Realty Associates, LLC, is a single asset real estate (as defined in 11 U.S.C. Section 101(51B)). Its principal assets are located at 19 Woodhill Hooksett Road Bow, N.H. Slim Dollar Realty Associates filed a voluntary petition under Chapter 11 of the Bankruptcy Code (Bankr. D.N.H. Case No. 20 10761) on Aug. 24, 2020. Charles R. Sargent, Jr., manager, signed the petition. At the time of filing, the Debtor estimated $500,000 to $1 million in assets and $1 million to $10 million in liabilities. Judge Bruce A. Harwood oversees the case. Victor W. Dahar, P.A. serves as Debtor's legal counsel. SM ENERGY: Reports $251.3-Mil. Net Loss for Quarter Ended March 31 ------------------------------------------------------------------ SM Energy Company filed with the Securities and Exchange Commission its Quarterly Report on Form 10-Q disclosing a net loss of $251.27 million on $443.85 million of total operating revenues and other income for the three months ended March 31, 2021, compared to a net loss of $411.89 million on $355.73 million of total operating revenues and other income for the three months ended March 31, 2020. As of March 31, 2021, the Company had $5.02 billion in total assets, $776.62 million in total current liabilities, $2.47 billion in total noncurrent liabilities, and $1.77 billion in total stockholders' equity. The Company said, "Based on the current commodity price environment, we believe we have sufficient liquidity and capital resources to execute our business plan while continuing to meet our current financial obligations. We continue to manage the duration and level of our drilling and completion service commitments in order to maintain flexibility with regard to our activity level and capital expenditures, and we have successfully renegotiated certain contracts and have realized cost savings that directly support our objective of maximizing cash flows." "We expect our 2021 capital program to be funded by cash flows from operations. Although we expect cash flows from operations to be sufficient to fund our expected 2021 capital program, we may also use borrowings under our revolving credit facility or may elect to raise funds through new debt or equity offerings or from other sources of financing. If we raise additional funds through the issuance of equity or convertible debt securities, the percentage ownership of our current stockholders could be diluted, and these newly issued securities may have rights, preferences, or privileges senior to those of existing stockholders and bondholders. Additionally, we may enter into carrying cost and sharing arrangements with third parties for certain exploration or development programs. All of our sources of liquidity can be affected by the general conditions of the broader economy, force majeure events, fluctuations in commodity prices, operating costs, tax law changes and volumes produced, all of which affect us and our industry." A full-text copy of the Form 10-Q is available for free at: https://www.sec.gov/ix?doc=/Archives/edgar/data/893538/000089353821000030/sm-20210331.htm About SM Energy SM Energy Company is an independent energy company engaged in the acquisition, exploration, development, and production of crude oil, natural gas, and natural gas liquids in the state of Texas. SM Energy reported a net loss of $764.61 million for the year ended Dec. 31, 2020, compared to a net loss of $187 million for the year ended Dec. 31, 2019. As of Dec. 31, 2020, the Company had $4.97 billion in total assets, $583.74 million in total current liabilities, $2.37 billion in total noncurrent liabilities, and $2.01 billion in total stockholders' equity. SPI ENERGY: Posts $6.5 Million Net Loss in 2020 ----------------------------------------------- SPI Energy Co., Ltd. filed with the Securities and Exchange Commission its Annual Report on Form 20-F disclosing a net loss attributable to shareholders of the company of $6.52 million on $138.63 million of net sales for the year ended Dec. 31, 2020, compared to a net loss attributable to shareholders of the company of $15.26 million on $97.88 million of net sales for the year ended Dec. 31, 2019. As of Dec. 31, 2020, the Company had $217.03 million in total assets, $168.65 million in total liabilities, and $48.38 million in total equity. As of Dec. 31, 2020, the Group had a working capital deficit of $72,245,000 and the cash flow used in the operation activities for the year ended Dec. 31, 2020 was $5,650,000. The Group's operating results for future periods are subject to numerous uncertainties and it is uncertain if the Group will be able to reduce or eliminate its net losses for the foreseeable future. If management is not able to increase revenue and/or manage operating expenses in line with revenue forecasts, the Group may not be able to achieve profitability. For the next 12 months from the issuance date of this report, the Group plans to continue implementing various measures to boost revenue and control the cost and expenses within an acceptable level. Such measures include: 1) negotiate with potential buyers on PV solar systems; 2) negotiate for postponing of convertible bond payments; 3) closely monitor the Group's capital spending level; 4) strictly control and reduce business, marketing and advertising expenses in United States and Australia; 5) lower the remuneration of the Group's management team; and 6) seek for certain credit facilities. Given the significant increase in net sales and the considerable amount of cash raised from convertible bond and direct offering in 2021, the Group assesses current working capital is sufficient to meet its obligations for the next 12 months from the issuance date of this report. A full-text copy of the Form 20-F is available for free at: https://www.sec.gov/Archives/edgar/data/1210618/000168316821001594/spi_20f-2020.htm About SPI Energy Co., Ltd. SPI Energy Co., Ltd. (SPI) is a global renewable energy company and provider of solar storage and electric vehicle (EV) solutions for business, residential, government, logistics and utility customers and investors. The Company provides a full spectrum of EPC services to third-party project developers, as well as develops, owns and operates solar projects that sell electricity to the grid in multiple countries, including the U.S., the U.K., Greece, Japan and Italy. The Company has its US headquarters in Santa Clara, California and maintains global operations in Asia, Europe, North America and Australia. SPI is also targeting strategic investment opportunities in green industries such as battery storage and charging stations, leveraging the Company's expertise and growing base of cash flow from solar projects and funding development of projects in agriculture and other markets with significant growth potential. SPI Energy reported a net loss attributable to shareholders of the Company of $12.28 million for the year ended Dec. 31, 2018, a net loss attributable to shareholders of the company of $91.08 million for the year ended Dec. 31, 2017, and a net loss attributable to shareholders of the company of $220.69 million for the year ended Dec. 31, 2016. SPRY PUBLISHING: Seeks Cash Collateral Access --------------------------------------------- Spry Publishing, LLC, ask the U.S. Bankruptcy Court for the Eastern District of Michigan, Southern Division, for authority to use cash collateral in accordance with the proposed budget, with a 10% variance for each line item and in total. The Debtor requires the use of Cash Collateral to make payments as are necessary for the continuation of its business. The projected revenue and expenses in the Budget is based upon historical financial data as well as the current and scheduled projects. During the first three calendar months of the case, the Debtor projects it will need to spend $92,784.79 to avoid immediate and irreparable harm. On the Petition Date, the Debtor, without admission, believes the cash collateral consists of collectible accounts receivable valued at approximately $3,900 and available funds held in bank accounts valued at approximately $173,000. Before the Petition Date, Fifth Third Bank, National Association filed a UCC-1 financing statement against certain of the Debtor's assets, including its cash collateral. The Debtor anticipates that the Bank will assert a security interest in the Debtor's Cash Collateral. The Debtor further anticipates that the Bank will assert that its security interest and liens have first priority over all other security interests and