/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/210531.mbx T R O U B L E D C O M P A N Y R E P O R T E R Monday, May 31, 2021, Vol. 25, No. 150 Headlines 323-327 MAIN ST: Gets OK to Hire Max Spann as Auctioneer 4354 PINEVIEW DRIVE: Seeks to Hire Kumar Prabhu as Legal Counsel 4712 MEADOWS ROAD: Seeks to Hire Kumar Prabhu as Legal Counsel 5 STAR PROPERTY: $190K Sale of Winter Haven Property Withdrawn 5 STAR PROPERTY: $375K Sale of Winter Haven Property to Cody Okayed 975 WALTON BRONX: Gets OK to Hire Chief Restructuring Officer A.W. BROWN: S&P Alters Outlook to Neg., Affirms 'BB-' Bonds Rating ABILITY INC: Suffers Cash Flow Difficulties Due to COVID-19 ACER THERAPEUTICS: Plans NDA Submission for ACER-001 in Q3 ADAM S. DASH: Agreed Order Solving $94K Sale Deposit Dispute Signed AEROCENTURY CORP: 10 Aircraft Sale Okayed, Erasing $83 Million Debt ALL AROUND TRUCK & TRAILER: Files for Chapter 7 Bankruptcy ALLEN MEDIA: S&P Affirms 'B' Issuer Credit Rating, Outlook Stable ALLY FINANCIAL: Moody's Reviews Ba1 Issuer Rating for Upgrade ALTHAUS FAMILY: Kalabat Buying Temperance Property for $5.5-Mil. ALTO TOWNHOMES: Unsecureds to Recoup 10% of Allowed Claims AMERICAN BUYITNOW: Wealth Street Buying Orange Property for $52K ANDES INDUSTRIES: Commission Buying PCT's Extruder Line for $40K ANDRA'S REDEMPTION: Seeks to Hire Joshua's Realty as Broker ANTERO MIDSTREAM: Moody's Rates New $650MM Unsecured Notes 'B1' ANTERO MIDSTREAM: S&P Rates $650MM Senior Unsecured Notes 'BB-' APP CAR: Seeks Approval to Tap Joyce W. Lindauer as Legal Counsel ARIZONA INDUSTRIAL: S&P Places 'B-(sf)' Bonds Rating on Watch Neg. ARLINGTON DOUBLE DOWN: Seeks Cash Collateral Access ARLINGTON DOUBLE: Case Summary & 6 Unsecured Creditors ASP NAPA: S&P Assign 'CCC+' Issuer Credit Rating, Outlook Stable ATHERTON BAPTIST: Fitch Assigns 'BB+' Issuer Default Rating AULT GLOBAL: Posts $3.1 Million Net Income in First Quarter AUTOMOTORES GILDEMEISTER: Reorganization Under New Owners Okayed BALDWIN RISK: Moody's Rates $500MM Repriced Secured Term Loan 'B2' BAUSCH HEALTH: Fitch Assigns BB Rating to Secured Notes BAUSCH HEALTH: Moody's Rates New Sr. Secured Notes 'Ba2' BAUSCH HEALTH: S&P Rates New $1.6BB Senior Secured Notes 'BB' BAYTEX ENERGY: Fitch Affirms 'B' IDR & Alters Outlook to Stable BEAR COMMUNICATIONS: Case Summary & 20 Largest Unsecured Creditors BELDEN INC: Moody's Affirms Ba2 CFR, Outlook Stable BETTERECYCLING CORP: Plan Confirmation Hearing Slated for June 9 BETTEROADS ASPHALT: June 9 Confirmation Hearing Set BFCD PROPERTIES: Seeks Approval to Hire Bankruptcy Attorneys BIBB COUNTY: S&P Alters Outlook to Stable, Affirms BB Bonds Rating BIOLASE INC: Fails to Comply With Nasdaq Bid Price Requirement BK4 LLC: Gets Approval to Hire Goldberg Weprin as Legal Counsel BLUBELLE LLC: Lone Unsecured Creditor Gets $2K of $157K Claim BLUE EAGLE: Forse Selling Gadsden Property to Joneses for $270K BOY SCOUTS OF AMERICA: Survivors Aim Chubb for More Insurance Info BOYD GAMING: Moody's Rates New $750MM Unsecured Notes 'Caa1' BOYD GAMING: S&P Rates New $750MM Senior Unsecured Notes 'B' BRAZIL MINERALS: Incurs $1.2 Million Net Loss in First Quarter BRISTOW GROUP: Narrows Down Loss in First Year Since Chapter 11 BUY MOORE: Seeks to Hire Oppenhuizen Law Firm as Legal Counsel CAMBER ENERGY: Receives Noncompliance Notice From NYSE American CAMELOT UK: S&P Alters Outlook to Stable, Affirms 'B' ICR CAMP RIM ROCK: Plan Exclusivity Period Extended Until June 7 CARDINAL BAY: S&P Stays 'BB-' 2016C Bonds Rating on Watch Negative CAREERBUILDER LLC: Moody's Cuts CFR to Caa1, Outlook Negative CARESTREAM DENTAL: S&P Alters Outlook to Stable, Affirms 'B' ICR CASTEX ENERGY: Chapter 11 Plan Nears Final But More Talks Needed CASTEX ENERGY: Taxing Authorities Oppose Plan Disclosures CASTEX ENERGY: Texas Petroleum Says Amended Plan Unconfirmable CASTEX ENERGY: United States Trustee Says Amended Plan Defective CBL & ASSOCIATES: Creditors Oppose Ch.11 Equity Holders Committee CITIUS PHARMACEUTICALS: Adjourns Special Meeting Until June 21 CITY BREWING: S&P Withdraws B+ Rating in Revolving Credit Facility CLAIRE E. GRUPPO: Albert Venger Buying Ancram Property for $320K COLFAX CORP: S&P Affirms 'BB' ICR on Improving Performance COLLAB9 LLC: Sale of Business Assets to SecureComm. LLC Approved COLLECTED GROUP: Joint Prepackaged Plan Confirmed by Judge COLT HOLDING: Announces Acquisition by CZG COMPASS DATACENTERS: S&P Gives (P)BB- on 2021-1 Class C Debt CONSOL ENERGY: S&P Alters Outlook to Stable, Affirms 'B-' ICR CONTRACT TRANSPORT: American Buying Cleveland Property for $750K COOPER'S HAWK: S&P Upgrades ICR to 'B-', Outlook Stable COOPER-STANDARD AUTOMOTIVE: Moody's Alters Outlook on CFR to Stable CPV MARYLAND: S&P Assigns 'BB- Rating on $350MM Term Loan B CVENT INC: S&P Alters Outlook to Positive, Affirms 'CCC+' ICR CYBER LITIGATION: Wins November 22 Plan Exclusivity Extension DECO-USA LLC: Case Summary & 4 Unsecured Creditors DEVON ENERGY: Moody's Rates New Sr. Unsecured Notes 'Ba1' DIEBOLD NIXDORF: S&P Alters Outlook to Positive, Affirms 'B-' ICR DISCOVERY DAY: June 30 Plan Confirmation Hearing Set DLT RESOLUTION: Incurs $180K Net Loss in First Quarter EAGLE HOSPITALITY TRUST: Court Okays $482M Hotel Sale In Chapter 11 EAGLE RANCH: Plan Seeks Sale of Portion of Debtor's Main Asset ELDERHOME LAND: Seeks to Extend Plan Exclusivity Thru June 9 ELO TOUCH: S&P Alters Outlook to Stable, Affirms 'B' ICR EQUIVALENT FINANCIAL: Voluntary Chapter 11 Case Summary ETHEMA HEALTH: Incurs $2.4 Million Net Loss in First Quarter EVOLUTION ACADEMY: S&P Upgrades ICR to 'B+' on Improved Liquidity EXELA TECHNOLOGIES: Taps Equity Market to Raise Cash to Cut Debt FAITH CATHEDRAL: TD Bank Says Plan Disclosures Not Feasible FIVE POINT: Moody's Affirms B3 CFR & Alters Outlook to Positive FLOYD CHARLES YORK: Scanlons Buying Alexandria Property for $1.825M FRANCESCA'S HOLDINGS: Conditionally Approves Disclosures and Plan FRANCIS FARMS: $2.4M Sale of Commercial Property in Rehoboth OK'd FRESH ACQUISITIONS: Committee Seeks to Hire Financial Advisor FRIENDS OF CITRUS: U.S. Objection Resolved; Court Confirms Plan GAIA INTERACTIVE: Seeks to Hire Binder & Malter as Legal Counsel GATEWAY RADIOLOGY: August 11 Plan & Disclosure Hearing Set GDC TECHNICS: Seeks to Hire SierraConstellation, Appoint CRO GDC TECHNICS: Seeks to Hire Wick Phillips as Bankruptcy Counsel GENESIS WEIGHT: Seeks to Use Cash Collateral GEO GROUP: S&P Downgraded ICR to 'CCC+', Outlook Negative GEX MANAGEMENT: Incurs $402K Net Loss in First Quarter GILBERT MH: HAZ Investment Buying Gilbert Property for $1.5 Million GILBERT MH: June 15 Hearing on $1.5M Gilbert Property Sale to HAZ GOLF TAILOR: Case Summary & 20 Largest Unsecured Creditors GOLF TAILOR: Seeks Cash Collateral Access GREAT LAKES PETROLEUM: IronPlanet Buying 14 Trucks for $461.7K GROW CAPITAL: Incurs $842,512 Net Loss in Third Quarter GROWLIFE INC: Incurs $2.9 Million Net Loss in First Quarter GRUPO AEROMEXICO: Hires Lee Group as Special Airline Counsel GTT COMMUNICATIONS: Likely to File Chapter 11 Before June 30, 2021 GUDORF SUPPLY: Seeks to Tap Michael Einterz as Special Counsel GUMP'S HOLDINGS: Joint Liquidating Plan Confirmed by Judge H-BAY MINISTRIES: S&P Stays 'B+' 2018A/B Bonds Rating on Watch Neg HARLAN REAL: Case Summary & Unsecured Creditor HC2 HOLDINGS: S&P Alters Outlook to Stable, Affirms 'B-' ICR HEALTHIER CHOICES: Rights Offering Subscription Period Commences HELIOS AND MATHESON: KLDiscovery Claim Timely Filed, Court Says HORSE BUTTE: Case Summary & 6 Unsecured Creditors HUSCH & HUSCH: Simon CRE Buying Harrah Property for $175K Cash HUTCHINSON REGIONAL: Moody's Affirms Ba1 Rating, Outlook Stable IG INVESTMENTS: Dividend Increase No Impact on Moody's B3 CFR INSPIRON INC: Amended Liquidating Plan Confirmed by Judge J & GC: Seeks Approval to Hire Eric A. Liepins as Legal Counsel JACOBS ENTERTAINMENT: S&P Affirms 'B-' ICR on Expected Deleveraging JADE PROPERTY: Seeks to Hire Dilks Law Firm as Bankruptcy Counsel JB HOLDINGS: Online Auction Sale of Hobe Sound Property Approved JC STRENGTH: Plan Exclusivity Extended Until September 8 JONES SODA: CEO and President Mark Murray Appointed as Director KB HOME: Moody's Hikes CFR to Ba2 & Rates New Unsecured Notes Ba2 KB HOME: S&P Rates New $300MM Senior Unsecured Notes Due 2031 'BB' KELLA JUNE BABCOCK: Husband Buying Lolo Homestead for $298.5K KING'S TOWING: Seeks to Hire Parrish Agency as Accountant KINSER GROUP II: Seeks Cash Collateral Access KINSER GROUP: Case Summary & 20 Largest Unsecured Creditors KRONOS WORLDWIDE: Fitch Alters Outlook on 'B+' LT IDR to Stable LAKE CECILE: Seeks Access to Cash Collateral LAKEWAY PUBLISHERS: Emerges from Chapter 11 Bankruptcy LINKMEYER PROPERTIES: Discl. Statement Hearing Slated for July 12 LJ RUBY: Moody's Alters Outlook on B3 Corp. Family Rating to Stable LOGIX HOLDING: Moody's Lowers CFR to Caa2, Outlook Still Negative LSB INDUSTRIES: S&P Upgrades ICR to 'CCC+' on Improved Pricing M&M BEDDING: Case Summary & 8 Unsecured Creditors MACHINE TECH: KC Estimating Buying Adel Property for $130K MALLINCKRODT PLC: Bid to Move Acthar Cases to Delaware Questioned MALLINCKRODT PLC: Chubb Companies Say Plan Patently Unconfirmable MALLINCKRODT PLC: Committee Taps Cushman & Wakefield as Appraiser MALLINCKRODT PLC: DMPs Say Plan Contains Ambiguous Provisions MALLINCKRODT PLC: FCR Complains, Opioid PI Claimants UnCategorized MALLINCKRODT PLC: OCC Tells Qualms re Debtors' Solicitation Method MARTIN CARPENTER'S: Seeks to Hire Shannon Sheridan as Accountant MAUNESHA RIVER: Case Summary & 20 Largest Unsecured Creditors MEDIACOM COMMUNICATIONS: Moody's Withdraws Ba1 Corp. Family Rating MEDLEY LLC: Committee Seeks to Hire Kelley Drye as Lead Counsel MEDLEY LLC: Committee Taps FTI Consulting as Financial Advisor MEDLEY LLC: Committee Taps Potter Anderson as Delaware Counsel MERCY HOSPITAL: Buyer Reaches Operational Deal With Chicago METHODIST UNIVERSITY: S&P Lowers 2012 Revenue Bonds Rating to 'BB' METRO-GOLDWYN-MAYER: Moody's Puts B1 CFR Under Review for Upgrade MICROCHIP TECHNOLOGY: Moody's Alters Outlook on Ba1 CFR to Positive MILLER'S ALE: Moody's Alters Outlook on 'Caa1' CFR to Stable MINESEN COMPANY: Hires Goodsill Anderson as Special Counsel MISSION BROADCASTING: Moody's Rates New $300MM Secured Loan 'Ba2' MOMENTIVE PERFORMANCE: Moody's Alters Outlook on B3 CFR to Stable MOOG INC: Moody's Alters Outlook on 'Ba2' CFR to Stable MUSCLEPHARM CORP: Posts $94K Net Income in First Quarter NEOVASC INC: Fails to Comply With Nasdaq Bid Price Requirement NEWMARK GROUP: S&P Alters Outlook to Stable, Affirms 'BB+' ICR NIELSEN FINANCE: Moody's Rates New $1BB Sr. Unsecured Notes 'B2' NIELSEN FINANCE: S&P Rates New Senior Unsecured Notes 'BB' OASIS MIDSTREAM: S&P Affirms 'B' Long-Term ICR, Outlook Stable OASIS PETROLEUM: Moody's Assigns B1 CFR Amid Williston Deal OASIS PETROLEUM: S&P Assigns 'B' ICR, Outlook Stable OBITX INC: Taps RedChip as Investor Relations Firm OCTAVE MUSIC: Moody's Affirms B3 CFR & Alters Outlook to Stable ODYSSEY ENGINES: July 21 Plan Confirmation Hearing Set OPTIV INC: Moody's Alters Outlook on Caa1 CFR to Positive PADDOCK ENTERPRISES: Plan Exclusivity Extended Until July 6 PAPS CAB: June 30 Plan Confirmation Hearing Set PARK RIVER: Fitch Rates New $340MM Unsecured Notes 'CCC+' PARK RIVER: Moody's Affirms B2 CFR & Rates New Unsecured Notes Caa1 PARK RIVER: S&P Downgrades ICR to 'B-' on Debt-Funded Acquisition PATERSON CHARTER SCHOOL: S&P Raises Revenue Bonds Rating to 'BB' PENSKE AUTOMOTIVE: S&P Rates New $500MM Senior Sub. Notes 'BB-' PESCRILLO NEW YORK: June 24 Plan Confirmation Hearing Set PESCRILLO NIAGARA: June 24 Plan Confirmation Hearing Set PG&E CORP: Fitch Affirms 'BB' IDRs, Outlook Stable PG&E CORP: Names 5 Regional VPs, New Chief Info Security Officer POINT LOOKOUT: Trustee's $1.25M Sale of Ridge Property Approved POWDR CORP: S&P Alters Outlook to Stable, Affirms 'B-' ICR PREMIERE GLOBAL SERVICES: S&P Lowers ICR to 'CCC-', Outlook Neg. PRO VIDEO: Case Summary & 10 Unsecured Creditors PROFESSIONAL DIVERSITY: Receives Noncompliance Notice From Nasdaq PUERTO RICO: PREPA Board Seeks Bankruptcy Exit in 2021 PURDUE PHARMA: Judge Says Disclosures Gives Creditors Enough Info QUANTUM CORP: Widens Net Loss to $35.5 Million in Fiscal 2021 QUEST PATENT: Incurs $5.2 Million Net Loss in First Quarter RANDOLPH HOSPITAL: Wins June 4 Solicitation Exclusivity Extension REALOGY GROUP: Moody's Hikes CFR to B1, Outlook Remains Stable RENOVATE AMERICA: Unsecureds to Split Liquidating Trust Pro Rata RIOT BLOCKCHAIN: Appoints Benjamin Yi as Executive Chairman RITORI LLC: Seeks to Hire Alex Cooper as Auctioneer RLCH INC: Seeks to Sell Barclay Building to Fund Reorganization ROLLING MEADOWS: Fitch Affirms BB+ Rating on $15MM Revenue Bonds ROMANS HOUSE: Wins Cash Collateral Access Thru June 30 RONALD DWAYNE COLLINS: $4K Sale of 2001 Ford F350 Truck Approved ROY LOMPA: Bates Properties Buying Dunlap Property for $7.4 Million ROYALE ENERGY: Appoints Weaver and Tidwell as Accountant ROYALE ENERGY: Moss Adams Quits as Accountant RT DEVELOPMENT: Seeks to Hire Michael Jay Berger as Legal Counsel RYAN 1000: Seeks to Hire Strouse Law Offices as Legal Counsel RYAN 8641: Seeks to Hire Strouse Law Offices as Legal Counsel SEADRILL LTD: Appoints New Management Members SEALED AIR: Moody's Hikes CFR to Ba1, Outlook Stable SEARS HOLDING: Buyer Not Liable for Warranty Lawsuit, Says Judge SECURE HOME: Joint Prepackaged Plan Confirmed by Judge SHADDEN LLC: Court Confirms Reorganization Plan SHARE ENERGY: Voluntary Chapter 11 Case Summary SOUTHERN PRODUCE: Proposed $6K Sale of Faison Property Approved SOVOS BRANDS: Moody's Rates New $580MM First Lien Term Loan 'B2' SOVOS BRANDS: S&P Alters Outlook to Negative, Affirms 'B' ICR SOVOS BRANDS: S&P Withdraws 'CCC+' Rating on Second-Lien Debt STONEMOR INC: S&P Upgrades ICR to 'CCC+' on Improved Liquidity SUFFERN PARTNERS: Seeks to Hire Davidoff Hutcher as Legal Counsel SUFFERN PARTNERS: Seeks to Hire Hahn & Hessen as Special Counsel SUFFERN PARTNERS: TT Holder Buying Suffern Property for $52.5M SURVEYMONKEY INC: Moody's Hikes CFR to B2, Outlook Stable TEA OLIVE: Haybeach Special Buying Class Action Claim for $61.5K TEA OLIVE: June 8 Hearing on $61.5K Sale of Class Action Claims TEAM HEALTH: Moody's Puts Caa2 CFR Under Review for Upgrade TECT AEROSPACE: Sets Bidding Procedures for Assets in Kansas THADEUS A. GADOMSKI JR: Selling Wells Asset for $505K to Rau & Dang THADEUS A. GADOMSKI, JR.: June 15 Hearing on Sale of Wells Property TIANJIN JAHO: Case Summary & 3 Unsecured Creditors TMX FINANCE: S&P Affirms 'B-' ICR on Steady Operating Performance TOP FLIGHT INVESTMENTS: Seeks to Hire Abbasi Law as Legal Counsel TORNANTE-MDP JOE: S&P Places 'B-' ICR on CreditWatch Positive TOWN SPORTS: N.Y. Sports Club Bankruptcy Deal 'Destroyed' Stake TPT GLOBAL: Posts $1.7 Million Net Loss in First Quarter TRANSACT HOLDINGS: S&P Alters Outlook to Pos., Affirms 'CCC+' ICR TRIUMPH GROUP: S&P Raises First-Lien Note Rating to 'B' TTK RE ENTERPRISE: Arias Buying Atlantic City Property for $200K U.S. SILICA: Unit Gets Imminent Danger Order at Texas Mine UNITED BANCSHARES: Late-Filed Form 10-K Shows $319K Loss for 2017 US VIRGIN ISLANDS WAPA: Fitch Retains CCC Issuer Default Rating UWM MORTGAGE 2021-1: Moody's Assigns (P)B3 Rating to Cl. B5 Notes VAL'S FOOD: July 7 Plan & Disclosure Hearing Set VERICAST CORP: S&P Downgrades ICR to 'CCC', Outlook Negative VERITAS FARMS: Incurs $1.2 Million Net Loss in First Quarter VIP PHARMACY: Wins Cash Collateral Access Thru July 31 VIRGINIA TRUE: Suit v. Cipollones Stays in Bankruptcy Court VISTA CHARTER MIDDLE SCHOOL: S&P Puts 'BB+' LT Rating on Watch Neg. W&T OFFSHORE: S&P Affirms 'CCC+' ICR on Asset Sale, Outlook Neg. WARDMAN HOTEL: Trustee Selling Art Van's Bellwood Property for $2M WASTEQUIP LLC: S&P Affirms 'B' ICR on Anticipated Demand Recovery WAXELENE INC: Court Extends Plan Exclusivity Thru July 29 WB BRIDGE HOTEL: Wants Plan Exclusivity Extended Thru August 18 WENDY'S CO: S&P Raises ICR to 'B+' on Improved Performance WILLIAM CARTER: Moody's Affirms Ba1 CFR, Outlook Remains Stable WOODFORD EXPRESS: Moody's Hikes CFR to B3, Outlook Stable WORK CAT: Wins Cash Collateral Access Thru June 17 WYNDHAM HOTELS: Moody's Affirms Ba1 CFR & Alters Outlook to Stable XPERI HOLDING: Moody's Rates $810MM First Lien Term Loan 'Ba3' YI LLC: Moody's Affirms B3 CFR & Alters Outlook to Stable YIELD10 BIOSCIENCE: All Four Proposals Passed at Annual Meeting YOAKUM INDEPENDENT SCHOOL: S&P Lowers GO Debt Rating to 'BB' YOUFIT HEALTH CLUBS: Asks Court to Dismiss Bankruptcy Case ZIG ZAG DOUGH: Case Summary & 12 Unsecured Creditors ZIG ZAG DOUGH: Seeks Cash Collateral Access [^] BOND PRICING: For the Week from May 24 to 28, 2021 ********* 323-327 MAIN ST: Gets OK to Hire Max Spann as Auctioneer -------------------------------------------------------- 323-327 Main St., LLC and 38 Market St., LLC received approval from the U.S. Bankruptcy Court for the District of New Jersey to employ Max Spann Real Estate & Auction Co. as auctioneer. The Debtors require the services of the firm to conduct a public auction of real properties located at 323-327 Main St. and 36-38 Market St., Paterson, N.J. The firm will be paid a commission of 10 percent of the winning bid price for each property. Maximiillian Spann, Jr., a partner at Max Spann, 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: Maximiillian M. Spann, Jr. Max Spann Real Estate & Auction Co. 1325 NJ-31 Annandale, NJ 08801 Tel: (888) 299-1438 About 323-327 Main St. LLC and 38 Walnut St. LLC 323-327 Main St., LLC and 38 Walnut St., LLC filed voluntary petitions for relief under Chapter 11 of the Bankruptcy Code on (Bankr. D.N.J. Lead Case No. 20-21121) At the time of the filing, 323-327 Main St. disclosed $4,325,000 in assets and $4,232,013 in liabilities while 38 Walnut St. disclosed assets of between $1 million and $10 million and liabilities of the same range. Judge John K. Sherwood oversees the cases. Norgaard O'Boyle& Hannon serves as the Debtors' bankruptcy counsel. 4354 PINEVIEW DRIVE: Seeks to Hire Kumar Prabhu as Legal Counsel ---------------------------------------------------------------- The 4354 Pineview Drive Land Trust seeks approval from the U.S. Bankruptcy Court for the Northern District of Georgia to hire Kumar, Prabhu, Patel & Banerjee, LLC as its legal counsel. The firm's services include: a. providing the Debtor legal advice with respect to its powers and duties in the management of its property; b. preparing legal papers; c. seeking the turnover of the Debtor's property, which is in the possession and control of other parties; d. examining claims of creditors; e. assisting with the preparation of a disclosure statement and plan of reorganization and with the confirmation and consummation of the plan; and f. other legal services necessary to administer the Debtor's Chapter 11 case. Kumar will charge these hourly fees: Partners $300 - $450 Associates $150 - $250 Legal Assistants $100 - $150 The firm holds a retainer in the sum of $10,000. As disclosed in court filings, Kumar does not represent any interest adverse to the Debtor and its bankruptcy estate. The firm can be reached through: Gai Lynn McCarthy, Esq. Kumar, Prabhu, Patel & Banerjee, LLC One Lakeside Commons, Suite 800 990 Hammond Drive Atlanta, GA 30328 Phone: 678-443-2244 Fax: 678-443-2230 Email: gmccarthy@kppblaw.com About The 4354 Pineview Drive Land Trust The 4354 Pineview Drive Land Trust sought protection for relief under Chapter 11 of the Bankruptcy Code (Bankr. N.D. Ga. Case No. 21-53482) on May 3, 2021, listing under $1 million in both assets and liabilities. Kumar, Prabhu, Patel & Banerjee, LLC represents the Debtor as legal counsel. 4712 MEADOWS ROAD: Seeks to Hire Kumar Prabhu as Legal Counsel -------------------------------------------------------------- The 4712 Meadows Road Land Trust seeks approval from the U.S. Bankruptcy Court for the Northern District of Georgia to hire Kumar, Prabhu, Patel & Banerjee, LLC, as its legal counsel. The firm's services include: a. advising the Debtor regarding its powers and duties in the management of its property; b. preparing legal papers; c. seeking the turnover of the Debtor's property, which is in the possession and control of other parties; d. examining claims of creditors; e. assisting with the preparation of a disclosure statement and plan of reorganization and with the confirmation and consummation of the plan; and f. other legal services necessary to administer the Debtor's Chapter 11 case. Kumar will charge these hourly fees: Partners $300 - $450 Associates $150 - $250 Legal Assistants $100 - $150 The firm holds a retainer in the sum of $10,000. As disclosed in court filings, Kumar does not represent any interest adverse to the Debtor and its bankruptcy estate. The firm can be reached through: Gai Lynn McCarthy, Esq. Kumar, Prabhu, Patel & Banerjee, LLC One Lakeside Commons, Suite 800 990 Hammond Drive Atlanta, GA 30328 Phone: 678-443-2244 Fax: 678-443-2230 Email: gmccarthy@kppblaw.com About The 4712 Meadows Road Land Trust The 4712 Meadows Road Land Trust sought protection for relief under Chapter 11 of the Bankruptcy Code (Bankr. N.D. Ga. Case No. 21-53483) on May 3, 2021, listing under $1 million in both assets and liabilities. Kumar, Prabhu, Patel & Banerjee, LLC serves as the Debtor's legal counsel. 5 STAR PROPERTY: $190K Sale of Winter Haven Property Withdrawn -------------------------------------------------------------- 5 Star Property Group, Inc., filed with the U.S. Bankruptcy Court for the Middle District of Florida a notice of withdrawal of request (i) to approve sale of the real property is located at 2625 Avenue S NW, in Winter Haven, Florida 33881, described as Inwood Unit3 PB 9 PG 7A 7B 7C S13/ 24 T28 R25 Lots 544 &545, to Joe Rivers for $190,000, and (ii) for expedited hearing on proposed sale. The Debtor is the owner of the Real Property, which it listed on Schedule A of its Petition. The Property is not the Debtor's homestead. About 5 Star Property Group, Inc. 5 Star Property Group, Inc. sought protection for relief under Chapter 11 of the Bankruptcy Code (Bankr. M.D. Fla. Case No. 20-07801) on Oct. 20, 2020, listing under $1 million in both assets and liabilities. Buddy D. Ford, Esq. at BUDDY D. FORD, P.A. represents the Debtor as counsel. 5 STAR PROPERTY: $375K Sale of Winter Haven Property to Cody Okayed ------------------------------------------------------------------- Judge Catherine Peek McEwen of the U.S. Bankruptcy Court for the Middle District of Florida authorized 5 Star Property Group, Inc.'s sale of the real property is located at 4130 Country Club Road South, in Winter Haven, Florida 33881, described as The Gates of Lake Region PB 100 PGS 25 & 26 Lot 31, to Shanell Cody for $375,000. A hearing on the Motion was held on May 20, 2021. The sale is "as is" and free and clear of any liens, claims, interests, encumbrances, and security interests of any kind. The liens of any secured creditors, including Raymond Rairigh, Sr., the Polk County Tax Collector, the Gates of Lake Region Homeowners’ Association, Kari's Granite & Marble, LLC, the City of Winter Haven, and Roger & Jeanie Fitzpatrick will attach to the proceeds from the sale. The Debtor is authorized to pay the liens of the following secured creditors, and all ordinary and necessary closing expenses normally attributed to a seller of real estate, at closing, to wit: a. Raymond Rairigh, Sr. will be paid, at closing, the full amount of his first mortgage lien pursuant to a current payoff letter provided by Rairigh prior to closing; and b. The Gates of Lake Region Homeowners' Association will be paid, at closing, the full amount of its lien pursuant to a current payoff letter provided by the HOA prior to closing. The remaining sale proceeds, after payment of the above-listed secured claims and closing costs, will be held in trust by the Debtor's counsel until further order of the Court regarding the distribution of sale proceeds. The Debtor will provide a copy of the closing statement from the sale of the property to the office of the United States Trustee within five days of the closing date. The Debtor will file a copy of the closing statement with the Court within seven days of the closing date. Interested parties will have 14 days from the date the closing statement is filed to file objections to the proposed disbursements. The 14-day stay required under Bankruptcy Rule Section 6004(h) is waived. Attorney for Debtor, Buddy D. Ford, Esq., is directed to serve a copy of the Order on interested parties who do not receive service by CM/ECF and file a Proof of service within three days of entry of the Order. About 5 Star Property Group, Inc. 5 Star Property Group, Inc. sought protection for relief under Chapter 11 of the Bankruptcy Code (Bankr. M.D. Fla. Case No. 20-07801) on Oct. 20, 2020, listing under $1 million in both assets and liabilities. Buddy D. Ford, Esq. at BUDDY D. FORD, P.A. represents the Debtor as counsel. 975 WALTON BRONX: Gets OK to Hire Chief Restructuring Officer ------------------------------------------------------------- 975 Walton Bronx, LLC received approval from the U.S. Bankruptcy Court for the Eastern District of New York to appoint David Smith, Esq., an attorney in New York, as its chief restructuring officer. The CRO's services include: (a) administering the Debtor's assets and liabilities during its Chapter 11 case; (b) overseeing the preparation of all Chapter 11 reporting, including monthly operating reports and budgets; (c) negotiating on the restructuring of mortgage debt and resolution of claims; and (d) such other services as the Debtor and its lender request and Smith agrees to perform. Mr. Smith received a $5,000 retainer. In court filings, Mr. Smith disclosed that he is a "disinterested person" as that term is defined by Section 101(14) of the Bankruptcy Code. Mr. Smith can be reached at: David L. Smith, Esq. 2 Charleston Street, Apt. 7-C New York, NY 10014 About 975 Walton Bronx 975 Walton Bronx, LLC is a New York limited liability company, which primarily owns a multi-family residential apartment building at 975 Walton Avenue, Bronx, N.Y. The property consists of 182 apartments and commercial space, including a cell tower. 975 Walton Bronx sought protection under Chapter 11 of the Bankruptcy Code (Bankr. E.D. N.Y. Case No. 21-40487) on Feb. 25, 2021. At the time of the filing, the Debtor had between $10 million and $50 million in both assets and liabilities. Judge Jil Mazer-Marino oversees the case. Goldberg Weprin Finkel Goldstein, LLP and David L. Smith, Esq., an attorney in New York, serve as the Debtor's legal counsel and chief restructuring officer, respectively. A.W. BROWN: S&P Alters Outlook to Neg., Affirms 'BB-' Bonds Rating ------------------------------------------------------------------ S&P Global Ratings revised its outlook to negative from stable and affirmed its 'BB-' underlying rating on Arlington Higher Education Finance Corp., Texas' series 2016 and 2017 education revenue bonds, issued for A.W. Brown Leadership Academy. "The outlook revision reflects that there is at least a one-in-three chance that we could lower the rating within our outlook horizon due to the school's weakened demand profile," said S&P Global Ratings credit analyst David Holmes, "with consecutive double-digit declines leading to consecutive full-accrual operating deficits and lease-adjusted maximum annual debt service coverage below 1x with expectations for similar results in fiscal 2021." A.W. Brown's revenue as defined in the governing bond documents consisting primarily of per-pupil funding from the state secures the bonds. The academy used the proceeds of the proposed series 2017 bonds to refund the series 2011Q direct-pay qualified school construction bonds of A.W. Brown and to fund and reimburse various campus expansion/improvement projects. S&P understands that the series 2016 and 2017 bonds are guaranteed by the corpus of the Texas Permanent School Fund (PSF). A charter school gross revenue pledge secures the bonds. Given the PSF guarantee, there is no deed of trust securing the series 2017 bonds. In addition, the series 2017 obligations do not require a debt service reserve fund. Coverage tests require annual debt service coverage (DSC) of at least 1.1x, and a DSC ratio below 1.0x would constitute an event of default, subject to extraordinary items being excluded. In addition, A.W. Brown participates in the Texas PSF Bond Guarantee Program for its series 2016 and 2017 bonds. The existing 'AAA' long-term program rating on the series 2016 and 2017 bonds reflects S&P's view of A.W. Brown's participation in the Texas PSF Bond Guarantee Program, which provides the security of a permanent fund of assets that could be used to meet debt service on the series 2016 and 2017 bonds. S&P said, "We assessed A.W. Brown's enterprise profile as vulnerable, characterized by a somewhat large enrollment base, although the school experienced sharp enrollment declines in fall 2020 and 2019 and the waitlist weakened from historical levels. The assessment also reflects our opinion of the recent deterioration in academic performance for one of the campuses in 2019 and transition risk associated with recent management, board, and staff turnover. We assessed A.W. Brown's financial profile as vulnerable, with negative operating performance, weak maximum annual debt service (MADS) coverage, and covenant violations in fiscal years 2018 and 2017, offset by sufficient unrestricted liquidity position for the rating level. Combined, these credit factors lead to an anchor of 'bb-' and a final rating of 'BB-.' "We would consider a negative rating action if there was continued enrollment declines that weakens operating margins and lease-adjusted MADS coverage to levels that we no longer consider commensurate with the rating. We could also take a negative rating action if the school's academic performance further weakens, and jeopardizes the charter standing, management and staff transitions have an unfavorable impact on the school's enterprise or financial profile, or a covenant violation recurs. "We could revise the outlook to stable if the school shows a trend of enrollment stability to its enterprise profile leading to near breakeven or positive full-accrual operations and lease-adjusted MADS coverage closer to 1x." ABILITY INC: Suffers Cash Flow Difficulties Due to COVID-19 ----------------------------------------------------------- Ability Inc. published on May 26, 2021, an immediate report in Israel as follows: Further to what is stated in sections 1.2.5, and 27.1 of the first part of the periodic report for 2020, which was published on March 29, 2021 (reference number: 2020-01-049623) ("the Periodic Report"), regarding the effect of the Corona virus crisis on the Company's operations ("COVID-19 Outbreak Crisis"), and as stated in the auditor's report and in note 1.d. of the consolidated financial statements as of December 31, 2020 regarding the Company's going concern notice, the Company hereby reports that in light of the realization of some of the risks listed in section 27 of the first part of the Periodic Report, and in particular the effects of the COVID-19 Outbreak Crisis on the Company's operations, the Company is experiencing cash flow difficulties. Accordingly, the Company's Board of Directors received an overview from the Company's management on its financial and business status and examined together with the Company's management and its legal counsels the alternatives for continuing its ongoing operations. In light of the overview, the Company's Board of Directors noted that the Company's cash flow difficulties require immediate action. The Board of Directors instructed the Company's management to continue examining alternatives for the continuation of the Company's ongoing operations, which include among other things, paying salaries to its employees and repaying its debts to suppliers and service providers. The above mentioned may be achieved by obtaining sources of financing. Furthermore, the Board of Directors decided that the Company's management will urgently formulate a plan of which its goals include among others; examining alternatives for the continuation of the Company's operations as a going concern by establishing a new activity and / or formulating a settlement and recovery plan for the Company while negotiating with the Company's creditors and other parties in order to reduce its debts and improve its liquidity with the consultation and assistance of entities that specialize in corporate rehabilitation. Additionally, the Company is examining the various options for formulating a settlement and a recovery plan for the Company in accordance with the provisions of the Israeli Insolvency and Economic Rehabilitation Law, 2018. Sincerely, Ability Inc. Signed by: Anatoly Hurgin, CEO About Ability Inc. Ability Inc. is a holding company operating through its subsidiaries Ability Computer & Software Industries Ltd., Ability Security Systems Ltd., and Telcostar, which provide advanced interception, geolocation and cyber intelligence products and solutions that serve the needs and increasing challenges of security and intelligence agencies, military forces, law enforcement agencies and homeland security agencies worldwide. Ability Inc. reported a net and comprehensive loss of US$7.74 million for the year ended Dec. 31, 2019, compared to a net loss and comprehensive loss of US$10.19 million for the year ended Dec. 31, 2018. As of June 30, 2020, the Company had US$14.14 million in total assets, US$21.34 million in total liabilities, and a total shareholders' deficit of US$7.20 million. Ziv Haft, Certified Public Accountants (Isr.) BDO Member Firm, in Tel Aviv, Israel, the Company's auditor since 2015, issued a "going concern" qualification in its report dated June 15, 2020 citing that the Company has an accumulated deficit, working capital deficit, suffered recurring losses and has negative operating cash flow. Additionally, the Company is under an investigation of the Israeli Ministry of Defense, which ordered a suspension of certain export licenses. Additionally, severe restrictions imposed by many countries on global travel as a result of the coronavirus disease of 2019 outbreak have impeded the Group's ability to complete the phase of the systems acceptances. These matters, along with other reasons, raise substantial doubt about the Company's ability to continue as a going concern. ACER THERAPEUTICS: Plans NDA Submission for ACER-001 in Q3 ---------------------------------------------------------- Acer Therapeutics Inc. announced the outcome of Acer's pre-New Drug Application (NDA) meeting with the U.S. Food and Drug Administration (FDA) for ACER-001 for the treatment of Urea Cycle Disorders (UCDs). ACER-001 is a proprietary immediate release multi-particulate powder formulation of sodium phenylbutyrate (NaPB) with a taste-masked coating. ACER-001 is being developed in collaboration with Relief. The purpose of the pre-NDA meeting was to discuss the content of Acer's planned NDA submission. Based on FDA feedback, the Companies believe the proposed data package will be sufficient to support an NDA submission under the Section 505(b)(2) regulatory pathway of ACER-001 for the treatment of patients with UCDs. Following NDA submission and FDA determination of acceptance for filing, the FDA will conduct a substantive review before deciding upon the action on the application. "We are pleased with the outcome of our recent pre-NDA meeting with FDA, supporting our belief that the studies and data we intend to include in our planned NDA for ACER-001 should be sufficient for NDA submission," said Chris Schelling, CEO and founder of Acer. "We remain on track to complete the NDA submission in Q3 2021, provided that we obtain agreement with the FDA on our initial pediatric study plan (iPSP)." Jack Weinstein, CFO and treasurer of Relief Therapeutics, added: "The outcome of the pre-NDA meeting with the FDA is highly encouraging and marks an important milestone in support of the development and potential commercialization of ACER-001 worldwide. We are pleased with the progress of the ACER-001 program and look forward to working with the Acer team to potentially bring to market an alternative to existing NaPB-based treatments." ACER-001 is an investigational product candidate which has not been approved by FDA. There can be no assurance that if submitted, an NDA will be accepted for filing and substantive review or, if filed, that an NDA would be approved. Acer Therapeutics Acer Therapeutics -- http://www.acertx.com-- is a pharmaceutical company focused on the acquisition, development and commercialization of therapies for serious rare and life-threatening diseases with significant unmet medical needs. Acer's pipeline includes four clinical-stage candidates: emetine hydrochloride for the treatment of patients with COVID-19; EDSIVO (celiprolol) for the treatment of vascular Ehlers-Danlos syndrome (vEDS) in patients with a confirmed type III collagen (COL3A1) mutation; ACER-001 (a taste-masked, immediate release formulation of sodium phenylbutyrate) for the treatment of various inborn errors of metabolism, including urea cycle disorders (UCDs) and Maple Syrup Urine Disease (MSUD); and osanetant for the treatment of induced Vasomotor Symptoms (iVMS) where Hormone Replacement Therapy (HRT) is likely contraindicated. Each of Acer's product candidates is believed to present a comparatively de-risked profile, having one or more of a favorable safety profile, clinical proof-of-concept data, mechanistic differentiation and/or accelerated paths for development through specific programs and procedures established by the FDA. Acer Therapeutics reported a net loss of $22.88 million for the year ended Dec. 31, 2020, compared to a net loss of $29.42 million for the year ended Dec. 31, 2019. As of March 31, 2021, the Company had $44.51 million in total assets, $34.10 million in total liabilities, and $10.41 million in total stockholders' equity. BDO USA, LLP, based in Boston, Massachusetts, issued a "going concern" qualification in its report dated March 1, 2021, citing that the Company has recurring losses and negative cash flows from operations that raise substantial doubt about the Company's ability to continue as a going concern. ADAM S. DASH: Agreed Order Solving $94K Sale Deposit Dispute Signed ------------------------------------------------------------------- Judge Laurel M. Isicoff of the U.S. Bankruptcy Court for the Southern District of Florida issued an amended agreed order resolving Adam S. Dash and Shellpoint Mortgage Servicing's dispute concerning the $94,133.69 deposited into the Court Registry pursuant to the Court's agreed order granting in part the Debtor's sale of the real property located at 630 79th Street, in Miami Beach, Florida, to Alberto B. Mendoza and Jon Condell for $970,000. The Debtor and Shellpoint have advised the Court that the parties have reached a settlement regarding the Deposit. The Clerk of Court is authorized and directed to transfer the sum of $72,500 from the Deposit in the Court Registry to the Debtor, Adam Dash, plus 50% of any interest earned on the Deposit no later than 10 days from the entry of the Order. The Clerk of Court is authorized and directed to transfer the sum of $21,633.99 from the Deposit in the Court Registry to NewRez LLC d/b/a Shellpoint Mortgage Servicing, 75 Beattie Place, Suite 300, Greenville, SC 29601 plus 50% of any interest earned on the Deposit no later than 10 days after the entry of the Order. The May 11, 2021 evidentiary hearing was cancelled. Attorney Nicholas B. Bangos is directed to serve a copy of the Order on all interested parties and to file a Certificate of Service reflecting same. Adam S. Dash sought Chapter 11 protection (Bankr. S.D. Fla. Case No. 14-13785-LMI) on Feb. 18, 2014. The Court confirmed the Debtor's Second Amended Plan of Reorganization on Aug. 5, 2015. AEROCENTURY CORP: 10 Aircraft Sale Okayed, Erasing $83 Million Debt ------------------------------------------------------------------- Alex Wolf of Bloomberg Law reports that bankrupt aircraft lessor AeroCentury Corp. won court approval to sell off 10 aircraft to secured lender Drake Asset Management Jersey Ltd. in exchange for forgiveness of $83 million in debt. Judge John T. Dorsey of the U.S. Bankruptcy Court for the District of Delaware approved the deal Friday after AeroCentury all but sealed Drake's credit bid purchase by canceling a proposed auction of its most valuable package of assets. "We're satisfied that the stalking horse bid is in fact the highest and best out there," AeroCentury's attorney, Joseph Barry of Young Conaway Stargatt & Taylor LLP, said during a virtual hearing. 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. ALL AROUND TRUCK & TRAILER: Files for Chapter 7 Bankruptcy ---------------------------------------------------------- Marty Finley of Louisville Business First reports that Louisville-area trucking company, All Around Truck & Trailer LLC, has filed for Chapter 7 bankruptcy protection. All Around Truck & Trailer LLC of Shepherdsville, Kentucky recently filed a voluntary bankruptcy petition in the U.S. Bankruptcy Court, Western District of Kentucky, Louisville Division. In the bankruptcy filing, All Around Truck & Trailer lists between one and 49 creditors and no estimated assets. Its estimated liabilities, meanwhile, total more than $150,000, the bankruptcy filing shows. The company's operations are listed on West Hebron Lane in Shepherdsville. Michael Garrett is the president and primary employee of the company, the filings state. "It is [believed] in March 2021 Mr. Garrett paid himself wages in the amount of $7,500. This was the only wages he [received] in the prior 6 months," the petition states. The petition also states a landlord for the business was paid $27,905 in March for rent. And the company listed two Bullitt Circuit Court lawsuits with TCF Financial and Alexandr Afanasenco related to a repossessed truck wrecker as well as repair work the company did, respectively. Among the company's creditors is a $33,000 claim from Afanasenco; a $93,034 claim from Brotherhood Mutual of Fort Wayne, Indiana; a $28,000 claim from Nuula of Coral Springs, Florida; and $3,600 on a US Bank credit card. Louisville Business First has reached out to Garrett and his attorney, Nick Thompson, for more details on the case and this story may be updated. A Web site for the company linked on its Facebook account is no longer active. About All Around Truck & Trailer All Around Truck & Trailer LLC is a company that provides truck and trailer repairs, emergency roadside assistance and semi towing among its services. All Around Truck & Trailer LLC sought Chapter 7 protection (Bankr. W.D. Ky. Case No. 31151) on May 24, 2021. In the petition signed by CEO Michael H. Garrett, All Around Truck estimated liabilities of more than $150,000 and no estimated assets. The cases are handled by Honorable Judge Charles R. Merrill. Nick Thompson is the Debtor's counsel. ALLEN MEDIA: S&P Affirms 'B' Issuer Credit Rating, Outlook Stable ----------------------------------------------------------------- S&P Global Ratings affirmed its 'B' issuer credit rating on Allen Media LLC (AMG). AMG's acquisition of seven TV stations from Quincy Media will increase its broadcast EBITDA contribution to over 50% of total pro forma EBITDA. S&P views broadcasters' prospects more favorably than those of cable networks given their stronger position in the TV ecosystem, in turn leading to a revision of its assessment of AMG's business risk profile upward. AMG's growing broadcast segment will strengthen its market position and future negotiating leverage while mitigating inherent volatility in its cable networks segment. The company's growing broadcast segment (expected to contribute over 50% of 2021 EBITDA pro forma for the seven Quincy TV stations) improves its inherent revenue volatility from the secularly pressured cable networks segment. S&P typically views broadcast networks more favorably given their stronger position within the TV ecosystem. Local TV broadcasters benefit from rights to live national and local sports programming (including the Super Bowl/National Football League games on CBS, NBC, and Fox affiliates), and their focus on local programming including news. These characteristics make them must-haves in almost all pay-TV packages, which benefits subscriber trends compared to cable networks. S&P expects the broadcast industry to also benefit from increased retransmission fees for at least two more renewal cycles (over the next two to five years) before secular pressures start to adversely affect that growth trajectory. Post the Quincy acquisition, Allen Media's television stations will reach approximately 4.5% of U.S. households--albeit in smaller markets. This compares to more than 20% for some of the company's larger peers such as E.W. Scripps and Gray TV. Higher-rated stations generally benefit from higher advertising revenue, especially during an election year when political ad spending increases dramatically. S&P said, "We expect secular pressures will continue to affect AMG's cable networks, partially offset by better distribution within its Entertainment Studios (ES) portfolio of cable networks. The company successfully settled its lawsuits with Comcast and Charter that resulted in increased carriage for the company's Entertainment Studios (ES) portfolio of cable networks. The negotiated deal will increase affiliate fees and lead to improved advertising opportunities on these networks. Given the low programming expenses, we expect these additional revenue streams to be accretive to AMG's cable network EBITDA margins." However, cable networks still face secular pressure and AMG's most widely distributed cable network, The Weather Channel (TWC), faces pressures in-line with the broader industry. Furthermore, TWC's digital presence is limited as it does not have broad carriage with various virtual multichannel video programming distributors (vMVPDs), limiting its ability to benefit from growth in virtual MVPDs. S&P expects TWC to experience subscriber declines and increased audience fragmentation in line with the broader linear television market partially mitigated by growth at the ES networks over the next 12 to 24 months. S&P said, "In our view, AMG will continue to be highly acquisitive keeping adjusted leverage above 6.0x on a sustained basis. We expect AMG to continue to pursue debt-financed acquisitions--primarily broadcast TV stations--as it works to grow its footprint within the broadcast industry. A steady stream of acquisitions will also keep restructuring and transaction expenses elevated, which we have factored into our adjusted leverage calculations. While broadcast acquisitions will continue to improve the company's market position and negotiating leverage, if the company continues pursuing significant debt-financed acquisitions at elevated multiples, adjusted leverage could cross beyond S&P's 6.5x threshold on a sustained basis. This could indicate an elevated credit risk, despite the benefits of a larger broadcast footprint in the longer term. S&P said, "We continue to view AMG's lack of an independent board as a risk factor, but the company has demonstrated a track record over the past three years on executing its strategic objectives. We have historically viewed AMG's lack of an independent board and key person risk as a major governance issue. Over the past three years, the company has established a track record of successfully executing on its strategic objectives, which include growing its broadcast footprint while increasing distribution of its Entertainment Studios portfolio of cable networks and maintaining TWC's distribution. The company has also increased the number of executives in key positions within the company. We view these actions to have somewhat mitigated the key risks we had previously identified sufficiently enough to revise our management and governance score to fair from weak." Environmental, social, and governance (ESG) credit factors for this credit rating change: -- Management and governance S&P said, "The stable outlook reflects our view that AMG's adjusted leverage will remain below 6.5x over the next 12 months. We expect EBITDA growth in 2021 resulting from a recovery in advertising spending across both cable and broadcast network in line with the economic recovery, and from a full year benefit of new distribution agreements for AMG's Entertainment Studios cable networks." S&P could lower its rating if it believes adjusted leverage will remain above 6.5x on a sustained basis. This could occur if: -- Secular declines within cable networks accelerate faster than S&P's current forecast; -- Local advertising recovery is further delayed; or -- AMG pursues material debt-financed acquisitions and/or distributions that will keep leverage elevated above our threshold on a sustained basis. S&P said, "We view an upgrade as unlikely over the next 12 months. We could raise our rating on the company if we expect AMG to maintain a less aggressive financial policy, including keeping adjusted leverage below 5.0x on a sustained basis even when taking into account acquisitions and/or distributions." ALLY FINANCIAL: Moody's Reviews Ba1 Issuer Rating for Upgrade ------------------------------------------------------------- Moody's Investors Service has placed on review for upgrade the Ba1 long-term senior unsecured rating of Ally Financial Inc. All other ratings of Ally Financial and GMAC Capital Trust I were also placed on review for upgrade. The review for upgrade was prompted by Ally's operating and financial resilience through the coronavirus pandemic, and will focus on the strength of Ally's capital, profitability and funding profile. On Review for Upgrade: Issuer: Ally Financial Inc. - Commercial Paper (both domestic and foreign currency), Placed on Review for Upgrade, currently NP - Issuer Rating, Placed on Review for Upgrade, currently Ba1, Rating Under Review From Stable - Senior Unsecured Medium-Term Note Program (both domestic and foreign currency), Placed on Review for Upgrade, currently (P)Ba1 - Other Short-Term Note Program (both domestic and foreign currency), Placed on Review for Upgrade, currently (P)NP - - Senior Unsecured Regular Bond/Debenture, Placed on Review for Upgrade, currently Ba1, Rating Under Review From Stable Issuer: GMAC Capital Trust I Backed Preferred Stock, Placed on Review for Upgrade, currently Ba3 (hyb) Outlook Actions: Issuer: Ally Financial Inc. Outlook, Changed To Rating Under Review From Stable Issuer: GMAC Capital Trust I Outlook, Changed To Rating Under Review From No Outlook RATINGS RATIONALE / FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS During the review for upgrade, Moody's will reassess Ally's capital and profitability strength, as well as asset quality resilience relative to peers, as coronavirus-pandemic challenges continue to abate. The review will also focus on the benefits to creditors from Ally's growing bank franchise and the stability of the bank's significantly improved funding profile. Despite the economic challenges and uncertainties of the pandemic, Ally's capital, liquidity and funding structure have continued to improve for the last several quarters. Profitability deteriorated in 2020 at the onset of the pandemic, as the bank was required to increase its loan loss reserves significantly, following the adoption of the Current Expected Credit Losses (CECL) accounting standard and concurrent deterioration of economic conditions. However, profitability strengthened to pre-pandemic levels with net income to tangible assets above 1% for the last three quarters. Similar to other consumer lenders, even with elevated unemployment, Ally's asset quality has remained strong. At 0.53% for Q1 2021 retail auto charge-offs were at their lowest level since 2012. The April US unemployment rate of 6.1% remains well above the 3.5% rate before the onset of the pandemic and would typically cause delinquencies to increase sharply. The decline in delinquencies contrary to this usual relationship is largely explained by the massive amount of fiscal stimulus, which has raised personal income as well as savings even as unemployment spiked. In addition, consumer asset quality has been aided by accommodative monetary policy, payment and eviction moratoriums, and now a strengthening job market. Moody's expects delinquencies for auto loans, which accounted for 82% of Ally's total loans as of March 31, 2021, to be largely flat for much of 2021, before rising late in the year and peaking as much as 25% to 50% above 2019 levels of around 0.75% in 2022. Additionally, Moody's believes the bank's total loss absorbing capacity and therefore resilience to expected losses has increased in large part due to the higher levels of required reserves with the adoption of CECL. Ally has continued to increase its deposit base consistently over the last several years and has transitioned to a primarily bank-funded model. As of March 31, 2021, deposits were 87% of total funding, a significant increase from 75% of year-end 2019 and 66% of year-end 2018. As a result, Ally's ratio of market funds as a percentage of tangible banking assets decreased to 13% at year-end 2020 from 22% at year-end 2019. During the review, Moody's will assess whether these metrics are likely to be sustained. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS The ratings could be upgraded upon conclusion of the review, if Moody's were to assess that the company was able to maintain its current level of profitability, improved funding and liquidity profiles, and to absorb post-pandemic losses while demonstrating stress capital resilience. The ratings could be confirmed at the current level if Moody's believes that Ally will not maintain its liquidity position and increase reliance on market funding or if improved profitability and current capital levels are unsustainable. Given the review for upgrade, a downgrade of Ally's ratings is unlikely. However, the ratings could be downgraded if capitalization weakens materially, such as tangible common equity to risk weighted assets falling below and expected to remain below 7.5%. The ratings could be downgraded if asset performance results to be weaker than Moody's expectations, or if liquid resources decline materially, making the firm vulnerable to market shocks. The principal methodology used in these ratings was Banks Methodology published in March 2021. ALTHAUS FAMILY: Kalabat Buying Temperance Property for $5.5-Mil. ---------------------------------------------------------------- Althaus Family Investors, LTD, asks the U.S. Bankruptcy Court for the Northern District of Ohio to authorize the sale of its real property located at 100 Reed Drive, Temperance, Michigan, consisting of the following parcels as designated by Monroe County Michigan: 0290005015; 0203604620; and 0203604621, to Kalabat Development Group, Inc., for $5.5 million, subject to overbid. The Real Property holds a 120,300 sq. ft. manufacturing facility. An Appraisal conducted of the Real Property estimated its value to be $4.83 million as of April 18, 2019. In the Unique Tool & Manufacturing Co., Inc. bankruptcy case, a related entity, the Court entered an Order, on April 2, 2020, appointing a Chapter 11 Trustee. Ricardo I. Kilpatrick was named as the Chapter 11 Trustee. In the Unique Bankruptcy Case, the Trustee filed a motion to sell certain equipment owned by Unique. On Sept. 2, 2020, the Court entered an Agreed Order approving the sale of the Equipment. The Debtor has two primary creditors in the case: (1) Waterford Bank, N.A.; and (2) the Monroe County Treasurer. The Waterford indebtedness is based upon two notes executed by the Debtor. First, in March of 2013, Waterford made a loan to the Debtor in the principal amount of $1.3 million to refinance a prior loan made to the Debtor with respect to the Real Property. Second, in November of 2013, Waterford made a loan to the Debtor in the principal amount of $2,932.937. The proceeds of this loan were used to expand the Facility. Both these loans are secured by mortgages against the Real Property. Based upon these loans, Waterford filed a proof of claim in the case on Nov. 22, 2019, in the amount of $3,773,512.43. This Claim is asserted as fully secured. Both of the loans made by Waterford are also secured by an assignment of leases and rents. Waterford also filed a proof of claim in the case in the amount of $1,681,801.37 (Cl. No. 5-1). This claim is based upon the Debtor's guarantee of a loan made to Unique. This claim is asserted as fully secured against the Real Property. The indebtedness to Monroe County is for unpaid real estate taxes. Based upon proofs of claim filed in te case, the sum of $65,889.30 is owed to Monroe County for unpaid, prepetition real estate taxes (Cl. Nos. 1 & 2). The Debtor also owes post-petition real estate taxes to Monroe County in the unliquidated amount of $50,171.61. On Feb. 24, 2020, the Debtor filed an application to Employ Rob Keleghan, Senior Broker of Signature Associates as Realtor for the purpose of marketing the Real Property for Sale. On March 13, 2020, the Court entered an order, approving this Application. As a part of this Application, the Debtor and the Broker entered into an Exclusive Listing Agreement for the sale of the Real Property. Under this Listing Agreement, the Broker is entitled to a 5% commission on the aggregate sale price of the Real Property. The Broker is willing to accept a 4% commission on any offer that would be approved by the Court. After the approval of the Application, the Broker undertook efforts to market the Real Property. These efforts yielded a number of inquiries and offers and resulted in an offer to purchase the Real Property as well as some personal property associated with the Real Property from Green Bear Holdings, LLC in the amount of $6.2 million. As a result, the Debtor caused to be filed a Motion to Sell Property Free and Clear of Liens which was approved on Oct. 14, 2020. Thereafter, the Debtor undertook due diligence efforts to seek to meet the terms of the offer, until it became clear that, due to contingencies contained in the offer concerning the occupancy permits for the Real Property, the sale to Green Bear could not be consummated, with the Debtor and Green Bear thereafter executing a termination agreement and the Debtor commencing negotiations with other interested parties. The Debtor and the Broker thereafter continued to market the Real Property. This marketing effort resulted in an offer for the Real Property from Scott and Corey Liber in the sum of $5.5 million. A purchase agreement was entered into between said purchase and the Debtor on March 8, 2021, for the sale. However, again for reasons concerning occupancy permits with respect to the Real Property, the offer from Scott and Corey Liber was withdrawn. Said offer was withdrawn on May 18, 2021. On May 21, 2021, the Debtor received a further offer to purchase the Real Property. Said agreement was made by the Kalabat Development Group, Inc. Under the Purchase Offer, Kalabat has offered to purchase the Real Property for the Sum of $5.5 million. The Debtor intends to continue efforts to gain modification of this Purchase Offer. Pursuant to the Motion, the Debtor seeks authority to sell the Real Property free and clear. The proposed procedures for the sale of the Real Property will be as follows: (a) Unless an extension is approved by the Court, the sale of the Real Property will occur no later than July 2, 2021. (b) Prior to the Sale Date, the Broker will continue to list and market the Real Property pursuant to the Listing Agreement. (c) The Broker will notify any potential purchaser of the Real Property, including Kalabat, that the sale of the Real Property must occur by no later than the Sale Date. (d) That the Broker is authorized to enter into any Sale Agreement for the Sale of the Real Property provided it is, in the Broker and Debtor’s business judgment, a better offer than the current Purchase Offer made by Kalabat. (e) If no offer is received which is better than the Purchase Offer made by Kalabat, the Debtor and Broker will be authorized to accept the Purchaser Offer made by Kalabat. Any Sale Agreement entered into by the Debtor and Broker will provide that sale of the Real Property must occur by the Sale Date. The Debtor asks the Court that as part of any sale of the Real Property, the Debtor and the Broker are authorized to sell any or all of the Equipment which the Court authorized the Trustee to sell in the related case of Unique including the cranes and compressors that are affixed to the Real Property. If a sale is conducted that includes the cranes and compressors, the Debtor would propose to pay $37,000 from the proceeds of the Sale of the Real Property to the Trustee of Unique as and for the value of the cranes and compressors. The successful purchaser of the Real Property will take the Real Property "as is" with no warranties being made by the Debtor and the successful purchaser will have no recourse against the Debtor concerning the sale except as otherwise set forth in the Court's Order Approving the Sale. The Debtor requests the Court enters an order, pursuant to section 363(b), (f) and (m) and Bankruptcy Rule 6004, as follows: a. Authorizing the Broker to conduct a sale of the Real Property and Equipment pursuant to the Sales Procedures; b. Authorizing the Broker, without further order of the Court, to be paid the agreed fees and commissions of 4% as opposed to the 5% set forth in the Listing Agreement. c. Authorizing the payment of any other reasonable and necessary costs and fees to complete the sale of the Real Property. d. Authorizing the Debtor, its representatives and/or the Broker, to execute any documentation necessary to effectuate the sale of the Real Property and Equipment pursuant to the Sale Procedures; e. Authorizing that the Sale of the Real Property and Equipment by the Broker to the successful Purchaser be free and clear pursuant to 11 U.S.C. Section 363(f), including the interests claimed by Waterford and Monroe County in the Real Property and Equipment, with the interests of any party in the Real Property and Equipment attaching to the net sale proceeds in the same order, priority and validity that presently exists; f. Authorizing the payment of $37,000 to the Trustee of Unique as and for the value of the cranes and compressors of Unique; g. Authorizing and directing the Broker or any other entity designated by the Court to retain the net sale proceeds from the sale of the Real Property and Equipment pending further order of the Court; h. Authorizing that the sale of the Real Property and Equipment be made by a private sale pursuant to Bankruptcy Rule 6004(f)(1); i. Providing that the stay of Bankruptcy Rule 6004(h) be held inapplicable and waived; j. Finding that the successful Purchaser is a good a good faith purchaser under Section 363(m) and, as such, is entitled to all the protections afforded thereby; k. That the successful purchaser of the Real Property will take the Real Property "as is" with no warranties being made by the Debtor and the successful purchaser will have no recourse against the Debtor concerning the sale except as otherwise provided in the Court's Order of Sale; l. That the Court retains jurisdiction to enforce and interpret the order; and m. That the Court's Order provides that the Trustee in the Unique bankruptcy case will be kept apprised of the sale of the Equipment and will be authorized to have any communications with the Broker and/or Debtor he deems necessary to protect in the bankruptcy case of Unique the estate's interest in the Equipment, and that that the Court's Order provides that nothing will preclude the Trustee from asserting his interest in any proceeds received on account of the sale of the Equipment. A copy of the Listing Agreement is available at https://tinyurl.com/4fyjurwr PacerMonitor.com free of charge. About Althaus Family Investors Althaus Family Investors Ltd., filed a Chapter 11 bankruptcy petition (Bankr. N.D. Ohio Case No. 19-32357) on July 26, 2019, estimating under $1 million in both assets and liabilities. The Debtor is represented by Steven L. Diller, Esq., at Diller and Rice, LLC. On March 13, 2020, the Court appointed Rob Keleghan, Senior Broker of Signature Associates, as Realtor. ALTO TOWNHOMES: Unsecureds to Recoup 10% of Allowed Claims ---------------------------------------------------------- The Alto Townhomes on Hall, LLC filed with the Bankruptcy Court on May 25, 2021 a Second Amended Disclosure Statement explaining its First Amended Plan of Reorganization. Pursuant to the Plan, the Debtor will obtain $8,000,000 in new first mortgage financing from CoreVest American Finance Lender, LLC and $2,500,000 of new equity investment from a new acquiring entity owned by American Ventures, LLC and Four Arrow Funding, Inc. American Ventures, LLC will receive 80% ownership of the new entity acquiring the new equity interests in the Debtor. The new capital contribution will be used to (i) fund the payments under the Plan and (ii) complete the final construction of the 20 townhomes on the Debtor's property in Dallas, Texas, and (iii) fund the Debtor's operations as it resumes construction of the unfinished townhomes. The townhomes are 85% completed and will be rented out for profit when finished. The Debtor projects that the townhomes will be completed by October 31, 2021 if the Effective Date is on or before July 31, 2021. Claims will be treated under the Plan as follows: * Class 1: Allowed Secured Claims of Dallas County Tax Assessor Class 1 Claims will be paid in full on the Effective Date, with interest accruing from the Petition Date at the rate of 12% per annum. This Class is not impaired. * Class 2: Allowed Secured Claim of Cambia Capital Partners, LLC The Class 2 Allowed Secured Claim of Cambia Capital Partners, LLC shall be paid in full $7,202,000 plus 6% interest per annum. The original balance was $7,914,000, which includes a $712,000 remaining construction reserve unfunded to the Debtor. Cambia Capital asserts, however, that its Claim is not less than $7,800,000 and that all actions taken in connection with the first lien financing were legal and permissible under the applicable loan agreements. Class 2 Claim is impaired. * Class 3: Allowed Secured Claim of Cambia Investments, LLC The Class 3 Claims shall be paid the amount the Court determines is owed to Cambia Investments after considering the usury claims asserted against Cambia Investments in the pending Adversary Proceeding before the Bankruptcy Court. Cambia Investments has disputed the allegations made in this lawsuit and asserts that its second lien financing is legal and permissible under applicable state law. If the Court determines that the Claim should not be invalidated per Texas usury laws, the Debtor will pay $1,375,150 on the Class 3 Claims, plus interest at 6% per annum from the Petition Date until paid in full. Cambia Investments asserts that its claim is substantially more than $1,375,150. Payment shall be made on the Effective Date and Cambia Investments, LLC shall retain its lien until its Claim is paid in full. Class 3 Claim is impaired. * Class 4: Allowed Secured Claims of U.S. Small Business Association. Class 4 Claims shall be treated as an unsecured creditor in Class 5 under the Plan. This Claim is impaired. * Class 5 shall consist of Allowed Unsecured Claims, other than the Claims of Class 7 Insiders. Class 5 Claims shall be paid 10% of the face amount of their Allowed Claims. These Claims once allowed shall be paid on the Effective Date. * Class 6: Allowed Preferred Equity Interests Class 6 Interests shall be paid nothing and shall be cancelled. Class 6 includes Four Arrow Funding, Inc. as well as any claim that Cambia Investments, LLC may claim as a preferred equity holder of the Debtor. Four Arrow Funding, Inc. will be a part of an acquiring entity of the new equity interests in the Debtor pursuant to the Plan. These Interests are impaired. A copy of the Disclosure Statement is available for free at https://bit.ly/3uwHKjT from PacerMonitor.com. About Alto Townhomes on Hall The Alto Townhomes on Hall, LLC is a single asset real estate debtor (as defined in 11 U.S.C. Section 101(51B)). The Alto Townhomes on Hall sought protection under Chapter 11 of the Bankruptcy Code (Bankr. N.D. Texas Case No. 21-30379) on March 2, 2021. Lawrence Selevan, 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 between $10 million and $50 million. Judge Harlin Dewayne Hale oversees the case. The Debtor is represented by Joyce W. Lindauer Attorney, PLLC. AMERICAN BUYITNOW: Wealth Street Buying Orange Property for $52K ---------------------------------------------------------------- American Buyitnow Investments, LLC, asks the U.S. Bankruptcy Court for the Eastern District of Texas to authorize the sale of the real estate located at 3710 Pheasant, in Orange, Texas, to Wealth Street Capital LLC for $52,000. Objections, if any, must be filed 21 days from the date of service of notice. The Debtor operates a business to purchase and possess real estate holdings, with the purpose of rehabilitating, renting and selling properties for a profit. Among the list of assets scheduled in the case is the Property. Joyce Morris Trust has a valid 1st lien on the property in the amount $340,060. Home Tax Solutions has a valid statutory lien on the property for taxes, with a payoff of approximately $6,184.68, plus a per diem rate from May 20, 2021. Orange County is also owed approximately $1,259.70 for 2020 taxes. The ad valorem taxes for tax year 2021 pertaining to the property will become the responsibility of the purchaser and the 2021 ad valorem tax liens will be retained against the property until said taxes, including any penalties and interest that may accrue, and paid in full. A sale of the property has been negotiated by the Debtor to Wealth for $52,000 in accordance with the terms of their One to Four Family Residential Contract. The sale is in the best interest of the estate. Prior to the Bankruptcy filing, the Debtor estimated the value of the property at $41,220. The statutory lien of Home Tax Solutions will be paid in full at closing, Orange County will be paid for the 2020 taxes, and the remaining net proceeds will be turned over to the Joyce Morris Trust. In return, Joyce Morris Trust agrees to release the lien against the property at 4 Childers, Orange, Texas, while maintaining its lien against the remaining property, per its security documents. The Debtor prays for an order (i) allowing the sale of the property free and clear of all liens; (ii) allowing it to pay all closing costs; (iii) that upon closing, the Debtor be allowed to pay off Home Tax Solutions in the approximate sum of $6,184.68, plus a per diem rate from and after April 28, 2021; (iv) that upon closing, the Debtor be allowed to pay Orange County in the approximate sum of $1,259.70; (v) that the remaining net proceeds will be paid to Joyce Morris Trust, who will then release the lien against the property; and (vi) for such other and further relief as is just. A copy of the Contract is available at https://tinyurl.com/4mrn3737 from PacerMonitor.com free of charge. About American Buyitnow Investments American BuyItNow Investments, LLC, filed a Chapter 11 bankruptcy petition (Bankr. E.D. Tex. Case No. 20-10486) on Dec. 1, 2020, disclosing under $1 million in both assets and liabilities. The Debtor is represented by MAIDA CLARK LAW FIRM, P.C. ANDES INDUSTRIES: Commission Buying PCT's Extruder Line for $40K ---------------------------------------------------------------- PCT International, Inc., and together with Andes Industries, Inc., ask the U.S. Bankruptcy Court for the District of Arizona to authorize the sale of a surplus Davis Standard 3.5" Extruder Line to Commission Brokers Inc. for $40,000. PCT was previously a party to a certain real property lease with Western B West AZ, LLC, for the premises located at 2260 West Broadway Road, Building 9, in Mesa, Arizona. PCT has since vacated the Premises and, during these bankruptcy proceedings, has sold assets that were located at the Premises that are no longer necessary for the Debtors' operations. PCT has recently received an offer for the Property from the Purchaser for the price of $40,000. The offer from the Purchaser was the only offer that the Debtors have received for the Property. The Property is a specialized piece of equipment. The Debtors received a list of potential buyers from the engineer of the Property that deals with the product. They contacted all potential buyers on this list and received only one offer for the Property. Upon information and belief, there are no liens, claims, encumbrances, or interests against the Property other than the blanket lien of the Debtors' primary lender, Sallyport Commercial Finance, LLC. Sallyport consents to the sale, subject to its right to assert a security interest against proceeds of the sale, if the property sold is within the scope of Sallyport's collateral. Based on the foregoing and the entire record before the Court in these proceedings, the Debtors respectfully request that the Court enters an order: A. Approving PCT's sale of the Property to Purchasers for $40,000; B. Approving Purchasers as good faith purchasers, as contemplated by Bankruptcy Code Section 363(m); C. Approving the sale of the Property to take place consistent with the terms and condition of the Motion, and free and clear of all liens, claim, encumbrances, and interests; D. Waiving the 14-day stay imposed by Bankruptcy Rule 6004(h) so that the sale of the Property may occur any time after entry of the Order approving the Motion; and E. Granting such other and further relief as the Court deems just and proper. About Andes Industries and PCT International Creditors EZconn Corporation, Crestwood Capital Corporation, and Devon Investment Inc. filed involuntary bankruptcy petitions against Andes Industries, Inc. and PCT International, Inc. under Chapter 7 of the Bankruptcy Code in the U.S. Bankruptcy Court for the District of Arizona. On Dec. 4, 2019, the Chapter 7 cases were converted to cases under Chapter 11 (Bankr. D. Ariz. Lead Case No. 19-14585). Judge Paul Sala oversees the cases. Sacks Tierney P.A. is the Debtors' legal counsel. ANDRA'S REDEMPTION: Seeks to Hire Joshua's Realty as Broker ----------------------------------------------------------- Andra's Redemption, Inc. seeks approval from the U.S. Bankruptcy Court for the Eastern District of New York to hire Joshua's Realty as its real estate broker. The Debtor needs the services of a real estate broker to sell its property located at 94-91 104th St., Ozone Park, N.Y. Joshua's Realty will receive a 6 percent commission on the sales price. Joshua Harris, a realtor at Joshua's Realty, disclosed in a court filing that his firm is a disinterested person as defined under 11 Section 101(14) of the Bankruptcy Code. The firm can be reached through: Joshua Harris, GRI,CBR Joshua's Realty 124 06 Rockaway Blvd,2 fl South Ozone Park, NY 11420 Phone: 718-845-4000 Fax: 718-845-9585 Email: joshuasrealty@gmail.com About Andra's Redemption Andra's Redemption, Inc., owner of a mixed-use building in Ozone Park, N.Y., filed a Chapter 11 petition (Bankr. E.D.N.Y. Case No. 17-40825) on Feb. 24, 2017. Andra Indarmattie, president, signed the petition. The Debtor reported $1.02 million in total assets and $493,000 liabilities as of the bankruptcy filing. Judge Nancy Hershey Lord oversees the case. Bruce Weiner, Esq., at Rosenberg, Musso & Weiner, serves as the Debtor's bankruptcy counsel. ANTERO MIDSTREAM: Moody's Rates New $650MM Unsecured Notes 'B1' --------------------------------------------------------------- Moody's Investors Service assigned a B1 rating to Antero Midstream Partners LP's (Antero Midstream or AM) proposed $650 million senior unsecured notes due 2029. AM's other ratings, including its Ba3 Corporate Family Rating, and stable outlook were unchanged. Net proceeds will be used to redeem the company's $650 million 5.375% notes due September 2024, which were called by the company concurrently with the proposed note offering. "This is a leverage neutral transaction that will improve Antero Midstream's maturity profile, but on the whole, will not have any effect on ratings," said Sajjad Alam, Moody's Vice President and Senior Analyst. Assignments: Issuer: Antero Midstream Partners LP Gtd Senior Unsecured Regular Bond/Debenture, Assigned B1 (LGD5) RATINGS RATIONALE The proposed unsecured notes are rated B1, one notch below AM's Ba3 CFR. The notching reflects the relatively large secured revolving credit facility in AM's capital structure that has an all-asset pledge and a priority-claim to all of AM's assets. The new notes will rank equally in right of payment with all of AM's existing senior unsecured notes and have similar upstream guarantee from AM's existing and future domestic subsidiaries. Antero Midstream's Ba3 CFR reflects its heavy reliance on a single counterparty, Antero Resources Corporation (Antero or Antero Resources, Ba3 stable); concentrated geographic focus in northern Appalachia; significant dividend payments, and indirect exposure to volatile natural gas and natural gas liquids (NGLs) prices. The weakness in Antero's credit profile negatively impacted Antero Midstream in 2019-2020. However, recent improvements in Antero's operating and financial performance have lowered AM's counterparty credit risk. Given Antero's significant ownership of AM and Antero's influence over AM's strategic decisions, Antero's credit profile will continue to have a direct and outsized impact on AM's ratings for the foreseeable future. AM's credit profile is supported by its substantial scale, moderate financial leverage, improved distribution coverage and predominantly fee-based revenue stream from Antero under long term contracts. AM will have more cash flow to reinvest and reduce debt following its decision to reduce dividends by 27 percent in April 2021. Antero Midstream's stable rating outlook is consistent with the rating outlook of Antero Resources Corporation. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATING An upgrade of AM's ratings would depend on Antero Resources Corporation ratings being upgraded. Moody's would also expect debt/EBITDA to remain near 3x and distribution coverage to be sustained above 1.1x. The CFR could be downgraded if Antero Resources' CFR is downgraded, or if AM's leverage metric rises above 4x. The principal methodology used in this rating was Midstream Energy published in December 2018. Antero Midstream Partners LP is a wholly owned subsidiary of Antero Midstream Corporation, a midstream energy company based in Denver, Colorado. Antero Midstream Corporation owns and operates an integrated system of natural gas gathering pipelines, compression stations, processing and fractionation plants, and water handling and treatment assets in northwest West Virginia and southern Ohio. ANTERO MIDSTREAM: S&P Rates $650MM Senior Unsecured Notes 'BB-' --------------------------------------------------------------- S&P Global Ratings assigned its 'BB-' issue-level rating and '3' recovery rating to Antero Midstream Partners L.P.'s $650 million senior unsecured notes due in 2029. The '3' recovery rating indicates its expectation of meaningful (50%-70%; rounded estimate: 50%) recovery in the event of a default. The partnership will use proceeds from this issuance to repay its $650 million of outstanding notes due 2024. The issuer credit rating on Antero Midstream is 'BB-' with a stable outlook. APP CAR: Seeks Approval to Tap Joyce W. Lindauer as Legal Counsel ----------------------------------------------------------------- APP Car Wash LLC seeks approval from the U.S. Bankruptcy Court for the Northern District of Illinois to employ Joyce W. Lindauer Attorney, PLLC as its legal counsel. The Debtor needs the firm's legal assistance to effectuate a reorganization, propose a plan of reorganization and effectively move forward in its Chapter 11 proceeding. The hourly rates of the firm's attorneys and staff are as follows: Joyce W. Lindauer $450 Dian Gwinnup $125 Paralegals and Legal Assistants $65 - $125 In addition, the firm will seek reimbursement for out-of-pocket expenses incurred. The firm has not received a retainer in connection with the proceeding. Joyce Lindauer, Esq., the owner of the firm, disclosed in court filings that the firm is a "disinterested person" as defined in Section 101(14) of the Bankruptcy Code. The firm can be reached through: Joyce W. Lindauer, Esq. Joyce W. Lindauer Attorney, PLLC 1412 Main Street, Suite 500 Dallas, TX 75202 Telephone: (972) 503-4033 Facsimile: (972) 503-4034 Email: joyce@joycelindauer.com About APP Car Wash Chicago, Ill.-based APP Car Wash, LLC filed a voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. N.D. Ill. Case No. 21-06550) on May 20, 2021. Paras Sharma, executive officer, signed the petition. At the time of the filing, the Debtor had estimated assets of between $500,000 and $1 million and estimated liabilities of between $1 million and $10 million. Judge Lashonda A. Hunt oversees the case. Joyce W. Lindauer Attorney, PLLC serves as the Debtor's legal counsel. ARIZONA INDUSTRIAL: S&P Places 'B-(sf)' Bonds Rating on Watch Neg. ------------------------------------------------------------------ S&P Global Ratings has extended the CreditWatch, with negative implications, on its 'B+(sf)', 'B(sf)', and 'B-(sf)' long-term ratings on Arizona Industrial Development Authority's series 2019A, 2019B, and 2019C senior living revenue bonds (Great Lakes Senior Living Communities LLC Project), respectively. S&P is extending its CreditWatch an additional 90 days following notification that the fiscal 2020 audited financials will soon be available. The initial CreditWatch action followed rapid and material deterioration in the project's financial and operating performance as indicated by the fiscal 2020 fourth quarter financial reporting package, posted to EMMA (Electronic Municipal Market Access) on Feb. 16, 2021. The report included unaudited financial and operating information as of fiscal year ended Dec. 31, 2020, and showed revenues coming in substantially below budget for the year primarily due to severe occupancy strains at several of the eight properties in the portfolio, with markedly higher expenses. This resulted in the project's fiscal 2020 debt service coverage ratios (DSC), based on maximum annual debt service (MADS), dropping to an estimated 1.32x, 0.94, and 0.83x for series A, series B and series C, respectively, from 1.64x, 1.17x, and 1.03x in audited fiscal 2019. The abrupt drop in DSC ratios and declining occupancy trends are the key factors in the CreditWatch placement. While the information is unaudited, it has been certified by the ownership entity and indicates material decline. A second disclosure document posted to EMMA on Feb. 19, 2020 stated the borrower's anticipation of requiring additional funds for essential capital improvements and to fund working capital needs. S&P said, "Difficulty in obtaining the requested information within 90 days could result in our suspension of the affected ratings, preceded, in accordance with our policies, by any change to the ratings that we consider appropriate given available information. However, if we receive information that we consider sufficient and of satisfactory quality within this 90-day period, we will conduct a review and take appropriate rating action." ARLINGTON DOUBLE DOWN: Seeks Cash Collateral Access --------------------------------------------------- Arlington Double Down Enterprises, LLC asks the U.S. Bankruptcy Court for the Eastern District of Texas, Sherman Division, for authority to use cash collateral. The Debtor has an immediate need to use Cash Collateral, including cash proceeds, to pay its employees and other operating expenses. Truist Bank f/k/a Branch Banking and Trust Company asserts a security interest in the Debtor's cash collateral secured by a recorded UCC financing statement filed on May 23, 2011, in which Truist asserts a lien against all assets, including all accounts, account receivables and inventory. The Debtor requests interim authorization to use Cash Collateral as set forth in the Budget until a final order granting further use of Cash Collateral can be entered. Because the Debtor's request for interim authorization seeks the use of only that amount of Cash Collateral as is necessary to avoid immediate and irreparable harm to the value of the estate pending a final hearing. The Budget includes a list of business expenses that are reasonable and necessary and that must be paid until such time as a final hearing on the Motion can be held. The Debtor has also budgeted a carve out for administrative expenses of $1,500 each month. These business expenses are reasonable and necessary and must be paid until such time as the Debtor can reach confirmation. The Debtor proposes to adequately protect the interest of Truist in any prepetition collateral by granting Truist replacement liens in estate property. The Debtor proposes to grant the Replacement Liens upon all property and assets of the estate in which Truist held a validly perfected and nonavoidable lien or right of setoff as of the Petition Date. The Debtor does not propose to grant any liens in avoidance actions under Chapter 5 of the Bankruptcy Code or the proceeds thereof. A copy of the motion is available for free at https://bit.ly/3wGqx9b from PacerMonitor.com. About Arlington Double Down Enterprises, LLC Arlington Double Down Enterprises, LLC owns and operates a Mellow Mushroom franchise pizzeria and bar located at 200 N Center St, Arlington, Texas 76011. The store serves dine-in and takeout food and alcohol. Arlington Double Down has approximately 28 employees paid on a semi-monthly basis. In addition to payroll, its primary expenses include utility obligations, food and alcohol inventory, and franchisee royalties. Arlington Double Down sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. E.D. Tex. Case No. 21-40796) on May 28, 2021. In the petition signed by Kimberly Slawson, president, the Debtor disclosed up to $10 million in both assets and liabilities. Quilling, Selander, Lownds, Winslett & Moser, P.C. represents the Debtor as counsel. ARLINGTON DOUBLE: Case Summary & 6 Unsecured Creditors ------------------------------------------------------ Debtor: Arlington Double Down Enterprises, LLC dba Mellow Mushroom 200 N. Center Street Arlington, TX 76011 Business Description: Arlington Double Down Enterprises operates a pizza restaurant chain. Chapter 11 Petition Date: May 28, 2021 Court: United States Bankruptcy Court Eastern District of Texas Case No.: 21-40796 Debtor's Counsel: Christopher J. Moser, Esq. QUILLING, SELANDER, LOWNDS, WINSLETT & MOSER, P.C. 2001 Bryan Street, Suite 1800 Dallas, TX 75201 Tel: (214) 871-2100 Email: cmoser@qslwm.com Estimated Assets: $1 million to $10 million Estimated Liabilities: $1 million to $10 million The petition was signed by Kimberly Slawson, president. A copy of the Debtor's list of six unsecured creditors is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/46YC6DA/Arlington_Double_Down_Enterprises__txebke-21-40796__0002.0.pdf?mcid=tGE4TAMA A full-text copy of the petition is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/RN4CBCA/Arlington_Double_Down_Enterprises__txebke-21-40796__0001.0.pdf?mcid=tGE4TAMA ASP NAPA: S&P Assign 'CCC+' Issuer Credit Rating, Outlook Stable ---------------------------------------------------------------- S&P Global Ratings assigned a new 'CCC+' issuer credit rating to ASP NAPA Intermediate Holdings Inc. At the same time, S&P withdrew the 'CCC' issuer credit rating on parent ASP NAPA Holdings LLC. Effectively, S&P raised the issuer credit rating and moved it to a different entity because of a change in the company's organization structure. ASP NAPA Holdings LLC includes the anesthesia business recently acquired from Mednax Inc. and is separate from ASP NAPA Intermediate Holdings Inc. S&P also raised its issue-level ratings on the company's senior secured revolving facility and first-lien term loan to 'CCC+'. The recovery rating remains '3' (50%-70%, rounded estimate: 65%). Business levels have returned to normal. The company's business has largely returned to normal from the pandemic. Patient volume is slightly above levels from the same period in 2019 after declining roughly 80% last spring when elective procedures were halted. In addition, patient acuity is currently higher, contributing to higher revenue per patient. The company relies mostly on growth from new business although its recently large increase in revenue is largely due to an accounting consolidation, not from any acquisition or increase in growth rate. Growth is mostly derived from new business contracts and acquisitions. Its recently large growth in its revenue base in 2020 versus 2019 despite the pandemic slowdown was due to an accounting change, and not an acquisition. In February 2020, North American Partners in Anesthesia LLP amended its service agreement with NAPA Management Services Corp., resulting in its consolidation into ASP NAPA Intermediate Holdings LLC's financial statements. Previously, ASP NAPA Intermediate recognized management fee income from this subsidiary. The impact to adjusted EBITDA is minimal, but adverse to margins because all the revenue and expenses associated with that business are now recognized in the consolidated financial statements as opposed to recognizing only management service revenue. The company has sufficient cash reserves to meet all cash outflows in 2021, and all debt amortization requirements thru 2023. The company built a large cash reserve of $36 million by the end of 2020 due to several measures including an equity infusion, benefits from the CARE's Act including advanced Medicare payments, CARE's Act grants, payroll tax deferrals, and working capital management measures. S&P said, "We expect cash reserves in 2021 to decline significantly from that level as the company repays a portion of the advanced Medicare payments and payroll tax deferrals and working capital returns to normal levels. Still, we expect the combination of limited free cash flow and remaining cash reserves will be adequate to cover all debt amortization prior to the maturities of its debt in 2023." The company struggles to generate cash flow. ASP NAPA has not generated any free cash flow since 2015. S&P said, "We define free cash flow as cash flow from operations minus capital expenditures. We do expect some improvement in cash flow due to its increase in scale and due to the benefits of the consolidation of North American Partners in Anesthesia, but we believe free cash flow will remain low." S&P said, "We believe there is significant refinancing risk in 2023 that could lead to a defaultAll the company's debt matures in two years. Its revolver expires in 2022, first-lien term loan matures in April 2023, and its second-lien facility in October 2023. Given high leverage in excess of 7x, low organic growth, and the inability to generate significant free cash flow, we are not certain the company will be able to support the same debt level, suggesting a potential for a distressed transaction or a default." The stable outlook on ASP NAPA Intermediate reflects that the company can meet all its obligations, and has the liquidity to meet its amortization requirements until its debt matures in 2023. S&P said, "We could lower our rating on ASP NAPA Intermediate if we believe the company's performance is below our base case within the next 12 months with persistent cash flow deficits. Should this occur, we would view the risk of a default or distressed exchange as elevated given the approaching debt maturities. "We could raise the rating if the company exceeds our base case scenario, particularly on cash flow, and has a plan to address the approaching debt maturities. We believe this would reduce the likelihood for a distressed transaction or a default." ATHERTON BAPTIST: Fitch Assigns 'BB+' Issuer Default Rating ----------------------------------------------------------- Fitch Ratings has assigned a 'BB+' Issuer Default Rating (IDR) to Atherton Baptist Homes, CA (Atherton) and affirmed the 'BB+' rating on the series 2016 revenue bonds issued by Alhambra, CA on behalf of Atherton. The Rating Outlook is Stable SECURITY The bonds are secured by a gross revenue pledge, mortgage lien and debt service reserve fund. ANALYTICAL CONCLUSION The 'BB+' rating reflects Atherton's stable financial profile and balance sheet metrics, offset by an elevated average age of plant and long-term capex needs. Fitch views the community's 16 years average age of plant as weak having spent below depreciation expense over the last five years. Management is in the process of reviewing its long-term master facility plan and capital needs, and Fitch will evaluate future capital projects and assess any impact on the rating as more details become available. Fitch's scenario analysis supports rating stability over the next couple of years and as more people are vaccinated and the community resumes normal operations, Fitch expects occupancy rates will recover and operations to improve to pre-pandemic levels. KEY RATING DRIVERS Revenue Defensibility: 'a' Consistent Demand in Stable Market Atherton's strong revenue defensibility reflects its stable market area and high degree of price flexibility. Fitch expects occupancy rates will improve over the next couple of years given the community's position in the market and limited competition for Type C contracts. Operating Risk: 'bb' Recovery of Operations Expected The weak operating risk assessment primarily reflects Atherton's elevated average age of plant and Fitch's belief that the community will need to increase capex in order to maintain its market position over the long term. Atherton had consistent operations and profitability through fiscal 2020, although 2Q21 performance weakened given the latest surge in coronavirus cases. Fitch expects operations will continue to be pressured for the remainder of the fiscal year but then recover to pre-pandemic levels. Financial Profile: 'bb' Fitch's Scenario Analysis Supports Rating Stability Fitch believes that Atherton's balance sheet provides financial cushion to managed weather pandemic-related disruptions. Despite the pandemic and its impact on operations year-to-date, Atherton's key leverage metrics improved over the prior year and through the interim period. Fitch's scenario analysis supports the expectation that key leverage metrics will continue to improve supporting rating stability over the five-year outlook. ASYMMETRIC ADDITIONAL RISK CONSIDERATIONS There are no asymmetric risk factors affecting the rating determination. RATING SENSITIVITIES Factor that could, individually or collectively, lead to positive rating action/upgrade: -- Significant improvement in liquidity levels where cash to adjusted debt is sustained at or above 75%. Factors that could, individually or collectively, lead to negative rating action/downgrade: -- Significant deterioration in operating margins where NOM and NOM adjusted are sustained below 0% and 11%, respectively; -- Significant issuance of debt to address Atherton's long-term capex needs resulting in decline of liquidity levels and cash to adjusted debt declining below 50%. BEST/WORST CASE RATING SCENARIO International scale credit ratings of Sovereigns, Public Finance and Infrastructure issuers have a best-case rating upgrade scenario (defined as the 99th percentile of rating transitions, measured in a positive direction) of three notches over a three-year rating horizon; and a worst-case rating downgrade scenario (defined as the 99th percentile of rating transitions, measured in a negative direction) of three notches over three years. The complete span of best- and worst-case scenario credit ratings for all rating categories ranges from 'AAA' to 'D'. Best- and worst-case scenario credit ratings are based on historical performance. Founded in 1914, Atherton is a Type-C life plan community (LPC) located in Alhambra, CA. The community provides independent living, in-home care, assisted living, skilled nursing, short-term rehab and hospice services with 167 Classic independent living units (ILU), 50 Courtyard ILUs, 32 assisted living units (ALU), 4 memory care beds for early cognitive impairment and 99 skilled nursing facility (SNF) beds. Total revenue as of audited fiscal year-end 2020 (Dec. 31 fiscal year end) was $22.9 million. REVENUE DEFENSIBILITY ILU occupancy rates held steady at 92% and 81%, respectively, in fiscal 2020 and through the interim period however ALU and SNF occupancy rates softened year-to-date as a result of the coronavirus pandemic. This was driven primarily by slower move-ins to ALUs and higher attrition in the SNF due to a coronavirus outbreak in the SNF in Dec 2020. SNF occupancy rates declined to 62% as of March 31, 2021 compared to 85% at fiscal year-end 2020. With the SNF making up the majority of Atherton's net revenues, the outbreak had a moderate impact on revenues through the interim period. As the rollout of the vaccine continues across the service area and restriction are lifted, Fitch expects occupancy rates to improve to pre-pandemic levels, attributable also to a good standing waitlist, although SNF may take a little longer to recover. The community benefits from limited competition in its immediate market and maintains a strong brand awareness given its longevity in the community and religious affiliation. Although there are other LPCs nearby, Atherton does not compete with them directly as they either offer higher-end products or different contract types. The community is located in an economically stable market, and Fitch believes it is poised to support consistent demand for its offerings. Fitch views Atherton's rates and affordability provides moderate price flexibility with rate increases that occur regularly and are affordable relative to the service area's median home values. Weighted average entrance fees are considered affordable and in line with market rates. The SNF is not reliant on governmental payors (the majority of SNF residents are private payors), which mitigates the reimbursement risk typically seen in LPCs with high SNF exposure and length of stay challenges. Private payors represented 64% of the community's SNF payor mix in fiscal 2020. OPERATING RISK Atherton is a Type C contract community. Fitch views this contract type presents the lowest actuarial risk and, therefore, the lowest operating expense risk, among all contract types. Atherton offers mostly 90% refundable contracts, while a small number of legacy contracts units are nonrefundable. Despite pandemic-related disruptions on the overall LPC sector, Atherton maintained healthy operations and cash flow generation in fiscal 2020 as evidenced by an operating ratio of 98.1%, net operating margin (NOM) of 5.5% and NOM adjusted of 20.8% in fiscal 2020. These levels are favorable and exceeded Fitch's 'BB' category expectations. However, in December 2020 and through January 2021, the community experienced a surge of coronavirus cases that significantly impacted the ALU and SNF. This contributed to higher attrition in SNF and limited residents from moving to higher levels of care, which resulted in declined revenues. Through the first quarter of fiscal 2021 ended March 31, 2021, Atherton generated an operating ratio of 109.3%, NOM of negative 5.0% and NOM adjusted of negative 0.8%. As restrictions are lifted and move-ins continue, Fitch believes operations have the potential to recover to levels more in line with historical performance over the next couple of years. Fitch views Atherton's 16 years average age of plant at fiscal 2020 as elevated with capital spending averaging 76% of depreciation over the past five years. Management is planning on a number of capital projects over the next couple of years, including remodeling an ALU duplex. The project is estimated to cost $1.6 million and will be fully funded through cash reserves. Fitch believes Atherton will need to address capital plans and update a number of older facilities in order to maintain its market position over the long term. FINANCIAL PROFILE Due to consistent profitability, liquidity levels have improved over the last five years with days cash on hand (DCOH) increasing to 394 days in fiscal 2020 from 228 days five years ago. As a result, cash to adjusted debt improved to 73% and MADS coverage remains healthy at 3.2x at fiscal 2020. Outstanding total debt of $30.5 million as of fiscal 2020 consisted entirely of the series 2016 bonds. These bonds are insured by CA's Cal-Mortgage Loan Insurance Program and guaranteed by the full faith and credit of the State of California. Atherton has a defined benefit pension plan that is 58% funded as of fiscal 2020. Fitch included approximately $1 million of unfunded pension liabilities in Atherton's adjusted debt figure. The organization has no exposure to swap instruments. Fitch's scenario analysis supports the opinion that Atherton's balance sheet provides the financial cushion to weather the pandemic while maintaining key metrics that support the current rating. Even under a sustained operating and financial market stress, Atherton's leverage metrics remain stable and in line with 'BB' category expectations. Over the next couple of years, Fitch expects Atherton's operations will recover to levels that are consistent with pre-pandemic levels, supporting profitability and cash flow generation as well as gradual strengthening of key leverage metrics. 