liens asserted against the Debtor. Before the Petition Date, the U.S. Small Business Administration also filed a UCC-1 financing statement against certain of the Debtor's assets, including its cash collateral. The Debtor anticipates that the SBA will assert a security interest in the Debtor's Cash Collateral. The Debtor further anticipates that the SBA will assert that its security interest and liens have second priority over all other security interests and liens asserted against the Debtor. As adequate protection for any security interests that the Bank and SBA may assert, the Debtor offers replacement liens in its personal property, now owned or hereafter acquired and the proceeds and products thereof to the same extent that such liens existed prior to the Petition Date. The Debtor proposes that the Bank and SBA be granted the Replacement Liens as adequate protection to the extent of any diminution in value of the pre-petition Cash Collateral. The Replacement Liens will be liens on the Debtor's assets which are created, acquired, or arise after the Petition Date, but limited to only those types and descriptions of collateral in which the Bank and SBA held a pre-petition lien or security interest. The Replacement Liens will have the same priority and validity as the Bank's and SBA's pre-petition security interests and liens. As part of its request to use Cash Collateral, the Debtor is requesting that the Court allow it to escrow, on a monthly basis, the total of $3,000 into the client trust account of its proposed counsel to pay the professional fees of legal counsel employed by the Debtor in connection with the bankruptcy proceeding to the extent the fees are allowed by the Court. A copy of the motion and the Debtor's three-month budget through July 2021 is available for free at https://bit.ly/3tbMwTp from PacerMonitor.com. The Debtor's budget provides for these projections: Month Total Gross Profit Total Expenses ----- ------------------ -------------- May 2021 $500 $28,000.69 June 2021 $73,200 $36,703.62 July 2021 $76,100 $28,080.48 About Spry Publishing, LLC Spry Publishing, LLC serves the medical community by providing books and digital assets to patients suffering from chronic diseases through its partner network of pharmaceutical companies. While Spry was founded in 2012, it has family roots in publishing going back to 1893 and has continuously published for nearly 130 years with nearly 200 titles in print and thousands of titles on the backlist. Spry acquired The Word Baron in 2014 and PWB Marketing Communications in 2019 under the company name Spry Ideas. In 2020, having experienced a less than stellar foray into content marketing, the company ceased all content marketing operations and closed that portion of the business. Spry has since streamlined its operations and filed its bankruptcy case as a means of reorganizing its financial affairs. Spry sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. E.D. Mich. Case No. 21-43817) on April 30, 2021. In the petition signed by James M. Edwards, manager, the Debtor disclosed up to $50,000 in assets and up to $1 million in liabilities. Elliot G. Crowder, Esq. at STEVENSON & BULLOCK, PLC is the Debtor's counsel. ST. CHARLES COUNTY IDA: S&P Places 'BB+' Debt Rating on Watch Neg. ------------------------------------------------------------------ S&P Global Ratings placed certain long-term and underlying ratings on CreditWatch with negative implications for several local governments and public utilities with rated debt outstanding. S&P said, "The withdrawal of the affected ratings could follow if we do not receive fiscal 2019 financial statements within 30 days. We consider the financial statements necessary to maintain and assess our ratings on these issuers. Accordingly, the ratings are now at risk of being withdrawn, preceded by any change to the rating we consider appropriate given available information. However, if issuers provide us with 2019 financial statements within 30 days, we will conduct a full review and take a rating action within 90 days of the CreditWatch placement." The issuers included in this rating action are in states where an oversight function requires state approval of the financial statements prior to publication. S&P views the state framework as representing a governance risk within its environmental, social, and governance (ESG) factors for the affected local governments and utilities because delays associated with this state approval can affect the timely availability of the financial statements, which is a component of its institutional framework score assessment for local governments. Ratings Placed On CreditWatch Negative As Of April 30, 2021 ISSUER STATE CURRENT RATING Madison County AL AA+ Cullman Cnty AL AA- Lee County AL AA- Shelby County AL AA+ Centreville Water Works and Sewer Board AL A Leeds Water Works Board AL A+ Batesville AR A- Grand Meadow MN A+ City of Isle MN A+ St. Charles County Industrial Development Authority MO BB+ Lafayette County MS AA DeSoto County MS AA+ Horn Lake MS A+ Vicksburg Warren School District MS A+ Pawnee County OK AA- Creek County OK A- STANLEY-TRAFTON: Court Confirms Reorganization Plan --------------------------------------------------- Judge Michael A. Fagone of the U.S. Bankruptcy Court for the District of Maine confirmed the Plan of Reorganization of Stanley-Trafton Holdings, LLC. The Court effected certain revisions to the Plan. As to CLass 4 claims, the Debtor will make quarterly payments equal to the amount of the allowed unsecured claims against the Debtor amortized over 24 months from the Effective Date, at an interest rate of 4.25% per annum. A copy of the order is available for free at https://bit.ly/3udklol from PacerMonitor.com. About Stanley-Trafton Stanley-Trafton Holdings, LLC, is a single asset real estate debtor (as defined in 11 U.S.C. Section 101(51B)). It owns approximately 40 acres of real property on Stanley Pond on the border of Porter and Hiram, Maine, on which an affiliate, MPR Summers Inc., operates Maine Teen Camp, Maine's only accredited camp for adolescents. In May of 2020 during the initial surge of the COVID pandemic, in consultation with medical and industry experts, camper families and professional colleagues, the Debtor and MPR made the decision to suspend the summer 2020 camp season out of concern for the health of campers, staff and the community. Stanley-Trafton Holdings sought Chapter 11 protection (Bankr. D. Maine Case No. 20-20389) on Oct. 20, 2020. The Debtor was estimated to have $1 million to $10 million in assets and liabilities as of the bankruptcy filing. Judge Michael A. Fagone oversees the case. Bernstein, Shur, Sawyer & Nelson, P.A., led by Adam R. Prescott, is the Debtor's legal counsel. STAPLES INC: Moody's Lowers CFR to B2, Outlook Remains Negative --------------------------------------------------------------- Moody's Investors Service downgraded the ratings of Staples, Inc., including the corporate family rating, which was downgraded to B2. The outlook remains negative. Downgrades: Issuer: Staples, Inc. Probability of Default Rating, Downgraded to B2-PD from B1-PD Corporate Family Rating, Downgraded to B2 from B1 Senior Secured Bank Credit Facility, Downgraded to B2 (LGD3) from B1 (LGD3) Senior Secured Regular Bond/Debenture, Downgraded to B2 (LGD3) from B1 (LGD3) Senior Unsecured Regular Bond/Debenture, Downgraded to Caa1 (LGD6) from B3 (LGD6) Outlook Actions: Issuer: Staples, Inc. Outlook, Remains Negative "The actions recognize the negative impact on Staples' credit profile of the seismic shift in demand for its products resulting from the work-from-home proliferation due to COVID-19," stated Moody's Vice President Charlie O'Shea. "As a result of these work-from-home arrangements necessitated for health and safety reasons, Staples has experienced a meaningful drop in sales, and while the worst may be in the rear view mirror, it is difficult at this point to assess what a future 'equilibrium' environment for 'in office' will be," continued O'Shea. "Given that, handicapping the timing of a rebound in revenues, which would lead to an improvement in credit metrics, is difficult, and Staples' high fixed-cost structure is making it difficult for the company to preserve profitability." Moody's regard the coronavirus outbreak as a social risk under its ESG framework, given the substantial implications for public health and safety. RATINGS RATIONALE Staples B2 CFR considers its currently very weak credit metrics, with debt/EBITDA of around 10 times and EBITA/interest of under 1 time at the January 2021 FYE, as well as the scale of its delivery-only B2B business, loyal commercial relationships with high retention rates, and well established supply chain and distribution capabilities. Staples' revenues continue to suffer from reduced demand from its core corporate clients as employees continue to work at home due to COVID-19. This softness has not been sufficiently offset by demand increases in the Pro Segment and Staples.com, and expense cuts, which are difficult to achieve due to the high percentage of fixed costs in Staples' operating model, have not been nearly enough to maintain levels of profitability necessary to sustain the B1 rating. Going forward, ratings could be constrained by the impact on leverage of its pre-pandemic focus on increasing scale in non-office ancillary products (the Pro segment) that may include debt financed acquisitions, as well as the financial strategy risks inherent in a sponsor-owned company, including potential for leveraging extractions of equity. The negative outlook reflects Moody's view that there is a lack of visibility surrounding Staples' ability to rebound over the next 12-18 months sufficient to reduce leverage and improve coverage such that they are both in line with a B2 credit profile. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS Given the downgrade to B2, an upgrade over the near term is unlikely. However, ratings could be upgraded once the impact of coronavirus has abated and operating performance has improved such that debt/EBITDA can be sustained below 5.5 times, EBITA/ interest expense is sustained above 2.0 times and financial strategies are supportive of maintaining credit metrics at these levels. Ratings could be downgraded if Staples cannot make progress over the next few quarters sufficient to ensure that it can reduce debt/EBITDA to below 6.75 times with EBITA/interest above 1.5 times within the next 12-18 months, or if liquidity weakens. Headquartered in Framingham, MA, Staples, Inc. is a leading provider of contract office supplies to corporations, with FYE January 2021 revenues of around $10 billion. The principal methodology used in these ratings was Distribution & Supply Chain Services Industry published in June 2018. STREAM TV: Deal to Dismiss Its Bankruptcy Shows Validity of Case ---------------------------------------------------------------- Alex Wolf of Bloomberg Law reports that Stream TV Networks Inc. is fighting to proceed with its Chapter 11 case, pushing back on creditors and the government's accusations that the 3D technology developer is using bankruptcy protections to avoid transferring assets. The company has secured funding and has the ability to reorganize under the bankruptcy code, it said in a filing Sunday, May 2, 2021, with the U.S. Bankruptcy Court for the District of Delaware. The pushback comes after a bid by SeeCubic Inc.—an entity controlled by Stream TV's secured creditors—to throw out Stream TV's Chapter 11 case. SeeCubic argued that the case is a "sham" by Stream TV. About Stream TV Networks Philadelphia, Pa.-based Stream TV Networks, Inc., develops technology intended to display three-dimensional content without the use of 3D glasses. On Feb. 24, 2021, Stream TV Networks filed a Chapter 11 petition (Bankr. D. Del. Case No. 21-10433). Stream TV Networks CEO Mathu Rajan signed the petition. In the petition, the Debtor listed assets of about $100 million to $500 million and liabilities of $100 million to $500 million. Judge Karen B. Owens oversees the case. Dilworth Paxson, LLP, led by Martin J. Weis, Esq., is the Debtor's counsel. TACORA RESOURCES: S&P Assigns 'B-' Long-Term ICR, Outlook Stable ---------------------------------------------------------------- S&P Global Ratings On May 3, 2021, S&P Global Ratings assigned its 'B-' long-term issuer credit rating (ICR) to iron ore producer Tacora Resources Inc. S&P said, "The rating primarily reflects our view of the company's limited operating breadth as a single-mine iron ore producer, and financial sponsor ownership that limits upside to our financial risk assessment. "At the same time, we assigned our 'B' issue-level rating and '2' recovery rating to the company's proposed US$150 million senior secured notes. "The stable outlook reflects our expectation that the company will generate positive free operating cash flow (FOCF) and maintain low leverage over the next 12 months, led by increasing shipments amid a period of very strong iron ore prices. "Tacora has limited operating breadth, with reliance on a single mine for cash flow generation. Our ICR on Tacora primarily reflects the company's small scale and scope as an early-stage single-mine operator. The company produces high-grade iron ore from its Scully mine in Newfoundland and Labrador. In our view, the exclusive reliance on one mine subjects the company to the risk of unexpected operational issues that could materially affect its earnings and cash flow." Tacora is in the relatively early stages of operation, having restarted the Scully mine in June 2019, and its lack of commodity diversification exposes Tacora's operating results to historically volatile iron ore prices. The company's very small production profile contributes to high costs relative to that of global rated peers. S&P said, "We estimate Tacora's unit cash costs were close to US$70 per dry metric ton (/dmt) in 2020 (based on output of about 3.0 million metric tons), which corresponds with the fourth quartile of the global industry cash cost curve. We believe Tecora's high cost profile is temporary. The Scully mine is in the process of ramping up to 6 million metric tons per year (mtpy), almost twice the current annualized production rate of 3.3 mtpy, and the company anticipates reaching the target run-rate level by early 2022. Due to the high fixed component in Tacora's current cost structure, we believe an improvement in economies of scale will result from the increase in volumes produced, and meaningfully lower unit costs. We estimate a decrease of about 30% in 2022 compared with 2020 levels and expect this should be sustainable. Nevertheless, the company will need to complete the expansion in line with our expectations, of which there is no assurance due to various risks and uncertainties associated with mine development projects." The near-term outlook for earnings and cash flow is strong, but future price volatility remains a risk. S&P said, "We expect Tacora to generate credit measures and FOCF that are strong for the rating over the next two years. We estimate the company will generate FOCF of about US$70 million in 2021, led by iron ore prices that are near historical peak levels. Tacora produces high-grade iron ore with 65.9% iron content and low levels of impurities, sold exclusively to Cargill through an off-take agreement. We believe the company will continue to realize a premium relative to the 62% iron ore benchmark for its production, particularly as pollution-control initiatives (namely in China) accelerate. Tacora realized an average premium of close to 8% above the 62% index in the last 12 months ended March 31, 2021, after subtracting the share of the premium that Cargill is paid under the terms of the off-take agreement. We expect further improvement in 2022, mainly from increased production from the Scully mine expansion. FOCF is driven by strong earnings and relatively modest growth capital expenditures, resulting in leverage below 2x. In our view, the favorable prospects for FOCF generation provide financial flexibility and limit downside rating risk amid Tacora's current mine expansion." S&P said, "However, the company's earnings and cash flow will remain sensitive to future iron ore price volatility, and we do not envision prices will remain near current levels through next year. Therefore, our assessment of Tacora's financial risk incorporates the potential for future price declines that can have a material impact on the company's cash-generating capacity and credit measures. For example, we estimate that, all else being equal, a US$10/dmt decline in iron ore prices in 2022 (relative to our 62% benchmark assumption of US$100/dmt) could lead to a 20% decrease in EBITDA. To put this into context, the 62% iron ore benchmark fluctuated from levels close to US$60/dmt in early 2018 to current highs above US$180/dmt. "Our financial risk assessment is constrained by our view that a large percentage of the equity is owned by a