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. AULT GLOBAL: Posts $3.1 Million Net Income in First Quarter ----------------------------------------------------------- Ault Global Holdings, Inc. filed with the Securities and Exchange Commission its Quarterly Report on Form 10-Q disclosing net income of $3.08 million on $13.24 million of total revenue for the three months ended March 31, 2021, compared to a net loss of $6.53 million on $5.61 million of total revenue for the three months ended March 31, 2020. As of March 31, 2021, the Company had $234.03 million in total assets, $57.56 million in total liabilities, and $176.47 million in total stockholders' equity. As of March 31, 2021, the Company had cash and cash equivalents of $107.8 million and working capital of $119.5 million. In the past, the Company has financed its operations principally through issuances of convertible debt, promissory notes and equity securities. During the three months ended March 31, 2021, the Company continued to successfully obtain additional equity financing. The Company believes its current cash on hand is sufficient to meet its operating and capital requirements for at least the next twelve months from the date these financial statements are issued. Management Commentary The Company's Chief Financial Officer, Kenneth S. Cragun, said, "The financial results for the first quarter of 2021 demonstrate that we are achieving our objectives to grow revenue and improve operating results, with revenue growth of 136% over the prior first fiscal quarter and net income of $2.0 million. We saw tremendous growth from our lending and trading activities with the infusion of capital and continued growth in our defense business. Our gross margins for the three months ended March 31, 2021 improved considerably, up $6.4 million, or 364% from the prior first fiscal quarter. We significantly improved our balance sheet as well, ending the first quarter of 2021 with positive working capital of $119.5 million due to our ability to raise capital in the public market." Ault Global's Founder and Executive Chairman, Milton "Todd" Ault, III said, "Our positive financial results in the first quarter of 2021 result from years of strategic planning. During this time, we have strengthened our operating businesses, funded Digital Power Lending, our financial services subsidiary, and improved our balance sheet tremendously. We are pleased to report significant revenue growth and are optimistic of the long-term potential of Digital Power Lending. As I said in the previous quarter when commenting about our fiscal year ended December 31, 2020, with the strongest balance sheet in the Company's history, a capable management team and a talented group of CEOs at the subsidiary level, the future prospects look bright for the Company in the short and long term." Mr. Ault said, "I believe the current quarter results demonstrate that our holding company platform works as envisioned and provides the Company strength through the diversity of our holdings. Our recent capital raise of approximately $165 million has enabled us to fund our subsidiaries and eliminate our high-cost debt. We see strength across all our subsidiaries and expect to allocate additional capital to our lending and investment platform in the second quarter. Simply stated, we are in the strongest position of our company's 52-year history. The first quarter results constitute a promising start to 2021." Key initiatives for 2021 include: * exploring a potential IPO or other transaction to access capital markets for our Gresham Worldwide defense business; * exploring a potential IPO for our power electronics and electric vehicle charger business; * completing the initial 30,000 square foot buildout of our Michigan data center; * ramping up cryptocurrency mining operations at our Michigan data center; * ramping up fulfilment of the $50 million MTIX purchase order for MLSE plasma-laser systems; * expanding our loan and investment portfolio at Digital Power Lending; and * considering further acquisitions. Mr. Ault added, "Considering our subsidiaries operating in the sectors of defense, electric vehicle chargers, power electronic businesses, data center, crypto mining, lending and investment platform, the road ahead is bright." A full-text copy of the Form 10-Q is available for free at: https://www.sec.gov/Archives/edgar/data/896493/000121465921005858/p51821210q.htm About Ault Global Holdings, Inc. Ault Global Holdings, Inc. (fka DPW Holdings, Inc.) is a diversified holding company pursuing growth by acquiring undervalued businesses and disruptive technologies with a global impact. Through its wholly and majority-owned subsidiaries and strategic investments, the Company provides mission-critical products that support a diverse range of industries, including defense/aerospace, industrial, telecommunications, medical, and textiles. In addition, the Company extends credit to select entrepreneurial businesses through a licensed lending subsidiary. Ault Global reported a net loss of $32.73 million for the year ended Dec. 31, 2020, compared to a net loss of $32.94 million for the year ended Dec. 31, 2019. As of Dec. 31, 2020, the Company had $75.64 million in total assets, $26.51 million in total liabilities, and $49.13 million in total stockholders' equity. AUTOMOTORES GILDEMEISTER: Reorganization Under New Owners Okayed ---------------------------------------------------------------- Steven Church of Bloomberg News reports that Automotores Gildemeister SpA, a South American auto importer, won court approval to restructure debt and hand ownership to noteholders. U.S. Bankruptcy Judge Lisa Beckerman said during a virtual court hearing in New York that she would sign an order allowing the company to exit Chapter 11 protection once lawyers make minor wording changes to the document. Under the reorganization plan, the auto dealer will be taken over by noteholders owed more than $500 million in exchange for slashing debt. The company filed bankruptcy last month after working out the debt-for-equity swap with noteholders, including Elliott Investment Management. About Automotores Gildemeister Headquartered in Santiago, Chile, Automotores Gildemeister SpA is one of the largest car importers and distributors in Chile and Peru operating a network of company-owned and franchised vehicle dealerships. Its principal car brand is Hyundai, for which it is the sole importer in both of its markets. For the last 12 months ended June 30, 2020, AG reported consolidated net revenues of $770 million, of which 95.2% correspond to sales in Chile and Peru, its key markets. Automotores Gildemeister SpA and its affiliates sought Chapter 11 protection (Bankr. S.D.N.Y. Case No. 21-10685) in New York on April 12, 2021. The Hon. Lisa G. Beckerman is the case judge. Automotores was estimated to have $500 million to $1 billion in assets and liabilities as of the bankruptcy filing. The Debtors tapped Cleary Gottlieb Steen & Hamilton LLP as bankruptcy counsel; Cariola, Diez, Perez-Cotapos and Bruzzone & Gonzalez Abogados as special Chilean counsel; Rothschild & Co Us Inc. and Asesorias Financieras RP Spa as investment bankers; and FTI Consulting Canada ULC as financial advisor. Prime Clerk, LLC, is the claims and noticing agent and administrative advisor. BALDWIN RISK: Moody's Rates $500MM Repriced Secured Term Loan 'B2' ------------------------------------------------------------------ Moody's Investors Service has assigned a B2 rating to Baldwin Risk Partners, LLC's (BRP, corporate family rating B2) $500 million repriced and upsized senior secured term loan due October 2027. The rating outlook for BRP is unchanged at stable. RATINGS RATIONALE BRP's rating reflects its growing presence in property & casualty insurance brokerage and employee benefits, with a smaller presence in Medicare-related products. BRP offers a range of insurance products to middle market businesses and individuals through distinct channels across four business segments: Middle Market, Specialty, MainStreet and Medicare. The company generates strong organic growth by having tailored client engagement in each operating group and focusing resources on attractive market niches, notably including renter's insurance sold through sub-agent partners and property management software providers. BRP also seeks acquisitions with favorable growth prospects. The company has committed to its shareholders to operate with moderate net financial leverage (target range of 3.5x-4.0x per company calculations). The ratings reflect Moody's expectation that BRP will maintain its stated financial policy, and use a combination of equity and debt to fund internal growth and acquisitions. These strengths are offset by the BRP's limited scale and geographic scope relative to other rated insurance brokers. Other challenges include significant financial leverage (per Moody's calculations), modest interest coverage, and lower EBITDA margins compared to similarly rated peers. BRP's acquisition strategy carries execution and integration risks and could heighten the firm's exposure to errors and omissions, a risk inherent in professional services. Following the proposed transaction, Moody's estimates that BRP will have a pro forma debt-to-EBITDA ratio around 6x, with (EBITDA - capex) interest coverage of 1.5x-2x and a free-cash-flow-to-debt ratio in the low single digits. These pro forma metrics include Moody's adjustments for contingent earnout liabilities, operating leases, run-rate earnings from recent and pending acquisitions and certain non-recurring items. Moody's expects that BRP will manage its leverage below 6x through capital management and EBITDA growth. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATING Given the company's limited scale and its geographic concentration, an upgrade of BRP's ratings is unlikely in the intermediate term. Factors that could contribute positively to the company's credit profile include: (i) profitable growth with further geographic diversification, (ii) debt-to-EBITDA ratio below 5.0x, (iii) (EBITDA - capex) coverage of interest exceeding 2.5x, and (iv) free-cash-flow-to-debt ratio exceeding 5%. The following factors could lead to a downgrade of BRP's ratings: (i) disruptions to existing or newly acquired operations given the company's rapid growth, (ii) debt-to-EBITDA ratio remaining above 6.0x, (iii) (EBITDA - capex) coverage of interest below 1.5x, or (iv) free-cash-flow-to-debt ratio below 3%. Moody's has assigned the following rating: -- $500 million senior secured term loan maturing in October 2027 at B2 (LGD3). When the transaction closes, Moody's will withdraw the rating from BRP's existing senior secured term loan maturing in October 2027. The rating outlook for BRP is unchanged at stable. The principal methodology used in this rating was Insurance Brokers and Service Companies published in June 2018. BAUSCH HEALTH: Fitch Assigns BB Rating to Secured Notes ------------------------------------------------------- Fitch Ratings has assigned a 'BB'/'RR1' rating to Bausch Health Companies Inc.'s secured notes offering. The company intends to use the proceeds from the offering, along with cash on hand, to fund the redemption of its outstanding 7.00% senior secured notes due 2024. Post spinoff, Bausch Pharma's business profile and FCF generation will weaken but remain broadly consistent with the 'B' rating, despite the loss of diversification. Execution risk remains for Bausch Pharma to reduce leverage below 7x and build headroom through stabilization of the core business. KEY RATING DRIVERS Outlook Reflects Stressed Leverage: The company's leverage has remained above its 7x negative rating sensitivity throughout 2020, owing to a $1.2 billion legal settlement and operational challenges from the coronavirus pandemic. While Fitch believes Bausch Pharma will continue to deleverage post spinoff, its gross leverage could remain elevated above 7x for an extended period of time, if the company fails to execute. Coronavirus Headwinds: The pandemic adversely affected Bausch's operating performance during 2020, particularly in the second quarter. The company's Ortho Dermatologics, Dentistry and Global Surgical businesses, which account for roughly 13% of revenues have been hit the hardest. The company adjusted its operations to mitigate some of challenges, including manufacturing and marketing. Fitch expects the operating environment for Bausch to continue to improve throughout 2021, assuming management of the pandemic continues to improve. The affirmation considers Bausch's track record in reducing the absolute level of debt outstanding by approximately $8.8 billion since Jan. 1, 2016 with a combination of internally generated cash flow and proceeds from asset divestitures. Bausch agreed to sell all of their equity interests in Amoun Pharmaceutical for approximately $740 million and will use the net proceeds to repay debt. Bausch Spinoff Strategically Constructive: Fitch views planned spinoff of Bausch's eye care business as strategically sound, given limited synergies between the branded pharma business and eye care. The proposed transaction's effect on Bausch's credit profile will largely depend on the capital structure and financial strategy post spin. The company is working towards a post-spin pro forma net leverage profile of the eye care business and the legacy business of less than 2.5x and approximately 6.5x-6.7x, respectively. The company originally targeted post-spin proforma gross leverage of 4.0x and 5.5x, respectively. Even though Bausch's business risk profile will be negatively affected by less diversification, greater focus on innovative pharma should improve the company's R&D pipeline's probability of success. The Bausch + Lomb/International segment, which consists mostly of eye care, generated $4.4 billion or 55% of Bausch's $8.0 billion of revenue in 2020. The company intends to focus on expanding its leadership in its gastroenterology, aesthetics/dermatology, neurology and international business. Good Progress in Business Turn-around: Bausch Health's 'B' Issuer Default Rating (IDR) reflects progress in stabilizing operations and reducing debt since mid-2016 through the first quarter of 2021. Throughout the business turn-around, BHC consistently generated strong FCF relative to the 'B' category rating, pushed its nearest large debt maturity out until 2024, and loosened restrictive secured debt covenants through refinancing transactions. The company's stronger operating profile and consistent cash generation should enable it to further reduce leverage in the near term once the headwinds caused by the pandemic have abated. Observing Expanded Board's Behavior: The company has agreed with the Icahn Group to add two new independent directors as it owns approximately 9.6% of the Bausch's common stock. Fitch will monitor for any further changes to management's approach to capital deployment. Intermediate-Term Growth Potential: Bausch Health operates with a reasonably diverse business model relative to its products, customers and geographies served. Many of the company's businesses are comprised of defensible product portfolios, which are capable of generating durable margins and cash flows. Post the spinoff of the eye health business, Fitch believes that the expected long-term growth of the gastrointestinal (GI/Salix) businesses support the company's operating prospects. Fitch also expects that the dermatology business will grow in 2022 as BHC successfully commercializes recently launched products. Reliance on New Products: The stabilization of Bausch Health's operating profile has involved an increased focus on developing an internal research and development pipeline, which Fitch believes is constructive for the company's credit profile over the long term. This strategy is not without risk since Bausch Health needs to ramp up the utilization of recently-approved products through successful commercialization efforts. These products include Siliq (for the treatment of moderate-to-severe plaque psoriasis, although with safety restrictions), Bryhali (plaque psoriasis), Lumify (red eye) and Vyzulta (glaucoma). Near-Term Maturities Manageable: Bausch Health consistently generates significant positive FCF (2020 FCF margin of 11.2%) and has satisfied debt maturities until 2024. The company has adequate access to the credit markets providing the flexibility to further refinance upcoming maturities. DERIVATION SUMMARY Bausch Health is significantly larger and more diversified than specialty pharmaceutical industry peers Mallinckrodt plc and Endo International plc. While all three manufacture and market specialty pharmaceuticals and have maturing pharmaceutical products, Bausch Health's Bausch + Lomb (B+L) business meaningfully decreases business concentration risk relative to Mallinckrodt and Endo. B+L offers operational diversification in terms of geographies and payers. Many of its products are purchased directly by customers without the requirement of a prescription. Post spin-off, Bausch will become more similar to its peers regarding diversification. Bausch Health's rating also reflects gross debt leverage that is higher than peers. But unlike its peers, BHC does not face contingent liabilities related to the opioid epidemic. Bausch accumulated a significant amount of debt through numerous acquisitions. In addition, Bausch Health had a number of missteps in the integration process and other operational issues. Management has been focusing on reducing leverage by applying operating cash flow and divestiture proceeds to debt reduction and returning the business to organic growth through internal product development efforts. KEY ASSUMPTIONS -- Low to mid-single-digit revenue growth during the forecast period; -- EBITDA of $3.4 billion-$3.5 billion in 2021 and roughly $1.0 billion lower post eyecare spinoff; -- Annual FCF of at least $900 million throughout the forecast period; -- Continued debt reduction utilizing FCF; -- Leverage declining to below 7.0x by the end of 2021; -- The net proceeds from the Amoun sale used for debt reduction; -- Eye Care spinoff executed in 2022 with proforma post-spinoff net leverage of 6.5x-6.7x. RATING SENSITIVITIES Factors that could, individually or collectively, lead to positive rating action/upgrade: -- An expectation of gross debt leverage (total debt/EBITDA) durably below 6.0x; -- Bausch Health continues to maintain a stable operating profile and refrains from pursuing large, leveraging transactions including acquisitions; -- Forecasted FCF remains significantly positive. Factors that could, individually or collectively, lead to negative rating action/downgrade: -- Gross debt leverage (total debt/EBITDA) durably above 7.0x; -- FCF significantly and durably deteriorates; -- Refinancing risk increases and the prospect for meaningful leverage reduction weakens. 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 Bausch Health had adequate near-term liquidity at March 31, 2021, including restricted and unrestricted cash on hand of $1.89 billion. The company will use $1.21 billion of the cash to fund pending settlement of the U.S. Securities litigation. The company had full availability (excluding letters of credit) under its $1.225 billion revolving credit facility that matures in 2023. The company's most recent refinancing activities have satisfied debt maturities through 2023. Bausch Health consistently generated significantly positive FCF during 2015-2020, despite facing serious operating challenges. Fitch expects the company to maintain adequate headroom under the debt agreement financial maintenance covenants during the 2021-2024 forecast period. Recovery Assumptions The recovery analysis assumes that Bausch Health would be considered a going concern in bankruptcy and that the company would be reorganized rather than liquidated. The analysis is based on the current company (i.e. not pro forma for the loss of the eye care business and any resultant change in debt). Fitch estimates a going concern enterprise value (EV) of $19.2 billion for Bausch Health and assumes that administrative claims consume 10% of this value in the recovery analysis. The going concern EV is based upon estimates of post-reorganization EBITDA and the assignment of an EBITDA multiple. Fitch's estimate of Bausch Health's going concern EBITDA of $2.55 billion is roughly 25% lower than the LTM 2019 EBITDA, reflecting a scenario where the recent stabilization in the base business is reversed, and the company is not successful in commercializing the R&D pipeline. Fitch assumes Bausch Health will receive a going concern recovery multiple of 7.5x EBITDA. This is slightly higher than the 6.0x-7.0x Fitch typically assigns to specialty pharmaceutical manufacturers, representing B+L's relatively more durable consumer products focus and the company's larger scale and broader product portfolio than peers. The current average forward public market trading multiple of Bausch Health and the company's closet peers is 9.9x. Fitch applies a waterfall analysis to the going concern EV based on the relative claims of the debt in the capital structure, and assumes that the company would fully draw the revolvers in a bankruptcy scenario. The senior secured credit facility, including the term loans and revolver, and senior secured notes ($9.9 billion in the aggregate), have outstanding recovery prospects in a reorganization scenario and are rated 'BB'/'RR1', three notches above the IDR. The senior unsecured notes ($15.5 billion in the aggregate) have an average recovery and are rated 'B'/'RR4'. ESG CONSIDERATIONS Bausch Health Companies Inc. has an ESG Relevance Score of '4' for Exposure to Social Impacts due to pressure to contain healthcare spending growth, a highly sensitive political environment, and social pressure to contain costs or restrict pricing. 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. BAUSCH HEALTH: Moody's Rates New Sr. Secured Notes 'Ba2' -------------------------------------------------------- Moody's Investors Service assigned a Ba2 rating to the new senior secured note offering of Bausch Health Companies Inc. There are no changes to Bausch Health's other ratings including the B2 Corporate Family Rating, the B2-PD Probability of Default Rating, the Ba2 senior secured rating, the B3 senior unsecured rating and the SGL-1 Speculative Grade Liquidity Rating. The outlook remains unchanged at stable. Proceeds of the new senior secured notes are intended for the redemption of existing senior secured notes due in 2024 in a leverage neutral refinancing transaction. The refinancing is credit positive in that it will extend Bausch's debt maturity profile. Rating assigned: Issuer: Bausch Health Companies Inc. Senior secured notes, Assigned Ba2 (LGD2) RATINGS RATIONALE Bausch Health's B2 Corporate Family Rating reflects its high financial leverage with gross debt/EBITDA of approximately 7.7x as of March 31, 2021. Despite ongoing debt reduction, factors inhibiting deleveraging include earnings pressure related to the ongoing coronavirus pandemic. However, demand for Bausch Health's products will continue to increase as the pandemic ebbs, supported by good progress in an ongoing turnaround prior to the outbreak. The credit profile is supported by good scale with over $8 billion of global revenue, solid product diversity and good free cash flow. The company is evaluating the potential spinoff of its global eyecare business. Such a transaction would increase business risks of the remaining company, including outstanding legal investigations and an unresolved patent challenge on Xifaxan -- its largest product. The company recently changed its target net debt/EBITDA for the remaining business from 5.5x to a range of 6.5x-6.7x. The exact structure and timing of a spinoff are tied to various conditions and approvals. Moody's will continue to gauge the impact on Bausch Health's credit profile as more details around the spinoff are disclosed, and based on the latest operating performance and risk factors affecting the company, as well as deleveraging prospects. ESG considerations are material to the rating. Moody's regards the coronavirus pandemic as a social risk under Moody's ESG framework, given the substantial implications for public health and safety. Beyond the coronavirus outbreak, Bausch Health faces a variety of unresolved legal issues. These include some related to the company's former relationship with the specialty pharmaceutical distributor Philidor, and the potential for large cash outflows to resolve the matters cannot be ruled out. Other social risks include exposure to regulatory and legislative efforts aimed at reducing drug pricing. However, Bausch Health's product and geographic diversification help mitigate some of that exposure, as well as business lines outside of branded pharmaceuticals. Among governance considerations, management has had a consistent debt reduction strategy, which Moody's envisions continuing following the eyecare spinoff. In addition, the company has built a steady track record of generating positive organic growth in recent years. The stable outlook reflects Moody's expectation that coronavirus-related earnings pressure will subside, resulting in debt/EBITDA declining below 7.5x in 2021 on a total-company basis (i.e., prior to the eyecare spinoff). FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS Factors that could lead to an upgrade include improvement in earnings growth, successful commercial uptake of new products, and significant resolution of outstanding legal matters. Quantitatively, sustaining debt/EBITDA below 6.5 times with CFO/debt approaching 10% could support an upgrade, but a spinoff of the eyecare business would result in different thresholds due to reduced scale and diversity. Factors that could lead to a downgrade include significant reductions in pricing or utilization trends of key products, large litigation-related cash outflows, or an adverse outcome in the Xifaxan patent challenge. Quantitatively, debt/EBITDA sustained above 7.5 times could lead to a downgrade, but a spinoff of the eyecare business would result in a different threshold due to reduced scale and diversity. Bausch Health Companies Inc. is a global company that develops, manufactures and markets a range of pharmaceutical, medical device and over-the-counter products. These are primarily in the therapeutic areas of eye health, gastroenterology and dermatology. Revenues for the 12 months ended March 31, 2021 totaled approximately $8 billion. The principal methodology used in these ratings was Pharmaceutical Industry published in June 2017. BAUSCH HEALTH: S&P Rates New $1.6BB Senior Secured Notes 'BB' ------------------------------------------------------------- S&P Global Ratings assigned its 'BB' issue-level and '1' recovery ratings to Bausch Health Cos. Inc.'s proposed $1.6 billion senior secured notes. The '1' recovery rating indicates its expectations for modest (90%-100%; rounded estimate: 95%) recovery in the event of a payment default. The company plans to use the proceeds from this offering and cash on hand to redeem its existing $1.6 billion 7% senior secured notes and to pay related fees and expenses. S&P said, "Our 'B+' issuer credit rating and negative outlook are unchanged, reflecting the company's recent announcement that the leverage target for Bausch Pharma (the remaining entity after the company's proposed spin of its eye-care business) has changed to ~6.5x-6.7x at the time of the proposed spin-off, roughly 1x higher than the previous target of mid-5x. Bausch Pharma is a weaker business without the eye-care contribution, in our view. The high product concentration and an unproven pipeline lead us to believe Bausch Pharma will likely resort to acquisitions in the coming years to diversify. Partially offsetting these negative developments are Bausch Pharma's sizable scale and solid free cash flow generation ability." BAYTEX ENERGY: Fitch Affirms 'B' IDR & Alters Outlook to Stable --------------------------------------------------------------- Fitch Ratings has affirmed Baytex Energy Corporation's (Baytex) Issuer Default Rating (IDR) at 'B'. Fitch has also affirmed the rating on Baytex's unsecured notes at 'B'/'RR4'. The Rating Outlook has been revised to Stable from Negative. Baytex's ratings reflect its diversified North American asset base, high liquids cut, improving leverage and FCF profile, hedging program, and maturity profile. The rating also considers the company's lower FFO, Proved reserve base, non-operated status of its Eagle Ford assets and exposure to heavy oil differentials. The Stable Outlook reflects Baytex's credit supportive five-year plan that focuses on production stability and efficiency, FCF and deleveraging. KEY RATING DRIVERS Improving Credit Metrics: With an improved price environment and Baytex's hedging program, Fitch forecasts improvements in EBITDA to reduce total debt with equity credit/operating EBITDA to approximately 2.4x at year-end 2021. This compares with 4.4x at year-end 2020, which, in part, reflects the impact of historically low pricing in 2020 on EBITDA. Baytex could experience further upside to leverage at strip, which inclusive of hedging, Baytex estimates a USD1 increase in WTI benefits FFO by CAD13 million. 2024 Maturities: Baytex has CAD607 million utilized on its USD575 million revolving and CAD300 million term loan facilities at 1Q21. This leaves CAD401 million in undrawn capacity, which, coupled with Fitch's FCF forecast, should be adequate to meet liquidity needs during its forecast period. Baytex's next maturities are in 2024, when its secured credit facilities and 5.65% unsecured notes mature. Forecast FCF through 2024, subject to Baytex's allocation to debt, is adequate to fully repay its revolving facility or materially reduce the refinancing risk of its 2024 notes either through potential open market operations or redeeming the 5.625% notes, which become callable at par in 2022. FCF Allocation to Debt: Baytex plans to apply all of its 2021 FCF towards discretionary debt repayments. Under Fitch's base case, which assumes WTI of USD55 and Henry Hub gas of USD2.75 in 2021, Fitch forecasts FCF of approximately CAD250 million during the year, supporting a reduction in gross debt to just above CAD1.5 billion by yearend. After 2021 Baytex will allocate FCF to debt when WTI is below USD55. Financial policy when WTI is above USD55 in regards to the allocation of FCF between discretionary debt repayments, potential opportunistic share buybacks and a future dividend is not set. Fitch expects the ultimate balance in allocation will emphasize debt reduction as Baytex's longer-term net debt to EBITDA ratio target is 1.5x, which, under Fitch's oil and gas price deck, will require further discretionary repayments to be achieved given Baytex's 5-year production profile emphasizes stability over growth. Credit Supportive Five-Year Plan: Baytex's stated five-year plan expects to produce between 80mboed to 85mboed, focus on FCF generation, deleveraging and an undetermined level of dividends and/or share buybacks. The focus on FCF and deleveraging is supportive of a strengthening credit profile. Demonstrated progress along Baytex's five-year plan would be supportive to Baytex's rating. FCF and improving leverage are balanced by FFO of broadly around USD400 million annually during Fitch's forecast, which is at a level toward the lower end of the 'B' rating category. Diversified Assets: Baytex has a meaningfully diverse asset base by geography and hydrocarbon. In 1Q21, 34% of production came from the Eagle Ford (77% liquids), and the remaining 66% was Canadian production, with 25% Viking (91% liquids), 31% Peace River and Lloydminster Heavy Oil (90% liquids) and 3% Duvernay (84% liquids). Heavy oil and bitumen are discounted due to quality and transportation differentials, the impact on Baytex's overall margins is softened by its Light Louisiana Sweet (LLS) priced Eagle Ford production and Mixed Sweet Blend (MSW) priced Viking production. Baytex has identified within its Peace River acreage, a prospective play targeting the Spirit River formation where its first well in 1Q21 demonstrated a 30-day initial production rate of 175 bbl/d. 2H21 capex plans included up to six additional wells in the area. While diversification is a strength in Baytex's credit profile for its production size, Baytex's YE20 proved reserved of 161mboe is relatively small for its production level. Hedging Policy Reduces Cash Flow Volatility: Baytex hedged 47% of 2021 and 33% of 2022 estimated volume at 1Q21 and also partially hedges Canadian differentials between Western Canadian Select and MSW to WTI. Baytex has some U.S. dollar to Canadian dollar FX exposure due to its Eagle Ford assets, U.S. dollar-denominated debts and Canadian dollar reporting. DERIVATION SUMMARY With 78.9Mboepd (81% liquids) of production at 1Q21, Baytex is similar in size to Canadian peers MEG Energy Corp. (MEG; B+/Stable; 90.8Mboepd, 100% liquids) and Vermilion Energy Inc. (Vermilion; BB-/Negative; 86.3Mboepd, 55% liquids). Baytex's diverse asset base provides exposure to Canadian heavy and light oil as well as the price-advantaged Eagle Ford, which results in a cash netback of CAD22.08/boe, which is above to the 100% heavy oil exposed MEG at CAD14.06/boe, but below Vermilion, who benefits from exposure to higher priced international oil and natural gas indices, at CAD34.95/boe in 1Q21. Baytex's 1P reserve base of 169.9MMboe, is materially below MEG's 1.3 billion boe and relatively in line with Vermilion's 285MMboe. In terms of debt to flowing barrel, Baytex' approximately CAD22,000 is in line with Vermilion and well below more levered MEG at approximately CAD32,000. Compared with 'B'-category rated Eagle Ford exposed peers SM Energy (B/Stable) and Penn Virgina (B-/Stable), Baytex's U.S. dollar-equivalent cash netback of USD17.58/boe compares well with SM Energy's USD15.03/boe although comparability in netbacks is in part due to a larger realized hedge loss for SM in the quarter. Compared with primarily Eagle Ford exposed, Penn Virginia, Baytex's netback trails its USD24.71/boe in the quarter; however, its production is materially above Penn Virginia 20.5Mboepd. KEY ASSUMPTIONS -- WTI prices of USD55.00 in 2021, USD50.00 in 2022 and USD50.00 thereafter; -- Henry Hub prices of USD2.75/Mcf in 2021, USD2.45/Mcf in 2022 and USD2.45/Mcf thereafter; -- Canadian dollar to U.S. dollar FX rate of 1.25 through forecast; -- 2021 average production of 78Mboepd, with growth trending toward 83Mboepd by end of forecast; -- Capex in line with management's five-year plan; -- FCF allocated to debt repayment in 2021. In later years of forecast, FCF when WTI is below USD55 is allocated to debt, when above USD55 FCF is utilized for discretionary debt repayments, shareholder buybacks and implementation of a dividend. KEY RECOVERY RATING ASSUMPTIONS The recovery analysis assumes that Baytex would be reorganized as a going-concern in bankruptcy rather than liquidated. Fitch has assumed a 10% administrative claim and a 100% drawn on its secured revolving facility, reflecting that Baytex's facilities are not affected by redetermination risk. Going-Concern (GC) Approach Baytex's GC EBITDA assumption reflects Fitch's view of a sustainable, post-reorganization EBITDA level upon which Fitch bases the enterprise valuation. Baytex's bankruptcy scenario considers a structurally lower priced crude oil and natural gas environment, resulting in reduced operational and financial flexibility, in line with stress case assumptions beyond existing production hedged period. Fitch believes the lower price environment supports a lower capital program, modest production declines and negative FCFs. The GC EBITDA assumption million reflects the stress case EBITDA in the latter years of the forecast, when commodity prices start to move towards mid-cycle conditions. An EV multiple of 4.0x EBITDA is applied to the GC EBITDA to calculate a post-reorganization enterprise value. The choice of this multiple considered the following factors: -- The historical bankruptcy case study exit multiples for peer companies ranged from 2.8x-7.0x, with an average of 5.2x and a median of 5.4x; -- Selection of a lower multiple is consistent with the non operated nature of the Eagle Ford assets, relatively lower PDP reserves, as well as exposure to lower-netback heavy oil in Canada. Liquidation Approach The liquidation estimate reflects Fitch's view of transactional and asset-based valuations, including recent transactions in the Canadian oil sands, Viking, Duvernay and the Eagle Ford basin on a CAD/boepd and CAD/acre, as well as Baytex's standardized measure of net cash flows (PV-10) estimates. This data was used to determine a reasonable sales price for the company's assets. RATING SENSITIVITIES Factors that could, individually or collectively, lead to positive rating action/upgrade: -- Commitment to conservative financial policy resulting in mid cycle debt with equity credit/operating EBITDA or FFO-adjusted leverage below 2.5x; -- Sustained production above 80,000 boepd, maintaining adequate drilling inventory and competitive corporate unit economics; -- Developing its track record of gross debt reduction and positive FCF. Factors that could, individually or collectively, lead to negative rating action/downgrade: -- Deteriorating liquidity and financial flexibility, including increased revolver borrowings and inability to live within cash flow over the next 12 to 18 months; -- Loss of operational momentum leading to forecasted production below 50,000 boepd; -- Mid-cycle debt with equity credit/EBITDA or FFO adjusted leverage sustained above 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 At 1Q21 Baytex had CAD607 million drawn on its credit facilities, which consist of a USD575 million revolving facility and a CAD300 million non-revolving term loan, both of which mature on April 2, 2024. Net of CAD14.9 million in letters of credit Baytex had CAD401 million undrawn capacity (1Q21 Canadian dollar to U.S. dollar of 1.257) to meet liquidity needs. Liquidity is supported by expected positive FCF generation through Fitch's forecast. Baytex's next maturities are in 2024, when the currently CAD503 million outstanding on its originally USD400 million notes and its credit facilities mature. Fitch expects FCF allocation to discretionary debt repayments over the next two years, consistent with Baytex's leverage target of 1.5x, to reduce refinancing risk. 