financial sponsor.We view Tacora's largest shareholder, Proterra Investment Partners, as a financial sponsor, and this limits upside to our financial risk assessment on the company. Proterra has a 76% controlling equity stake in Tacora, and 10 of the 11 board seats are represeted by the company's equity owners (including three from Proterra and one from Cargill, which is an investor in Proterra). These factors contribute to our use of the financial policy modifier (FS-6), which caps the financial risk assessment at highly leveraged. "Notwithstanding the estimated strength in Tacora's credit measures over our forecast period, we believe Proterra's controlling position could lead to aggressive financial policies that materially increase leverage. In addition, our assessment incorporates the uncertainty regarding future uses of excess cash flow and Proterra's limited track record as an owner of Tacora. This could include shareholder returns or funds used toward the potential development of its recently acquired (but idle) Sydvaranger mine in Norway. We have assumed the Sydvaranger mine will remain undeveloped through our forecast horizon. "The stable outlook reflects our expectation that Tacora will generate strong FOCF and low leverage over the next two years. Our earnings and cash flow estimates are underpinned by strong iron ore prices, particularly in 2021, which provide financial flexibility amid expansion of the company's Scully mine. "We could downgrade Tacora if, over the next 12 months, we view its capital structure as unsustainable over the long term. In our view, this could result from a sharp drop in iron ore prices or operational issues related to the Scully mine expansion that materially weaken the company's prospective liquidity and/or leverage. "Although unlikely over the next 12 months, we could raise the ratings if we positively revised our financial policy assessment. Under this scenario, we would expect the company to demonstrate a track record of maintaining modest leverage, with low risk of a future material cash outflows." TANGO DELTA: Trustee Taps Whittaker & Associates as Tax Accountant ------------------------------------------------------------------ Jeffrey Warren, Chapter 11 trustee for Tango Delta Financial, Inc., seeks approval from the U.S. Bankruptcy Court for the Middle District of Florida to employ Whittaker & Associates, CPA's, PA as tax accountant. The trustee requires an accountant to prepare corporate tax returns for the Debtor's bankruptcy estate. The firm will be paid based upon its normal and usual hourly billing rates and reimbursed for out-of-pocket expenses incurred. The retainer fee is $5,000. Thomas Whittaker, a partner at Whittaker & Associates, 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: Thomas Whittaker Whittaker & Associates, CPA's, PA 304 West Venice Avenue, Suite 300 Venice, FL 34285 Tel: (941) 493-5299 Fax: (941) 493-3290 Email: info@whittakercpas.net About Tango Delta Financial Tango Delta Financial Inc., formerly doing business as American Student Financial Group Inc. (ASFG), is a Sarasota, Fla.-based company that buys student loans for investment purposes. On May 11, 2020, Tango Delta sought protection under Chapter 11 of the Bankruptcy Code (Bankr. M.D. Fla. Case No. 20-03672). Tango Delta President Timothy R. Duoos 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. Judge Catherine Peek McEwen oversees the case. Cole & Cole Law, P.A. is the Debtor's legal counsel. Jeffrey W. Warren is the trustee appointed in the Debtor's Chapter 11 case. The trustee tapped Bush Ross, P.A. as legal counsel and Whittaker & Associates, CPA's, PA as tax accountant. THERMASTEEL INC: Asks Court to Approve Disclosure Statement ----------------------------------------------------------- William E. Callahan, Jr., Chapter 11 Trustee to the estate of Thermasteel, Inc., asked the Court to grant conditional approval to the Disclosure Statement explaining the Plan of Reorganization of Thermasteel, Inc. The Trustee is the proponent of the said Plan. A copy of the motion is available for free at https://bit.ly/3eT27lT from PacerMonitor.com. About Thermasteel Inc. Thermasteel, Inc. -- http://www.thermasteelinc.com/-- is a provider of panelized composite building systems, manufacturing composite foundation, floor, wall, roof and ceiling panels for residential, commercial and industrial applications. Its pre-insulated steel framing has been used in large military housing projects in the USA, Germany and Guantanamo Bay, Cuba. Production facilities are presently located in USA (Virginia, Alaska), and Russia, with products being shipped via container to many other countries. Thermasteel sought protection under Chapter 11 of the Bankruptcy Code (Bankr. W.D. Va. Case No. 18-71461) on Oct. 26, 2018. At the time of the filing, the Debtor estimated assets of $1 million to $10 million and liabilities of the same range. The case is assigned to Judge Paul M. Black. The Debtor tapped the Law Office of Richard D. Scott as its legal counsel. William E. Callahan, Jr. is the Chapter 11 trustee appointed in the Debtor's case. The trustee tapped Gentry Locke Rakes & Moore, LLP as his legal counsel and Hicok, Brown & Company CPAs as his accountant. THERMASTEEL INC: Unsecureds to Recover 100% in Trustee Plan ----------------------------------------------------------- William E.Callahan, Jr., the trustee in the Chapter 11 case of Thermasteel, Inc., filed a proposed Chapter 11 Plan and a Disclosure Statement for the Debtor. The Debtor, under the guidance of its current management and officers, will continue to manage and perform its operations after the Effective Date of the confirmed Plan. Henry Bass and Lisa Bass, the Investors, will invest $3,000,000 in Thermasteel and waive their $117,000 administrative expense claim in exchange for the issuance of stock in the post-confirmation, Reorganized Debtor in an amount required to result in the New Investors becoming the holder of 51 % of the stock in the Reorganized Debtor. These funds shall be the source of funds necessary to pay the amounts due under the Plan. In the event that the new funds are insufficient to pay all administrative expenses and all claims in full, funds currently held by the Trustee amounting to $94,000 and funds from the operation of the Debtor's business shall be used to supplement the funds obtained by the investment by the New Investors. The Trustee shall pursue avoidable preferences and other avoidance actions if and to the extent that he deems such pursuit to be beneficial to the estate. The General Unsecured Claims in Class 5 are the claims of the Debtor's vendors, suppliers, shippers, contractors and other general trade debt that were incurred in the ordinary course of the Debtor's business prior to the Petition Date. These claims are estimated to total $41,572. The Trustee shall pay or cause the Debtor to pay 100% of the allowed amounts of all General Unsecured Claims on the Effective Date with the Investment Fund or funds to be generated by the Debtor's operations. A copy of the Disclosure Statement is available for free at https://bit.ly/3uehw6F from PacerMonitor.com. About Thermasteel Inc. Thermasteel, Inc. -- http://www.thermasteelinc.com/-- is a provider of panelized composite building systems, manufacturing composite foundation, floor, wall, roof and ceiling panels for residential, commercial and industrial applications. Its pre-insulated steel framing has been used in large military housing projects in the USA, Germany and Guantanamo Bay, Cuba. Production facilities are presently located in USA (Virginia, Alaska), and Russia, with products being shipped via container to many other countries. Thermasteel sought protection under Chapter 11 of the Bankruptcy Code (Bankr. W.D. Va. Case No. 18-71461) on Oct. 26, 2018. At the time of the filing, the Debtor estimated assets of $1 million to $10 million and liabilities of the same range. The case is assigned to Judge Paul M. Black. The Debtor tapped the Law Office of Richard D. Scott as its legal counsel. William E. Callahan, Jr. is the Chapter 11 trustee appointed in the Debtor's case. The trustee tapped Gentry Locke Rakes & Moore, LLP as his legal counsel and Hicok, Brown & Company CPAs as his accountant. THRIVE MERGER: Moody's Assigns First Time 'B3' Corp. Family Rating ------------------------------------------------------------------ Moody's Investors Service assigned first time credit ratings to Thrive Merger Sub, LLC (dba "Therapy Brands"), including a B3 corporate family rating, a B3-PD probability of default rating, B2 instrument ratings to its proposed senior secured first-lien term loan due 2028, senior secured first-lien revolving credit facility expiring in 2026 and senior secured first-lien delayed draw term loan and Caa2 instrument ratings to its proposed senior secured second-lien term loan due 2029 and senior secured second-lien delayed draw term loan. The outlook is stable. The $320 million of proceeds from the proposed term loans and $970 million of equity from affiliates of financial sponsor Kohlberg Kravis Roberts & Co. L.P. ("KKR") and management will be used to acquire Therapy Brands, pay transaction-related fees and expenses and add $10 million of cash to the balance sheet. RATINGS RATIONALE The B3 CFR reflects Therapy Brands' very small revenue scale, very high debt to EBITDA of over 10 times as of December 31, 2020 pro forma for the announced transactions that Moody's expects will decline to 6.5 times by 2022 and the company's limited operating history in highly competitive and fragmented markets. Growth and profitability can be pressured by other electronic health record ("EHR"), practice management solutions ("PMS"), revenue cycle management ("RCM") and payment solutions providers with larger revenue scale and wider operating scope. Credit support is provided by visible and highly-recurring software-as-a-service ("SaaS") revenue streams, high gross client retention rates around 95%, anticipated low-teen revenue growth, high EBITDA margins around 40% and low capital expenditures requirements that support free cash flow and deleveraging. Moody's expects Therapy Brands to generate mid-single digit free cash flow to debt over the next 12 to 18 months. Further support comes from a good growth opportunity driven by a large addressable market and an increase in utilization of tech-enabled services across Therapy Brands' end markets. Therapy Brands' integrated SaaS product offerings enables cross-sell and add-on solutions opportunities to existing and prospective customers which provides support for the high anticipated revenue growth rate. A substantial equity investment provides equity value at closing well in excess of the amount of debt. However, growth-driven deleveraging could be pressured by additional borrowing, particularly utilizing the first and second lien delayed draw term loans, to fund acquisitions. All financial metrics cited reflect Moody's standard adjustments. As a software company, environmental and social considerations are not highly material to the rating. Therapy Brands' corporate governance policy exposes risk through both high financial leverage and private equity ownership, which typically places shareholder interest above creditors. Moody's anticipates aggressive financial policies measured by high leverage, debt-funded M&A transactions and other shareholder-friendly policies. The high debt levels can impede Therapy Brands' ability to stay competitive and invest in growth needed to support business expansion. Moody's considers Therapy Brands' liquidity profile as good, supported by a $10 million cash balance anticipated at transaction close, at least $27 million of free cash flow expected and an undrawn and fully available $40 million revolver. The proposed revolver is subject to maintaining its First Lien Net Leverage Ratio (as defined in the loan agreement) below 9.5 times when the drawn amount exceeds $16 million. Therapy Brands should maintain an ample cushion on the financial covenant if it is tested. The B2 rating assigned to the senior secured 1st lien revolving credit facility, term loan and delayed draw term loan ratings, one notch above the B3 CFR, is driven by the B3-PD PDR and a loss given default ("LGD") assessment of LGD3, their priority lien position ahead of and the loss absorption benefit provided by the junior ranking debt. The Caa2 rating assigned to the senior secured 2nd lien term loan and delayed draw term loan, two notches below the B3 CFR, is driven by the B3-PD PDR and an LGD assessment of LGD5, reflecting their ranking junior to and first loss position with respect to the company's senior secured 1st lien obligations. Availability of the senior secured first lien delayed draw term loan is subject to pro forma compliance with a 5.55 times maximum First Lien Leverage Ratio (as defined in the loan agreement), among other things. The senior secured second lien delayed draw term loan availability is subject to pro forma compliance with a 7.55 times maximum Senior Secured Leverage Ratio (as defined in the agreement). Moody's anticipates limited initial availability of the delayed draw loans for purposes other than to fund acquisitions of companies which have sufficient EBITDA to balance an increase in debt and thereby maintain pro forma compliance with the leverage ratios. The senior secured debt documents are expected to include provisions permitting incremental senior secured first lien debt capacity up to the sum of: (1) the greater of a) $43 million and b) 100% of pro forma consolidated EBITDA for the trailing four quarters for the first lien (increased to the greater of a) $53.75 million and b) 125% of pro forma consolidated EBITDA for the second lien); (2) amounts available under the general debt basket; (3) uncapped amounts subject to pro forma first lien leverage ratio not to exceed 5.55x (for amounts secured on a pari passu basis with the first lien) or not to exceed pro forma senior secured leverage ratio not to exceed 7.80x (for amounts secured on a junior priority basis to the first lien); and (4) amounts previously repaid voluntarily including prepayments of second lien loans. Amounts up to the greater of $86 million and 200% of pro forma consolidated EBITDA, or any incremental facility amount incurred in connection with a permitted acquisition or investment may be incurred with an earlier maturity date than the initial term loans. The credit agreement does not permit the designation of unrestricted subsidiaries, preventing collateral "leakage" to unrestricted subsidiaries. There no express "blocker" provisions which prohibit the transfer of specified assets to unrestricted subsidiaries. Non-wholly-owned subsidiaries are not required to provide guarantees; dividends or transfers resulting in partial ownership of subsidiary guarantors could jeopardize guarantees, with a protective provision requiring majority lender consent for any guarantee releases, if required under the credit agreement. There are no express protective provisions prohibiting an up-tiering transaction. The stable outlook reflects Moody's expectations for mid-teens revenue growth rates, free cash flow to debt above 3% and debt to EBITDA falling toward 6.5 times in 2022. The outlook also reflects Moody's anticipation of aggressive financial strategies, including debt funded acquisitions or other shareholder-friendly actions. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS The ratings could be upgraded if (1) revenue scale increases materially, resulting in market share and customer expansion; (2) debt to EBITDA remains below 6 times; (3) good liquidity and (4) sustained conservative financial policies. The ratings could be downgraded if (1) revenue growth is less than 10%; (2) EBITDA margins decline, (3) debt to EBITDA remains around 8 times; or (4) liquidity is less than adequate. Issuer: Thrive Merger Sub, LLC Corporate Family Rating, Assigned B3 Probability of Default Rating, Assigned B3-PD $235M Senior Secured 1st Lien Term Loan, Assigned B2 (LGD3) $60M Senior Secured 1st Lien Delayed Draw Term Loan, Assigned B2 (LGD3) $40M Senior Secured Multicurrency Revolving Credit Facility, Assigned B2 (LGD3) $85M Senior Secured 2nd Lien Term Loan, Assigned Caa2 (LGD5) $20M Senior Secured 2nd Lien Delayed Draw Term Loan, Assigned Caa2 (LGD5) Outlook, is Stable The principal methodology used in these ratings was Software Industry published in August 2018. Therapy Brands, headquartered in Birmingham, AL and controlled by KKR, is a provider of integrated SaaS solutions including, EHR, PMS, RCM and payment solutions to the mental health, behavioral health and patient rehabilitation markets. Moody's expects 2021 revenue of over $110 million. TKC HOLDINGS: Moody's Hikes First Lien Credit Facilities to B1 -------------------------------------------------------------- Moody's Investors Service upgraded the secured ratings on TKC Holdings, Inc.'s proposed first lien revolving credit facility and first lien term