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. BEAR COMMUNICATIONS: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------------ Debtor: Bear Communications, LLC DBA Bear Communications of New Mexico 725 N 2nd St Ste M Lawrence, KS 66044 Business Description: Bear Communications, LLC -- http://www.bearcommunications.net-- is a communications contractor offering aerial construction, underground construction, splicing, subscriber drop placement, residential/commercial installations, residential/commercial wiring, consulting, and testing services. Chapter 11 Petition Date: May 28, 2021 Court: United States Bankruptcy Court District of Kansas Case No.: 21-10495 Judge: Hon. Dale L. Somers Debtor's Counsel: W. Thomas Gilman, Esq. HINKLE LAW FIRM LLC 1617 N. Waterfront Parkway, Suite 400 Wichita, KS 67206 Tel: 316-267-2000 Fax: 316-264-1518 Email: tgilman@hinklaw.com Estimated Assets: $10 million to $50 million Estimated Liabilities: $50 million to $100 million The petition was signed by Bryant Gray, VP of Legal and Risk. A full-text copy of the petition is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/35KJ36A/Bear_Communications_LLC__ksbke-21-10495__0001.0.pdf?mcid=tGE4TAMA List of Debtor's 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ 1. Verizon Boru House Block T $43,969,599 Eastpoint Business Park Dublin, D03R6C6 Ireland 2. US Small Business Admin PPP Loan $4,100,000 Attn: District Counsel 220 W Douglas Ave Ste 450 Wichita, KS 67202 3. Advanced Business Capital LLC 20 CV 1606 $3,398,091 dba Triumph Business Capital Johnson CO, KS c/o Geiger Prell LLC 10000 College Blvd, Ste 100 Overland Park, KS 66210 4. The Guarantee No Evidence $1,638,830 c/o Morefield Speicher Bachman of Perfection Attn: Stanley B. Bachman 11814 W 135th St Overland Park, KS 6622 5. Kadrmas Lee & Jackson Inc. $1,213,333 PO Box 4130 Bismarck, ND 58503 6. Milenium Inc. 21 CV 254- $713,904 5396 Cogswell Rd Johnson Co KS Wayne, MI 48184 7. Poblocki Paving Corp 20 CV 1063 $585,000 PO Box 13456 Circuit Ct, Dane Wauwatosa, WI 53213-0456 Co WI 8. Fidelity First Inc. 2020 CV 279 $463,632 1605 Weld Bird Ct Douglas CO. KS Valrico, FL 33594 9. Genesis Utility $432,547 Communications 5015 Abisher Wood Ln Brandon, FL 33511 10. RC Underground LLC Retainage Payable $385,306 6422 Key Island Ave Apollo Beach, FL 33572 11. Jet Underground LLC 2021 CV 99 $243,667 S8617 State Road 23 Douglas Co KS Plain, WI 53577-9764 12. Graybar Electric 20SL-CC04207 $222,818 Company Circuit Ct, St. Attn Stuart Jaeger Louis CO, MO Dir Finance 12438 Collections Center Dr Chicago, IL 60693-2437 13. Beckstrom Construction Inc. LACV196266 $195,120 c/o Simmons Perrine Moyer etal Dist Ct. Woodbury 115 3rd St SE Ste 1200 Co, IA Cedar Rapids, IA 52401 14. KC Underground LLC $147,306 8014 NE 51st St Kansas City, MO 64119 15. LTD Utilities Retainage Payable $126,250 1306 Shady Oak Ln Cedarville, AR 72932 16. Amazon Valley $93,541 Engineering LLC 2 S 35th Ave Ste 6357 Phoenix, AZ 85009 17. D & E Underground $91,574 13244 E Rte 72 PO Box 278 Davis Junction, IL 61020 18. JLK Underground Utilities 20 CV 278 $91,226 6219 Jernbanegade Douglas Co KS Askov, MN 55704 19. Blaylock HDD Inc. Retainage Payable $84,945 1095 Meadowridge Rd Monticello, MS 39654 20. Regal Utility Pros LLC $82,694 47 N 69th Ave Phoenix, AZ 85043 BELDEN INC: Moody's Affirms Ba2 CFR, Outlook Stable --------------------------------------------------- Moody's Investors Service affirmed Belden Inc.'s Ba2 Corporate Family Rating, Ba2-PD Probability of Default Rating, and Ba3 Senior Subordinate rating. Belden's SGL-1 Speculative Grade Liquidity Rating is unchanged. The outlook is stable. Belden's leverage remains temporarily elevated after disruptions from the coronavirus pandemic caused revenue declines in 2020. The rating affirmations reflect Belden's strong liquidity profile and robust operations which are diversified across end-markets and geographies as well as Moody's expectations for greatly improving financial performance over the near-term. Revenue growth over the next 12-18 months is expected to be in the high single-digit percent range which will support cash flow generation and leverage reduction. The stable outlook reflects Moody's expectations that Belden's leverage will be reduced to 4.75x or below by the end of 2022 while maintaining strong free cash flow and interest coverage metrics. Affirmations: Issuer: Belden Inc. Corporate Family Rating, Affirmed Ba2 Probability of Default Rating, Affirmed Ba2-PD Senior Subordinated Regular Bond/Debenture, Affirmed Ba3 (LGD4) Outlook Actions: Issuer: Belden Inc. Outlook, Remains Stable RATINGS RATIONALE The Ba2 CFR reflects Belden's leading positions within segments of the enterprise and industrial cabling, connectivity, networking and security product markets, which enable the company to produce solid operating margins and healthy free cash flow. The ratings are tempered by Belden's temporarily elevated leverage profile. As of Q1'2021, Belden's leverage was about 6x (Moody's adjusted), which is temporarily high for the rating category. The high leverage is the result of revenue and EBITDA declines experienced throughout 2020 as the coronavirus pandemic caused various disruptions and an economic recession. Belden however is expected to grow revenues in the high single-digit percent range over the next 12-18 months, which will enable the company to de-lever toward 4.75x. Although Belden's pursuit of growth through business acquisitions has contributed to increased leverage over time, it has also resulted in more diversified sources of revenue and increased scale. However, Belden's operating performance is cyclical with the impact on revenues, EBITDA and leverage are magnified during economic downturns, as evidenced by the recession during the past year. The company benefits from governance considerations as a widely held and publicly traded company with a largely independent board of directors. Moody's expects that shareholder returns and acquisition activity will be tempered until Belden's leverage is reduced significantly. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS Though unlikely over the near term, Belden's ratings could be upgraded if EBITDA improves such that leverage is sustained below 4x while maintaining very strong cash balances. The ratings could be downgraded if Moody's expects that leverage is not on track to be reduced below 4.75x by the end of 2022. Ratings could also be downgraded if Belden pursues further increases in debt. The Speculative Grade Liquidity (SGL) rating of the SGL-1 reflects Belden's very good liquidity based on a cash balance of $371 million as of March 31, 2021, access to an undrawn $400 million ABL revolving credit facility ($269 million available as of March 31, 2021) and expectations for free cash flow of at least $100 million in 2021. The ABL revolver matures in May of 2022 and if it is not renewed or replaced, liquidity could be weakened. The principal methodology used in these ratings was Manufacturing Methodology published in March 2020. Belden Inc. is a leading designer and manufacturer of connectivity and signal transmission products for the global network communication and specialty electronic marketplaces. Belden generated revenues of $1.863 billion in 2020. The company is headquartered in St. Louis, Missouri. BETTERECYCLING CORP: Plan Confirmation Hearing Slated for June 9 ---------------------------------------------------------------- Judge Enrique S. Lamoutte set for June 9, 201 at 10 a.m. the confirmation hearing on the First Amended Plan of Reorganization of Betterecycling Corporation. Judge Lamoutte approved the Disclosure Statement explaining that Plan on May 21, 2021. The Court has authorized the Debtor to solicit votes on the Plan. The voting deadline is June 3, 2021. The deadline to file objections to Plan confirmation is also June 3, 2021. A copy of the order is available for free at https://bit.ly/3yKH6mg from PacerMonitor.com. About Betterecycling Corporation Betterecycling Corporation produces gasoline, kerosene, distillate fuel oils, residual fuel oils, and lubricants. Based in San Juan, P.R., Betterecycling Corporation filed a voluntary petition under Chapter 11 of the Bankruptcy Code (Bankr. D.P.R. Case No. 17-04157) on June 9, 2017. The Honorable Enrique S. Lamoutte oversees the case. Lugo Mender Group, LLC, is the Debtor's legal counsel. BETTEROADS ASPHALT: June 9 Confirmation Hearing Set --------------------------------------------------- Judge Enrique S. Lamoutte set for June 9, 2021, at 10 a.m. the confirmation hearing on the First Amended Plan of Reorganization of Betteroads Asphalt LLC. Judge Lamoutte conditionally approved the First Amended Joint Disclosure Statement to that Plan on May 21, 2021. Plan confirmation objections are due by June 3, 2021. The Voting Deadline is also on June 3, 2021. A copy of the order is available for free at https://bit.ly/3up96Zj from PacerMonitor.com. About Betteroads Asphalt and Betterecycling Corp Betteroads Asphalt LLC produces warm mix asphalt, which is used in airports, highways, neighborhoods, and environmental projects. Betterecycling Corporation produces gasoline, kerosene, distillate fuel oils, residual fuel oils, and lubricants. Both companies are based in San Juan, P.R. On June 9, 2017, creditors commenced involuntary bankruptcy petitions under Chapter 11 of the Bankruptcy Code against Betteroads Asphalt LLC (Bankr. D.P.R. Case No. 17-04156) and Betterecycling Corporation (Bankr. D.P.R. Case No. 17-04157). On Oct. 11, 2019, the court entered the "order for relief" after finding that the involuntary petitions were not filed for an improper bankruptcy purpose or with bad faith. Judge Enrique S. Lamoutte oversees the cases. The Debtors are represented by Lugo Mender Group, LLC. BFCD PROPERTIES: Seeks Approval to Hire Bankruptcy Attorneys ------------------------------------------------------------ BFCD Properties, LLC seeks approval from the U.S. Bankruptcy Court for the Middle District of Pennsylvania to hire Brett Weiss, Esq., at The Weiss Law Group, LLC, and Kara K. Gendron, Esq., at Mott & Gendron Law, to handle its Chapter 11 case. The bankruptcy attorneys' services will include: (a) providing legal advice with respect to the powers, rights, and duties of the Debtor; (b) providing legal advice and consultation related to the legal and administrative requirements of the case, including assisting the Debtor in complying with the procedural requirements of the Office of the United States Trustee; (c) taking actions to protect and preserve the estate, including prosecuting actions on the Debtor's behalf, defending actions commenced against it, and representing its interests in any negotiations or litigation in which it may be involved; (d) preparing legal documents; (e) representing the Debtor at the initial interview, meeting of creditors and court hearings; (f) assisting the Debtor in the formulation, negotiation, and implementation of a disclosure statement, Chapter 11 plan and all documents related thereto; (g) assisting and advising the Debtor with respect to negotiation, documentation, implementation, consummation, and closing of transactions, including the sale of assets; (h) assisting and advising the Debtor with respect to the use of cash collateral, obtaining financing, and negotiating, drafting, and seeking approval of any documents related thereto; (i) reviewing claims and representing the Debtor in connection with objections to such claims; (j) advising the Debtor with respect to the assumption, assignment, rejection or renegotiation of executory contracts and unexpired leases; (k) coordinating with other professionals employed in the case; and (l) reviewing and analyzing legal documents. The firm will be paid at these rates: Mr. Weiss $495 per hour Ms. Gendron $400 per hour Paralegals $125 per hour As disclosed in court filings, the attorneys are disinterested persons" within the meaning of Section 101(14) of the Bankruptcy Code. The firms can be reached through: Brett Weiss, Esq., The Weiss Law Group, LLC 6404 Ivy Lane, Suite 650 Greenbelt, MD 20770 Tel: (301) 924-4400 Fax: (240) 627-4186 Email: brett@BankruptcyLawMaryland.com -- and -- Kara Katherine Gendron, Esq. Mott & Gendron Law 125 State St. Harrisburg, PA 17101 Phone: 717-232-6650 Email: mottgendronecf@gmail.com About BFCD Properties BFCD Properties, LLC, sought protection for relief under Chapter 11 of the Bankruptcy Code (Bankr. M.D. Pa. Case No. 21-01127) on May 18, 2021, listing $100,001 to $500,000 in both assets and liabilities. Judge Henry W. Van Eck oversees the case. The Weiss Law Group, LLC and Mott & Gendron Law represent the Debtor as legal counsel. BIBB COUNTY: S&P Alters Outlook to Stable, Affirms BB Bonds Rating ------------------------------------------------------------------ S&P Global Ratings revised the outlook to stable from negative and affirmed its 'BB' long-term rating and underlying rating (SPUR) on the Bibb County Health Care Authority (BCHCA), Ala.'s hospital tax revenue bonds. On April 21, 2020, S&P revised the outlook on BCHCA's debt outstanding to negative from stable as part of a larger rating action on speculative-grade-rated issuers in response to additional pressures from the COVID-19 pandemic. "The outlook revision to stable from negative reflects BCHCA's robust financial performance in fiscal 2020 and through the six-month interim period ended March 31, 2021, as well as significant improvement in balance sheet metrics," said S&P Global Ratings credit analyst Chloe Pickett. More specifically, the rating reflects S&P's opinion of the authority's: -- Limited competition as the only hospital in the primary service area (PSA); -- Healthy operating income and maximum annual debt service coverage (MADS) well above speculative-grade medians; -- Sound debt profile with no contingent liabilities and limited pension exposure; and -- Stable, well-tenured senior management team. S&P believes the above strengths are somewhat offset by what it considers the authority's: -- Risks inherent to small hospitals, including a limited PSA population and rural location; soft volumes; and concentration of admissions with a small number of physicians, which can lead to operational volatility in the event of the departure of a key physician or economic challenges in the local service area; -- Reliance on special funding, which while nominally low, accounts for 11% of total fiscal 2020 operating revenue; -- Relatively low unrestricted reserves, although liquidity is robust for the rating level; and -- Very high average age of plant. S&P said, "We view Bibb County's social risk as elevated given the small PSA, which we believe leaves Bibb County vulnerable to economic disruption in the region or departures in medical staff that lead to a shift in patient demand. The core mission of health care facilities is to protect the health and safety of communities, which is further evidenced by responsibilities to serve the surge in coronavirus patients. We believe this exposes Bibb County and its peers to additional social risks that could present financial pressure in the short term. Despite the elevated social risks, we believe Bibb County's environmental and governance risk are in line with our view of the sector as a whole. "The stable outlook reflects our expectation that the hospital will maintain its current business position, supporting consistent volumes and good MADS coverage while sustaining healthy balance sheet metrics for the rating level through the outlook period. The stable outlook also reflects our view that operating income will remain positive, although likely at lower levels following fiscal 2021 given the expectation of no additional provider relief funding. "We could revise the outlook to positive or raise the rating over the outlook period if Bibb County is able to sustain positive operating margins and healthy MADS coverage, as well as maintaining or improving the balance sheet, specifically days' cash on hand and cash to debt. We would also view positively further clarity on financial performance expectations after the pandemic as well as capital expenditures over the outlook period. "We could consider a negative outlook or a lower rating if there is a sustained trend of weaker operations resulting in a measurable decline in MADS coverage. We would also view negatively incremental new debt or the use of unrestricted reserves that results in a meaningful weakening of key balance sheet metrics." BIOLASE INC: Fails to Comply With Nasdaq Bid Price Requirement -------------------------------------------------------------- Biolase, Inc. received a deficiency letter from the Listing Qualifications Department of the Nasdaq Stock Market on May 24, 2021, notifying the Company that, for the last 30 consecutive business days, ending on May 21, 2021, the bid price for the Company's common stock had closed below the minimum $1.00 per share requirement for continued inclusion on the Nasdaq Capital Market pursuant to Nasdaq Listing Rule 5550(a)(2). In accordance with Nasdaq rules, the Company has been provided an initial period of 180 calendar days, or until Nov. 22, 2021, to regain compliance with the Bid Price Rule. If, at any time before the Compliance Date, the bid price for the Company's common stock closes at $1.00 or more for a minimum of 10 consecutive business days, the Staff will provide written notification to the Company that it complies with the Bid Price Rule. If the Company does not regain compliance with the Bid Price Rule by the Compliance Date, the Company may be eligible for an additional 180 calendar day compliance period. To qualify, the Company would need to provide written notice of its intention to cure the deficiency during the additional compliance period, by effecting a reverse stock split, if necessary, provided that it meets the continued listing requirement for the market value of publicly held shares and all other initial listing standards, with the exception of the bid price requirement. If the Company does not regain compliance with the Bid Price Rule by the Compliance Date and is not eligible for an additional compliance period at that time, the Staff will provide written notification to the Company that its common stock may be delisted. At that time, the Company may appeal the Staff's delisting determination to a NASDAQ Listing Qualifications Panel. The Company intends to monitor the closing bid price of its common stock and may, if appropriate, consider available options to regain compliance with the Bid Price Rule. About BIOLASE BIOLASE -- http://www.biolase.com-- is a medical device company that develops, manufactures, markets, and sells laser systems for the dentistry, and medicine industries. BIOLASE's proprietary laser products incorporate approximately 271 patented and 40 patent-pending technologies designed to provide biologically and clinically superior performance with less pain and faster recovery times. Biolase reported a net loss of $16.83 million for the year ended Dec. 31, 2020, compared to a net loss of $17.85 million for the year ended Dec. 31, 2019. As of March 31, 2021, the Company had $63.48 million in total assets, $29.97 million in total liabilities, and $33.52 million in total stockholders' equity. BK4 LLC: Gets Approval to Hire Goldberg Weprin as Legal Counsel --------------------------------------------------------------- BK4 LLC received approval from the U.S. Bankruptcy Court for the Eastern District of New York to hire Goldberg Weprin Finkel Goldstein, LLP as its bankruptcy counsel. The firm will render these services: a. provide the Debtor with all necessary representation in connection with its Chapter 11 case as well as its responsibilities under the Bankruptcy Code; b. represent the Debtor in all proceedings before the bankruptcy court and the Office of the U.S. Trustee; c. review, prepare and file legal papers; d. render all other legal services needed by the Debtor. The standard rates charged by the firm's associates range from $275 to $425 per hour. Partners charge $575 per hour. Goldberg received a retainer in the amount of $25,000. As disclosed in court filings, Goldberg does not hold an interest adverse to the Debtor and its bankruptcy estate. The firm can be reached through: Kevin J. Nash, Esq. Goldberg Weprin Finkel Goldstein, LLP 1501 Broadway 22nd Floor New York, NY 10036 Tel: (212) 221-5700 Email: knash@gwfglaw.com About BK4 LLC Albertson, N.Y.-based BK4 LLC is the fee simple owner of three properties in Brooklyn with a total current value of $6.29 million. BK4 filed its voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. E.D.N.Y. Case No. 21-70681) on April 12, 2021. Tal August, manager, signed the petition. At the time of the filing, the Debtor had between $1 million and $10 million in both assets and liabilities. Judge Alan S. Trust oversees the case. Goldberg Weprin Finkel Goldstein, LLP represents the Debtor as legal counsel. BLUBELLE LLC: Lone Unsecured Creditor Gets $2K of $157K Claim ------------------------------------------------------------- Blubelle LLC filed with the Bankruptcy Court a Disclosure Statement to its Chapter 11 Plan of Reorganization on May 21, 2021. The significant portion of the Claims against the Debtor consists of lenders' interests for money loaned to fund the restoration of properties the Debtor acquired at foreclosure sales. The Debtor is a holding company for several single-family homes that it acquired at HOA lien foreclosure sales. The lenders' refusal to negotiate the Debtor's liabilities necessitated the Debtor's filing for bankruptcy. Each of the following Classes, which are all impaired under the Plan, shall recover 100% of the allowed amount, as follows: * Class 1 Willow Wren Secured Claim - $292,000 * Class 2 Pulsipher Secured Claim - $74,000 * Class 3 Peachy Canyon Secured Claim - $227,000 * Class 4 Hussium Hills Secured Claim - $116,940 * Class 5 General Unsecured Claims for $156,851 pertains to one creditor who will recover $2,000 of the claim. * Class 6 Equity Interest in Debtor shall have no distribution under the Plan. On and after the Effective Date, Reorganized Debtor shall continue to exist as a separate entity and shall retain all licenses necessary to its operations that existed as of the Petition Date. On and after the Effective Date, Reorganized Debtor and managing member, Samuel Culotta, Jr., shall provide substantial new value to the Reorganized Debtor by infusing the Reorganized Debtor with the necessary funds to restore the Property to habitable conditions, and renovate to maximize income, which Debtor projects will cost at least $100,000. A copy of the Disclosure Statement is available for free at https://bit.ly/3hY7UcQ from PacerMonitor.com. About Blubelle LLC Blubelle LLC is a holding company for several single-family homes that it acquired at HOA lien foreclosure sales. The Debtor filed a voluntary petition under Chapter 11 of the Bankruptcy Code (Bankr. Case No. D. Nev. Case No. 20-11225) on March 3, 2020, listing $500,001 to $1 million in assets and $100,001 to $500,000 in liabilities. Ryan A. Andersen, Esq. at Andersen Law Firm serves the Debtor as counsel. BLUE EAGLE: Forse Selling Gadsden Property to Joneses for $270K --------------------------------------------------------------- Forse Investments, LLC, an affiliate of Blue Eagle Farming, LLC, asks the U.S. Bankruptcy Court for the Northern District of Alabama to authorize the sale of the real property located in Gadsden, Etowah County, Alabama, listed in the Debtor's Schedules as "1075 Lakemont Drive South," tax parcel identification number 21-09-30-0-001-005.00, to George E. Jones, Sr., and Glenda L. Jones for $270,000. On May 1, 2021, the Purchasers signed a residential purchase agreement to purchase the Property. The agent for the Seller and Purchasers is Hagemore Realty Group. The broker compensation is four and a half percent, paid to Hagemore Realty Group. The marketing efforts for the Property were mostly the use of a real estate agent to list the Property for sale. Prior lower offers were made on the Property prior to accepting the Purchase Price. The tax value given by Etowah County in 2020 was $201,900. The Purchasers are in no way affiliated with the Debtors personally or professionally. The proposed sale of the Property is an exercise of the Debtor's sound business judgment. The offered Purchase Price is fair and reasonable. Forse has concluded that the sale of the Property presents the best option for maximizing the value to creditors of its estate. A copy of the Agreement is available at https://tinyurl.com/8r925t2 from PacerMonitor.com free of charge. About Blue Eagle Farming Blue Eagle Farming and H J Farming are engaged in the business of cattle ranching and farming. Blue Smash Investments operates in the financial investment industry; War-Horse Properties manages companies and enterprises; Eagle Ray Investments and Forse Investments are lessors of real estate while Armor Light, LLC, is engaged in the business of residential building construction. Blue Eagle Farming, LLC, and its affiliate H J Farming, LLC, sought protection under Chapter 11 of the Bankruptcy Code (Bankr. N.D. Ala. Case Nos. 18-02395 and 18-02397) on June 8, 2018. On June 9, 2018, five Blue Eagle affiliates filed Chapter 11 petitions: Blue Smash Investments LLC, Eagle Ray Investments LLC, Forse Investments LLC, Armor Light LLC, and War-Horse Properties, LLLP (Bankr. N.D. Ala. Case Nos. 18-81707 to 18-81711). The cases are jointly administered under Case No. 18-02395. In the petitions signed by Robert Bradford Johnson, general partner of Blue Eagle Farming, LLC's sole owner, Blue Eagle estimated $1 million to $10 million in assets and $100 million to $500 million in liabilities as of the bankruptcy filing. Judge Tamara O. Mitchell presides over the cases. Burr & Forman LLP is the Debtors' legal counsel. Eagle Ray Investments, LLC, an affiliate of Blue Eagle Farming, LLC, asks the U.S. Bankruptcy Court for the Northern District of Alabama to authorize the sale of the real property located in Butler County, Alabama, listed in the Debtor's Schedules as "Dollar General, 119 Hwy 106, Georgiana, Alabama," tax parcel identification numbers is 17-05-22-4-002-003.001, to APK Properties VIX, LLC for $345,000, free and clear of any liens, encumbrances or interests. On March 22, 2021, Eagle Ray and the Purchaser completed execution of an agreement to purchase the Property. The Purchaser agreed to pay a total price of $345,000 for the Property. The Sale Agreement was negotiated at arms'-length between the parties' respective representatives. The broker, Marcus & Millichap, will receive a full commission paid by the Seller at closing. The broker compensation is 6%, paid only to Marcus & Millichap. The marketing efforts for the Property were mostly the use of a real estate agent to list the Property for sale. The tax value given by Butler County in 2020 was $346,400. Eagle Ray is a party to a lease with Dolgencorp, LLC related to the Property where Eagle Ray is the landlord and Dolgencorp, LLC is the tenant. Eagle Ray seeks to assume the Lease and assign the Lease, pursuant to section 365 of the Bankruptcy Code, to the Purchaser. It has no cure obligations under the Lease. Eagle Ray is unaware of any person or entity with a lien, claim, interest or encumbrance on the property. However, in the event that any person or entity claims a valid lien, claim, encumbrance or interest, the lien is in bona fide dispute, as required pursuant to Section 363(f)(4). The proposed sale of the Property is an exercise of Eagle Ray's sound business judgment. Eagle Ray respectfully asks that the Court waives the 14-day stay imposed by Bankruptcy Rule 6004(h), as the exigent nature of the relief sought justifies immediate relief. A copy of the Agreement is available at https://tinyurl.com/je3sv45 from PacerMonitor.com free of charge. The Purchaser: APK PROPERTIES IX, LLC c/o KMB Design Group, LLC 1800 Route 34, Suite 209 Wall, NJ 07719 Attn: Stephen A. Bray E-mail: sbray@kmbcompanies.com The Purchaser is represented by: MCELROY, DEUTSCH, MULVANEY & CARPENTER, LLP 1300 Mount Kemble Avenue P.O. Box 2075 Morristown, NJ 07962 Attn: Lucille J. Karp, Esq. E-mail: lkarp@mdmc-law.com About Blue Eagle Farming Blue Eagle Farming and H J Farming are engaged in the business of cattle ranching and farming. Blue Smash Investments operates in the financial investment industry; War-Horse Properties manages companies and enterprises; Eagle Ray Investments and Forse Investments are lessors of real estate while Armor Light, LLC, is engaged in the business of residential building construction. Blue Eagle Farming, LLC, and its affiliate H J Farming, LLC, sought protection under Chapter 11 of the Bankruptcy Code (Bankr. N.D. Ala. Case Nos. 18-02395 and 18-02397) on June 8, 2018. On June 9, 2018, five Blue Eagle affiliates filed Chapter 11 petitions: Blue Smash Investments LLC, Eagle Ray Investments LLC, Forse Investments LLC, Armor Light LLC, and War-Horse Properties, LLLP (Bankr. N.D. Ala. Case Nos. 18-81707 to 18-81711). The cases are jointly administered under Case No. 18-02395. In the petitions signed by Robert Bradford Johnson, general partner of Blue Eagle Farming, LLC's sole owner, Blue Eagle estimated $1 million to $10 million in assets and $100 million to $500 million in liabilities as of the bankruptcy filing. Judge Tamara O. Mitchell presides over the cases. Burr & Forman LLP is the Debtors' legal counsel. BOY SCOUTS OF AMERICA: Survivors Aim Chubb for More Insurance Info ------------------------------------------------------------------ Leslie A. Pappas of Bloomberg Law reports that sexual abuse claimants in the Boy Scouts of America's bankruptcy case are asking the court to require Chubb Ltd. to disclose more information, arguing that the nonprofit's insurer is withholding documents they need to evaluate potentially billions of dollars worth of insurance claims. Chubb subsidiaries Century Indemnity Co. and Chubb Group Holdings Inc. should produce documents related to a 1990s corporate restructuring involving the Insurance Co. of North America (INA), three groups representing abuse survivors said Wednesday in a letter to the U.S. Bankruptcy Court for the District of Delaware. About Boy Scouts of America The Boy Scouts of America -- https://www.scouting.org/ -- is a federally chartered non-profit corporation under title 36 of the United States Code. Founded in 1910 and chartered by an act of Congress in 1916, the BSA's mission is to train youth in responsible citizenship, character development, and self-reliance through participation in a wide range of outdoor activities, educational programs, and, at older age levels, career-oriented programs in partnership with community organizations. Its national headquarters is located in Irving, Texas. The Boy Scouts of America and affiliate Delaware BSA, LLC, sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 20-10343) on Feb. 18, 2020, to deal with sexual abuse claims. Boy Scouts of America was estimated to have $1 billion to $10 billion in assets and at least $500 million in liabilities as of the bankruptcy filing. The Debtors have tapped Sidley Austin LLP as their bankruptcy counsel, Morris, Nichols, Arsht & Tunnell LLP as Delaware counsel, and Alvarez & Marsal North America, LLC as financial advisor. Omni Agent Solutions is the claims agent. The U.S. Trustee for Region 3 appointed a tort claimants' committee and an unsecured creditors' committee on March 5, 2020. The tort claimants' committee is represented by Pachulski Stang Ziehl & Jones, LLP, while the unsecured creditors' committee is represented by Kramer Levin Naftalis & Frankel, LLP. BOYD GAMING: Moody's Rates New $750MM Unsecured Notes 'Caa1' ------------------------------------------------------------ Moody's Investors Service assigned a Caa1 rating to Boyd Gaming Corporation's proposed $750 million unsecured notes due 2031. The company's B2 Corporate Family Rating, B2-PD Probability of Default Rating, existing senior secured revolver and term loans rated Ba3, and the company's existing Caa1 rated senior unsecured notes remain unchanged. The company's Speculative Grade Liquidity rating remains SGL-2 and the outlook remains stable. Boyd intends to use proceeds from the proposed $750 million unsecured notes to redeem all of the company's $750 million 6.375% senior unsecured notes due 2026. Boyd additionally intends to use $600 million of cash on hand and $100 million of borrowings under its revolver to redeem its $700 million 6% notes due 2026. An additional draw on the company's revolving credit facility of approximately $70 million is expected to pay the redemption premium, accrued and unpaid interest, and related fees and expenses. The refinancing is credit positive because it reduces the company's funded debt and leverage levels with cash and will extend the company's maturities and reduce cash interest expense. Moody's expects to withdraw the Caa1 rating on the 6.375% notes when the transaction closes. Assignments: Issuer: Boyd Gaming Corporation Senior Unsecured Regular Bond/Debenture, Assigned Caa1 (LGD5) RATINGS RATIONALE Boyd's B2 CFR reflects the meaningful earnings decline from efforts to contain the coronavirus and the potential for a slow or uneven recovery as properties have reopened. Boyd's properties have largely reopened with its Las Vegas locals and Midwest and South regions performing better than Downtown Las Vegas given demand levels and expense reductions. The rating also reflects the company's significant size and geographic diversification. The company is one of the largest regional gaming operators in terms of net revenue and number of casino assets operated. Key credit concerns include Boyd's significant leverage prior to the coronavirus outbreak and longer-term social risk and fundamental challenges facing Boyd and other regional gaming companies related to consumer entertainment preferences and US population demographics that Moody's believes will move in a direction that does not favor traditional casino-style gaming. Boyd's speculative-grade liquidity rating of SGL-2, reflects good liquidity and that largely all of the company's casinos have reopened and have demonstrated EBITDA margin improvement, while generating strong free cash flow of over $240 million for Q3 and Q4 2020. As of December 31, 2020, the company had $519 million of unrestricted cash, and an undrawn $1,033.7million revolving credit facility, with $1,021.1 million of availability after $12.6 million of letters of credit. Moody's estimates the company could maintain sufficient internal cash sources after maintenance capital expenditures to meet required annual amortization and interest requirements assuming a sizeable decline in annual EBITDA. Boyd is currently subject to a minimum liquidity requirement of $250 million, as typical financial maintenance covenants are waived until Q2 2021. Moody's believes the company will maintain compliance with the minimum liquidity covenant and the leverage and interest coverage financial covenants once they resume in Q2 2021. 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 Boyd from the current weak US economic activity and a gradual recovery for the coming year. Although an economic recovery is underway, it is tenuous, and its continuation will be closely tied to containment of the virus. As a result, the degree of uncertainty around Moody's forecasts is unusually high. Moody's regards the coronavirus outbreak as a social risk under its ESG framework, given the substantial implications for public health and safety. The gaming sector has been one of the sectors most significantly affected by the shock given its sensitivity to consumer demand and sentiment. More specifically, the weaknesses in Boyd's credit profile, including its exposure to travel disruptions and discretionary consumer spending have left it vulnerable to shifts in market sentiment in these unprecedented operating conditions and Boyd remains vulnerable to the outbreak continuing to spread. Governance risk is considered balanced given public ownership and the company's track record of managing dividends and share repurchases principally from cash flow. The company suspended its modest quarterly cash dividend to conserve liquidity due to the impact of coronavirus on the company's operations. From a leverage and financial policy perspective, with several significant acquisitions behind the company, Boyd had been able to reduce debt-to-EBITDA leverage to about 5x before the pandemic pushed leverage up to over 7x as of December 2020. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS The stable outlook considers the recovery in the company's business and margin improvement exhibited in Q3 and Q4 2020, and the expectation for continued sequential improvement in 2021. The stable outlook also incorporates the company's good liquidity and the expectation for leverage to continue to come down from current levels as the business continues to recover and debt is reduced. Boyd remains vulnerable to travel disruptions and unfavorable sudden shifts in discretionary consumer spending and the uncertainty regarding the pace at which consumer spending at reopened gaming properties will recover. Ratings could be downgraded if liquidity deteriorates or if Moody's anticipates Boyd's earnings declines to be deeper or more prolonged because of actions to contain the spread of the virus or reductions in discretionary consumer spending. Debt-to-EBITDA leverage sustained over 6x could result in a downgrade. The ratings could be upgraded if facilities are able to remain open and earnings recover such that positive free cash flow and reinvestment flexibility is fully restored, and debt-to-EBITDA is sustained below 5.25x. The principal methodology used in these ratings was Gaming Methodology published in October 2020. Boyd Gaming Corporation owns and operates 28 gaming properties in ten states: Nevada, Illinois, Indiana, Iowa, Kansas, Louisiana, Mississippi, Missouri, Ohio, and Pennsylvania. Revenue for the publicly-traded company for the last twelve-month period ended December 31, 2020 was approximately $2.2 billion. BOYD GAMING: S&P Rates New $750MM Senior Unsecured Notes 'B' ------------------------------------------------------------ S&P Global Ratings assigned its 'B' issue-level rating and '5' recovery rating to Boyd Gaming Corp.'s proposed $750 million senior notes due 2031. The '5' recovery rating indicates its expectation for modest (10%-30%; rounded estimate: 25%) recovery for noteholders in the event of a payment default. S&P subsequently placed the issue-level ratings on the proposed notes issuance and Boyd's existing unsecured debt rating on CreditWatch with positive implications. Boyd plans to use the proceeds from the proposed notes, $600 million of cash on hand and $170 million of borrowings under its revolving credit facility to fund the redemption of its 6.375% senior unsecured notes due 2026 ($750 million outstanding) and its 6% senior unsecured notes due 2026 ($700 million outstanding), and pay the redemption premiums, fees, and expenses. In connection with this launch, Boyd plans to issue two separate conditional notices of redemption to redeem the entirety of its 6.375% senior unsecured notes and its 6% senior unsecured notes, both of which are conditioned upon the consummation of this proposed offering. Should Boyd execute these transactions as contemplated, the company's unsecured debt balances would decrease by $700 million. The CreditWatch listing reflects the potential for improved recovery prospects for unsecured noteholders should the company permanently reduce the amount of its unsecured debt. S&P said, "In the event the company executes the proposed notes issuance and both notes redemptions as currently contemplated, we expect to revise our recovery rating on the company's unsecured debt to '4' from '5' and raise the issue-level ratings by one notch to 'B+' from 'B'. We would also withdraw our issue-level ratings on the 6.375% and 6% senior notes once they are redeemed." S&P said, "Our issuer credit rating on Boyd remains 'B+'. Although the company is using a portion of its sizable cash balances to repay unsecured debt, our leverage forecast is relatively unchanged. This is because we previously net this cash against the company's debt balances in calculating credit measures. For our complete issuer credit rating rationale, please see our most recent research update on Boyd, published March 15, 2021, on RatingsDirect." Recovery Analysis Key analytical factors: -- S&P assigned its 'B' issue-level rating and '5' recovery rating to Boyd's proposed $750 million senior notes due 2031. S&P subsequently placed the issue-level ratings on the proposed notes and Boyd's existing unsecured notes on CreditWatch with positive implications. -- The CreditWatch listing reflects the possibility that recovery prospects for unsecured lenders could improve in the event Boyd completes the transactions as currently contemplated. Pro forma for the proposed notes issuance and notes redemptions, Boyd's total unsecured debt would decrease by $700 million. As a result, S&P could revise its recovery rating to '4' from '5' and raise the unsecured issue-level ratings one notch to 'B+' from 'B'. -- The current '5' recovery rating indicates its expectation for modest recovery (10%-30%; rounded estimate: 25%) for noteholders in the event of a payment default. Simulated default assumptions: -- S&P's simulated default scenario contemplates a payment default occurring in 2025 (which is in line with its average four-year default assumption for 'B+' rated credits) due to a significant decline in its cash flow stemming from prolonged economic weakness and increased competitive pressure across its portfolio. -- In the waterfall below, S&P assumes Boyd completes both of its conditional redemption offers, thus reducing the total of unsecured debt by $700 million, and improving recovery prospects for unsecured note holders. -- S&P assumes any debt maturing between now and its assumed year of default is extended to the year of default. -- S&P assumes a reorganization following the default and use an emergence EBITDA multiple of 7.0x to value the company, which is modestly higher than the average 6.5x multiple it uses for companies in the leisure industry. This reflects Boyd's good geographic diversity and largely owned real estate portfolio. -- S&P assumes that the revolver is 85% drawn at default. Simplified waterfall: -- EBITDA at emergence: About $420 million -- EBITDA multiple: 7.0x -- Gross recovery value: $2.9 billion -- Net recovery value after administrative expenses (5%): $2.8 billion -- Obligor/nonobligor valuation split: 100%/0% -- Estimated first-lien claims (credit facility): $1.8 billion -- Value available for senior secured claims: $2.8 billion --Recovery expectations: 90%-100% (rounded estimate: 95%) -- Estimated senior unsecured claims (notes): $2.4 billion -- Value available for unsecured claims: $0.9 billion --Pro forma recovery expectations: 10%-30% (rounded estimate: 35%) Note: All debt amounts include six months of prepetition interest. BRAZIL MINERALS: Incurs $1.2 Million Net Loss in First Quarter -------------------------------------------------------------- Brazil Minerals, Inc. filed with the Securities and Exchange Commission its Quarterly Report on Form 10-Q disclosing a net loss of $1.19 million on $4,459 of revenue for the three months ended March 31, 2021, compared to a net loss of $592,276 on $2,630 of revenue for the three months ended March 31, 2020. As of March 31, 2021, the Company had $1.79 million in total assets, $2.70 million in total liabilities, and a total stockholders' deficit of $909,313. As of March 31, 2021, the Company had cash and cash equivalents of $262,242 and a working capital deficit of $2,294,870. Net cash provided by operating activities totaled $488,711 for the three months ended March 31, 2021, compared to net cash used of $190,647 during the three months ended March 31, 2020 representing an increase in cash provided of $679,358 or 356.3%. Net cash used in investing activities totaled $939,927 for the three months ended March 31, 2021, compared to net cash used of $14,304 during the three months ended March 31, 2020 representing an increase in cash used of $925,623 or 6,854.2%. Net cash provided by financing activities totaled $466,249 for the three months ended March 31, 2021, compared to $258,291 during the three months ended March 31, 2020 representing an increase in cash provided of $207,958 or 80.5%. "We have limited working capital, have historically incurred net operating losses, and have not yet received material revenues from the sale of products or services. These factors create substantial doubt about our ability to continue as a going concern," Brazil Minerals said. "Our primary sources of liquidity have been derived through proceeds from the (i) issuance of debt and (ii) sales of our equity and the equity of one of our subsidiaries. Our ability to continue as a going concern is dependent upon our capability to generate cash flows from operations and successfully raise new capital through debt issuances and sales of our equity. We believe that we will be successful in the execution of our initiatives, but there can be no assurance. We have no plans for any significant cash acquisitions in the foreseeable future," the Company said. A full-text copy of the Form 10-Q is available for free at: https://www.sec.gov/Archives/edgar/data/1540684/000152013821000285/bmix-03312021_10q.htm About Brazil Minerals Brazil Minerals, Inc. -- http://www.brazil-minerals.com-- has two components to its business model: (1) growing a portfolio of mineral rights in a wide spectrum of strategic and sought-after minerals, from which equity holdings or royalty interests may develop, and (2) mining certain specific areas for gold, diamonds, and sand. The Company currently owns mineral rights in Brazil for lithium, rare earths, titanium, cobalt, iron, manganese, nickel, gold, diamonds, precious gems, and industrial sand. Brazil Minerals reported a net loss of $1.55 million for the year ended Dec. 31, 2020, a net loss of $2.08 million for the year ended Dec. 31, 2019, and a net loss of $1.85 million for the year ended Dec. 31, 2018. Lakewood, Colorado-based BF Borgers CPA PC, the Company's auditor since 2015, 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 that raise substantial doubt about its ability to continue as a going concern. BRISTOW GROUP: Narrows Down Loss in First Year Since Chapter 11 --------------------------------------------------------------- Allister Thomas of Energy Voice reports that Bristow, the helicopter operator, posted pre-tax losses of GBP40 million for the 12 months ending March 31, 2021, which compares to a deficit of GBP468million in the 2019 financial year. Bristow emerged from Chapter 11 in November 2019, and subsequently announced a merger with US rival Era. Revenues dropped from GBP878 million to GBP829 million for the year, while Bristow made a Q4 loss of GBP43.5 million, compared to profits of GBP199 million in the same period last 2020. CEO Chris Bradshaw said: "In addition to challenging market conditions related to the pandemic and depressed offshore oil and gas customer activity, the company's current quarter results also reflect the typical seasonality in our business, as the March quarter has historically been the period of lowest flight activity due to fewer daylight hours and more inclement weather days." "Despite the challenging conditions, Bristow generated a substantial amount of free cash flow in the quarter, further demonstrating the resiliency of our business model." Houston-headquartered Bristow has around 900 employees in the UK, working across North Sea oil and gas transportation and search and rescue operations. It entered the Chapter 11 bankruptcy process in May 2019 in a bid to strengthen its balance sheet. Emerging in November 2019, the firm said it had agreed to a restructuring deal which would inject GBP400 million into the business. About Bristow Group Bristow Group Inc. (OTC: BRSWQ) -- http://www.bristowgroup.com/-- provides industrial aviation and charter services to offshore energy companies in Europe, Africa, the Americas, and the Asia Pacific. It also provides search and rescue services for governmental agencies and the oil and gas industry. Headquartered in Houston, Bristow Group employs 3,000 individuals around the world. Bristow Group and its affiliates sought protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Tex. Lead Case No. 19-32713) on May 11, 2019. As of Sept. 30, 2018, the Debtors had $2.861 billion in assets and $1.886 billion in liabilities. The cases are assigned to Judge David R. Jones. The Debtors tapped Baker Botts LLP as bankruptcy counsel; Wachtell, Lipton, Rosen & Katz as co-counsel with Baker Botts; Alvarez & Marsal and Houlihan Lokey Capital, Inc., as financial advisors; and Prime Clerk LLC as claims, noticing and solicitation agent. Henry Hobbs Jr., the acting U.S. trustee for Region 7, appointed seven creditors to serve on the official committee of unsecured creditors in the Chapter 11 cases of Bristow Group Inc. and its affiliates. The Committee selected Kramer Levin Naftalis & Frankel LLP as its legal counsel. Porter Hedges LLP is the Committee's local and conflicts counsel. Imperial Capital, LLC, is the Committee's financial advisor, and Perella Weinberg Partners LP is the investment banker. BUY MOORE: Seeks to Hire Oppenhuizen Law Firm as Legal Counsel -------------------------------------------------------------- Buy Moore, LLC seeks approval from the U.S. Bankruptcy Court for the Western District of Michigan to employ Oppenhuizen Law Firm, PLC as its legal counsel. The firm will render these legal services: (a) provide information to the Debtor regarding its duties and responsibilities; (b) assist in the preparation of bankruptcy schedules and statement of affairs; (c) assist in the preparation of financial statements, balance sheets, and business plans; (d) pursue claims of the Debtor against third parties; (e) represent the Debtor with regard to any actions brought against it by third parties in its Chapter 11 proceeding; (f) assist in negotiations with creditors and prepare a plan of reorganization; and (g) obtain confirmation of a plan of reorganization. The hourly rates of the firm's attorneys and staff are as follows: James R. Oppenhuizen, Esq. $350 Associates $250 Paralegals/Legal Assistants $150 In addition, the firm will seek reimbursement for expenses incurred. James Oppenhuizen, Esq., a member of Oppenhuizen 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: James R. Oppenhuizen, Esq. Oppenhuizen Law Firm, PLC 25 Division Ave. S, Suite 525 Grand Rapids, MI 49503 Telephone: (616) 730-1861 Email: joppenhuizen@oppenhuizenlaw.com About Buy Moore Buy Moore, LLC is a company that buys and sells toys and comics in Rockford, Mich. It conducts business under the name Buy Moore Toys & Comics. Buy Moore filed a petition under Subchapter V of Chapter 11 of the Bankruptcy Code (Bankr. W.D. Mich. Case No. 21-01230) on May 10, 2021. Jeff Moore, member, signed the petition. At the time of the filing, the Debtor listed up to $50,000 in both assets and liabilities. Judge Scott W. Dales oversees the case. Oppenhuizen Law Firm, PLC serves as the Debtor's legal counsel. CAMBER ENERGY: Receives Noncompliance Notice From NYSE American --------------------------------------------------------------- Camber Energy, Inc. was notified by the NYSE American that the Company was not in compliance with the Exchange's continued listing standards set forth in Section 1007 of the NYSE American Company Guide given the Company failed to timely file its Form 10-K for the 9-month period ended Dec. 31, 2020. The delinquency will be cured via the filing of the Report. The Company previously filed a Form 12b-25 with the Securities and Exchange Commission on May 6, 2021, to extend the due date for the Report. The Form 12b-25 disclosed that the Report was unable to be filed on time due to delays in assembling the financial information required to be reviewed by the Company's independent auditor, and in completing the accounting of certain transactions affecting the Company. Such further delay in filing the Report past the deadline set forth in the Form 12b-25 is due to issues that have arisen in connection with (i) finalizing the determination of the fair values of both assets and liabilities associated with the Company's acquisition of a controlling interest in Viking Energy Group, Inc. in December of 2020, and (ii) key personnel changes at the Company's independent auditing firm. The Company is taking steps to complete the required accounting and plans to file the Report as soon as practicable. During the six-month period from the date of the Filing Delinquency, the Exchange will monitor the Company and the status of the Report and any subsequent delayed filings, including through contact with the Company, until the Filing Delinquency is cured. If the Company fails to cure the Filing Delinquency within the Initial Cure Period, the Exchange may, in the Exchange's sole discretion, allow the Company's securities to be traded for up to an additional six-month period depending on the Company's specific circumstances. If the Exchange determines an Additional Cure Period is not appropriate, suspension and delisting procedures will commence in accordance with the procedures set out in Section 1010 hereof. If the Exchange determines that an Additional Cure Period of up to six months is appropriate and the Company fails to file its Delinquent Report and any subsequent delayed filings by the end of that period, suspension and delisting procedures will generally commence. Receipt of the letter does not have any immediate effect on the listing of the Company's shares on the Exchange, except that until the Company regains compliance with the Exchange's listing standards, a "BC" indicator will be affixed to the Company's trading symbol. The Company's business operations and SEC reporting requirements are unaffected by the notification, provided that if the Filing Delinquency is not cured then the Company will be subject to the Exchange's delisting procedures. The Company is committed to filing the Report to achieve compliance with the Exchange's requirements, and, although there are no guarantees it will do so, the Company expects to file the Report within the Initial Cure Period. About Camber Energy Based in Houston, Texas, Camber Energy -- http://www.camber.energy -- is primarily engaged in the acquisition, development and sale of crude oil, natural gas and natural gas liquids from various known productive geological formations, including from the Hunton formation in Lincoln, Logan, Payne and Okfuskee Counties, in central Oklahoma; the Cline shale and upper Wolfberry shale in Glasscock County, Texas; and Hutchinson County, Texas, in connection with its Panhandle acquisition which closed in March 2018. Camber Energy reported a net loss of $3.86 million for the year ended March 31, 2020, compared to net income of $16.64 million for the year ended March 31, 2019. As of Sept. 30, 2020, the Company had $11.79 million in total assets, $1.61 million in total liabilities, $6 million in preferred stock (series C), and $4.18 million in total stockholders' equity. Marcum LLP, in Houston, Texas, the Company's auditor since 2015, issued a "going concern" qualification in its report dated June 29, 2020, citing that the Company has incurred significant losses from operations and had an accumulated deficit as of March 31, 2020 and 2019. These factors raise substantial doubt about its ability to continue as a going concern. CAMELOT UK: S&P Alters Outlook to Stable, Affirms 'B' ICR --------------------------------------------------------- S&P Global Ratings revised its outlook on U.S.