loan to B1 from B2. The company's B3 corporate family rating, B3-PD probability of default rating and Caa2 senior unsecured notes ratings remain unchanged. The outlook is stable. The upgrade of the first lien facilities to B1 from B2 follows a shift in the proposed capital structure, decreasing the proposed term loan to $925 million from $1.125 billion (due 2028) and an increase in the unsecured notes to $700 million from $500 million (due 2029). As a result, and in accordance with Moody's Loss Given Default for Speculative-Grade Companies methodology, the first lien facilities are rated two notches above the B3 CFR. The unsecured notes are rated two notches below the CFR at Caa2, reflecting their junior position behind the first lien debt. Upgrades: Issuer: TKC Holdings, Inc. Senior Secured First Lien Term Loan, Upgraded to B1 (LGD2) from B2 (LGD3) Senior Secured First Lien Revolving Credit Facility, Upgraded to B1 (LGD2) from B2 (LGD3) RATINGS RATIONALE TKC's CFR is constrained by: (1) high leverage (7.8x LTM Dec-20) settling around 7x in 2021; (2) aggressive financial policies under private equity ownership; and (3) a volume-based business exposed to social risks linked to prison policy reform and an ongoing modest but steady decline in the US incarcerated population. The company benefits from: (1) good revenue visibility supported by multiyear contracts; (2) a strong market position in its commissary and food service businesses, providing competitive advantages in pricing and bidding processes; (3) ongoing outsourcing trend as local and state governments seek operational efficiencies; and (4) good liquidity. TKC has good liquidity. Pro forma for the transaction as of March 2021, Moody's estimate sources total about $140 million, consisting of about $20 million in cash on hand, positive free cash flow of around $70 million and full availability under the $50 million revolving credit facility due 2026. Uses over the next twelve months are limited to $9 million in debt amortizations. The revolver has a springing covenant based on a maximum net leverage ratio when drawings exceed 35% of total borrowing capacity, with which TKC will remain comfortably in compliance. The company has limited ability to generate alternate liquidity from asset sales. The stable outlook reflects Moody's expectation for modest revenue growth and deleveraging towards 7x in 2021 while maintaining good liquidity. TKC has high exposure to social risks tied to an ongoing decline in incarceration rates in the US, prison policy shifts at local, state and federal levels, public pressure to implement criminal justice reform, and negative investor sentiment surrounding the prison industry. Mitigants to these long-term social risks include industry trends such as the transition towards outsourcing prison services, cross-selling opportunities and industry consolidation, which will increase the number of prisoners TKC serves even as the overall population declines. Most recently, the impact of COVID-19 on public health and safety led to the release of inmates from prisons and delays in legal and criminal proceedings, causing a temporary, but material reduction of between 10% to 15% in prison populations. The impact on TKC has been limited due to price adjustments in its food service contracts following the COVID-19 outbreak and overall resiliency in the commissary business, which benefited from factors such as increased inmate spending limits and contributions from inmate families and friends when visits ceased due to the pandemic. Governance risks are high, arising from the aggressive track record of TKC's private equity ownership, including debt-funded distributions, leading to elevated leverage. Given the longer tenor of HIG's holdings (since 2012), there is heightened risk TKC's debt burden could further increase as shareholders execute an exit strategy or seek additional returns. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS TKC's ratings could be upgraded if adjusted debt to EBITDA is sustained below 6x (7.8x LTM Dec-20) while adhering to more conservative financial policies. The ratings could be downgraded if adjusted debt to EBITDA is maintained above 8x or if there is a weakening of free cash flow, liquidity or competitive positioning. The ratings could also be pressured by increasingly negative financial policies. TKC is a leading provider of commissary, food service, and related products, serving correctional facilities across the United States. The company is headquartered in St. Louis, Missouri and generated revenues of approximately $1.7 billion in 2020. TKC is owned by funds affiliated with H.I.G. Capital. The principal methodology used in these ratings was Business and Consumer Service Industry published in October 2016. TWO GUNS CONSULTING: Taps Wickens Herzer as Special Counsel ----------------------------------------------------------- Two Guns Consulting & Construction, LLC seeks approval from the U.S. Bankruptcy Court for the Southern District of Texas to employ Wickens Herzer Panza as special counsel. The Debtor needs the firm's legal assistance in connection with the pending lawsuit styled In re: Two Guns Consulting & Construction, LLC v. MarkWest Liberty Midstream & Resources, LLC and Jefferson Gas Gathering Company, LLC (Case Number 19CV00472) filed in the Court of Common Pleas, Jefferson County, Ohio. Wickens will be paid on a contingent fee basis. The firm will get 35 percent of any recovery made 60 days before the date on which the lawsuit is first set for trial or 42.5 percent of any recovery that occurs thereafter. The firm received a retainer of $3,000 from the Debtor to cover its expenses. Michael Fortne, Esq., a partner at Wickens, 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: Michael R. Fortne, Esq. Wickens Herzer Panza 35765 Chester Road Avon, OH 44011 Tel: (440) 695-8000 Fax: (440) 695-8098 Email: About Two Guns Consulting & Construction Two Guns Consulting & Construction, LLC is a company in the heavy and civil engineering construction industry. The company is based in Odem, Texas. 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. and Wickens Herzer Panza serve as the Debtor's bankruptcy counsel and special counsel, respectively. UNIVISION COMMUNICATIONS: S&P Assigns Prelim 'B+' on Sr. Sec. Notes ------------------------------------------------------------------- S&P Global Ratings assigned its preliminary 'B+' issue-level rating and '3' recovery rating to U.S.-based Spanish-language multimedia company Univision Communications Inc.'s proposed senior secured term loan and notes. S&P said, "The positive CreditWatch reflects that we expect to raise our issuer credit rating on Univision to 'B+' from 'B' when the merger closes based on our forecast that its pro forma leverage will improve to the 6.1x-6.3x range in 2021 from over 8x currently, assuming the proposed deal terms and our assumptions do not materially change. At that time, we also expect to raise our issue-level rating on the company's existing secured debt to 'B+' from 'B'. If the merger is not completed, we expect to affirm our current 'B' issuer credit rating because we anticipate that Univision's leverage would remain elevated between 7.3x and 7.5x in 2021. "We expect Univision's leverage to improve to the 6.1x-6.3x range in 2021 because of the proposed merger. We expect Univision's leverage to improve to the 6.1x-6.3x range in 2021, and below 6.0x in 2022, as a result of the proposed transaction. We expect the combined company to benefit from an increase in advertising revenue in the U.S. and Mexico as both economies recover from the coronavirus pandemic, it expands the user base of its ad-supported streaming service PrendeTV, and it raises its ad pricing through inventory management (such as increasing scatter inventory) and advanced marketing solutions. Additionally, Televisa's expansive content library will provide Univision with an opportunity to materially increase its licensing revenue. Univision and Televisa's content segment each generate significant cash flow (with margins of more than 35%) and have modest capital expenditure requirements. At the same time, Univision has identified over $200 million of cost synergies, including headcount rationalization, facilities footprint consolidation, and third-party contract savings. We believe the company's identified cost savings are obtainable, although we expect it will take until 2023 for it to fully realize these synergies. "We include Univision's proposed series B preferred stock in our debt calculations. The company plans to issue $750 million of series B preferred stock and $1 billion of series C preferred stock to partially fund the proposed merger. We treat the proposed series B preferred stock as debt because it will be held by one investor and Univision will have the option to pay interest in kind, which--in our view--increases the potential for the preferred stock to be refinanced with debt. However, we recognize the additional financial flexibility provided by the instrument's perpetual nature and pay-in-kind (PIK) interest and view Televisa's holding of the preferred stock as credit positive because it will have a 45% ownership stake in the company and five board seats. We consider the proposed series C preferred stock to be equity because it will not have a coupon, is perpetual, and will be held by a group of investors (including ForgeLight, SoftBank, Google, and Raine Group). "The proposed merger will improve Univision's ability to expand its streaming business. We expect subscription revenue for the combined business to provide a relatively stable source of revenue over the next few years. However, we anticipate limited improvement in this revenue stream given the decline in pay-TV subscribers in the U.S. and only modest growth in Mexico. We believe the company's streaming platform could provide it with a significant growth opportunity because only 10% of the Spanish speaking population currently uses a streaming video product (compared with 70% for the English language market). Furthermore, Mexican consumers and the Hispanic population in the U.S. are more accustomed to watching free over-the-air television than the U.S.' English speaking population. We believe the proposed transaction will improve Univision's ability to invest in its streaming platform, which will require sizable investments for content, given the additional financial resources the transaction will provide. In addition, the company will take ownership of Televisa's Spanish-language content library, which is the largest in the world with over 300,000 hours of programming. "We expect to resolve the CreditWatch placement when the merger closes later in 2021. At that time, we expect to raise our issuer credit rating on Univision to 'B+' from 'B' based on our expectation that its pro forma leverage will improve to the 6.1x-6.3x range from over 8.0x currently, assuming the proposed deal terms and our assumptions do not materially change. We also expect to raise our issue-level rating on the company's existing secured debt to 'B+' from 'B'. If the merger is not completed, we would expect to affirm our current 'B' issuer credit rating because we would expect Univision's leverage to remain elevated between 7.3x and 7.5x in 2021. The proposed merger remains subject to regulatory approval in the U.S. and Mexico and a vote by Televisa's shareholders." US SHIPPING: Moody's Withdraws B3 CFR Following Debt Redemption --------------------------------------------------------------- Moody's Investors Service has withdrawn all ratings of U.S. Shipping Corp, including the company's B3 corporate family rating, B3-PD probability of default rating, B3 senior secured bank credit facility and negative outlook following the full redemption of its senior secured facilities. The following ratings/assessments are affected by the action: Ratings Withdrawn: Issuer: U.S. Shipping Corp Corporate Family Rating, Withdrawn , previously rated B3 Probability of Default Rating, Withdrawn , previously rated B3-PD Senior Secured 1st Lien Term Loan B, Withdrawn , previously rated B3 (LGD3) Outlook Actions: Issuer: U.S. Shipping Corp Outlook, Changed To Rating Withdrawn From Negative RATINGS RATIONALE Moody's has withdrawn all of U.S. Shipping Corp ratings following the company's complete redemption of all its outstanding $220 million first lien credit facility. U.S. Shipping Corp, headquartered in Edison, NJ, owns four modern articulated tug-barge units and two legacy tankers serving the US Jones Act chemical and petroleum markets. Revenues approximated $95 million for the period ended December 31, 2020. VERONI BRANDS: Delays Filing of 2020 Annual Report -------------------------------------------------- Veroni Brands Corp. filed a Form 12b-25 with the Securities and Exchange Commission notifying the delay in the filing of its Annual Report on Form 10-K for the year ended Dec. 31, 2020. Veroni Brands' recent business activities have delayed the preparation of the report. The company expects to report a loss of roughly $100,000 for the 2020 fiscal year, as compared to a loss of $600,813 for the 2019 fiscal year. About Veroni Brands Corp. Headquartered in Bannockburn, Illinois, Veroni Brands Corp. is an importer, seller and distributor of premium beverage, chocolate and snack products produced in Europe, engaging with both domestic and international well-known retailers so that its products are sold in thousands of stores in the United States. Veroni is also a supplier of confectionery and beverage products for major U.S. retailers under private label brands. Deer Park, Illinois-based Soldinger Associates, LLC, the Company's auditor since 2018, issued a "going concern" qualification in its report dated April 14, 2020, citing that the Company has incurred losses since inception, has an accumulated deficit of approximately $907,000 and a cash balance of approximately $99,000 and working capital of $2,715 as of Dec. 31, 2019. The Company needs to raise capital or debt to fund its obligations and develop its operations and become profitable. These conditions raise substantial doubt as to the Company's ability to continue as a going concern. VIENTO WINES: Wins Cash Collateral Access Thru June 30 ------------------------------------------------------ The U.S. Bankruptcy Court for the Eastern District of Oregon has authorized Viento Wines, Inc. to use cash collateral on an interim basis in accordance with the budget, with a 10% variance through June 30, 2021. First Interstate Bank has a loan outstanding to the Debtor in the original principal amount of $742,500 pursuant to a Business Loan Agreement dated January 7, 2011 and Construction Loan Agreement dated January 7, 2011 evidenced by a promissory note in the original principal amount of the 10237 Loan executed by the Debtor in favor of CenterPointe Community Bank. FIB has an additional loan outstanding to the Debtor in the original principal amount of $350,000 pursuant to a Business Loan Agreement dated July 16, 2013 and Commercial Construction Loan Agreement dated July 16, 2013. The 1043000 Loan is also evidenced by a promissory note in the original principal amount $350,000 executed by the Debtor in favor of CenterPointe. CenterPointe later merged into Inland Northwest Bank, which thereafter merged into FIB. The parties entered into a Forbearance Agreement dated April 15, 2019. Under the Forbearance Agreement, the Debtor caused additional real estate collateral to be pledged to secure the obligations of the Debtor under the 1043000 Loan Documents and the 10237 Loan Documents. Pursuant to the Court's order, the Debtor is authorized to use cash collateral to pay for operating expenses and costs of administration incurred by the Debtor from April 26, 2021 until the earliest to occur of (a) June 30, 2021, or (b) the occurrence of a "Termination Event." These events constitute a Termination Event: a. the Debtor will fail to deposit on a weekly basis all cash receipts and collections from whatever source in its post-petition debtor-in-possession account(s) or such other accounts as approved by the Court; b. except as permitted by any order of the Court and included in the Budget, the Debtor will make any payment in respect of a prepetition claim; c. the Debtor's chapter 11 case will be dismissed or converted to a case under chapter 7 of the Bankruptcy Code; d. the Debtor (i) fails to maintain, insurance in such amounts and against the risks as are customarily maintained by companies of established repute engaged in the same or similar businesses operating in the same or similar locations and all insurance required to be maintained pursuant to the Loan Documents, not otherwise furnished by the Co-Obligors Richard & Robin Cushman, or (ii) fails to furnish to FIB, upon reasonable request, information in reasonable detail as to the insurance so maintained; or e. the Debtor fails to comply with any of the terms or conditions of the Order; provided, however, that FIB