-based data services provider Camelot UK Holdco Ltd. (doing business as Clarivate) to stable from positive. At the same time, S&P affirmed its 'B' issuer credit rating. The stable outlook reflects S&P's expectation that Clarivate will continue to successfully integrate recent acquisitions, organically expand product and service offerings, and continue to improve its cash flow generation such that free operating cash flow (FOCF) to debt increases toward the 10% area and leverage declines to the high-5x area in 2022. Clarivate announced its plan to acquire ProQuest LLC in a debt- and equity-funded transaction, valuing the company at $5.3 billion. The transaction is expected to close in the third quarter of 2021. S&P said, "The partially debt-funded acquisition of ProQuest will keep pro forma leverage above our 5.5x upgrade threshold over the next 12 months. Although details of the transaction funding have not been announced, Clarivate has stated that funding sources will include $1.3 billion in Clarivate shares, a primary equity offering, and roughly $2 billion in new debt. We view the company's substantial use of equity to fund the transaction as relatively financially prudent. However, in our view the $2 billion in additional debt to fund the acquisition is substantial relative to our expectations for S&P Global Ratings-adjusted ProQuest EBITDA. Further, while we believe Clarivate will achieve the majority of its announced cost efficiencies with this transaction, as shown by its track record of integrating past acquisitions, we expect there may be substantial restructuring costs over the first 12 months of integration that will limit significant EBITDA margin expansion until 2023. "As a result, we believe the acquisition will keep Clarivate's leverage above our 5.5x upgrade threshold. Specifically, we expect 2021 leverage in the high-7x area (high-6x area pro forma for a full year of revenue contributions from ProQuest) before declining to the high-5x area in 2022. This is because of increased EBITDA generation from organic revenue growth and an increased cash balance, reducing the company's net debt burden." The acquisition will expand Clarivate's database and digital education resource capabilities. ProQuest is a scholarly and historical digital content and software solutions provider that serves higher education institutions, corporations, government agencies, public libraries, and K-12 schools. The company benefits from low client concentration, favorable geographic diversity, and high annual recurring revenues, all of which will be incrementally positive to Clarivate's business profile. In addition, we believe ProQuest's data-centric capabilities and research-oriented clients could compliment Clarivate's products and services. Aside from the announced cost structure optimizations, there may be an additional opportunity for Clarivate to optimize its go-to-market strategy and salesforce across this research-focused ecosystem of clients. These benefits are partially offset by ProQuest's lower EBITDA margins in the low-20% area and historically low organic growth profile, which are not as favorable as some of Clarivate's offerings, in S&P's view. The stable outlook reflects S&P's expectation Clarivate will continue to successfully integrate recent acquisitions, organically expand its products and services, and continue to improve its cash flow generation such that FOCF to debt increases to the 10% area and leverage declines to the high-5x area in 2022. S&P could raise its rating on Clarivate if: -- It successfully integrates recent acquisitions such that S&P expects it to increase organic revenue by the mid-single-digit percent area; -- S&P anticipates it will reduce its leverage below the 5.5x area and sustain it at that level--including the potential for future acquisitions; and -- It generates FOCF to debt above the high-single-digit percent area on a sustained basis. S&P could lower its issuer credit rating on Clarivate if: -- S&P believes FOCF to debt will remain well below 5% due to weaker operating performance because of organic growth challenges, additional one-time restructuring costs, and integration costs remaining elevated; or -- It pursues significant debt-financed acquisitions or dividend distributions. CAMP RIM ROCK: Plan Exclusivity Period Extended Until June 7 ------------------------------------------------------------ At the behest of Camp Rim Rock, LLC, Judge Magdeline D. Coleman of the U.S. Bankruptcy Court for the Eastern District of Pennsylvania extended the periods in which the Debtors may file a Chapter 11 plan until June 7, 2021, and to solicit acceptances until August 6, 2021. The Debtor's financial issues came to a peak during 2020 when the unexpected Covid-19 health pandemic resulted in a significant number of cancellations in the 2020 season and created several related operational challenges. On December 9, 2020, the Debtor filed for relief under chapter 11 of the Bankruptcy Code to reorganize its affairs when they encounter increased pressure from the Debtor's creditors, including the Debtor's senior secured lender, and inadequate funds to address those demands. When the Debtor filed its bankruptcy case, it believed that it had to secure funding to both address its obligations and fund operations going forward. The Debtor spent a significant amount of time identifying third-party funders, ranging from strategic partners to a variety of possible lenders. Nevertheless, with the more recent signs that the risks associated with the health pandemic were lessening and with a robust interest in the camp for the 2021 season (not only from return campers but with new campers). The Debtor now believes that it will be able to self-fund its reorganization and has been in active discussions with The Dime Bank, its senior secured lender, to attempt to negotiate the terms of consensual treatment under a plan. The extensions of its exclusive periods will enable the Debtor to advance the possibility of negotiating consensual treatment with The Dime Bank, without disruptions to the Debtor's efforts to reorganize. A copy of the Debtor's Motion to extend is available at https://bit.ly/2RJ18wL from PacerMonitor.com. A copy of the Court's Extension Order is available at https://bit.ly/3fG4MiX from PacerMonitor.com. About Camp Rim Rock Camp Rim Rock, LLC -- https://camprimrock.com/ -- is an overnight camp for girls. The activities include horseback riding, performing arts, aquatics, arts & crafts, sports, and other camp activities. Camp Rim Rock, LLC, based in Bryn Mawr, PA, filed a Chapter 11 petition (Bankr. E.D. Pa. Case No. 20-14692) on December 9, 2020. In its petition, the Debtor was estimated $1 million to $10 million in both assets and liabilities. The petition was signed by Joseph Greitzer, a sole member. The Honorable Magdeline D. Coleman presides over the case. SMITH KANE HOLMAN, LLC, serves as bankruptcy counsel to the Debtor. CARDINAL BAY: S&P Stays 'BB-' 2016C Bonds Rating on Watch Negative ------------------------------------------------------------------ S&P Global Ratings has extended its CreditWatch with negative implications on the following ratings, on New Hope Cultural Education Finance Corp., Texas' senior living revenue bonds, issued for Cardinal Bay Inc. (Village on the Park/Carriage Inn Project): -- The 'BBB' rating on the series 2016A bonds; -- The 'BB' rating on the series 2016B bonds; and -- The 'BB-' rating on the series 2016C bonds. As borrower, Cardinal Bay Inc. issued bonds to acquire a pool of eight senior living rental properties--seven in Texas and one in Oklahoma. The total bond issuance included the three rated tranches and a fourth-tier series 2016D that S&P does not rate. The 1,037 units are either independent living, assisted living, or memory care. Each property has a dining facility, communal areas for tenant activities, and other amenities. Cardinal Bay Inc. is an affiliate of The Emmaus Calling (TEC). "The CreditWatch extension is due to the lack of independent third-party audited statements for fiscal 2020, which we believe would provide a sufficient description of financial performance," said S&P Global credit analyst Raymond Kim. The original placement on March 1 was based on persistently low occupancy--reported as 77% for the full year--leading to debt service coverage for 2020 that is below 1x on both the class B and Class C bonds, as per S&P's calculations. S&P notes that the project paid debt service in January 2021 without the use of draws on the debt service reserve fund, partially assisted by deferred payments to the owner and asset manager, and secured loans under the federal government's Paycheck Protection Program that reimbursed certain operating expenses. S&P said, "We further note that in terms of the upcoming July 1 debt service payment due date, according to the trustee, the debt service fund's current balance reflects full funding as of the date of this publication, and the debt service reserve funds continue to be fully funded. "Given that the audit will likely be completed in June, we expect to resolve this placement within our 90-day CreditWatch period." CAREERBUILDER LLC: Moody's Cuts CFR to Caa1, Outlook Negative ------------------------------------------------------------- Moody's Investors Service downgraded CareerBuilder, LLC's corporate family rating to Caa1 from B3, probability of default rating to Caa1-PD from B3-PD and senior secured credit facility rating to Caa1 from B3. The outlook is revised to negative from stable. "The downgrade of the CFR to Caa1 from B3 is driven by our expectation for elevated investments in product and marketing to eliminate earnings and free cash flow until 2022," said Andrew MacDonald, Moody's Assistant Vice President. RATINGS RATIONALE CareerBuilder's Caa1 CFR reflects Moody's expectation for revenue declines, weak credit metrics and about $30 million of negative free cash flow in 2021 as the company invests in marketing and its go-to-market strategy, principally by converting customers to stickier subscription based products and focusing on integrated product delivery. The sizable investments in sales and marketing required to reverse the declining revenue trend will be funded from cash the company retained from the net proceeds of asset sales completed in 2020. Although CareerBuilder repaid about $110 million of debt after the asset sale, Moody's concern that the nearing maturity of the remaining debt, especially the term loan due in July 2023, may not afford the company enough time to stabilize revenue and strengthen credit metrics enough to permit a successful refinancing of the debt. All financial metrics cited reflect Moody's standard adjustments. According to sources cited by the company, CareerBuilder's online job board grew market share in 2020, after having seen meaningful share erosion over prior years. CareerBuilder benefits from a well-known brand and a large database of resumes. The company claims that recent investments in sales and marketing have been driving increased site traffic and registered user counts. However, there is increased competition, including from larger, better-capitalized peers such as Indeed.com owner Recruit Holdings Co., Ltd. (A3 stable) and LinkedIn owner Microsoft Corporation (Aaa stable). Industry revenue was pressured in 2020 by weak employment and recruitment conditions following the coronavirus pandemic outbreak. Moody's expects CareerBuilder's financial strategies will be aggressive under its private equity ownership and may include cash distributions to shareholders. The use of proceeds from asset sales in 2020 included debt reduction, cash to fund future investment and a distribution to shareholders. Moody's notes that the anticipated losses and cash flow burn are in part a result of the company's decision to invest asset sale proceeds in the business. That said, the large expected 2021 revenue decline is also a key driver of the poor anticipated operating results. As a business services company, CareerBuilder faces low environmental risk. The company is also expected to have relatively low social risks as the data CareerBuilder safeguards is made available by its user base. Governance risks include CareerBuilder's aggressive expected financial strategies under private equity ownership. The financial sponsors have already recouped all of their initial investment through dividend payouts. CareerBuilder's liquidity profile is considered limited but adequate. The company will rely on its large cash balance to fund the anticipated cash burn. Cash as of December 31, 2020 was $114 million. The undrawn $50 million revolving credit facility expires in July 2022, which is within 15 months; therefore, it is not considered a source of liquidity. Moody's expects the company will generate negative free cash flow until sometime in 2022. The revolver is subject to a maximum net first lien leverage ratio (as defined in the facility agreement) of 3.0x that is applicable to the revolver only if usage exceeds $15 million. Moody's does not expect the covenant to be tested over the next 12 months. The Caa1 rating assigned to the senior secured credit facility, consisting of a $50 million revolving credit facility expiring in July 2022 and a $175 million term loan maturing in July 2023, reflects both the PDR of Caa1-PD and the loss given default ("LGD") assessment of LGD3. The senior secured first lien credit facilities benefit from secured guarantees from all existing and subsequently acquired domestic subsidiaries. The Caa1 senior secured rating is in line with the Caa1 CFR as there is no other meaningful debt in the capital structure. The negative outlook reflects Moody's concern that if CareerBuilder's weak credit metrics and expected cash burn cannot be reversed in the next year, the company will face elevated refinancing risk of its term loan before it becomes a current liability in July 2022. The outlook could be stabilized if CareerBuilder extends its debt maturity profile, affording it adequate time to complete its investment efforts, or if Moody's expects revenue and earnings to grow. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS The ratings could be upgraded if Moody's expects CareerBuilder will maintain debt-to-EBITDA below 6x and free cash flow as a percentage of debt in a low single digits range. The ratings could be downgraded if term loan refinancing uncertainty rises, or if liquidity weakens faster than anticipated from a higher than anticipated cash burn. The ratings could also be downgraded should the likelihood of a distressed exchange or other default action increase, or if business recovery prospects weaken. The principal methodology used in these ratings was Business and Consumer Service Industry published in October 2016. Issuer: CareerBuilder, LLC Corporate Family Rating, Downgraded to Caa1 from B3 Probability of Default Rating, Downgraded to Caa1-PD from B3-PD Senior Secured Bank Credit Facility, Downgraded to Caa1 (LGD3) from B3 (LGD3) Outlook, Changed To Negative From Stable CareerBuilder, headquartered in Chicago, IL and controlled by affiliates of private-equity sponsor Apollo Global Management, operates an online job board and provides related services and software. Revenue as of year-end 2020 proforma for the sale of CBES, Kariera S.A. and Textkernel was about $280 million and is expected to decline in 2021. CARESTREAM DENTAL: S&P Alters Outlook to Stable, Affirms 'B' ICR ---------------------------------------------------------------- S&P Global Ratings revised its outlook on Carestream Dental Parent Ltd. (CSD) to stable from negative and affirmed its 'B' long-term issuer credit rating and its 'B' issue-level rating on the company's first-lien debt. S&P said, "The stable outlook reflects our view that the company's solid market position, improving operating margin, and solid free cash flow (FOCF) generation create a cushion for potential merger and acquisition (M&A) or shareholder return activity in the future. "We expect CSD will maintain its improved operating performance for the rest of 2021. We believe the company, which maintains solid market positions in imaging equipment and software for dental business, will continue to benefit from the ongoing recovery in dental visit volumes worldwide as the effects of the pandemic subside. In the first quarter of 2021, CSD experienced a robust recovery in its sales, including an increase in its both segments (equipment and dental practice management software (DPMS)) compared to first-quarter 2020 and first quarter 2019 (pre-pandemic). "We believe CSD's new product launches, expansion of digital tools that support dentist practices, and tuck-in acquisitions will support growth above pre-pandemic levels in the coming years. "CSD will likely maintain its improved adjusted EBITDA margins.Profitability has improved since mid-2020. Specifically, CSD's S&P Global Ratings-adjusted EBITDA margins expanded meaningfully in first-quarter 2021, from first-quarter 2019 (pre-pandemic). We believe CSD will retain many cost savings that it achieved in response to the pandemic headwinds. We believe the cost-containment measures CSD has already implemented, combined with favorable product mix, will enable it to sustain EBITDA margins near current levels. "We expect CSD to sustain leverage above 5x, given the private equity ownership.We forecast CSD's EBITDA and FOCF generation will exceed pre-pandemic levels, supporting the potential for gradual leverage reduction to below 5x in 2022. However, given the company's private equity ownership, we expect CSD to prioritize shareholder returns over permanent debt reduction. Hence, we believe the long term leverage will remain over 5x." Maintaining its market-leading position and managing the cyclicality of its demand are the company's key long-term risks. Sales of dental products are sensitive to budget pressures, especially during economic downturns, because patients may choose to delay dental treatments because of a lower level of coverage from their insurance providers and the elective nature of some dental treatments. Furthermore, while CSD maintains a solid position in the market, it must continue to invest in research and development, and it must innovate new dental equipment to meet the competitive challenges of the dental equipment marketplace. The company's expected launch of a new generation of scanner, as well as other new products, should support its market share in the coming years. The stable outlook reflects S&P's view that CSD's solid market position, improving operating margin, and FOCF generation create a cushion for potential M&A or shareholder return activity in the future. S&P could consider lowering the rating if S&P expects adjusted debt to EBITDA to exceed 8x and free cash flow to debt to decline to below 3%. This scenario could occur if: -- Operating performance materially underperforms S&P's expectations (e.g., because pricing pressure stemming from intensifying competition causes EBITDA margin to contract by at least 500 basis points (bps) relative to our 2021 forecast) or; -- The company pursues a significant debt-funded dividend or acquisition. -- S&P said, "We could consider raising the rating if we expect adjusted debt to EBITDA to be sustained below 5x. While CSD could achieve these metrics by improving margins by about 100 bps above our base-case expectation for 2021, we would likely view a leverage reduction resulting from an improvement in profitability as temporary, given the company's financial sponsor ownership." CASTEX ENERGY: Chapter 11 Plan Nears Final But More Talks Needed ---------------------------------------------------------------- Law360 reports that bankrupt offshore oil and gas production company Castex Energy told a Texas judge Thursday, May 27, 2021, it has reached agreement with stakeholders on the framework of a Chapter 11 plan, but additional discussions are needed before presenting it for confirmation. During a virtual hearing, debtor attorney Matthew S. Okin of Okin Adams LLP said in the 90 days since it filed its Chapter 11 petition, Castex has been able to bring together the major constituencies in the case to prepare a term sheet to form the basis for a plan. About Castex Energy 2005 Holdco Castex Energy 2005 Holdco, LLC and its affiliates, Castex Energy 2005, LLC, Castex Energy Partners, LLC, and Castex Offshore, Inc., sought protection under Chapter 11 of the Bankruptcy Code on Feb. 26, 2021 (Bankr. S.D. Tex. Lead Case No. 21-30710) on February 26, 2021. The petitions were signed by chief restructuring officer, Douglas J. Brickley. At the time of the filing, the Debtors estimated their assets and liabilities at $100 million to $500 million. Judge David R. Jones oversees the case. The Debtors are represented by Matthew Okin, Esq. at Okin Adams LLP. The Debtors tapped The Claro Group, LLC as their Financial Advisors, Thompson & Knight LLP as their Special Counsel and Conflicts Counsel, and Donlin, Recano & Company, Inc. as their Notice, Claims & Balloting Agent. CASTEX ENERGY: Taxing Authorities Oppose Plan Disclosures --------------------------------------------------------- Harris County and Shelby County (the "Taxing Authorities"), secured creditors of Castex Energy 2005 Holdco, LLC and its affiliates, objects to Second Amended Joint Chapter 11 Plan. The Taxing Authorities claim that the Plan is vague as to how and when the Taxing Authorities' claims will be paid. They assert that the Plan should not be confirmed until the Debtors specifically provide how the tax claims will be paid. The Taxing Authorities point out that the Plan fails to properly provide for the payment of interest on the Taxing Authorities' claims as required by 11 U.S.C. §§ 506(b) and 1129. The Taxing Authorities are entitled to interest on the claims at the statutory rate of 12% per annum continuing until the claims are paid in full. The Taxing Authorities object to the Plan on the basis that the Plan fails to provide for the retention of the Taxing Authorities' liens on the collateral. The Plan should not be confirmed unless and until it specifically provides for the Taxing Authorities' liens to remain on the collateral until the taxes are paid in full. Lastly, the Taxing Authorities object to the Plan on the basis that the Plan requires prior authorization to amend any claims after the Effective Date. The Taxing Authorities' claims include estimated amounts for the 2021 tax year that will not become final until after the Effective Date. Counsel for the Taxing Authorities: LINEBARGER GOGGAN BLAIR & SAMPSON, LLP JOHN P. DILLMAN Texas State Bar No. 05874400 TARA L. GRUNDEMEIER Texas State Bar No. 24036691 Post Office Box 3064 Houston, Texas 77253-3064 Tel: (713) 844-3478 Fax: (713) 844-3503 E-mail: john.dillman@lgbs.com tara.grundemeier@lgbs.com About Castex Energy 2005 Holdco Castex Energy 2005 Holdco, LLC and its affiliates, Castex Energy 2005, LLC, Castex Energy Partners, LLC, and Castex Offshore, Inc., sought protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Texas Lead Case No. 21-30710) on Feb. 26, 2021. At the time of the filing, the Debtors disclosed assets of between $100 million and $500 million and liabilities of the same range. Judge David R. Jones oversees the cases. The Debtors tapped Okin Adams LLP as bankruptcy counsel, The Claro Group, LLC as financial advisor, and Thompson & Knight LLP as special counsel and conflicts counsel. Douglas Brickley, managing director at Claro Group, serves as the Debtors' chief restructuring officer. Donlin, Recano & Company, Inc. is the notice, claims and balloting agent. The U.S. Trustee for Region 7 appointed an official committee of unsecured creditors in the Debtors' Chapter 11 cases. Stewart Robbins Brown & Altazan, LLC and Howley Law, PLLC serve as the committee's bankruptcy counsel and local counsel, respectively. Seaport Global Securities, LLC is the committee's financial advisor. CASTEX ENERGY: Texas Petroleum Says Amended Plan Unconfirmable -------------------------------------------------------------- Texas Petroleum Investment Company ("TPIC") objects to the Second Amended Joint Chapter 11 Plan of Castex Energy 2005 Holdco, LLC and its affiliates. TPIC claims that the Plan impermissibly permits the Debtors to Abandon Executory Contracts. The Plan appears to contemplate a scenario where the Debtors may be allowed to abandon executor contracts. TPIC objects to the Plan to the extent same purports to in any manner affect adversely, through confirmation of the Plan, TPIC's setoff and recoupment rights. On the one hand, proposed treatment in Class No. 1 seems to preserve TPIC's setoff rights, on the other hand, the injunction and release provisions of the Plan seem to cutoff such rights. TPIC points out that the Debtors seek to abandon properties without providing for payment of the Debtors' share of P&A obligations. Under applicable law, even after abandonment, the Debtors maintain regulatory and contractual obligations to plug and abandon or pay their share of P&A costs, and the Debtors cannot abandon their way out of these liabilities by simply confirming and substantially consummating their Plan. TPIC also objects to the Plan because it is highly questionable whether Debtors (a) have the ability to pay allowed administrative expense claims in full, and (b) to satisfy all of its P&A Obligations under the Plan. Considering the fact that certain P&A claims may be entitled to administrative expense status, the magnitude of such claims could also potentially impact the feasibility of the Plan, thus making the Plan unconfirmable pursuant to § 1129(a)(11). TPIC asserts that the Plan is not clear respecting whether the lenders' liens will be released respecting assets proposed to be abandoned under the Plan. It appears that the Debtors propose to abandon certain of its interests in properties in which TPIC is involved as either the operator or a working interest holder. Counsel to Texas Petroleum: GRAY REED Micheal W. Bishop Texas Bar No. 02354860 Matthew W. Bourda Texas Bar No. 24091948 1601 Elm Street, Suite 4600 Dallas, Texas 77056 Telephone: (214) 954-4135 Facsimile: (214) 953-1332 E-mail: mbishop@grayreed.com mbourda@grayreed.com About Castex Energy 2005 Holdco Castex Energy 2005 Holdco, LLC and its affiliates, Castex Energy 2005, LLC, Castex Energy Partners, LLC, and Castex Offshore, Inc., sought protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Texas Lead Case No. 21-30710) on Feb. 26, 2021. At the time of the filing, the Debtors disclosed assets of between $100 million and $500 million and liabilities of the same range. Judge David R. Jones oversees the cases. The Debtors tapped Okin Adams LLP as bankruptcy counsel, The Claro Group, LLC, as financial advisor, and Thompson & Knight LLP as special counsel and conflicts counsel. Douglas Brickley, managing director at Claro Group, serves as the Debtors' chief restructuring officer. Donlin, Recano & Company, Inc. is the notice, claims and balloting agent. The U.S. Trustee for Region 7 appointed an official committee of unsecured creditors in the Debtors' Chapter 11 cases. Stewart Robbins Brown & Altazan, LLC and Howley Law, PLLC serve as the committee's bankruptcy counsel and local counsel, respectively. Seaport Global Securities, LLC is the committee's financial advisor. CASTEX ENERGY: United States Trustee Says Amended Plan Defective ---------------------------------------------------------------- Kevin M. Epstein, the United States Trustee for Region 7, objects to the Second Amended Joint Chapter 11 Plan of Castex Energy 2005 Holdco, LLC and its affiliates. The U.S. Trustee objects to confirmation of the Amended Plan because it does not meet the requirements of Sections 1129(a)(2), (a)(9) and (a)(12). * The Amended Plan does not meet the requirements under Section 1129(a)(2) because the Debtors have not filed any monthly operating reports. Monthly operating reports are much more than busy work imposed upon a Chapter 11 debtor for no reason other than to require it to do something. * The Amended Plan is defective because it does not identify what entity has the obligation to file post-confirmation reports. The Amended Plan, the Liquidating Trust Agreement and any related document should be amended to provide that the Liquidating Trustee has the obligation to file the post-confirmation quarterly reports. * The Amended Plan does not meet the requirements of Sections 1129(a)(9) and 1129(a)(12) because it does not provide for payment of Quarterly Fees on the Effective Date. Confirmation of the Amended Plan should be denied unless the Debtors provide full and accurate disbursement information for the U.S. Trustee to determine the amount of all Quarterly Fees owed, and said fees are paid on or before the Effective Date. * Lastly, the Debtors' releases and third-party releases are objectionable because they do not contain a carveout for gross negligence, willful misconduct, or actual fraud. The Court should require the Debtors to amend the Debtors' releases and third-party releases to carveout gross negligence, willful misconduct, and actual fraud. About Castex Energy 2005 Holdco Castex Energy 2005 Holdco, LLC and its affiliates, Castex Energy 2005, LLC, Castex Energy Partners, LLC, and Castex Offshore, Inc., sought protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Texas Lead Case No. 21-30710) on Feb. 26, 2021. At the time of the filing, the Debtors disclosed assets of between $100 million and $500 million and liabilities of the same range. Judge David R. Jones oversees the cases. The Debtors tapped Okin Adams LLP as bankruptcy counsel, The Claro Group, LLC as financial advisor, and Thompson & Knight LLP as special counsel and conflicts counsel. Douglas Brickley, managing director at Claro Group, serves as the Debtors' chief restructuring officer. Donlin, Recano & Company, Inc. is the notice, claims and balloting agent. The U.S. Trustee for Region 7 appointed an official committee of unsecured creditors in the Debtors' Chapter 11 cases. Stewart Robbins Brown & Altazan, LLC and Howley Law, PLLC serve as the committee's bankruptcy counsel and local counsel, respectively. Seaport Global Securities, LLC is the committee's financial advisor. CBL & ASSOCIATES: Creditors Oppose Ch.11 Equity Holders Committee ----------------------------------------------------------------- Law360 reports that the unsecured creditors of mall owner CBL & Associates told a Texas bankruptcy judge that they oppose the creation of an official committee of preferred equity holders in CBL's Chapter 11 case because it would drain the limited resources of the company's estate. In its objection late Thursday, May 27, 2021, the official committee of unsecured creditors said that shareholders are out of the money in the case and not entitled to a recovery since unsecured creditors won't be paid in full under CBL's proposed Chapter 11 plan. About CBL & Associates CBL & Associates Properties, Inc. -- http://www.cblproperties.com/ -- is a self-managed, self-administered, fully integrated real estate investment trust (REIT) that is engaged in the ownership, development, acquisition, leasing, management and operation of regional shopping malls, open-air and mixed-use centers, outlet centers, associated centers, community centers, and office properties. CBL's portfolio is comprised of 107 properties totaling 66.7 million square feet across 26 states, including 65 high-quality enclosed, outlet and open-air retail centers and 8 properties managed for third parties. It seeks to continuously strengthen its company and portfolio through active management, aggressive leasing and profitable reinvestment in its properties. CBL, CBL & Associates Limited Partnership and certain other related entities filed voluntary petitions for reorganization under Chapter 11 of the U.S. Bankruptcy Code in Houston, Texas, on Nov. 1, 2020 (Bankr. S.D. Tex. Lead Case No. 20-35226). The Debtors have tapped Weil, Gotshal & Manges LLP as their legal counsel, Moelis & Company as restructuring advisor and Berkeley Research Group, LLC, as financial advisor. Epiq Corporate Restructuring, LLC, is the claims agent. CITIUS PHARMACEUTICALS: Adjourns Special Meeting Until June 21 -------------------------------------------------------------- Citius Pharmaceuticals, Inc. held a special meeting of stockholders on May 24, 2021. At the meeting, stockholders were asked to vote on three proposals. Stockholders voted on Proposal 2 to approve the adjournment of the special meeting, and any adjournment or postponement thereof, if necessary, to solicit additional proxies if there are not sufficient votes in favor of Proposal 1 (an increase in the authorized shares of common stock). The stockholders also voted on Proposal 3 to approve the Citius Pharmaceuticals, Inc. 2021 Omnibus Stock Incentive Plan. In light of the approval by stockholders to permit adjournment to solicit additional proxies, and given that the results of the voting so far indicate the clear majority of shares that have been voted to date have voted to approve Proposal 1, the Company decided to adjourn the meeting with respect to such proposal until 8:00 a.m. (Eastern Time) on June 21, 2021 at its headquarters at 11 Commerce Drive, First Floor, Cranford, New Jersey. About Citius Headquartered in Cranford, NJ, Citius Pharmaceuticals, Inc. -- http://www.citiuspharma.com-- is a specialty pharmaceutical company dedicated to the development and commercialization of critical care products targeting unmet needs with a focus on anti-infectives, cancer care and unique prescription products. Citius reported a net loss of $17.55 million for the year ended Sept. 30, 2020, compared to a net loss of $15.56 million for the year ended Sept. 30, 2019. As of March 31, 2021, the Company had $134.67 million in total assets, $8.90 million in total liabilities, and $125.77 million in total equity. Boston-based Wolf & Company, P.C., the Company's auditor since 2014, issued a "going concern" qualification in its report dated Dec. 16, 2020, citing that the Company has suffered recurring losses and negative cash flows from operations and has a significant accumulated deficit. These conditions raise substantial doubt about the Company's ability to continue as a going concern. CITY BREWING: S&P Withdraws B+ Rating in Revolving Credit Facility ------------------------------------------------------------------ S&P Global Ratings withdrew its 'B+' issue-level and '3' recovery ratings on City Brewing Co. LLC's revolving credit facility at the issuer's request. All of S&P's other ratings on City Brewing, including the 'B+' issuer credit rating and its 'B+' issue-level and '3' recovery ratings on the company's first-lien term loan B credit facility, are unchanged. CLAIRE E. GRUPPO: Albert Venger Buying Ancram Property for $320K ---------------------------------------------------------------- Claire E. Gruppo asks the U.S. Bankruptcy Court for the Southern District of New York to authorize the sale of the real property located at 537 County Route 27, in Ancram, New York, to Albert Venger for $320,000, cash. A hearing on the Motion is set for June 22, 2021, at 9:00 a.m. Objections, if any, must be filed at least seven business days prior to the Hearing. The Debtor desires to sell a portion of Property, to wit: an 18.503-acre parcel with two barns, on the north side of the road bearing Section 174, Block 1, Lot 40.200. The sale of the Property will aid the Debtor in consummating her Chapter 11 plan of reorganization, and is critical in the resolution of the litigation with the Debtor's largest creditor, Pensmore Investments, LLC. The Property is encumbered by a first mortgage lien held by Key Bank, N.A. ("KeyBank1") in the sum of approximately $111,122.22. The amount required to reinstate the first mortgage of KeyBank1 and release its lien on the Property is approximately $60,441.72. The Property is encumbered by a secondary lien (a home equity line of credit) held by Keybank, N.A. ("KeyBank2") in the sum of approximately $722,801.02. The sum required by KeyBank2 to reinstate the home equity line of credit and release its lien on the Property is approximately $85,866.62. The sale of the Property will not result in prejudice to the Debtor's creditors, as it is the proceeds of the sale that will be used to pay closing costs, reinstate the mortgageliens1, and pay down the obligation to Pensmore. It is contemplated that, after paying ordinary closing costs, including special counsel for the debtor and the realtor for the Debtor, reinstatement amounts to KeyBank1 (approximately $60,441.72) and KeyBank2 (approximately $85,866.62), the remaining proceeds will be paid to Pensmore in accordance with the parties' Stipulation of Settlement (the Application to Approve the Stipulation was filed with the Court on May 13, 2021 and is scheduled for presentment on June 7, 2021, see this Court's docket). The sale is in the best interest of the estate as it will enable the debtor to consummate the Chapter 11 plan and move towards a feasible reorganization. In July, 2020, the Debtor received a cash offer from Albert Venger on the Property of $320,000. Upon information and belief, the fair market value of the Property is approximately $125,000 per the valuation performed by George M. DeVoe Real Estate Appraisals, LLC. The offer to purchase the Property was made by the Debtor's neighbor, as the Property abuts the neighbor's. As such, if the Property was listed on the MLS, the Debtor would not achieve nearly as high an offer as was negotiated by the proposed realtor, Andrew Hingson of Graham T. Klemm, Broker, doing business as Private Properties. The Debtor makes the Application for an Order authorizing her to sell her right, title and interest in and to the Property free and clear of all liens against the Property. By the Motion, the debtor seeks the entry of an Order: (i) authorizing her to proceed with the Sale of the Property; (ii) approving the sale of the Property, free and clear of all liens, claims and encumbrances, security interests and other interests, to the Buyer; and (iii) granting such other and further relief. A copy of the Agreement is available at https://tinyurl.com/5dkx5ksv from PacerMonitor.com free of charge. Counsel for Debtor: Andrea B. Malin, Esq. Michelle L. Trier, Esq. GENOVA & MALIN LLP 1136 Route 9 Wappingers Falls, NY 12590 Telephone: (845) 298-1600 Claire E. Gruppo sought Chapter 11 protection (Bankr. S.D.N.Y. Case No. 20-35797) on July 29, 2020. The Debtor tapped Michelle Trier, EsGenova & Malin as counsel. COLFAX CORP: S&P Affirms 'BB' ICR on Improving Performance ---------------------------------------------------------- S&P Global Ratings affirmed its 'BB' ratings on Colfax Corp. The outlook remains negative. The negative outlook continues to reflect the uncertainty regarding the proposed transaction. S&P believes Colfax will maintain its recently improved operating performance, although some risk remains as it relates to recent inflationary pressures. Still, it believes the company will improve EBITDA margins and reduce debt to EBITDA. Key details of the FabTech/MedTech separation remain uncertain. In March 2021, Colfax announced plans to separate its MedTech and FabTech businesses into independently traded public companies. The proposed transaction continues Colfax's portfolio transformation. It acquired DJO Global Inc. (MedTech) in February 2019 and sold Howden (its air and gas handling business) later that year. S&P said, "We believe the proposed separation will reduce Colfax's overall scale and diversification that it previously benefited from. At this point, it remains unclear on how management will capitalize the two separate businesses, as well as the future financial policies and growth strategies of the stand-alone businesses. When the separation occurs (expected in Q1 2022) we will review the new capital structure and assess Colfax as a stand-alone entity once we have a better understanding of the company's capital allocation plans. Downside risk remains because there is meaningful uncertainty in the new structure, in our view. We could lower the rating if the capitalization of the existing business no longer supports a 'BB' rating. Given the reduced scale and diversification, there is limited possibility of us raising the rating at this time." Colfax significantly reduced its leverage following an equity issuance in March 2021. S&P originally anticipated leverage would modestly improve prior to the separation as the company rebounded from the global economic recession. However, following the separation announcement, Colfax completed an equity offering of $711.3 million and used the proceeds to redeem the $600 million senior unsecured notes due 2024 and $100 million of its senior unsecured notes due 2026. A gradual rebound of the economy coupled with contributions from acquisitions should continue to drive revenue growth in the MedTech segment. Colfax completed five acquisitions within its MedTech segment in 2020 and three so far in 2021. S&P views the expansion into adjacencies, such as foot and ankle offerings, positively because they enhance the reconstruction segment of MedTech, in itsr view. S&P said, "The trajectory of the MedTech business is dependent on the resumption of rehabilitation services and elective surgeries, which we believe is likely given the pace of reopenings. The medical segment suffered from the lockdowns during the second quarter of 2020 given the pause in elective medical procedures, organized sports activities, and fewer workplace injuries. The second wave of COVID-19 and increased hospitalizations in the fourth quarter of 2020 also weighed on the business, though the effect was not as pronounced. We believe this segment could still remain under pressure depending on when rehabilitation services and elective surgeries return to pre-COVID levels; however, first quarter 2021 showed strength as the MedTech segment returned to positive growth of 7% year over year. We expect the company to continue experiencing modest growth in its MedTech segment in 2021 as hospitals are better able to manage COVID patients and higher levels of elective surgeries, as well as the benefits of its recent acquisitions. "We anticipate FabTech revenues will return to pre-COVID levels in 2021. We anticipate that the FabTech segment will benefit from its exposure to faster growing, developing regions in 2021, and therefore return to pre-COVID levels this year. Partially offsetting the growth is the raw material inflation that is impacting manufacturing companies globally. Similar to other companies, Colfax is implementing pricing to pass along inflation, but we believe this remains a risk. We believe the company could pursue bolt-on acquisitions in the FabTech segment as well. We believe these could be in adjacencies to the current business such as medical and specialty gas control, and digital and software. "As a result of expected growth and inclusive of potential acquisitions, we expect Colfax's S&P Global Ratings-adjusted EBITDA margins to be in the mid- to high-teens-percent area, and for S&P Global Ratings-adjusted leverage to be less than 3x in 2021. "The negative outlook reflects the uncertainty regarding the proposed transaction. We believe Colfax will maintain its recently improved operating performance over the next 12 months. Despite inflationary pressures, we believe the company will improve S&P Global Ratings-adjusted EBITDA margins to the mid- to high-teens range and reduce leverage less than 3x in 2021. "We acknowledge that the company's plan to separate its two businesses will result in reduced scale and diversification overall. Therefore, we could lower the rating if we no longer believed its leverage and financial policies were supportive of the business. We will assess the rating and outlook as more information emerges. "While less likely, if the transaction does not occur we could lower our ratings on Colfax if the existing company's operating performance deteriorates beyond our expectations, possibly due to diminished demand for its products, such that its debt to EBITDA remains above 5x. We could also lower the rating if the company makes financial policy decisions, particularly as it relates to shareholder returns and acquisitions, that result in leverage sustained above 5x. "We could revise the outlook on Colfax to stable once we receive more clarity on the remaining business, including its financial policies and capital structure, and if we believed these were commensurate with a 'BB' rating. "If Colfax were no longer to pursue the separation of the businesses, or if the timeline were significantly delayed, we could revise the outlook to stable if Colfax maintains its recently improved operating performance. Under this scenario, we would expect the company to maintain leverage well below 5x and would need to believe the company's financial policies would support this improved level of leverage." COLLAB9 LLC: Sale of Business Assets to SecureComm. LLC Approved ---------------------------------------------------------------- Judge Ernest M. Robles of the U.S. Bankruptcy Court for the Central District of California authorized Collab9, LLC's sale of business assets to SecureComm. LLC free and clear of all Interests. A Sale Hearing was held on May 20, 2021, at 10:00 a.m. The Agreement, and all of the terms and conditions thereof, is approved. The Debtor is authorized and directed to take all actions necessary to consummate the Sale pursuant to and in accordance with the terms and conditions of the Agreement. On the Closing Date, from the Purchase Price, the Buyer or the Debtor will (i) pay to the non-debtor party to each Assigned Contract as to which a cure amount is stated on Exhibit B, the amount of such Cure Amount. Any unfunded amount of the $275,000 "Carve-Out" to be paid to the Debtor's bankruptcy counsel in accordance with the Court's final order approving DIP financing and use of case cash collateral entered on April 21, 2021 will be advanced to the Debtor's bankruptcy counsel's trust account by the Buyer prior to the Closing Date. Notwithstanding the provisions of Fed. R. Bankr. P. 6004 (h), 6006(d), and 7062, the Order will be effective and enforceable immediately upon entry. About Collab9 LLC Collab9, LLC -- https://www.collab9.com/ -- is a cloud communications platform that caters to the public sector marketplace with FedRAMP Authorized Unified Communications as a Service. The platform integrates voice, video, messaging, mobility, presence, conferencing, and customer care in one predictable, user-based subscription model. Collab9 sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. C.D. Calif. Case No. 21-12222) on March 19, 2021. In the petition signed by Kevin Schatzle, chief executive officer, the Debtor disclosed up to $10 million in assets and up to $50 million in liabilities. Judge Ernest M. Robles oversees the case. Victor A. Sahn, Esq., at SulmeyerKupetz, A Professional Corporation, is the Debtor's legal counsel. COLLECTED GROUP: Joint Prepackaged Plan Confirmed by Judge ---------------------------------------------------------- Judge Laurie Selber Silverstein has entered an order approving the Disclosure Statement and confirming the First Modified Joint Prepackaged Chapter 11 Plan of Reorganization for The Collected Group, LLC and Its Debtor Affiliates. All documents necessary to implement the Plan and all other relevant and necessary documents (including the Exit Facility Documents, the New Organizational Documents, and the GUC Trust Agreement) have been negotiated in good faith and at arm's length and shall, upon completion of documentation and execution, be valid, binding, and enforceable agreements and shall not be in conflict with any federal or state law. The Debtors have disclosed all material facts regarding the Restructuring Transactions and the Plan, including with respect to the Exit Facility Documents, the New Organizational Documents, and the GUC Trust Agreement. The Debtors, the Released Parties, and the Releasing Parties have been and will be acting in good faith if they proceed to: (a) consummate the Plan and the agreements, settlements, transactions, and transfers contemplated; and (b) take the actions authorized and directed by this Confirmation Order to reorganize the Debtors' businesses and effect the Exit Facility Documents, the New Organizational Documents, the GUC Trust Agreement, and the Restructuring Transactions. The establishment and governance of the GUC Trust as set forth in Article IV.N of the Plan and the GUC Trust Agreement are approved in all respects. On the Effective Date, the GUC Trust shall be established for the sole purpose of liquidating the GUC Trust Assets and making distributions to Holders of Allowed General Unsecured Claims in accordance with the Plan and the GUC Trust Agreement. Counsel for the Debtor: Brian S. Hermann John T. Weber Brian Bolin PAUL, WEISS, RIFKIND, WHARTON & GARRISON LLP 1285 Avenue of the Americas New York, New York 10019 Telephone: (212) 373-3000 Facsimile: (212) 757-3990 Pauline K. Morgan Andrew L. Magaziner Joseph M. Mulvihill YOUNG CONAWAY STARGATT & TAYLOR, LLP Rodney Square 1000 North King Street Wilmington, Delaware 19801 Telephone: (302) 571-6600 Facsimile: (302) 571-1253 About The Collected Group The Collected Group and four affiliates filed for Chapter 11 bankruptcy (Bankr. D. Del. Lead Case No. 21-10663) on April 5, 2021. In the petitions signed by CRO Evan Hengel, the Debtors estimated assets of between $50 million and $100 million and liabilities of between $100 million and $500 million. The Honorable Judge Laurie Selber Silverstein is the case judge. Founded in 2001, The Collected Group, LLC is a designer, distributor and retailer of three contemporary, consumer-inspired, apparel lifestyle brands: Joie, Equipment, and Current/Elliott. TCG, the ultimate parent company, wholly owns Debtors RBR, LLC and The Collected Group Company, LLC. RBR wholly owns non-debtor The Collected Group Holdings Manager, LLC, which, in turn, wholly owns non-debtor The Collected Group Holdings, LLC. Paul, Weiss, Rifkind, Wharton & Garrison, LLP and Young Conaway Stargatt & Taylor, LLP serve as the Debtors' legal counsel while Miller Buckfire & Co., LLC and its affiliate, Stifel, Nicolaus & Co., Inc., serve as financial advisor and investment banker. The Debtors also tapped Berkeley Research Group, LLC and appointed the firm's managing director, Evan Hengel, as their chief restructuring officer. Epiq Corporate Restructuring LLC is the claims agent and administrative advisor. An official committee of unsecured creditors has been appointed in the case and is represented by: Lauren Schlussel, Esq. Eric Wilson, Esq. Jason Adams, Esq. Kelley Drye & Warren LLP 3 World Trade Center 175 Greenwich Street New York, NY 10007 E-mail: LSchlussel@KelleyDrye.com EWilson@KelleyDrye.com JAdams@KelleyDrye.com KKR Loan Administration Services LLC, as DIP Agent, is represented by: Vincent Indelicato, Esq. Megan Volin, Esq. Proskauer Rose LLP Eleven Times Square New York, NY 10036 E-mail: vindelicato@proskauer.com E-mail: mvolin@proskauer.com - and - Robert J. Dehney, Esq. Andrew R. Remming, Esq. Morris Nichols Arsht & Tunnell LLP 1201 North Market Street Wilmington, DE 19899 E-mail: rdehney@morrisnichols.com E-mail: aremming@morrisnichols.com COLT HOLDING: Announces Acquisition by CZG ------------------------------------------ Shephard News reports that Ceska zbrojovka Group (CZG) has announced that it has successfully closed on its acquisition of 100% of the equity interest in Colt Holding Company LLC for $220 million in cash and stock. Colt Holding Company is the parent company of the US firearms manufacturer, Colt's Manufacturing Company, as well as its Canadian subsidiary, Colt Canada Corporation. CZG and Colt are confident that the merger will bring significant operational, commercial and R&D synergies for the combined business. The combined businesses generated Pro-forma aggregated annual sales in excess of $570million and have more than 2,000 employees in the Czech Republic, the United States, Canada and Germany. The acquisition occurred following the lengthy process of securing all necessary regulatory approvals from the Canadian and the US authorities, which is traditionally reluctant to allow foreign companies to purchase US defence firms. Colt recently found itself in a position of financial difficulty when the organisation filed for bankruptcy in June 2015. The contributing factors to the bankruptcy included: bad management, product portfolio and imprudent financial engineering. Colt officially exited bankruptcy, with its emergence from Chapter 11 restructuring, in January 2016. This acquisition reflects the renewed confidence in Colt's financial stability and quality of its products. About Colt Defense Colt Defense LLC is one of the world's oldest and most iconic designers, developers, and manufacturers of firearms for military, law enforcement, personal defense, and recreational purposes and was founded over 175 years ago by Samuel Colt, who patented the first commercial successful revolving cylinder firearm in 1836 and began supplying U.S. and international military customers with firearms in 1847. Colt is incorporated in Delaware and headquartered in West Hartford, Connecticut. In 1992, Colt Manufacturing Company, then the principal operating subsidiary, filed chapter 11 petitions (Bankr. D. Conn.). An investment by Zilkha & Co. allowed CMC to confirm a chapter 11 plan and emerge from Bankruptcy in 1994. Sometime after 1994, majority ownership of the Company Transitioned from Zilkha & Co. to Sciens Capital Management. Colt Holding Company LLC and nine affiliates, including Colt Defense LLC, on June 14, 2015, filed voluntary petitions (Bankr. D. Del. Lead Case No. 15-11296) for relief under Chapter 11 of the Bankruptcy Code to pursue a sale of the assets as a going concern. Colt Defense estimated $100 million to $500 million in assets and debt. On June 16, 2015, the Court directed the joint administration of the assets. The Debtors tapped Richards, Layton & Finger, P.A., and O'Melveny & Myers LLP, as attorneys, and Kurtzman Carson Consultants LLC as claims and noticing agent. Perella Weinberg Partners L.P. is acting as financial advisor of the Company, and Mackinac Partners LLC is acting as its restructuring advisor. Wilmington Savings Fund Society, FSB, as agent under the $13.3 million Term DIP Loan Agreement, is represented by Pryor Cashman LLP's Eric M. Hellige, Esq.; and Willkie Farr & Gallagher LLP's Leonard Klingbaum, Esq. Cortland Capital Market Services LLC, as agent under the $6.67 million Senior DIP Credit Agreement, is represented by Holland & Knight LLP's Joshua M. Spencer, Esq.; Stroock & Stroock & Lavan LLP's Brett Lawrence, Esq.; and Osler, Hoskin & Harcourt LLP's Richard Borins, Esq., and Tracy Sandler, Esq. The U.S. Trustee for Region 3 appointed five creditors of Colt Defense Inc. and its affiliates to serve on the official committee of unsecured creditors. MagPul Industries Corp. has resigned from the committee leaving only four Committee members. Sciens Capital is represented by Skadden, Arps, Slate, Meagher & Flom LLP's Anthony W. Clark, Esq., and Jason M. Liberi, Esq. Colt officially exited bankruptcy, with its emergence from Chapter 11 restructuring, in January 2016. COMPASS DATACENTERS: S&P Gives (P)BB- on 2021-1 Class C Debt ------------------------------------------------------------- S&P Global Ratings assigned its preliminary ratings to Compass Datacenters Issuer LLC/Compass Datacenters Canada Issuer L.P.'s series 2021-1 class B and C data center revenue notes. Series 2021-1 shares collateral with series 2020-1 and 2020-2. The series 2021-1 class B and C notes are subordinate to the previously issued series 2020-1 and 2020-2 class A notes. The note issuance is an ABS securitization backed by primarily mortgages, deeds of trust, and deeds to secure debt, creating first-mortgage liens on the interests in the data centers; a perfected security interest in all personal property and fixtures owned by the issuer's subsidiaries located in the data centers; and any reserves and escrows related to the data centers. The preliminary ratings reflect S&P's view of the lease portfolio's projected performance, the real estate value, the manager's and the servicer's experience, the servicer and indenture trustee-provided advances, the available cushion as measured by the estimated closing date debt service coverage ratio of approximately 1.9x, and the transaction's structure. Preliminary Ratings Assigned Compass Datacenters Issuer LLC/Compass Datacenters Canada Issuer L.P. (Series 2021-1)(i) Series 2021-1 class B, $61.00 million: BBB- (sf) Series 2021-1 class C, $41.00 million: BB- (sf) (i)The preliminary ratings do not address post-ARD additional interest. ARD--Anticipated repayment date. CONSOL ENERGY: S&P Alters Outlook to Stable, Affirms 'B-' ICR ------------------------------------------------------------- S&P Global Ratings affirmed its issuer credit rating on U.S.-based thermal coal producer CONSOL Energy Inc. at 'B-' and revised the outlook to stable from negative. S&P said, "We are also affirming the issue-level ratings on CONSOL's first-lien debt at 'B+' and the issue-level rating on the company's second-lien notes at 'CCC'. "The stable outlook is based on our expectation of improved cash flows in the next 12 to 24 months. We also believe the risk of distressed debt exchange has been eased by the company's improved standing in the debt and equity markets, as evidenced by recent stock price recovery and its debt trading at levels close to par. "Our expectation of higher EBITDA and the acceleration of debt repayment should improve debt leverage over the next 12 months. We expect CONSOL's adjusted EBITDA will grow by 10%-15% in 2021, allowing free cash flow for debt repayment and potentially the completion of the Itmann project (the construction of a preparation plant for company's low-volatile (low-vol) metallurgical [met] coal mine in West Virginia). In addition, we estimate mandatory debt repayments will increase from about $30 million in 2021 to $45 million in 2022 due to a step up in the required amortization payments of the term loan A and in the cash flow sweep covenant of the term loan B. As a result, we project adjusted debt leverage will decline to 4.5x-5.0x over the next 12 months. "A shift toward industrial customers and international markets could help offset the secular decline in domestic thermal coal demand. We assume CONSOL will sell about 23 million tons of coal in 2021, a 23% increase from 2020. Our volume assumption is anchored on the company's high contracted position of about 90% of sales for 2021 and a shift of the sales volumes from power generation customers to industrial customers and to the international markets. Domestic thermal shipments to utility customers made up 65% of the total volumes in 2019, whereas we expect this percentage to decline to about 50% in 2021. Because CONSOL produces high-quality thermal coal with a very high heat content (about 12,900 British thermal units [Btu]) and medium sulfur (about 2.4%) content, its product is sold to industrial customers. We expect the company's sales volumes to international industrial customers will reach nearly 33% in 2021 from about 16% in 2019. The redirection of the sales mix toward international and industrial markets could help offset some of the domestic thermal coal demand decline. However, larger exposure to the international markets could lead to more volatile earnings in the future." CONSOL could face limited access to capital markets, even as international thermal markets recover. S&P believes thermal coal companies will continue to lose access to traditional financing options as major financial and investment companies have decreased, or committed to divest, their coal investments. As access to traditional financing sources continues to dwindle, CONSOL sought alternative financing options, including a $75 million of industrial revenue bonds issued in March 2021 and various asset-backed financing arrangements in the amount of $59 million. These sources have been secured at lower interest costs than the second lien notes. But future funding sources could have higher interest costs and could be insufficient to fund the approximately $530 million of debt coming due between 2023-2025. S&P estimates the company will generate $100 million-$120 million in free operating cash flows (FOCF) in 2021, a portion of which it expects CONSOL will apply towards debt repayment. The completion of the Itmann project could boost CONSOL's cashflows, if international met coal prices return to historical average levels. When operating at full capacity and if met prices normalize to 10-year average levels, the Itmann mine could generate $20 million-$25 million in EBITDA. The mine can produce up to 900,000 tons annually of high-quality, low-vol met coal, which can be exported or sold to domestic steel makers at premium price. But S&P assumes the Itmann mine will be operating at a reduced capacity until the processing plant is fully constructed. If the company decides to complete the plant the project will require about $65 million of incremental investment, with $15 million already spent. Met coal volumes still represent only about 1 million-2 million of total sales volumes, therefore thermal coal will continue to drive operating performance. S&P said, "The stable outlook is based on our expectation of improved international thermal demand and international prices in the next 12 months. The company's high contracted position for 2021, as well as its growing export sales, could provide some cash flow visibility over the next 12 months. We project adjusted leverage will decline to 4.5x-5.0x over the next 12 months. We also believe the risk of a distressed debt exchange has been eased by company's improved standing in the debt and equity markets. CONSOL's stock price has tripled since the lowest point in 2020 and its secured debt is trading at levels close to par value. "We could lower the rating over the next year if international thermal prices deteriorate 20%-30% from current expectations due to reduced thermal demand driven by COVID-19 related restrictions in key international markets for CONSOL like India, South America, or Asia-Pacific." Specifically, S&P could lower the rating under any of the following conditions if: -- S&P expects adjusted debt leverage to exceed 7x; -- Interest coverage ratio approached 1.5x; -- The company is at risk of breaching its financial covenants under the secured credit agreement; or -- S&P believes the company would not be able to refinance its maturities (starting in 2023) due to a lack of market access or because expected cash flows were not sufficient to cover the amount of debt coming due. S&P could raise the rating on CONSOL in the next 12 months if: -- S&P considers the refinancing risk to be low and further mitigated through debt repayment and more robust cashflows and liquidity; -- Adjusted leverage approached 4x; or -- Adjusted EBITDA margins remained over 25%. CONTRACT TRANSPORT: American Buying Cleveland Property for $750K ---------------------------------------------------------------- Contract Transport Services Inc. asks the U.S. Bankruptcy Court for the Northern District of Ohio to authorize the sale of the commercial building and the related parcels of real property located in and around 3223 Perkins Avenue, in Cleveland, Ohio, permanent parcel nos. 102-35-045, 102-35-037, 039, 040, 041 and 042; 102-35-043; 102-35-044; 102-35-045, to American Builders & Contractors Supply Co., Inc. or its nominee for $750,000, on the terms and conditions set forth in the offer to purchase. The Buyer has no connection to the Debtor and the Buyer seeks to purchase Perkins Avenue in good faith. As a part of the Sale Agreement, Grow America Fund ("GAF") must agree to certain offers-in-compromise ("OIC") from John Madachik and William and Laura Madachik. On April 1, 2021, the Debtor filed its Motion of Contract Transport Properties LLC to Sell a Parcel of Commercial Real Property Located at 3223 Perkins Avenue, Cleveland OH Free of Any Interest of Any Entity Other Than the Estate ("Motion") to the Buyer for $800,000. While that motion was pending with the Court, the Buyer commenced its due diligence in accordance with the proposed sales agreement. As a result of that due diligence, the Buyer determined that the roof needed replacement or substantial repair. It produced an estimate for such repair of $138,429. After further negotiations, the parties have agreed to reduce the proposed purchase price for Perkins Avenue to $750,000. Pursuant to an order of the Court, the Debtor has listed Perkins Avenue for sale with Michael J. Occhionero and Hanna Commercial Real Estate as real estate agent with an asking price of $997,000. After several showings to other parties and one lower offer, and after negotiations with the Buyer, the Gross Proceeds is the highest and best offer received for Perkins Avenue. After consultation with the Broker concerning the current real estate market the Gross Proceeds represent a fair and reasonable price for Perkins Avenue. Before the Petition Date, the Debtor, co-debtor Contract Transport Services, Inc. ("CTS"), the City of Cleveland, Ohio, and GAF ("Lien Holders") were parties to various financial accommodation agreements. On Sept. 1, 2007, the City, and the Debtor and the Madachiks entered into an Empowerment Zone Loan and Grant Agreement No. 67341 effective Sept. l, 2007, and a Cognovit Promissory Note. The City Loan was secured by the Open-End Mortgage of CTP on Perkins Avenue, and the Open-End Mortgage of the Madachiks on their home at 7643 Edgewood Lane, Seven Hills, Ohio. On April 29, 2013, GAF, CTP, and CTS entered into three loan agreements; one for $295,000; one for $994,000; and another for $255,000. The GAF Loans were used to pay off certain loans from National City Bank and in part the City Loan. As a part of the transaction, the City released its security interest on CTS' assets but retained the City Mortgage. The GAF Loans are secured by (i) a security interest in all of CTS' assets, (ii) an open-end mortgage ("Edgewood Mortgage") on Edgewood and (iii) an open-end mortgage from CTP on Perkins Avenue ("GAF Mortgage"). On April 16, 2013, GAF and the City entered into a series of Intercreditor Agreements the effect of which was to provide that the City and GAF held co-first priority liens on all assets of CTP, including the mortgages Perkins Avenue and Edgewood up to $260,241. After that amount, the City has a first-priority lien on those assets until it is paid in full at which point GAF is in first priority. On Aug. 30, 2018, GAF, CTS, CTP, and the Madachiks entered into a Forbearance and Loan Modification Agreement. Under the GAF Forbearance CTS, CTP and the Madachiks acknowledged that GAF was owed a total of $1,079,510.66 and agreed to repay that amount in monthly installments of $13,775.71. The City, CTS, CTP, and the Madachiks also signed a Forbearance Agreement and Second Amended Cognovit Promissory Note dated December 30, 2018, and an Amended Forbearance Agreement and Third Amended Cognovit Promissory Note on Dec. 10, 2019. The City is currently owed $224,288.22. On Jan. 17, 2020, GAF took a cognovit judgment against CTS, CTP, and the Madachiks in the Court of Common Pleas for Cuyahoga County Ohio and recorded a judgment lien against them for $853,325.21. On March 10, 2020, GAF filed a foreclosure proceeding in the Cuyahoga County Court of Common Pleas GAF v. Contract Transport Properties et al., Case No. 20CV930757. In the Foreclosure case GAF sought to foreclose the equities of redemption of all interests in Perkins Avenue junior in priority to the GAF Mortgage. On June 25, 2020, Sylvia Arellano filed a judgment lien against the Debtor. On Aug. 6, 2020, Domestic Linen Supply Co. Inc.("DLS") filed a judgment lien against the Debtor. The Judgment Liens are wholly unsecured as no value in Perkins Avenue attaches to their claims. The Judgment liens are subject to lis pendens with the Foreclosure and the DLS judgment lien is avoidable as a preferential transfer pursuant to 11 USC Section 547. The only interest superior to the GAF Mortgage in Perkins Avenue is the liens for real estate taxes payable to the Cuyahoga County Treasurer in the estimated total amount of $84,396.69 and the City Mortgage. There are numerous holders of an interest in Perkins Avenue (set forth on Exhibit B), but all such holders of any interest consent to the sale free of their interest. Many of the interests in Perkins Avenue are in bona fide dispute. As the remaining interests are junior in priority to the GAF Mortgage, the holder of any interest in Perkins Avenue may be compelled in a legal or equitable proceeding to accept a money satisfaction of such interest. In order to provide adequate protection of any interest in Perkins Avenue, the Debtor the sale proceeds will be deposited into an escrow account and disbursed to pay the costs of the transaction such as transfer fees, taxes and costs, a 6% commission to the real estate brokers and then to the appropriate parties in full satisfaction of their rights against Perkins Avenue in accordance with the respective rights and priorities of the holders any interest in Perkins Avenue, as such right appears and is entitled to be enforced against Perkins Avenue, the Estate or the Debtor under the Bankruptcy Code or applicable non-bankruptcy law. Therefore, Perkins Avenue may be sold free of any interest of any other entity. A copy of the Agreement is available at https://tinyurl.com/ysku7z52 from PacerMonitor.com free of charge. The Purchaser: AMERICAN BUILDERS & CONTRACTORS SUPPLY CO., INC. Attn: Brian Rushing One ABC Parkway Beloit, WI 53511 Telephone: (215) 622-5692 E-mail: brushing@abcsupply.com The Purchaser is represented by: HARRISON & HELD, LLP Attn: Brad S Gerber 333 W. Wacker Drive, Suite 1700 Chicago, IL 60606 Telephone: (312) 540-4965 E-mail: bgerber@harrisonheld.com About Contract Transport Services Contract Transport Services, Inc. -- http://www.ctsoh.net-- is a Cleveland-based passenger transportation company that began in 1997. It regularly provides transport for hotels all over NE Ohio as well as popular venues throughout the region. Contract Transport filed its voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. N.D. Ohio Case No. 20-14502) on Oct. 6, 2020. Contract Transport President William Madachik signed the petition. At the time of the filing, the Debtor disclosed $252,528 in total assets and $3,907,364 in total liabilities. Judge Price Smith oversees the case. Frederic P. Schwieg, Attorney at Law serves as the Debtor's legal counsel. COOPER'S HAWK: S&P Upgrades ICR to 'B-', Outlook Stable ------------------------------------------------------- S&P Global Ratings raised its ratings on casual dining restaurant and wine club operator Cooper's Hawk Intermediate Holding LLC, including its issuer credit rating to 'B-' from 'CCC+'. S&P said, "The stable outlook reflects our expectation for improving performance trends driven by the company's continued expanding restaurant base, wine club membership growth, and recovering consumer traffic. "We believe performance prospects for Cooper's Hawk have improved. We believe the increasing pace of COVID-19 vaccinations in the U.S. and economic recovery will support performance recovery from the coronavirus pandemic. In addition, the improving vaccination outlook should help ease restrictions on restaurant dining across U.S. states. We believe consumers are shifting back toward in-restaurant dining after a drastic shift to food-at-home consumption and social distancing in 2020. Although Cooper's Hawk still limits indoor dining due to occupancy restrictions and social distancing guidelines, we expect capacity will gradually increase from below 50% in early 2021 to more than 75% by year-end. We believe vaccination progress will increase occupancy rates and support spending at casual dining establishments. "We expect the company's performance trend to accelerate throughout fiscal 2021, improving adjusted leverage to the mid-8x area. In 2021, we expect Cooper's Hawk consolidated sales at year-end of about 12% above 2019 sales, supported by a larger unit base and recovering traffic. We also expect adjusted EBITDA margin of about 13% in 2021, slightly exceeding about 12.5% in 2019 due to top-line growth. Our forecast is based on Cooper's Hawk continuing to expand its restaurant base and sustained high demand for dining out through the remainder of the year. However, we believe recovery will be weighted toward the back half. In addition, we expect its wine club will drive strong customer traffic as members pick up their subscription wine bottles in stores and are inclined to dine in the restaurant or make additional retail purchases. With an expanding membership base during the prolonged pandemic environment, we expect Cooper's Hawk to maintain a reliable revenue stream relative to casual dining peers. We forecast S&P Global Ratings-adjusted leverage to improve to about mid-8x at the end of 2021 from mid-9x in 2019. "We believe Cooper's Hawk has sufficient liquidity to absorb potential volatility in its business, though it may have limited room for additional disruptions. During the height of the pandemic, Cooper's Hawk drew about $34 million under the $35 million revolver. This provided sufficient liquidity to absorb cash outflows while sales were significantly depressed because of store closures and social distancing. As of fiscal year-end 2020, the company had $25 million cash on the balance sheet. Cooper's Hawk has no near-term maturities. The revolver comes due in 2024 and its term loan matures in 2026. Based on our expectations of slightly negative free operating cash flow (FOCF) mostly due to new unit capital expenditure (capex) in 2021, we do not expect Cooper's Hawk to repay revolver borrowings in full over the next 12 months. While we believe the liquidity position is adequate to fund operating needs and Cooper's Hawk can adjust discretionary capex, the heavily drawn revolver could limit its financial flexibility if recovery is meaningfully weaker or delayed more than our expectations. "The stable outlook reflects our expectation for improving performance trends and credit metrics over the next 12 months, with sufficient liquidity to support operations and absorb modest volatility." S&P could lower the rating on Cooper's Hawk if: -- Performance is materially below its expectations, potentially due to uncertain recovery trends; and -- S&P expects meaningfully negative FOCF beyond 2021 to pressure liquidity. Under this scenario, S&P could view its capital structure as unsustainable and see elevated risk for a covenant breach. S&P could raise its rating on Cooper's Hawk if: -- The company executes its growth strategy, improving profitability with expanded adjusted EBITDA margins at least 200 basis points higher than our base-case projection, such that S&P would have a more favorable view of its business; and -- S&P expects adjusted leverage to decline and remain below 7x because of better-than-expected performance. COOPER-STANDARD AUTOMOTIVE: Moody's Alters Outlook on CFR to Stable ------------------------------------------------------------------- Moody's Investors Service affirmed Cooper-Standard Automotive Inc.'s B3 corporate family rating, B3-PD Probability of Default Rating, the Caa1 senior unsecured rating and the B1 senior secured debt rating. The Speculative Grade Liquidity Rating remains SGL-3. The rating outlook was changed to stable from negative. The rating action reflects Moody's expectation for a sustained rebound in operating results as global light vehicle volumes recover through 2022 while the company targets cost reductions with another year of restructuring initiatives. Currently weak credit metrics are expected to generate accelerated momentum in 2022 as benefits from organizational realignments are realized. Together with recovering volumes, the EBITA Margin (inclusive of Moody's standard adjustments) is expected to turn positive and free cash flow to significantly strengthen in 2022. Further, Moody's expectations for restructuring costs to subside after 2021 will also help normalize margins and preserve cash going into 2022. RATINGS RATIONALE Cooper-Standard's ratings reflect solid market positions in sealing systems, fuel & brake delivery systems and fluid transfer systems where demand fundamentals are largely drivetrain agnostic. Cooper-Standard's product mix towards SUVs/CUVs and light trucks, including content on top selling vehicle platforms, helps mitigate the competitive, highly fragmented nature in its core end markets. Nonetheless, margin erosion over the past several years highlights operating inefficiencies on falling industry volumes as well as increasingly competitive end markets. Customer concentration is high with the top three customers accounting for nearly 60% of revenues, two of which are currently experiencing significant production issues due to the lingering semiconductor chip shortage. Credit metrics are expected to remain weak through 2021 following organizational realignments, asset divestitures and the financial impact of the pandemic-driven shutdowns. However, Moody's expects margins and free cash flow to begin generating positive momentum in late-2021, benefiting from prior cost-saving restructurings and product focus on higher SUV/CUV/light truck volumes. Beyond 2021, Moody's anticipates a sustained rebound in operating results as global light vehicle volumes recover while the company executes its plan to improve operating efficiencies. Moody's also expects that significant restructuring initiatives will decrease after 2021, allowing cash to build in 2022. Debt-to-EBITDA (including Moody's standard adjustments) will remain elevated for the rating for 2021 (8x range) but should approach 5x or below by year-end 2022. The stable outlook reflects expectations for modest improvement in credit metrics during 2021 before a sharper rebound in 2022 as vehicle production levels, in conjunction with cost-saving initiatives, result in significantly improved operating leverage. Expectations to maintain an adequate liquidity profile, highlighted by a substantial cash balance and meaningful availability under the asset based revolving credit facility (ABL), also support the stable rating outlook. Cooper-Standard's SGL-3 speculative grade liquidity rating is supported by cash on hand at March 31, 2021 of nearly $400 million - Moody's notes that $250 million of this balance stems from the company's senior secured 13% note issuance in May of 2020 in a move to bolster liquidity. The $180 million ABL was unfunded at March 31, 2021 with $141 million of borrowing base availability after netting posted letters of credit and financial covenant restrictions. The facility expires March 2025 but includes a springing maturity of 91 days before the maturity of the term loan (November 2023). Moody's anticipates weak free cash flow over the next few quarters before turning meaningfully positive for full-year 2022. The primary covenant in the ABL is a springing fixed charge covenant of 1x when availability falls below the greater of $15 million or 10% of the facility's borrowing base. The senior secured term loan does not contain any financial maintenance covenants. The 13% senior secured notes become callable in June 2022, just outside of one year from the term loan maturing November 2023. Given the size of these notes, the company's liquidity position could be affected as management considers alternatives once the call option becomes exercisable. The following ratings were affirmed: Issuer: Cooper-Standard Automotive Inc. Corporate Family Rating, at B3 Probability of Default Rating, at B3-PD Senior Unsecured Notes, at Caa1 (LGD5) Senior Secured Term Loan, at B1 (LGD2) Senior Secured Regular Bond/Debenture, at B1 (LGD2) Outlook Actions: Outlook, changed to Stable from Negative FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS The ratings could be upgraded with stronger than anticipated margin recovery, boosted by prior restructuring and cost efficiency actions, as a result of the recovery in global light vehicle production. Accelerated progress towards generating positive free cash flow over the next twelve months would also be viewed favorably, strengthening overall financial flexibility. Maintaining an adequate liquidity profile is also important to supporting an upgrade. The ratings could be downgraded due to the inability to demonstrate significant margin improvement through 2022. Expectations for debt-to-EBITDA to remain above 7x or increasingly weaker free cash flow into 2022 could result in downward rating pressure. Erosion in the liquidity position and expectations for restructuring outlays to materially increase in 2022 could also result in negative rating action. Cooper-Standard's role in the automotive industry exposes the company to material environmental risks arising from increasing regulations on carbon emissions. As OEMs introduce more electrified powertrains, traditional internal combustion engines will become smaller. Some of Cooper-Standard's products are supportive of this trend including sealing systems and fluid transfer systems. However, fuel delivery products will be challenged over the longer-term as the industry transitions to full electrification. Financial policies are supportive of debtholders highlighted by management's opportunity to repay the 13% senior secured notes due 2024 that become callable in June 2022. The company issued these notes during the pandemic-driven recession for additional liquidity purposes - proceeds remain unused on the balance sheet. The principal methodology used in these ratings was Automotive Suppliers published in May 2021. Cooper-Standard Automotive Inc. is a global Tier 1 automotive supplier of sealing and trim, fuel and brake delivery systems and fluid transfer systems. Revenues for the latest twelve months ended March 31, 2021 were approximately $2.4 billion. CPV MARYLAND: S&P Assigns 'BB- Rating on $350MM Term Loan B ----------------------------------------------------------- On May 26, 2021, S&P Global Ratings assigned its 'BB-' project finance issue rating to CPV Maryland LLC's $350 million term loan. S&P also assigned a '2' recovery rating to the debt. CPV Maryland owns St. Charles, an operating 745 MW natural-gas-fired power plant in Charles County, Maryland. The facility achieved commercial operations on Feb. 14, 2017, and is owned equally by four indirect wholly owned subsidiaries of CPV Power Holdings LP, Toyota Tsusho Corp., Marubeni Corp., and Osaka Gas Co. Ltd. The power plant consists of two General Electric Co. (GE) 7F.05 combustion turbines with associated electric generators, two CMI duct-fired triple-pressure reheat heat recovery steam generators, and a single GE D11-A400 steam turbine with associated electric generator. The facility burns only natural gas fuel. The St. Charles facility is an efficient gas-fired generator that is competitively placed in the dispatch curve. With a summer baseload heat rate of 6,860 Btu/kWh, St. Charles is an efficient combined cycle generator that sits competitively in the PJM and SWMAAC dispatch curves. SWMAAC is composed of the Baltimore Gas & Electric and Potomac Electric Power load delivery areas and has a forecast peak load of above 12 gigawatts (GW). The two large load centers in the region are Washington, D.C., and Baltimore. Due to transmission constraints into the SWMAAC region, the price of power in SWMAAC is often set by a resource within SWMAAC. The facility's capacity factor since commissioning in February 2017 to 2019 was 64%-67%. Similar to that of many other merchant facilities, the facility's dispatch was negatively affected during 2020 due to COVID-19 pandemic-related demand decimation. The capacity factor for the year was 58%. Financial performance is also highly dependent on operational performance of the project, which has proven to be reliable within its relatively short operating history. For the past three years, the facility's forced outage rate has been below 2%, availability factors were 87%-94%, and heat rate was steady at about 7,000 Btu/kWh. In 2018, the project upgraded its combustion system, which increased the facility's capacity by 2% (dependent on ambient conditions) and improved its heat rate. S&P thinks the facility's major maintenance and routine capital expenditures will support its ability to maintain operational competitiveness over its useful life. Capacity prices in the MAAC region of the PJM are expected to clear at a premium compared with the rest of the RTO because of MAAC's generation mix. S&P said, "We expect prices in MAAC to clear above the RTO largely because the marginal unit in MAAC is expected to be a coal-fired unit, which, because of low natural gas prices, requires more compensation from the capacity market to remain in operation than the marginal unit in RTO. There is more than 10 GW of coal-fired capacity currently in operation in MAAC, whose fixed-cost structure is approximated at $130-$170/unforced capacity MW per day (UCAP MW-day), reflecting operating costs, scrubbing costs, property tax, and insurance. In addition, we expect coal economics to be negatively affected by Pennsylvania's anticipated membership in the Regional Greenhouse Gas Initiative (RGGI) beginning in 2022, which would likely increase the costs of the price-setting coal unit, further supporting MAAC's capacity price premium over RTO. Under our base-case scenario, we forecast capacity prices in the MAAC region for delivery year 2022/2023 at $110 per MW-day, and $120 per MW-day for delivery years 2023/2024 and 2024/2025. Beyond that, we forecast capacity price at $125 per MW-day, escalated at 2% annually thereafter." RGGI presents an upside for power prices; however, the magnitude of this uplift depends on several factors. The RGGI is a collaborative effort of eleven Northeastern states (Connecticut, Delaware, Maine, Maryland, Massachusetts, New Hampshire, New Jersey, New York, Rhode Island, Vermont, and Virginia), across three markets (ISO-NE, NYISO, and PJM) to reduce carbon emissions from the power sector. Under this program, power plant owners in participating states with generating capacity of 25 MW or above are required to obtain allowances equal to the number of tons of carbon dioxide they emit. RGGI expanded to New Jersey in 2020 and Virginia in 2021 and is anticipated to extend to Pennsylvania in 2022. By this time, 55% of PJM load will be in RGGI states. RGGI carbon pricing lifts power prices as costs increase for thermal generators to comply with emission control targets. This dynamic appears accretive for efficient generators like St. Charles, which have emission rates below those of the broader PJM system. That said, the extent to which power prices will rise because of RGGI is also dependent on the fuel that is on the margin, that is, the generator that sets the price of power (coal, natural gas, etc.), as well as its efficiency and resultant emissions relative to St. Charles. RGGI is also exposed to leakage, which means that the marginal generator at a given hour is dispatching power from a region that is not participating in RGGI (for example, Pennsylvania, and hence it is not subject to RGGI emissions costs. Such a scenario makes the generators in RGGI states uneconomic relative to non-RGGI generators, negatively affecting their dispatch and eliminating any price upside because of RGGI that could have been realized if similar carbon pricing was applicable on a systemwide basis. However, S&P believes this situation will improve after Pennsylvania joins the RGGI states next year. The project's key risk is its exposure to market forces in the PJM, and the broader merchant power space. The project does not benefit from any long-term contractual sales, which essentially exposes its profitability and cash generation to market-related forces. Power prices are difficult to predict and can exhibit volatility from period to period due to demand and supply dynamics, weather conditions, secular industry changes and trends (energy efficiency, renewable penetration, etc.), capacity additions and retirements, and applicable regulations--adding uncertainty to cash flows and forecasts. However, the project will receive capacity payments (about 50% of forecast gross margin), which will provide partial cash flow visibility and certainty through the cleared periods. The project will be exposed to refinancing risk toward the end of its debt term. Like other projects financed with TLB structures, the project will not have sufficient CFADS and cash on hand to repay debt outstanding at maturity and will therefore be exposed to refinancing risk and market conditions at that time. S&P said, "We project TLB outstanding debt at maturity of about $227 million (65% of issuance amount). That said, we also note a strong project life coverage ratio (PLCR) at TLB maturity, at 2.64x, which denotes considerable coverage and project value beyond the proposed debt life." The PLCR, which is a measure of a project's refinancing risk, compares the present value of its future cash flows relative to forecast debt at the point of maturity, establishing the likelihood that the project will ultimately repay its debt. The analysis is particularly relevant for projects that have market-sensitive cash flows and are financed with structures that materially rely on cash sweeps for the repayment of debt. However, the PLCR is sensitive to changes in our assumptions of variables such as the discount rate, dispatch, spark spreads, capacity pricing, asset life, and capital spending; as well