may waive, in writing, any Termination Event. As adequate protection, FIB is granted a first priority post-petition security interest and lien in, to and against all of the Debtor's assets, to the same priority, validity and extent that FIB held a properly perfected pre-petition security interest in such assets, which are or have been acquired, generated or received by the Debtor subsequent to the Petition Date, as well as in all presently owned and hereafter acquired property which is not subject to a prior perfected and enforceable pre-petition lien or security interest, but excluding any claims or recoveries by or on behalf of the Debtor, its estate or any trustee appointed arising under sections 544 through 550, inclusive, of the Bankruptcy Code. The liens and security interests granted are deemed perfected without the necessity for filing or execution of documents which might otherwise be required under non-bankruptcy law for the perfection of said security interests. A copy of the order is available at https://bit.ly/3vCoSRx from PacerMonitor.com. About Viento Wines, Inc. Viento Wines Inc. -- http://vientowines.com/-- is a winemaker offering Gorge wines ranging from Sparkling, White, Rose, Red & Dessert wine. Viento Wines sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. D. Ore. Case No. 21-30690) on March 29, 2021. In the petition signed by Richard Cushman, president, the Debtor disclosed $679,176 in assets and $1,272,818 in liabilities. Judge Trish M. Brown oversees the case. Michael D. O'Brien, Esq. at Michael D. O'Brien & Associates, P.C. is the Debtor's counsel. YUNHONG CTI: Sells, Leases Back Lake Barrington Facility -------------------------------------------------------- Yunhong CTI Ltd. entered into a Purchase and Sale Agreement pursuant to which the company sold its facility in Lake Barrington, Illinois, in which its headquarters office, production and warehouse space are located. The sale price for the property was $3,500,000, consisting of $2,000,000 in cash and the issuance of promissory note with a principal amount of $1,500,000. Concurrently with the closing under the Purchase and Sale Agreement, Yunhong CTI and the purchaser entered into a lease agreement pursuant to which the company agreed to lease the Lake Barrington facility from the purchaser for a period of 10 years. The annual base rent commences at $500,000 for the first year of the term and escalates annually to $652,386 during the last year of the term of the lease. Amendment to Agreement with PNC Bank As previously disclosed on the Company's Current Report on Form 8-K filed, on Dec. 14, 2017, the Company entered into a Revolving Credit, Term Loan and Security Agreement with PNC Bank, National Association. Concurrently with the PSA and the Lease, the Company entered into a Consent, Forbearance and Amendment No. 6 to Revolving Credit, Term Loan and Security Agreement with the Lender. Prior to entering into the Amendment Agreement, the Lender had notified the Company that various events of default had occurred under the Loan Agreement and were continuing. Pursuant to the Amendment Agreement, the Lender consented to the transactions undertaken pursuant to the PSA and Lease, as required under the Loan Agreement. As a condition to the Amendment Agreement, the Company agreed that the full $2,000,000 cash proceeds from the sale of the Lake Barrington Facility would be applied to repay the $2,000,000 term loan owed to the Lender pursuant to the Loan Agreement. The Company further agreed to the $1,500,000 from the payment of the proceeds from the Purchaser Promissory Note will be applied to amounts due and owing to the Lender under the revolving credit advances, thereby reducing the revolving credit advanced as of April 23, 2021 from $6,095,270.35 to $4,595,270.35. Pursuant to the Amendment Agreement, the Lender agreed to forbear from rights and remedies with respect to the Existing Event of Defaults under the Loan Agreement for a period ending on the earlier of Sept. 30, 2021, the occurrence of a new event of default under the Loan Agreement, or the occurrence of a Termination Event. Additionally, certain additions and amendments to the Loan Agreement were set forth in the Amendment Agreement, including: * The Maximum Revolving Advance Amount is reduced from $18,000,0000 to $9,000,000; * The Termination Date of the Loan Agreement is revised from Dec. 14, 2022 to Dec. 31, 2021; * On or before June 30, 2021, or such later date as the Lender agrees in its sole discretion, the Company shall receive an equity investment of at least $1,500,000 and apply 100% of the proceeds to a reduction of the Revolving Credit Advance under the Loan Agreement; * On or before Aug. 15, 2021, or such later date as the Lender agrees in its sole discretion, the Company shall deliver to Lender (i) a binding term sheet, in form and substance acceptable to Lender, from a financing source that provides for the refinance and payment in full, in cash, of the obligations owing under the Loan Agreement on or before Sept. 30, 2021, or (ii) evidence, in form and substance satisfactory to the Lender, that certain equity holders of the Company have available and identifiable funds that are on deposit with a depository institution that are sufficient to pay in full, in cash, all of the Company obligations under the Loan Agreement on or before Sept. 30, 2021; * On or before Sept. 30, 2021, the Company will cause all of the obligations owing under the Loan Agreement to be paid in full in cash; * The Forbearance Reserve (as defined in Amendment No. 5 to the Loan Agreement) shall be increased from $1,025,000 to $2,525,000; * Effective Aug. 1, 2021, accounts receivable from Wal-Mart Stores and its affiliates shall no longer be considered eligible receivables; * Modifications will be made to the budget, testing and variance provisions of the Loan Agreement. In consideration for entering into the Loan Amendment, the Company agrees to pay the Lender a Forbearance Fee of $1,000,000. Provided, however, that, so long as no Event of Default under the Loan Agreement has occurred (including as a result of a failure of the Company to pay down the Revolving Loans by $1,500,000 with the proceeds of the Purchaser Promissory Note, (i) if the Company consummates the Equity Investment by June 30, 2021, the Forbearance Fee shall be reduced by $250,000, and (ii) if the Company causes all of the obligations under the Loan Agreement to be paid in full, in cash, on or before Sept. 30, 2021, the Forbearance Fee shall be reduced by an additional $500,000, to $250,000. About Yunhong CTI Lake Barrington, Illinois-based Yunhong CTI Ltd. -- www.ctiindustries.com -- develops, produces, distributes and sells a number of consumer products throughout the United States and in over 30 other countries, and it produces film products for commercial and industrial uses in the United States. Many of the Company's products utilize flexible films and, for a number of years, it has been a leading developer of innovative products which employ flexible films including novelty balloons, pouches and films for commercial packaging applications. Yunhong CTI reported a net loss of $4.25 million for the 12 months ended Dec. 31, 2020, compared to a net loss of $8.07 million for the 12 months ended Dec. 31, 2019. As of Dec. 31, 2020, the Company had $21.55 million in total assets, $18.83 million in total liabilities, $1.53 million in mezzanine equity, and $1.19 million in total shareholders' equity. New York, NY-based RBSM LLP, the Company's auditor since 2019, issued a "going concern" qualification in its report dated April 15, 2021, citing that the Company has suffered recurring losses from operations and will require additional capital to continue as a going concern. In addition, the Company is in violation of certain covenants agreed to with PNC Bank which if not resolved could result in PNC Bank initiating liquidation proceedings. This raises substantial doubt about the Company's ability to continue as a going concern. ********* Monday's edition of the TCR delivers a list of indicative prices for bond issues that reportedly trade well below par. Prices are obtained by TCR editors from a variety of outside sources during the prior week we think are reliable. Those sources may not, however, be complete or accurate. The Monday Bond Pricing table is compiled on the Friday prior to publication. Prices reported are not intended to reflect actual trades. 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