as the project's actual financial performance, which will determine cash sweeps and consequently the debt outstanding at TLB maturity. S&P said, "The stable outlook reflects our expectation that CPV Maryland will continue to operate in line with historical performance and would largely generate DSCRs in the 1.8x-2.1x range through the TLB term. We also expect that the minimum DSCR will remain above 1.35x during the project's life, which includes the post-refinancing period (2028-2041). Finally, we forecast about $227 million outstanding on the term loan at maturity in mid-2028, resulting in a 1.55x minimum DSCR over the life of the asset. "We would lower the rating if the project is unable to maintain a minimum DSCR of 1.35x on a sustained basis. This could result from lower-than-expected capacity factors, weaker energy margins, depressed capacity prices, and operational challenges such as forced outages and lower plant availability. We could also consider a negative rating action if the project's cash flow sweeps were materially lower than our forecast, which would ultimately lead to the TLB balance exceeding $227 million at maturity, and consequently a weaker minimum DSCR, absent any other mitigating factors. "Although unlikely during our outlook period, we would consider an upgrade if we envisioned the project to achieve a minimum DSCR of at least 1.8x. This outcome would largely be a function of highly favorable business conditions, which would lead to improved dispatch, widening spark spreads, or higher-than-expected capacity pricing." CVENT INC: S&P Alters Outlook to Positive, Affirms 'CCC+' ICR ------------------------------------------------------------- S&P Global Ratings revised its outlook on event and hospitality cloud solutions provider Cvent Inc. to positive from developing. S&P affirmed its 'CCC+' issuer credit rating on Cvent. S&P also affirmed its issue-level rating on the company's secured term loan at 'CCC+'; the recovery rating on this debt is '3'. The positive outlook reflects S&P's expectation that Cvent will see modest revenue gains on growth from its event cloud solutions and stable EBITDA margins such that leverage will be below the 10x area and generate modest unadjusted free operating cash flow in 2021. Cvent has been able to stabilize its total liquidity on-better than-expected EBITDA generation during the COVID-19 pandemic. At the start of the COVID-19 pandemic, Cvent faced potential headwinds from customers seeking financial or cash relief as in-person events came to a complete stop, leading to revenue decline and cash collection issues. However, Cvent performed better than we expected during the COVID-19 pandemic. While Cvent saw revenue decline in the mid-10% area year-over-year, there was a chance it could have been higher. Cvent had 70% of revenue locked in at the onset of the COVID-19 pandemic, which means it had to generate more revenue throughout the year. Cvent also had to deal with customers asking for financial relief. Cvent was able to weather those significant headwinds such that the revenue decline was manageable even as in-person events stopped for the last nine months of the year. To deal with the revenue decline, Cvent took steps to make sure its cost structure was optimized during the pandemic. The company took out significant costs in its operating expenses during the COVID-19 pandemic such that EBITDA margins improved to the high-teens percent area in 2020 from the low-teens percent area in 2019. While Cvent's revenue decline was large, the improvement in EBITDA margins helped lead to manageable free operating cash flow burn, at around the $15 million range. As Cvent's balance sheet cash stabilized, it started to pay down its fully drawn $40 million revolver such that it was completely paid down as of April 2021. Cvent was then able to extend its $40 million revolver credit facility to August 2024 at the same interest rate as before. S&P believes that Cvent's more than $100 million in total liquidity should help it manage its recovery from the COVID-19 pandemic over the next few years. S&P said, "While events will become a hybrid of in-person and virtual, we believe Cvent can continue to operate in this event solution space. The COVID-19 pandemic has changed many aspects of the way business is conducted. With in-person conference events completely shut down, virtual events became the norm for business events in 2020. While in-person events will come back as people become more comfortable to travel or attend in-person events, we believe that moving forward most of the conference event model will be a hybrid of in-person and virtual events. We believe that Cvent with its virtual event solution will be able to continue to compete in this space." Before the COVID-19 pandemic, Cvent did not have a virtual attendee solution set. However, over a short period in 2020, Cvent was able to launch a virtual event solution, Attendee Hub, that has seen good bookings growth since September 2020. While there are more players in this virtual video and event space such as Zoom, Teams, On24, or Hopin, Cvent is one of the only providers that offer both in-person and virtual event solutions for companies that want a hybrid event. Even as On24 and Hopin have grown significantly in the past year due to virtual events of the COVID-19 pandemic, Cvent still has a much larger scale than those companies and will continue to invest in its hybrid event solutions. S&P believes that Cvent will be able to continue to compete in this space as it offers one of the more complete event platform products in the market. Cvent should see stable performance in 2021 as hybrid events start to come back. Before the COVID-19 pandemic, Cvent was growing fast as it saw more than 10% revenue growth from 2017 to 2019. While Cvent saw a large decline in 2020, we believe that it should see modest growth prospects in 2021 on good demand for its virtual event solutions. S&P believes that some companies might lower its in-person event budget due to wanting to permanently lower its travel and expense (T&E) costs. However, S&P believes that companies might move some of that in-person event cost to virtual events, such that Cvent should see good demand on its virtual event solution. S&P said, "However, we believe that Cvent will invest more heavily in growth in 2021 such that EBITDA margins would fall. Previously Cvent had lower EBITDA margins as it tried to capture strong topline growth. We believe that Cvent will invest in its virtual event solution set to drop EBITDA margins to the midteens percent area in 2021. The modest revenue growth will offset the decline in EBITDA margins such that S&P Global Ratings-adjusted leverage will be in the mid-9x area in 2021. "Also due to its investment for growth over the past few years, Cvent's capitalized software costs have increased. While we believe that capital expenditures (capex) will be over $50 million in 2021, Cvent should be able to keep EBITDA generation stable and generate modest positive unadjusted free operating cash flow in 2021. "The positive outlook reflects our expectation that Cvent will see modest revenue gains on growth from its event cloud solutions and stable EBITDA margins such that leverage will be below the 10x and it will generate modest unadjusted free operating cash flow in 2021. "We could look to raise the rating if Cvent was able to sustain leverage below the 10x and generate unadjusted free operating cash flow after debt service through the recovery of the COVID-19 pandemic. Cvent could achieve this with good organic revenue growth on its virtual event solutions and stable EBITDA margins. Alternatively, if the company's growth-related investments preclude it from achieving these benchmarks, we could still raise the rating if we believe it can manage those investments while sustaining its capital structure. This would likely entail being on a path to return to high-single digit revenue growth or higher in 2022, and single digit million dollar negative free operating cash flow (FOCF). "We could revise the outlook back to stable if we believe Cvent has not fully recovered from the COVID-19 pandemic such that revenues remain at their current run rate, or the company sustains large negative free operating cash flow generation. This could be caused by further macroeconomic impact from the COVID-19 pandemic or low demand for its virtual event solution." CYBER LITIGATION: Wins November 22 Plan Exclusivity Extension ------------------------------------------------------------- Judge Craig T. Goldblatt of the U.S. Bankruptcy Court for the District of Delaware extended the periods within which the Debtor Cyber Litigation Inc. f/k/a NS8 Inc. has the exclusive right to file a Chapter 11 plan through and including November 22, 2021, and to obtain acceptances of the plan through and including January 24, 2022. The Debtor has been operating under the protections of chapter 11 for just over six months in the wake of the arrest of its former CEO, Adam Rogas, for securities fraud. During this time, the Debtor has focused its efforts to identify and monetize its assets and administer its estate in the best interests of creditors. Specifically, the Debtor has ensured the smooth transition of its remaining pre-petition operations into chapter 11. The Debtor sold substantially all of its assets, complied with ongoing governmental investigations, and commenced broad litigation and asset recovery process, including an extensive investigation into Rogas' wide-ranging fraud and the parties that improperly benefitted from it. The Debtor's ongoing investigation is presently focused on identifying and developing causes of action that will lead to additional sources of recovery for the benefit of all stakeholders. Focused on maximizing the recovery of assets, the litigious nature of this process is labor-intensive and is a top priority of the Debtor' representatives and professionals. The Debtor and its professionals have diligently worked and will continue to work towards an ultimate framework for disposing of this chapter 11 case. In good faith to achieve the most value for its remaining assets, the Debtor will continue coordinating with various stakeholders, including its post-petition lender, Invictus. And since filing its chapter 11 case, the Debtor has taken numerous affirmative steps to reduce costs and ensure that administrative expenses are paid, and also continues to make timely payment on their undisputed post-petition obligations. The granted extension will give the Debtor more time to pursue the investigation and formulate a plan that will be best supported by stakeholders. A copy of the Debtor's Motion to extend is available at https://bit.ly/3wGhTYi from Stretto.com. A copy of the Court's Extension Order is available at https://bit.ly/2SEySeM from Stretto.com. About NS8 Inc. Las Vegas-based NS8 Inc. -- https://www.ns8.com -- is a developer of a comprehensive fraud prevention platform that combines behavioral analytics, real-time scoring, and global monitoring to help businesses minimize risk. NS8 sought Chapter 11 protection (Bankr. D. Del. Case No. 20-12702) on October 27, 2020. The petition was signed by Daniel P. Wikel, the chief restructuring officer. The Debtor was estimated to have $10 million to $50 million in assets and $100 million to $500 million in liabilities at the time of the filing. Judge Craig T. Goldblatt replaced the Honorable Christopher S. Sontchi as the case judge. The Debtor tapped Blank Rome LLP and Cooley LLP as its legal counsel, and FTI Consulting Inc. as its financial advisor. Stretto is the claims agent. * * * The company changed its name to Cyber Litigation after it sold substantially all of its assets to Codium Software LLC in December 2020. DECO-USA LLC: Case Summary & 4 Unsecured Creditors -------------------------------------------------- Debtor: Deco-USA LLC 22211 IH-10 West, Ste. 1206 San Antonio, TX 78257 Business Description: Deco-USA LLC is a Single Asset Real Estate debtor (as defined in 11 U.S.C. Section 101(51B)). The Debtor is the fee simple owner of two properties located in San Antonio, Texas having a total appraised value of $6.45 million. Chapter 11 Petition Date: May 28, 2021 Court: United States Bankruptcy Court Western District of Texas Case No.: 21-50679 Judge: Hon. Craig A. Gargotta Debtor's Counsel: Dean W. Greer, Esq. DEAN W. GREER 2929 Mossrock, Suite 117 San Antonio, TX 78230 Tel: (210) 342-7100 Fax: (210) 342-3633 E-mail: dean@dwgreerlaw.com Total Assets: $6,455,518 Total Liabilities: $4,070,289 The petition was signed by Raul Aguilar, manager. A full-text copy of the petition containing, among other items, a list of the Debtor's four unsecured creditors is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/K2YA4VY/DECO-USA_LLC__txwbke-21-50679__0001.0.pdf?mcid=tGE4TAMA DEVON ENERGY: Moody's Rates New Sr. Unsecured Notes 'Ba1' --------------------------------------------------------- Moody's Investors Service assigned a Ba1 rating to Devon Energy Corporation's new senior unsecured notes, proposed to be issued as part of an exchange offer for the approximately $2 billion of WPX Energy, Inc.'s (WPX, Ba3 ratings under review) outstanding notes. WPX is a wholly-owned, direct subsidiary of Devon. Devon's existing ratings, including its Ba1 Corporate Family Rating, Ba1-PD Probability of Default Rating, Ba1 senior unsecured notes rating and SGL-1 Speculative Grade Liquidity Rating are unchanged. The rating outlook remains positive. "Devon's exchange transaction should simplify its capital structure subsequent to its WPX combination, and does not add any additional debt," commented Amol Joshi, Moody's Vice President -- Senior Credit Officer. Assignments: Issuer: Devon Energy Corporation Senior Unsecured Notes, Assigned Ba1 (LGD4) RATINGS RATIONALE Devon has offered to exchange its senior unsecured notes with identical tenors and interest rates for each WPX senior notes outstanding. The Ba1 rating on Devon's new senior unsecured notes is consistent with its Ba1 CFR, reflecting the company's unsecured capital structure including its unsecured $3 billion revolving credit facility. Concurrent with the exchange offer, Devon is soliciting consents from WPX's noteholders to eliminate or revise certain covenants. WPX notes that remain outstanding following the conclusion of the exchange offer will likely not be guaranteed or have separate financial reporting, and therefore WPX's ratings are likely to be withdrawn at that time. Devon's Ba1 CFR reflects the significant size and scale of its E&P operations with a diversified geographic presence across key US onshore hydrocarbon basins. Devon is supported by its drilling focus on its higher-return assets in the Delaware Basin which should boost operating margins and cash flow. While the company has focused on increasing its oil production, Devon has a mix of oil, natural gas and natural gas liquids production providing some commodity price optionality. Devon's planned debt reduction efforts, along with improving returns and cost structure should improve its credit profile. Devon's commodity hedging strategy and strong liquidity provides resilience against low oil and gas prices. However, the company's variable dividend strategy, in addition to its fixed dividend and a potential for opportunistic share repurchases, will likely significantly reduce cash flow available for capital spending or further credit improvement. Devon's financial policy reflects its commitment to improve leverage metrics including its stated leverage target of around 1x net debt to EBITDA, while also pursuing shareholder returns including funding its dividend strategy. Devon's positive rating outlook reflects the company's ability to materially reduce debt by utilizing balance sheet cash, as well as improve cash flow and returns while focusing the company's activities on its higher-return assets in the Delaware Basin. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS Devon's ratings could be upgraded if the company's retained cash flow (RCF)/Debt exceeds 40% and its leveraged full-cycle ratio exceeds 1.5x, while production remains stable. The ratings could be downgraded if RCF/Debt falls below 20% or capital efficiency deteriorates. A significant increase in shareholder friendly actions that materially erode the company's liquidity or leverage metrics could also lead to a downgrade. Devon Energy Corporation, headquartered in Oklahoma City, Oklahoma, is a large independent exploration and production (E&P) company with a focus on US onshore oil and gas properties. The principal methodology used in these ratings was Independent Exploration and Production Industry published in May 2017. DIEBOLD NIXDORF: S&P Alters Outlook to Positive, Affirms 'B-' ICR ----------------------------------------------------------------- S&P Global Ratings revised its outlook on global ATM, point-of-sale (POS), and self-checkout (SCO) terminal assembler, distributor, servicer and software provider Diebold Nixdorf Inc. to positive from stable and affirmed all of its ratings, including its 'B-' issuer credit rating, its 'B-' issue-level rating on its secured debt, and its 'CCC' issue-level rating on its unsecured debt. S&P said, "The positive outlook reflects our view that Diebold Nixdorf will improve its credit metrics over the next year as it operates under its new streamlined cost structure and experiences stable end-market conditions. "We expect Diebold to report stronger credit metrics in 2021 as its restructuring costs wind down and it realizes the benefits from its cost-savings initiatives. Management's execution on its restructuring remained strong even during the significant economic uncertainty in 2020.We expect the company's credit metrics, such as its leverage and free cash flow to debt, to materially improve in 2021 as its reported EBITDA margins increase. Diebold Nixdorf's credit metrics have been pressured by the costs to implement its comprehensive DN Now business improvement plan over the past few years. Management has targeted areas such as streamlining its operating model, simplifying its products and manufacturing footprint, modernizing its services, reducing its general and administrative (G&A) expenses, and implementing various digital transformations to improve the company's margin. We note that management has already executed the majority of the actions related to its DN Now plan. Diebold Nixdorf expects to spend $50 million on its DN Now plan this year as its related costs wind down. This is a material step down from the more than $150 million of annual spending on the plan that it reported in 2019 and 2020. We expect management to undertake some level of restructuring or reinvestment annually, though we do not believe its future costs in these areas will be large enough to jeopardize its improving margin trajectory. "The positive outlook reflects our view that the benefits from management's expense-reduction efforts and the moderating level of restructuring costs related to its DN Now business improvement plan will support an expansion in its EBITDA and an improvement in its leverage to the high-5x area by the end of 2021. Our outlook also incorporates management's improved financial outlook and our expectation for a recovery in its end markets. "We could revise our outlook on Diebold Nixdorf to stable if its restructuring costs remains elevated or it experiences an operational misstep such that its leverage remains above 6.5x and its FOCF to debt stays under 5%. We could also revise our outlook to stable if it experiences continued revenue declines in 2021, which could indicate a weakening of its competitive position. "We could raise our rating on Diebold Nixdorf by one notch if it achieves and sustains cost savings and operational improvements such that its leverage declines below 6.5x and its FOCF to debt improves above 5% on a sustained basis. We assume the stable end-market dynamics for ATMs will lead to a stabilization in the company's revenue trends, which could also bode well for the rating." DISCOVERY DAY: June 30 Plan Confirmation Hearing Set ---------------------------------------------------- Discovery Day Academy II, Inc., filed with the U.S. Bankruptcy Court for the Middle District of Florida a disclosure statement. On May 20, 2021, Judge Caryl E. Delano conditionally approved the disclosure statement and ordered that: * June 30, 2021, at 11:00 a.m. in Ft. Myers, FL − Room 4−102, Courtroom E, United States Courthouse, 2110 First Street is the hearing on confirmation of the Plan. * Any written objections to the Disclosure Statement shall be filed with the Court and served no later than 7 days prior to the date of the hearing on confirmation. * Parties in interest shall submit to the Clerk's office their written ballot accepting or rejecting the Plan no later than 8 days before the date of the Confirmation Hearing. * Objections to confirmation shall be filed with the Court and served no later than 7 days before the date of the Confirmation Hearing. * In accordance with Local Rule 3018−1(a), the Plan Proponent shall file a ballot tabulation no later than 96 hours prior to the time set for the Confirmation Hearing. A full-text copy of the order dated May 20, 2021, is available at https://bit.ly/3oWZF24 from PacerMonitor.com at no charge. About Discovery Day Academy II Discovery Day Academy II Inc. is an independent private school located in Bonita Springs. Founded in 2006, Discovery Day Academy has developed The Discovery Method, a project-based learning model, with an emphasis on children ages two to eight years. Discovery Day Academy II filed its voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. M.D. Fla. Case No. 20-04183) on May 29, 2020. Discovery Day President Elizabeth A. Garcia signed the petition. At the time of the filing, the Debtor disclosed $5,500,000 and $6,050,389 in liabilities. Judge Caryl E. Delano oversees the case. The Debtor tapped Dal Lago Law as its legal counsel and Noack and Co. as its accountant. DLT RESOLUTION: Incurs $180K Net Loss in First Quarter ------------------------------------------------------ DLT Resolution, Inc. filed with the Securities and Exchange Commission its Quarterly Report on Form 10-Q a net loss of $180,303 on $440,083 of revenue for the three months ended March 31, 2021, compared to a net loss of $328,902 on $428,347 of revenue for the three months ended March 31, 2020. As of March 31, 2021, the Company had $3.35 million in total assets, $3.17 million in total liabilities, and $177,027 in total stockholders' equity. As of March 31, 2021, the Company had total current assets of $361,161 and current liabilities of $923,679 creating a working capital deficit of $562,518. As of Dec. 31, 2020, the Company had working capital deficit of $474,731 with the increase of the deficit attributed to the reduction in its accounts receivable in the quarter ended March 31, 2021 with the proceeds from collections of accounts receivable used to fund our operations. Net provided by operating activities was $355 during the three months ended March 31, 2021 compared to $19,527 for the same period in 2020. Net cash used in investing activities was $1,911 during the three months ended March 31, 2021 compared to $0 for the same period in 2020. During the three months ended March 31, 2021 and 2020, the Company generated $9,218 and $13,722 in cash from financing activities, respectively. The Company has suffered recurring losses from operations and has a significant accumulated deficit. In addition, the Company continues to experience negative cash flow from operations. These factors, the Company said, raise substantial doubt about its ability to continue as a going concern. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. Management's plans in regards to this matter include raising additional equity financing and borrowing funds under a private credit facility and/or other credit sources. A full-text copy of the Form 10-Q is available for free at: https://www.sec.gov/Archives/edgar/data/1420368/000147793221003602/dlti_10q.htm About DLT Resolution Las Vegas, NV-based DLT Resolution Inc. currently operates in three high-tech industry segments: blockchain applications; telecommunications; and data services which includes image capture, data collection, data phone center services, and payment processing. DLT Resolution reported a net loss of $503,929 for the year ended Dec. 31, 2020, compared to a net loss of $1.04 million for the year ended Dec. 31, 2019. As of Dec. 31, 2020, the Company had $3.52 million in total assets, $2.83 million in total liabilities, and $688,873 in total stockholders' equity. Lakewood, CO-based BF Borgers CPA PC, the Company's auditor since 2019, issued a "going concern" qualification in its report dated May 10, 2021, citing that the Company has suffered recurring losses from operations and has a significant accumulated deficit. In addition, the Company continues to experience negative cash flows from operations. These factors raise substantial doubt about the Company's ability to continue as a going concern. EAGLE HOSPITALITY TRUST: Court Okays $482M Hotel Sale In Chapter 11 ------------------------------------------------------------------- Law360 reports that a Delaware bankruptcy judge on Friday approved Eagle Hospitality's $481. 9 million Chapter 11 sale of 14 of its hotels, rejecting calls by a failed bidder for more time to solidify a new last-minute offer. Following a virtual hearing, Judge Christopher Sontchi denied the requests of Constellation Hospitality Group and a group of Eagle's equity holders to delay the sale to give Constellation more time to secure funding for its newly submitted bid, saying Constellation's offer wouldn't be ready in the immediate future and didn't appear to be a better deal. About Eagle Hospitality Group Eagle Hospitality Trust -- https://eagleht.com/ -- is a hospitality stapled group comprising Eagle Hospitality Real Estate Investment Trust ("Eagle H-REIT") and Eagle Hospitality Business Trust. Based in Singapore, Eagle H-REIT is established with the principal investment strategy of investing on a long-term basis, in a diversified portfolio of income-producing real estate which is used primarily for hospitality and/or hospitality-related purposes, as well as real estate-related assets in connection with the foregoing, with an initial focus on the United States. EHT US1, Inc., and 26 affiliates, including 15 LLC entities that each owns hotels in the U.S., sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 21-10036) on Jan. 18, 2021. EHT US1, Inc., estimated $500 million to $1 billion in assets and liabilities as of the bankruptcy filing. The Debtors tapped Paul Hastings LLP as bankruptcy counsel; FTI Consulting, Inc., as restructuring advisor; and Moelis & Company LLC, as investment banker. Cole Schotz P.C. is the Delaware counsel. Rajah & Tann Singapore LLP is Singapore Law counsel, and Walkers is Cayman Law counsel. Donlin, Recano & Company Inc. is the claims agent. EAGLE RANCH: Plan Seeks Sale of Portion of Debtor's Main Asset -------------------------------------------------------------- Eagle Ranch Resort, LLC filed with the Bankruptcy Court an Amended Subchapter V Small Business Plan of Reorganization on May 21, 2021. Payments and distributions under the Plan will be funded from the Debtor's continued operation of its business. The Debtor's primary assets consist of 750 acres of real estate with several buildings, a lake and ponds, on which Debtor's business is located. Classes of Claims and Their Treatment Under the Plan: * Class 1 Priority Unsecured Tax Claims Class 1 Claims consist of unsecured income, employment, sales, and other taxes. The IRS filed a Proof of Claim, as amended, for $37,297, asserting a priority claim for $11,836. The remaining balance is general unsecured claim in Class 3. The Debtor disputes IRS' Claim. Once allowed, however, the Claim will be paid in full, with interest, in regular monthly installment payments over a five-year period, with the first payment beginning upon Plan confirmation and continuing on the 29th day of each month until all distributions are made. Pursuant to Section 1129 (a)(9) of the Bankruptcy Code, the holder of a Section 507(a)(8) priority tax claim must receive the present value of its claim, in regular installments paid with interest over a period up to five years from the bankruptcy order of relief, unless said claim holder agrees otherwise. * Class 2 Class 2 Secured Claims -- Class 2A Secured Claims of Community National Bank & Trust is allowed for $837,086. The Debtor shall pay Community National Bank and Trust at $5,000 monthly beginning on or before 60 days after Plan confirmation, and continuing monthly thereafter until the loan is paid in full by the sale of the 520 acres of the Debtor's property and/or refinance of the remaining balance of the loan, to be applied first to the payment of accrued interest, and then to the reduction of the recapitalized principal amount. -- Class 2B Secured Claims of Steve and Donna Chappell Steve & Donna Chappell held pre-petition financing at $61,928, less payments made post-petition. The aggregate balance of the Claim will be paid, with 5% interest, and monthly payments of $800 for principal and interest for the months of April through October shall be made until the Debtor will refinance the remaining loan balance on or before 12 months from confirmation of the Plan. Class 2B is not impaired. -- Class 2D Secured Claim of Small Business Administration EIDL Class 2D consists of SBA's Claim for $47,387, which will be allowed under the Plan. The Debtor will begin the $229 monthly payments on September 1, 2021 and continue thereafter, as per the Loan Documents. * Class 3 General Unsecured Claims Class 3 consists of the unsecured portion of the IRS Claim, the general unsecured Claims of MBE Capital SBA PPP Loan for $1,156 (for which the Debtor has applied to seek forgiveness provisions) and Spark Business Capital One Bank for $4,858, on which the Debtor continues to make Court-approved monthly post-petition payments. The Debtor will, in the alternative, pay Spark Card $2,000 from cash on hand to pay this debt in full. A copy of the Amended Plan is available for free at https://bit.ly/2RRnH2v from PacerMonitor.com. A hearing on the Amended Plan is set for June 30, 2021 at 1:30 p.m. by Zoom Video. About Eagle Ranch Eagle Ranch Resort, LLC, founded in 2010 and organized in the state of Missouri, operates a resort that targets patrons who enjoy outdoor activities, camping, hunting, trail riding for horses and all-terrain vehicles, other horseback riding events, and ministry events and retreats. The Debtor filed for Chapter 11 bankruptcy protection (Bankr. W.D. Mo. Case No. 20-42109) on Dec. 11, 2020. Jerry Hennings, a member, signed the petition. In the petition, the Debtor disclosed $1,637,309 in assets and $973,597 in liabilities. Judge Dennis R. Dow oversees the case. Krukow Law Offices, LLC serves as the Debtor's legal counsel. ELDERHOME LAND: Seeks to Extend Plan Exclusivity Thru June 9 ------------------------------------------------------------ ElderHome Land, LLC and Burtonsville Crossing, LLC request the U.S. Bankruptcy Court for the District of Maryland, Greenbelt Division to extend by 14 days the exclusive periods during which the Debtors may file a plan and to obtain acceptances through and including June 9, 2021. On May 21, 2021, the Debtors received the terms of a certain Prepaid Forward Purchase Agreement from a lender willing and able to extend funds to the Debtor, subject to approval by the Court. The Debtors' counsel received the Agreement on May 25, 2021, but does not have ample time to review the Agreement with the Debtor and its impact, if any, on the Debtors' proposed Chapter 11 Plan. The Debtors request a short extension of the exclusivity period for a period of 14 days so that the Debtors can evaluate the Agreement, file a motion to approve the Agreement, and modify the proposed Chapter 11 Plan. The extension will not prejudice any party-in-interest and will enable the Debtors to conserve resources by filing a comprehensive plan capable of being confirmed. A copy of the Debtors' Motion to extend is available at https://bit.ly/3fPV3GT from PacerMonitor.com. 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 January 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. ELO TOUCH: S&P Alters Outlook to Stable, Affirms 'B' ICR -------------------------------------------------------- S&P Global Ratings affirmed its 'B' issuer credit ratings on Elo Touch Solutions Inc. and its first-lien debt. S&P revised the outlook to stable from negative. The stable outlook reflects S&P's view that Elo's end markets are beginning to show signs of recovery from easing COVID-19 restrictions and that the expectations of a broader economic recovery will enable Elo to return to revenue and EBITDA growth in the second half of 2021. Improved economic outlooks in the U.S. and globally should provide Elo opportunities for revenue growth in the second half of fiscal 2021 and 2022. Sequential quarterly revenue growth was positive in the March 2021 quarter, after revenue declines the previous three quarters. S&P said, "We believe businesses in industries hard hit by the COVID-19 pandemic (restaurants, hospitality, retail) are regaining confidence. We view many use cases for Elo products to be discretionary (self-service kiosks, interactive digital signage). But customer strategies in place before the pandemic to implement these solutions are likely to resume, with Elo seeing strong orders in its March 2021 quarter from a combination of pent-up demand and customers anticipating longer lead times and placing orders earlier than usual. We maintain our view that the recovery in the restaurant and retail industries will lag that of the broader economy. We conservatively expect Elo's second-half 2021 revenue will increase in the mid-single-digit percentages compared to the first half. As with many other companies, Elo faces challenges with its supply chain (semiconductors, glass substrate) and shipping logistics (overwhelmed ports, container shortages). We believe Elo can manage this risk, continue to procure the necessary components, and ship products accordingly. We forecast sequential revenue growth in the June 2021 quarter and flat in the September 2021 quarter." S&P said, "The stable outlook reflects our view that Elo's end markets are beginning to show signs of recovery from easing COVID-19 restrictions and that the expectations of a broader economic recovery will enable Elo to return to revenue and EBITDA growth in the second half of 2021 and continue into 2022. "We could lower the rating if a resurgence of COVID-19 delays the overall economic recovery, pushing out product implementations by customers, causing revenue growth to fall below our base-case expectation, or funded debt rising from current levels. This would lead to leverage exceeding the mid-5x area or total liquidity declining to less than $25 million. "We could raise the rating if the company continues increasing revenue and EBITDA while maintaining leverage in the mid-3x area." EQUIVALENT FINANCIAL: Voluntary Chapter 11 Case Summary ------------------------------------------------------- Debtor: Equivalent Financial, LLC 1885 NE 29th Avenue Suite 905 Miami, FL 33180 Business Description: Equivalent Financial, LLC develops custom accounting software. Chapter 11 Petition Date: May 28, 2021 Court: United States Bankruptcy Court Southern District of Florida Case No.: 21-15250 Judge: Hon. Jay A. Cristol Debtor's Counsel: Robert Reynolds, Esq. LAW OFFICES OF ROBERT F. REYNOLDS, P.A. 515 East Las Olas Blvd. 850 Fort Lauderdale, FL 33301 Tel: 954-755-9928 E-mail: rreynolds@robertreynoldspa.com Estimated Assets: $0 to $50,000 Estimated Liabilities: $1 million to $10 million The petition was signed by Thomas Fuhrman, the managing member. The Debtor failed to include in the petition a list of its 20 largest unsecured creditors. A full-text copy of the petition is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/HEHRYFI/Equivalent_Financial_LLC__flsbke-21-15250__0001.0.pdf?mcid=tGE4TAMA ETHEMA HEALTH: Incurs $2.4 Million Net Loss in First Quarter ------------------------------------------------------------ Ethema Health Corporation filed with the Securities and Exchange Commission its Quarterly Report on Form 10-Q disclosing a net loss of $2.37 million on $90,793 of revenues for the three months ended March 31, 2021, compared to a net loss of $10.34 million on $83,542 of revenues for the three months ended March 31, 2020. As of March 31, 2021, the Company had $4.09 million in total assets, $18.52 million in total liabilities, $400,000 in preferred stock, and a total stockholders' deficit of $14.83 million. "As at March 31, 2021 the Company has a working capital deficiency of $12,672,306, including derivative liabilities of $4,379,372 and accumulated deficit of $44,858,784. Management believes that current available resources will not be sufficient to fund the Company's planned expenditures over the next 12 months. Accordingly, the Company will be dependent upon the raising of additional capital through placement of common shares, and/or debt financing in order to implement its business plan and generating sufficient revenue in excess of costs. If the Company raises additional capital through the issuance of equity securities or securities convertible into equity, stockholders will experience dilution, and such securities may have rights, preferences or privileges senior to those of the holders of common stock or convertible senior notes. If the Company raises additional funds by issuing debt, the Company may be subject to limitations on its operations, through debt covenants or other restrictions. If the Company obtains additional funds through arrangements with collaborators or strategic partners, the Company may be required to relinquish its rights to certain geographical areas, or techniques that it might otherwise seek to retain. There is no assurance that the Company will be successful with future financing ventures, and the inability to secure such financing may have a material adverse effect on the Company's financial condition. These consolidated financial statements do not include any adjustments to the amounts and classifications of assets and liabilities that might be necessary should the Company be unable to continue operations," Ethema said. "The ability of the Company to continue as a going concern is dependent on the Company generating cash from the sale of its common stock or obtaining debt financing and attaining future profitable operations. Management's plans include selling its equity securities and obtaining debt financing to fund its capital requirements and ongoing operations; however, there can be no assurance the Company will be successful in these efforts," Ethema said. A full-text copy of the Form 10-Q is available for free at: https://www.sec.gov/Archives/edgar/data/792935/000172186821000319/f2sgrst10q051921.htm About Ethema Health Headquartered in West Palm Beach, Florida, Ethema Health Corporation -- http://www.ethemahealth.com-- operates in the behavioral healthcare space specifically in the treatment of substance use disorders. Ethema developed a unique style of treatment over the last eight years and has had much success with in-patient treatment for adults. Ethema will continue to develop world class programs and techniques for North America. Ethema reported net income of $3.08 million for the year ended Dec. 31, 2020, a net loss of $14.96 million for the year ended Dec. 31, 2019, and a net loss of $8.18 million for the year ended Dec. 31, 2018. Sunrise, Florida-based Daszkal Bolton LLP, the Company's auditor since 2018, issued a "going concern" qualification in its report dated April 15, 2021, citing the Company had accumulated deficit of approximately $42.4 million and negative working capital of approximately $12.9 million at Dec. 31, 2020, which raises substantial doubt about its ability to continue as a going concern. EVOLUTION ACADEMY: S&P Upgrades ICR to 'B+' on Improved Liquidity ----------------------------------------------------------------- S&P Global Ratings raised its rating to 'B+' from 'B' on Texas Public Finance Authority Charter School Finance Corp.'s series 2010A and B education revenue bonds and series 2010Q taxable education revenue bonds (qualified school construction bonds--direct pay), all issued for Evolution Academy (EA) Charter School. The outlook is stable. "The upgrade reflects EA's improved liquidity and operating performance, and projected positive operations for 2021 according to management, despite a deficit in fiscal 2020," said S&P Global Ratings credit analyst Brian Marshall. It also supports maximum annual debt service (MADS) coverage consistent with the rating level, and continued projected increases in liquidity, which should continue to gradually rise as operations strengthen. Because of the COVID-19 pandemic and broader safety concerns, EA converted to virtual learning in March 2020 through the end of the 2019-2020 school year. All of the organization's campuses will continue to use a combination of virtual and in-person learning instruction to begin the 2020-2021 school year. Officials will monitor the efficacy of various modes of instruction and make adjustments they deem necessary to deliver during the pandemic The 'B+' rating further reflects S&P's view of the charter school's: -- Recent decline in enrollment but with projections for improvement for fall 2021 , with no wait list; -- Relatively high student turnover and low retention rates resulting from servicing EA's target demographic of "at-risk" students; and -- Risk of charter revocation or nonrenewal before the bonds' maturity, which is a risk shared by all charter schools operating in Texas. Partially mitigating the preceding credit factors, in S&P's opinion, are EA's: -- Improved liquidity for the rating level, with modest increases projected for fiscal 2021; and -- Recently improved operating performance resulting in close-to-break-even margins and good debt service coverage for the rating. Currently, EA has about $13 million in debt and capital leases outstanding. The debt is entirely fixed rate and is secured by charter school revenues under a loan agreement between the charter school and the Texas Public Finance Authority. Evolution Academy Inc. was incorporated in Texas in 1999 as a federal tax-exempt 501(c) 3 not-for-profit organization. It operates high schools in the Dallas metropolitan area (Richardson campus), Houston, and Beaumont. The organization provides services to students who have dropped out of their local school or who are otherwise considered at risk of doing so. Two consequences of servicing this student population are that the headcount fluctuates throughout the school year and student turnover is high, leading to a transient student population. S&P said, "The stable outlook reflects our view that the school will maintain positive operations in the near term, resulting in operating margins and DSC levels that are commensurate with the current rating. Furthermore, we believe liquidity could continue to increase moderately in the near term if operations meet expectations. Our outlook also assumes EA will not issue additional growth-related debt. "We could raise the rating if enrollment stabilized while EA generates MADS coverage and improves liquidity to levels commensurate with those of higher-rated peers "We could lower the rating during the one-year outlook period if operating liquidity or operating performance weaken materially. In addition, any declines in enrollment resulting in weakened financial metrics could lead to a negative rating action." EXELA TECHNOLOGIES: Taps Equity Market to Raise Cash to Cut Debt ---------------------------------------------------------------- Katherine Doherty of Bloomberg News reports that Exela Technologies Inc. is the latest debt-laden business tapping hot equity markets to raise cash and cut down on borrowings. The technology company plans to sell as much as $100 million of new shares from time to time at market prices to pay down debt and lower interest expense, according to a filing Thursday, May 27, 2021. That sounds like a lot -- and it is, considering Exela’s current market capitalization is only $94 million. But it would barely make a dent in the company’s negative net worth, which stands at almost $1 billion, or the debt load of about $1.5 billion. About Exela Technologies Exela Technologies, Inc. is a business process automation (BPA) company, leveraging a global footprint and proprietary technology to provide digital transformation solutions enhancing quality, productivity, and end-user experience. With decades of expertise operating mission-critical processes, Exela serves a growing roster of more than 4,000 customers throughout 50 countries, including over 60% of the Fortune 100. With foundational technologies spanning information management, workflow automation, and integrated communications, Exela's software and services include multi-industry department solution suites addressing finance and accounting, human capital management, and legal management, as well as industry-specific solutions for banking, healthcare, insurance, and public sectors. Through cloud-enabled platforms, built on a configurable stack of automation modules, and over 22,000 employees operating in 23 countries, Exela rapidly deploys integrated technology and operations as an end-to-end digital journey partner. Exela Technologies reported a net loss of $509.12 million for the year ended Dec. 31, 2019, compared to a net loss of $169.81 million for the year ended Dec. 31, 2018. * * * As reported by the TCR on Nov. 29, 2019, S&P Global Ratings lowered its issuer credit rating on Irving, Texas-based Exela Technologies Inc. to 'CCC-' from 'CCC+' with negative outlook. "We could lower our ratings on Exela if the company defaults, announces a distressed exchange or restructuring, or misses its interest payment," S&P said. FAITH CATHEDRAL: TD Bank Says Plan Disclosures Not Feasible ----------------------------------------------------------- TD Bank, N.A., successor by merger with Carolina First Bank, objects to the Plan of Reorganization and Disclosure Statement of Faith Cathedral Look Up and Live Ministries, Inc. In support of its Objection, TD Bank respectfully states as follows: * The Plan fails to specify that TD Bank will be paid post petition interest and attorneys' fees as required by Section 506(b). Consequently, the Plan should not be confirmed unless it provides payment in full of TD Bank's secured claim, including post-petition interest and attorneys' fees. * The Debtor has not demonstrated the ability to service the principal and interest on the debt or to execute a plan to find another long-term solution, such as alternative financing or relocating and selling the real property. The Debtor proposes nothing in its Plan which indicates the outcome will be different this time. As consequence, the Debtor cannot prove its Plan is feasible as required by Section 1129(a)(11). * Even if the Debtor could establish the requirements of Section 1129(a), it cannot satisfy the requirements for cram down of TD Bank's claim under Section 1129(b). The Debtors cannot meet its burden to show the Plan is fair and equitable with respect to TD Bank's claim. The Debtors' Disclosure Statement fails to adequately disclose the following: * The Debtor fails to sufficiently describe the events leading to the bankruptcy filing, including the Debtor's inability to regularly service the TD Bank Loans and the reasons for its financial difficulties. * The Disclosure Statement does not adequately disclose the Debtor's current financial condition, including particularly any impact of the COVID-19 pandemic on its revenue. * The Debtor fails to provide adequate information regarding the proposed marketing and sale of a portion of the property, including without limitation the anticipated timeframe for the sale. A full-text copy of TD Bank's objection dated May 20, 2021, is available at https://bit.ly/3fvj07m from PacerMonitor.com at no charge. Attorneys for TD Bank, N.A. NELSON MULLINS RILEY & SCARBOROUGH LLP John T. Moore, ID No. 3978 Jody A. Bedenbaugh, ID No. 9210 1320 Main Street / 17th Floor Post Office Box 11070 (29211) Columbia, SC 29201 Tel: (803) 799-2000 About Faith Cathedral Look Up and Live Ministries Faith Cathedral Look Up and Live Ministries, Inc., a tax-exempt religious organization based in Piedmont, S.C., filed a voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. D.S.C. Case No. 20-03333) on Aug. 24, 2020. Jenette Cureton, assistant administrator, signed the petition. At the time of the filing, the Debtor disclosed $1 million to $10 million in both assets and liabilities. Judge Helen E. Burris oversees the case. Robert Pohl, Esq., at POHL, P.A., serves as Debtor's legal counsel which was substituted by Jason Ward Law, LLC, as counsel. FIVE POINT: Moody's Affirms B3 CFR & Alters Outlook to Positive --------------------------------------------------------------- Moody's Investors Service changed Five Point Operating Company, LP's outlook to positive from stable and upgraded the company's Speculative Grade Liquidity Rating to SGL-2 from SGL-3. Moody's also affirmed Five Point's B3 Corporate Family Rating, B3-PD Probability of Default Rating, and the B3 rating of the company's senior unsecured notes. The positive outlook reflects Moody's expectation that the company is at an inflection point to accelerate revenue growth and materially improve profitability and will remain committed to a conservative approach to balance sheet management. In addition, Moody's positive outlook considers the company's valuable land inventory and demand for the company's homesites that are currently under development for delivery in 2021 and 2022. The upgrade of Five Point's Speculative Grade Liquidity Rating to SGL-2 from SGL-3 reflects Moody's expectation of good liquidity over the next 12 to 18 months. At March 31, 2021, Five Point had approximately $229 million in available cash and approximately $125 million of availability under its unsecured revolving credit facility (unrated) that expires in April 2024. The following rating actions were taken: Affirmations: Issuer: Five Point Operating Company, LP Corporate Family Rating, Affirmed B3 Probability of Default Rating, Affirmed B3-PD Senior Unsecured Regular Bond/Debenture, Affirmed B3 (LGD4) Upgrades: Issuer: Five Point Operating Company, LP Speculative Grade Liquidity Rating, Upgraded to SGL-2 from SGL-3 Outlook Actions: Issuer: Five Point Operating Company, LP Outlook, Changed To Positive From Stable RATINGS RATIONALE Five Point's B3 CFR reflects the company's sizable and valuable land portfolio of three master planned communities currently planned to include approximately 40,000 homesites in three of the most desirable and supply constrained cities in California (CA). In addition, Moody's rating is supported by the company's conservative capital structure and good liquidity. At the same time, the rating considers the volatile and discrete transactional nature of the company's land development business and its geographic concentration. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS The ratings could be upgraded if (all ratios include Moody's standard adjustments): - The company improves its liquidity and free cash flow - The company delivers on expected revenue and profitability measures - The company's debt-to-capitalization is below 30% for a sustained period of time - The company's EBIT-to-interest expense approaches 2.0x The rating could be downgraded if: - The company's liquidity deteriorates - The company's debt-to-capitalization is above 40% for a sustained period of time - The company's EBIT-to-interest expense is below 1.0x for a sustained period of time - The company fails to deliver on expectations of reaching critical mass due to operational and / or legal delays impacting its credit quality The principal methodology used in these ratings was Homebuilding And Property Development Industry published in January 2018. Headquartered in Irvine, CA, Five Point Operating Company, LP is an owner and developer of three mixed-use master-planned communities (MPCs) designed to include approximately 40,000 homes and approximately 23 million square feet of commercial space in coastal California. The company's significant and valuable land banks consist of two large parcels in Southern California (Los Angeles and Irvine) and one in San Francisco. FLOYD CHARLES YORK: Scanlons Buying Alexandria Property for $1.825M ------------------------------------------------------------------- Floyd Charles York asks the U.S. Bankruptcy Court for the Eastern District of Virginia to authorize the sale of the real property located at 400 Hilltop Terrace, in Alexandria, Maryland, to Barry Scanlon and Lisa Scanlon for $1.825 million. On Feb. 2, 2021, York obtained confirmation of his Second Amended Chapter 11 Plan of Reorganization, which provided for the sale of the Property. On May 12, 2021, York entered into an agreement to sell the Property to the Buyers for $1.825 million with an expected closing date of June 2, 2021. The Buyers' agent, Eric Jay Rossum and Long & Foster Real Estate will be paid a commission of 2.5% of the sales price. York and Coldwell Banker Residential Brokerage are to be paid a commission of 3.5% of the sales price. The Property is currently encumbered by a First Deed of Trust held by Wells Fargo in the approximate amount of $575,878.92 and a Second Deed of Trust in the approximate amount of $351,798.33. York does not anticipate any significant tax liability resulting from the sale of the Property. He asks that the Court approves the sale of the Property under the terms of the Sale Contract and authorize the payment at settlement of the First Deed of Trust Note; Second Deed of Trust Note; real estate commissions; and all other ordinary and appropriate fees and costs that arise in connection with the closing on the sale of the Property, consistent with the sales contract and existing brokerage agreements with all remaining funds to be distributed to York as DIP, from which York will make the following payments: a. PNC Bank 1st Deed of Trust against 17222 Piney Point (Outstanding Pre- and Post-Petition Arrearages) - $32,882.43; b. Bayview Loan Servicing 2nd Deed of Trust against 17222 Piney Point (Outstanding Pre- and Post-Petition Arrearages) - $12,686.57; c. U.S. Trustee’s Fees - $13,000; d. Attorney's Fees - $32,000; e. Accountant's Fees - $3,900; f. Internal Revenue Service - $87,347.50; g. Commonwealth of Virginia - $10,408.68; h. State of Maryland - $2,464; and i. Unsecured Claimants - $56,015.29. These payments are consistent with York's confirmed Plan. In order to ensure the expeditious closing of the proposed sale consistent with the closing date established in the sales contract, York further requests that the 14-day stay of any order authorizing sale of the Property be waived. A copy of the Contract is available at https://tinyurl.com/96e5e6j6 from PacerMonitor.com free of charge. Counsel for Debtor: Jonathan B. Vivona, Esq. JONATHAN B. VIVONA, PLC 601 King Street, Suite 400 Alexandria, VA 22314 Telephone: (703) 739-1353 Facsimile: (703) 337-0490 E-maiL: vivonalaw@gmail.com Floyd Charles York sought Chapter 11 protection (Bankr. E.D. Va. Case No. 19-13106) on Sept. 18, 2019. The Debtor filed Pro Se. FRANCESCA'S HOLDINGS: Conditionally Approves Disclosures and Plan ----------------------------------------------------------------- Judge Brendan L. Shannon has entered an order conditionally approving the combined Disclosure Statement and Plan of FHC Holdings Corporation (f/k/a Francesca's Holdings Corporation). The combined hearing will be held on July 20, 2021, at 10:00 a.m. (EDT). The deadline to file objections to confirmation of the Plan on any ground and/or final approval of the Combined Disclosure Statement and Plan is 4:00 p.m. (EDT) on July 6, 2021 (the "Confirmation Objection Deadline"). The deadline to file a memorandum of law and/or any affidavits or declarations in support of confirmation of the Plan, and, if necessary, a reply to any valid objection to confirmation of the Plan and/or final approval of the Combined Disclosure Statement and Plan filed on or before the Confirmation Objection Deadline is July 15, 2021 at 4:00 p.m. (EDT). The Voting Record Date shall be May 26, 2021. The deadline for filing and serving any motion seeking to have a claim temporarily allowed for voting purposes pursuant to Bankruptcy Rule 3018 is June 24, 2021 at 4:00 p.m. (EDT). The deadline for the Debtors or any other parties in interest to object to such a motion is July 6, 2021. Pursuant to Bankruptcy Rule 3017(d), the Debtors are not required to transmit a Solicitation Package to holders of unclassified claims or holders of claims or equity interests in Class 1 (Priority Non-Tax Claims), Class 2 (Secured Claims), and Class 4 (Equity Interests) (collectively, the "Non-Voting Parties"). The Debtors shall mail or cause to be mailed to each Non-Voting Party, so that such mailing commences no later than the Solicitation Mailing Date, the Notice of Non-Voting Status, the Combined Disclosure Statement and Plan, and this Order; provided, however, that the Debtors shall only provide holders of equity interests in Class 4 with paper copies of the Notice of Non-Voting Status and this Order and will provide such holders with copies of the Combined Disclosure Statement and Plan upon request. All Ballots must be properly executed, completed, and delivered to the Voting Agent in accordance with the following instructions on or before July 9, 2021 (the "Voting Deadline"). About Francesca's Holdings Francesca's Holdings and its affiliates sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Del. Case No. 20-13076) on Dec. 3, 2020. Francesca's Holdings had total assets of $264.7 million and total liabilities of $290.5 million as of Nov. 1, 2020. Judge Brendan Linehan Shannon oversees the cases. The Debtors tapped O'Melveny & Myers LLP and Richards, Layton & Finger P.A. as legal counsel; FTI Capital Advisors LLC as financial advisor and investment banker; A&G Realty Partners as real estate advisor; and KPMG LLP as tax and accounting advisor. Bankruptcy Management Solutions Inc. is the notice, claims and balloting agent. The U.S. Trustee for Regions 3 and 9 appointed an official committee to represent unsecured creditors in the Debtors' cases. Cole Schotz P.C. and Province, LLC, serve as the committee's legal counsel and financial advisor, respectively. FRANCIS FARMS: $2.4M Sale of Commercial Property in Rehoboth OK'd ----------------------------------------------------------------- Judge Janet E. Bostwick of the U.S. Bankruptcy Court for the Eastern District of Massachusetts authorized Francis Farms Holdings, LLC's proposed private sale of the commercial real estate located at 151R County Street/19-33 Farm Road, in Rehoboth, Massachusetts, to the Town of Rehoboth for the sum of $2.4 million. There were no higher offers or objections filed with the Court. The sale is free and clear of all liens, claims, interests, and encumbrances, with all such interests to attach to the proceeds, if any. The closing agent for the sale of the Real Estate is authorized and ordered to disburse the gross proceeds of the sale of the Real Estate at the closing of the sale of the Real Estate as follows without further order of this Court to pay the following: A. Real estate taxes and other municipal obligations due or that may become due to the Town of Rehoboth to the date of the sale will be paid directly to the Town of Rehoboth or the Buyers as part of the closing adjustments. Based on the representations of the Debtor, there is a balance due to the Town of Rehoboth in the approximate amount of $30,000. B. Documentary tax stamps as well as Seller's customary recording expense. C. First Mortgage to Joseph Ruggerio as successor in interest to Bristol County Savings Bank in the approximate amount of $1,306,502.92 as of April 12, 2021 with a per diem thereafter of $296.82. The entire balance due to the Lender on t7he closing date will be paid in full. D. Second mortgage to The Small Business Administration in the amount of $938,314.48 as of April 13, 2021. There is no per diem interest to be paid to the Small Business Administration. The Debtor is directed to hold the balance of the sale proceeds in escrow pending further order of the Court. The Debtor is directed to file a report on the status of the sale by July 6, 2021. For good cause, the 14-day stay provided by Fed. R. Bankr. P. 6004(h) is waived. About Francis Farms Holdings Francis Farms Holdings, LLC sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Mass. Case No. 21-10273) on March 3, 2021. David Cascioli, manager, signed the petition. In the petition, the Debtor disclosed between $1 million and $10 million in both assets and liabilities. Judge Janet E. Bostwick oversees the case. Gary W. Cruickshank, Esq., serves as the Debtor's legal counsel. FRESH ACQUISITIONS: Committee Seeks to Hire Financial Advisor ------------------------------------------------------------- The official committee of unsecured creditors appointed in the Chapter 11 cases of Fresh Acquisitions, LLC and its affiliates seeks approval from the U.S. Bankruptcy Court for the Northern District of Texas to employ Caliber Advisors, LLC as its financial advisor. The firm's services include: (a) advising and assisting the committee relative to the Debtors' sale of assets and reorganization or liquidation; (b) reviewing the Debtors' current business plan, financial statements and all corporate documents; (c) assisting the committee in its examination and analysis of the conduct of the Debtors' affairs; (d) conducting financial diligence on projections and reports submitted by the Debtors; (e) making inquiries and supplying the committee's legal counsel with information related to various motions; (f) reviewing and analyzing bankruptcy schedules and claims; (g) advising the committee on sale process; (h) assisting the committee in its negotiations with the Debtors and other parties-in-interest concerning the terms of any proposed sales or plans of reorganization; and (i) assisting the committee in evaluating and prosecuting any claims that the Debtors may have against third parties. The hourly rates of the firm's professionals are as follows: David Gonzales $400 Ashley Loesch $200 In addition, the firm will seek reimbursement for expenses incurred. David Gonzales, a managing member of Caliber Advisors, 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: David Gonzales Caliber Advisors, LLC 7373 E Doubletree Ranch Road, Suite 210 Scottsdale, AZ 85258 Telephone: (602) 274-0333 Facsimile: (602) 956-0244 Email: dave@caliber-advisors.com About Fresh Acquisitions Fresh Acquisitions LLC and Buffets, LLC operate independent restaurant brands and are based in San Antonio, Texas. Prior to the COVID-19 pandemic, Fresh Acquisitions and its affiliates were a significant operator of buffet-style restaurants in the United States with approximately 90 stores operating in 27 states. Fresh Acquisitions' concepts include six buffet restaurant chains and a full service steakhouse, operating under the names Furr's Fresh Buffet, Old Country Buffet, Country Buffet, HomeTown Buffet, Ryan's, Fire Mountain, and Tahoe Joe's Famous Steakhouse, respectively. Buffets Holdings, Inc. filed for Chapter 11 relief in January 2008 and won confirmation of a reorganization plan in April 2009. In January 2012, Buffets again sought Chapter 11 protection and emerged from bankruptcy in July 2012. On Aug. 19, 2015, Alamo Ovation, LLC acquired Buffets Restaurants Holdings, Inc., and as a result of the merger, Buffets operated over 300 restaurants in 35 states. Down to 150 restaurants in 25 states after closing unprofitable locations, Buffets LLC and its affiliated entities sought Chapter 11 protection (Bankr. W.D. Texas Case No. Lead Case No. 16-50557) in San Antonio, Texas, on March 7, 2016. On April 27, 2017, the court confirmed the Debtors' Second Amended Joint Plan of Reorganization. The effective date of the plan was May 18, 2017. Fresh Acquisitions and 14 affiliates, including Buffets LLC (also known as Ovation Brands) sought Chapter 11 protection (Bankr. N.D. Texas Lead Case No. 21-30721) on April 20, 2021. Fresh Acquisitions was estimated to have $1 million to $10 million in assets and $10 million to $50 million in liabilities. The Hon. Harlin Dewayne Hale is the case judge. In the 2021 cases, the Debtors tapped Gray Reed as bankruptcy counsel, Katten Muchin Rosenman LLP as special counsel, B. Riley Advisory Services as financial advisor, and Hilco Real Estate, LLC as real estate consultant. BMC Group, Inc. is the claims and noticing agent. Arizona Bank & Trust, as creditor, is represented by Patrick A. Clisham, Esq., at Engelman Berger, PC while the Debtors' DIP lender is represented by J. Michael Sutherland, Esq., at Carrington Coleman. On April 30, 2021, the U.S. Trustee for Region 7 appointed an official committee of unsecured creditors in the Debtors' Chapter 11 cases. Dickinson Wright, PLLC and Caliber Advisors, LLC serve as the committee's legal counsel and financial advisor, respectively. FRIENDS OF CITRUS: U.S. Objection Resolved; Court Confirms Plan --------------------------------------------------------------- Judge Micheal G. Williamson has entered an order approving the Disclosure Statement of Friends of Citrus and the Nature coast, Inc. F/k/a Hospice of Citrus County, Inc., on a final basis. The Plan, as modified, is confirmed in all respects. The Mediation Settlement Agreement between the United States and the Debtor, including the Addendum filed on May 17, 2021, is approved. The Court shall hold post-confirmation status conference on July 21, 2021 at 10:00 a.m. Immediately after the date in which ballots were due, the Debtor realized that the three United States government classes (3, 4 and 5) voted to reject the Plan, which would have necessitated the need for an evidentiary contested confirmation hearing. On April 23, 2021, the Debtor filed a Ballot Tabulation reflecting, as of the Voting Deadline, the acceptances and rejections of each Class that voted to accept or reject the Plan. The Debtor and the United States were able to amicably resolve the disputes between them at Mediation and on May 11, 2021, the Debtor and the United States entered into a Mediation Settlement Agreement (the "Mediation Settlement Agreement") "[i]n full and complete settlement of all matters that were brought or that could have been brought herein." (Settlement Agreement, p. 1) The Debtor and the United States executed the Mediation Settlement Agreement on the same day as the Mediation. Thereafter, on May 14, 2021, a Plan Modification was filed with the Court amending and modifying the plan by interlineation and incorporating a redline version of the Plan, as modified. The Debtor modified the Plan by: I. incorporating an additional definition to Article I: Defined Terms and Rules of Interpretation, (A) Defined Terms which defined the Mediation Settlement Agreement; II. modifying Article III: Classification and Treatment of Claims, Paragraph B: Classification and Treatment of Claims Subsections (iii), (iv) and (v) entitled Unsecured Government IRO Claim (Class 3), CMS Final Cost Report PIP claim (Class 4) and DOJ Settlement Claim (Class 5), respectively, by deleting the last sentence and substituting in its place a revised sentence to conform the treatment of Classes 3, 4, and 5 to the terms of the Mediation Settlement Agreement which provides for the a settlement amount of $800,000 to be paid by the Debtor to the United States over 6 years and 15% of Vitas Litigation; III. modifying Article III: Classification and Treatment of Claims, Paragraph B, Classification and Treatment of Claims Subsection (vi) entitled Riverwood (Greystone) Claim (Class 6) (b) Treatment by deleting said paragraph in its entirety and submitting in its place a revised paragraph providing for the distribution of funds to the Class 6 claimant on the Effective Date of the Plan. About Friends of Citrus Friends of Citrus And The Nature Coast, Inc. -- https://friendsofcitrus.org/ -- is a charitable organization providing community grief support workshop for anyone who has experienced a loss; telephone support; grief support resources for all ages; educational materials for parents and teachers; and children's grief support camps. Friends of Citrus And The Nature Coast, Inc. filed a voluntary petition in this Court for relief under Chapter 11 of the Bankruptcy Code (Bankr. M.D. Fla. Case No. 19-03101) on Aug. 14, 2019. On Aug. 15, 2019, the case was transferred to Tampa Division and was assigned a new case number (Case No. 19-07720). In the petition signed by Bonnie L. Saylor, chief executive officer, Friends of Citrus estimated $7,510,918 in assets and $5,283,937 in liabilities. Judge Michael G. Williamson oversees the case. Frank P. Terzo, Esq. and Nicolette Corso Vilmos, Esq., at Nelson Mullins Broad and Cassel serves as the Debtor's legal counsel. GAIA INTERACTIVE: Seeks to Hire Binder & Malter as Legal Counsel ---------------------------------------------------------------- Gaia Interactive, Inc. seeks approval from the U.S. Bankruptcy Court for the Northern District of California to employ Binder & Malter, LLP as its legal counsel. The firm's services include: (a) assisting the Debtor in protecting and preserving the interests of secured and unsecured creditors, maximizing the value of estate property, and administering that property throughout its Chapter 11 case; (b) advising the Debtor of its powers and responsibilities under the Bankruptcy Code; (c) developing, through discussion with parties-in-interest, legal positions and strategies with respect to all facets of the Debtor's case; (d) preparing legal papers; (e) participating in the resolution of issues related to a plan of reorganization and the development, approval and implementation of such plan; and (f) rendering such other necessary services that the Debtor may require in connection with its bankruptcy case. The hourly rates of the firm's attorneys and staff are as follows: Heinz Binder $575 Michael W. Malter $575 Robert G. Harris $525 Julie H. Rome-Banks $525 David B. Rao $525 Wendy W. Smith $525 Christian P. Binder $425 Devin Jacobsen $425 Trang Do $325 Paralegals and Law Clerks $275 In addition, the firm will seek reimbursement for expenses incurred. Binder & Malter received retainer fees in the sum of $260,000 for this Chapter 11 case. Michael Malter, Esq., a partner at Binder & Malter, 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 W. Malter, Esq. Robert G. Harris, Esq. Julie Rome-Banks, Esq. Binder & Malter, LLP 2775 Park Avenue Santa Clara, CA 95050 Telephone: (408) 295-1700 Facsimile: (408) 295-1531 Email: Michael@bindermalter.com Rob@bindermalter.com Julie@bindermalter.com About Gaia Interactive Gaia Interactive, Inc., an owner and operator of online communities platform in Santa Clara, Calif., filed a voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. N.D. Calif. Case No. 21-50660) on May 12, 2021. James Cao, chief executive officer, signed the petition. At the time of the filing, the Debtor disclosed total assets of $567,616 and total liabilities of $8,193,464. Judge Stephen L. Johnson oversees the case. Binder & Malter, LLP serves as the Debtor's legal counsel. GATEWAY RADIOLOGY: August 11 Plan & Disclosure Hearing Set ---------------------------------------------------------- On May 12, 2021, the U.S. Bankruptcy Court for the Middle District of Florida conducted a hearing on the expedited motion of Philips Healthcare, LLC, a division of Philips Of North America, the largest creditor of Debtors Gateway Radiology Consultants, P.A., and PM Radiology, LLC, seeking conditional approval of its disclosure statement. On May 25, 2021, Judge Michael G. Williamson granted the motion and ordered that: * Philips' Disclosure Statement in Respect of Creditor's Combined Plan of Liquidation is conditionally approved. * August 11, 2021, at 10:30 a.m. in Courtroom 8A, Sam M. Gibbons United States Courthouse 801 N. Florida Avenue, Tampa, Florida 33602 is the hearing to consider final approval of Philips' disclosure statement and confirmation of Philips' plan. * The Debtors have until June 14, 2021 to propose and file a chapter 11 plan and disclosure statement, which may include an amendment to the Debtor's Joint Plan of Reorganization or the Debtor's Joint Disclosure Statement. * Creditors and other parties in interest shall file with the clerk their written acceptances or rejections of any plan (ballots) no later than seven days before the Confirmation Hearing. * Any party who wants to object to any disclosure statement or to confirmation of any plan shall file its objection no later than seven days before the Confirmation Hearing. * In accordance with Local Bankruptcy Rule 3018-1, any plan proponent shall file a ballot tabulation no later than four days before the Confirmation Hearing. A full-text copy of the order dated May 25, 2021, is available at https://bit.ly/3uvhSVB from PacerMonitor.com at no charge. Counsel to Philips North America LLC: GRAY ROBINSON, P.A. Steven J. Solomon Florida Bar No. 931969 333 S.E. 2nd Avenue, Suite 3200 Miami, Florida 33131 Tel: (305) 416-6880 Fax: (305) 416-6887 E-mail: StevenSolomon@Gray-Robinson.com About Gateway Radiology Consultants Saint Petersburg, Fla.-based Gateway Radiology Consultants P.A. filed a Chapter 11 petition (Bankr. M.D. Fla. Case No. 19-04971) on May 28, 2019. In the petition signed by Gateway Radiology President Gagandeep Manget M.D., the Debtor disclosed $1.2 million in assets and $14.9 million in liabilities. Judge Michael G. Williamson oversees the case. Joel M. Aresty, P.A., serves as the Debtor's bankruptcy counsel. The Debtor also tapped Beighley Myrick Udell + Lynne, PA, Paul C. Jensen Attorney-At-Law, and Netherlands-based Marxman Advocaten as special counsel. GDC TECHNICS: Seeks to Hire SierraConstellation, Appoint CRO ------------------------------------------------------------ GDC Technics, LLC seeks approval from the U.S. Bankruptcy Court for the Western District of Texas to hire SierraConstellation Partners, LLC and appoint Carl Moore, the firm's managing director, as chief restructuring officer. The firm's services include: a. preparing a 13-week cash flow forecast to manage liquidity and communicating with various stakeholders, including lenders; b. communicating with lenders to create "runway" to identify more fulsome strategic alternatives; c. identifying other strategic and restructuring alternatives that will position the Debtor for long-term sustainability; d. providing management support related to operations and cash flow management; e. providing management support in evaluating and responding to lenders during negotiations; f. executing cost reductions to improve profitability and liquidity; g. providing financial advice to the Debtor in structuring and effecting a refinancing or other capital structure transaction, including sale of the Debtor; h. assisting the Debtor in arranging a debtor-in-possession financing or otherwise, including identifying potential sources of capital, assisting in the due diligence process, and negotiating the terms of any proposed financing; i. assisting and managing the due diligence process; j. managing administrative tasks of Chapter 11 including the preparation of bankruptcy schedules and statements; k. providing testimony or serving as responsible party in Chapter 11 should it be necessary; and l. If needed, preparing a comprehensive asset recovery analysis to determine path forward to maximize recovery. The firm's hourly rates are as follows: Chief Restructuring Officer $585 Partners $790-$865 Managing Directors $605-$685 Senior Directors $550-$605 Director, Project Management $525 Isabella Montani, Director $420 Associates $235 Analysts $185 Mr. Moore disclosed in a court filing that he is a "disinterested person" within the meaning of Bankruptcy Code Section 101(14). The firm can be reached through: Carl Moore SierraConstellation Partners, LLC 355. S. Grand Avenue, Suite 1450 Los Angeles, CA 90071 Phone: (213) 289-9060 Fax: (213) 232-3285/(213) 402-3548 Email: info@sierraconstellation.com About GDC Technics Headquartered in Fort Worth, Texas, GDC Technics LLC -- https://www.gdctechnics.com/ -- is a global aerospace company with expertise in engineering and technical services, modifications, electronic systems, R&D, and MRO services. GDC Technics sought Chapter 11 bankruptcy protection (Bankr. W.D. Texas Lead Case No. 21-50484) on April 26, 2021. CEO Brad Foreman signed the petition. At the time of the filing, the Debtor had between $10 million and $50 million in both assets and liabilities. The case is handled by Judge Craig A. Gargotta. The Debtor tapped Wick Phillips Gould & Martin, LLP and SierraConstellation Partners, LLC as its bankruptcy counsel and restructuring advisor, respectively. Carl Moore, managing director at SierraConstellation, serves as the Debtor's chief restructuring officer. Oliver Zeltner of Jones Day is representing Boeing Co. Gabe Morgan of Weil, Gotshal & Manges is representing the pre-bankruptcy lenders. GDC TECHNICS: Seeks to Hire Wick Phillips as Bankruptcy Counsel --------------------------------------------------------------- GDC Technics, LLC seeks approval from the U.S. Bankruptcy Court for the Western District of Texas to hire Wick Phillips Gould & Martin, LLP as its bankruptcy counsel. The firm's services include: a. advising and consulting with the Debtor on the conduct of its Chapter 11 case, including all of the legal and administrative requirements of operating in Chapter 11; b. attending meetings and negotiating with representatives of creditors and other parties in interest; c. taking all necessary actions to protect and preserve the estate, including prosecuting actions on the Debtor’s behalf, defending any action commenced against the Debtor, and representing the Debtor in negotiations concerning litigation in which it is involved, including objections to claims filed against the estate; d. preparing legal documents; e. representing the Debtor in connection with obtaining authority to continue using cash collateral and post-petition financing; f. advising the Debtor in connection with any potential sale of estate assets; g. analyzing the Debtor's leases and contracts and the assumption and assignment or rejection thereof; h. analyzing and, as appropriate, challenging the validity of liens against assets of the estate; i. appearing before the court and any other court to represent the interests of the estate; j. investigating and prosecuting Chapter 5 causes of action and other potential litigation the Debtor may own or control; k. formulating, drafting, and obtaining confirmation of a Chapter 11 plan and all documents related thereto; and l. all other legal services that may be necessary or appropriate in connection with representing the Debtor in its Chapter 11 case. The firm will be paid at these rates: Jason M. Rudd, Partner $615 per hour Lauren K. Drawhorn, Partner $490 per hour Scott D. Lawrence, Associate $450 per hour Brenda Ramirez, Paralegal $175 per hour Wick Phillips is a "disinterested person" as defined in Section 101(14) of the Bankruptcy Code, according to court papers filed by the firm. The firm can be reached through: Jason M. Rudd, Esq. Wick Phillips Gould & Martin, LLP 7004 Bee Caves Rd. Bld 1, Suite 110 Austin, TX 78746 Phone: (512) 681-3732/(214) 740-4038 Email: jason.rudd@wickphillips.com About GDC Technics Headquartered in Fort Worth, Texas, GDC Technics LLC -- https://www.gdctechnics.com/ -- is a global aerospace company with expertise in engineering and technical services, modifications, electronic systems, R&D, and MRO services. GDC Technics sought Chapter 11 bankruptcy protection (Bankr. W.D. Texas Lead Case No. 21-50484) on April 26, 2021. CEO Brad Foreman signed the petition. At the time of the filing, the Debtor had between $10 million and $50 million in both assets and liabilities. The case is handled by Judge Craig A. Gargotta. The Debtor tapped Wick Phillips Gould & Martin, LLP and SierraConstellation Partners, LLC as its bankruptcy counsel and restructuring advisor, respectively. Carl Moore, managing director at SierraConstellation, serves as the Debtor's chief restructuring officer. Oliver Zeltner of Jones Day is representing Boeing Co. Gabe Morgan of Weil, Gotshal & Manges is representing the pre-bankruptcy lenders. GENESIS WEIGHT: Seeks to Use Cash Collateral -------------------------------------------- Genesis Weight Loss Centers, LLC asks the U.S. Bankruptcy Court for the Middle District of Florida, Tampa Division, for authority to immediately use property that may constitute cash collateral and provide adequate protection to entities that may have an interest in the property. The Debtor requires the use of cash collateral to maintain the Debtor's business operations and preserve value of the Debtor's estate, thereby avoiding direct, immediate and irreparable harm. The Debtor proposes to use the Cash Collateral in accordance with the Budget for payment of necessary maintenance, utilities and vendors; and other ordinary business expenses related to the ongoing operations of the business. CenterState Bank, N.A. may claim a security interest in all assets including accounts by virtue of a UCC-1 financing statement filed September 18, 2020, with the Florida Secured Transaction Registry as Number 20200479205X. To provide adequate protection, the Debtor proposes: A. All income derived from the business operations of the Debtor will be deposited in a new debtor-in-possession bank account. B. The Debtor will disburse funds from the Account to pay the customary and reasonable expenses associated with the operation of the Debtor's business in accordance with the budget. The Debtor requests that a variance of expense line items of up to 10% per month and cumulatively per month of up to 10% be permitted without the need for further Court order. C. The Debtor will provide CenterState with monthly written reporting as to the status of its accounts receivable, collections, disbursements and operations in the same or similar format as has been historically provided by Debtor. The Debtor submits that such reporting requirements serve to adequately protect the interests of CenterState especially when coupled with the reporting requirements under the Bankruptcy Code and Bankruptcy Rules. D. CenterState will be granted a replacement lien in any Cash Collateral acquired by the Debtor subsequent to the Petition Date to the same extent, priority and validity of its respective lien in such Cash Collateral as of the Petition Date. A copy of the motion and the Debtor's budget through the week ending June 21, 2021, is available for free at https://bit.ly/3uylcQ7 from PacerMonitor.com. The Debtor projects total income of $9,000 and total expenses of $10,648.53 for the week ending May 31, 2021. About Genesis Weight Loss Centers, LLC Genesis Weight Loss Centers, LLC is a Florida limited liability company offering various services to patients including; weight loss, bioidentical hormone replacement, and various medical cosmetic services. The Debtor leases real property located at 7011 Nightwalker Road, Brooksville, Fla. 34613. The Debtor sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. M.D. Fla. Case No. 8:21-bk-02820) on May 28, 2021. In the petition signed by Eugene Guerre, manager, the debtor disclosed up to $100,000 in assets and up to $1 million in liabilities. Jennis Morse Etlinger is the proposed counsel for the Debtor. GEO GROUP: S&P Downgraded ICR to 'CCC+', Outlook Negative --------------------------------------------------------- S&P Global Ratings lowered its issuer rating on The GEO Group Inc. to 'CCC+' from 'B' and all its issue-level ratings by two notches. The negative outlook reflects the potential for a downgrade if the company engages in a transaction that S&P views as distressed or if S&P believes it is likely the company will default within the next 12 months. The downgrade follows GEO's announcement that it has hired advisors to explore various alternatives for its capital structure. S&P notes the company has not communicated a recapitalization plan. However, operating conditions have become increasingly complex since President Biden's January 2021 executive order instructing The U.S. Department of Justice (DOJ) not to renew contracts with privately operated criminal-detention facilities. GEO recently drew down substantially all of its revolving credit facility availability, suspended its dividend, and strengthened its cash balances. S&P views these events, combined with low debt trading prices, onerous 2024 debt maturities, and challenging credit and capital market access as environmental, social, and governance (ESG) concerns cause lenders to curtail industry financing, as a likely prelude to a debt transaction that it could view as a default('D') or selective default ('SD'). Under S&P's criteria, a transaction is typically characterized as distressed if investors receive less value than the promise of the original securities without adequate offsetting compensation. Examples include: -- The combination of any cash amount and principal amount of new debts provided in the debt restructuring is less than the original par amount; -- The interest rate is lower than the original yield; -- The new debt's maturity extends beyond the original; -- The timing of payments is slowed (e.g., zero-coupon from quarterly paying, or bullet from amortizing); or -- The ranking is altered to more junior. Even a small discrepancy between the restructured debt and the original promise may be deemed distressed. The company has ample liquidity to fund its operations over the next 12 months. As of March 31, 2021, pro forma for $170 million of additional revolver borrowings, the company had about $459 million of available cash balances. We expect cash balances will build to over $600 million by year-end 2021. GEO's earliest maturity is April 1, 2023, when about $279 million of 5.125% senior notes matures, and in 2024 when about $1.78 billion of debt matures. Accordingly, we believe the company has sufficient time to consider and negotiate its capital structure alternatives. The company has a hefty total recourse debt capitalization of about $2.7 billion. S&P said, "In our opinion, absent a significant improvement in business and financing conditions, the company could struggle to refinance its debt at maturity. We believe refinancing risks are also reflected in the low debt trading prices." As of May 21, 2021, specific 2024 senior notes traded in the 76% area, and the company's secured credit facility that matures in 2024 was marked in the 87% area. On April 7, 2021, GEO suspended its quarterly dividend payments and announced the reevaluation of its real estate investment trust (REIT) corporate tax structure. The company is expected to conclude its evaluation in the fourth quarter of 2021, but a year-end REIT distribution to maintain compliance with the internal revenue service (IRS) code might be needed. The negative outlook reflects the potential for a downgrade if the company engages in a transaction that we view as distressed or if we are increasingly convinced the company will default within the next 12 months. S&P could lower its ratings if: -- S&P expects a payment default or a distressed exchange; -- Operating conditions worsen or performance is worse than expected; -- S&P believes it is likely the company will default within the next six to 12 months; -- S&P expects a covenant breach; or -- The 2024 maturities are not refinanced in a timely manner. S&P said, "We could revise the outlook to stable or raise our rating if we believe the likelihood of a distressed exchange has declined. In this scenario, the company has addressed its 2024 debt maturities and we believe there is the potential to achieve a sustainable capital structure over the long term without below market debt repurchases or a distressed exchange." GEX MANAGEMENT: Incurs $402K Net Loss in First Quarter ------------------------------------------------------ GEX Management, Inc. filed with the Securities and Exchange Commission its Quarterly Report on Form 10-Q disclosing a net loss of $402,363 for the three months ended March 31, 2021, compared to a net loss of $4,075 for the three months ended March 31, 2020. As of March 31, 2021, the Company had $3.31 million in total assets, $4.82 million in total liabilities, and a total shareholders' deficit of $1.51 million. The Company's revenue for the three months ended March 31, 2021 was $173,763 compared to $54,298 for the three months ended March 31, 2020. This strong 200%+ increase in year over year sales is attributable to a significant expansion in client footprints, aggressive business development efforts and a focus on higher end management and technology consulting business expansion and growth opportunities. Total operating expenses for the three months ended March 31, 2021 was $441,711 compared to the operating cost for the three months ended March 31, 2020 of $128,451. This higher expense is associated with significant staffing and G&A related expenses to support the rapid business and sales expansion efforts undertaken by the sales and business development team. GEX Management said, "The Company has identified several potential financing sources in order to raise the capital necessary to fund operations through December 31, 2021. Management believes that it has been historically difficult for minority and women owned businesses to get access to reasonably price capital at scale which creates an opportunity to invest into these companies and receive a greater than average return for our shareholders. However, the opportunity to make a significant return for our investors is so overwhelmingly compelling that management had in the past taken short term working capital loans against future receivables in order to timely fund the growth of the company. Management intends to move away from these expensive debt like obligations and rely on other traditional and non-traditional debt instruments primarily in the form of convertible notes as well as explore various other alternatives including debt and equity financing vehicles, strategic partnerships, government programs that may be available to the Company, as well as trying to generate additional sales and increase margins. However, at this time the Company has no commitments to obtain any additional funds, and there can be no assurance such funds will be available on acceptable terms or at all. If the Company is unable to obtain additional funding, the Company's financial condition and results of operations may be materially adversely affected and the Company may not be able to continue operations. "Additionally, even if the Company raises sufficient capital through additional equity or debt financing, strategic alternatives or otherwise, there can be no assurances that the revenue or capital infusion will be sufficient to enable it to develop its business to a level where it will be profitable or generate positive cash flow. If the Company incurs additional debt, a substantial portion of its operating cash flow may be dedicated to the payment of principal and interest on such indebtedness, thus limiting funds available for business activities. The terms of any debt securities issued could also impose significant restrictions on the Company's operations. Broad market and industry factors may seriously harm the market price of our common stock, regardless of our operating performance, and may adversely impact our ability to raise additional funds. Similarly, if the Company's common stock is delisted from the public exchange markets, it may limit its ability to raise additional funds. "In addition, at this time we cannot predict the impact of COVID-19 on our ability to obtain financing necessary for the Company to fund its working capital requirements." A full-text copy of the Form 10-Q is available for free at: https://www.sec.gov/Archives/edgar/data/1681556/000149315221012672/form10-q.htm About GEX Management GEX Management -- http://www.gexmanagement.com-- is a professional business services company that was originally formed in 2004 as Group Excellence Management, LLC d/b/a MyEasyHQ. The Company formed GEX Staffing, LLC in March 2017. GEX Management reported a net loss of $224,947 in 2020, a net loss of $100,200 in 2019, and a net loss of $5.10 million in 2018. As of Sept. 30, 2020, the Company had $3.81 million in total assets, $5.25 million in total liabilities, and a total shareholders' deficit of $1.44 million. GILBERT MH: HAZ Investment Buying Gilbert Property for $1.5 Million ------------------------------------------------------------------- Gilbert MH, LLC, filed with the U.S. Bankruptcy Court for the District of Arizona an amended request to approve the proposed sale of the land parcel located at the southeast corner of Val Vista Drive and Market Street, Gilbert, Arizona to The HAZ Investment Trust for $1.5 million, subject to higher and better offers. A telephonic hearing on the Motion is set for June 15, 2021, at 10:00 a.m. To make appearance, parties may call 877-810-9415, access code 1064631, several minutes before the hearing. Coldwater Gilbert LLC and Coldwater Capital LLC hold a first lien position on the Property. Maricopa County holds a tax lien on the Property. ARCHSOL, LLC recorded a Notice of Pendency of Action (Lis Pendens) in Maricopa County Recording No. 2019-0404852 on May 30, 2019 that may secure an interest in the subject property. The Debtor is not aware of any other claimed interest or lien in the property. The Debtor has entered into an Agreement to Purchase and Sale with the proposed purchaser, subject to the Court's Approval. The purchase price for the Property is $1.5 million, free and clear of liens and encumbrances, as evidenced by the Purchase Agreement. The proposed sale represents the highest and best offer that the Debtor has received and is fair value for the property. The Purchaser has no connection to the Debtor and it is an arm's-length transaction. The proposed sale price is less than the amount due Coldwater on the lien. Coldwater retains its rights to "credit bid" on the property. The Debtor submits that the sale is in the best interests of creditors of the estate. In the present case, the property is raw land. It may or may not be increasing in value with the passage of time and the proposed sale would facilitate Debtor’s Chapter 11 plan. The Debtor is not making payments to Coldwater. It is not current in property tax payments. It would be in the best interest of all if the property were to be sold at this time. In order to facilitate effective bidding and in order to generate the most revenue for the estate, the Debtors request that, at the time of a hearing on the sale and the entertainment of higher and better bids, that bids be accepted only in increments on no less than $50,000 higher than the then pending bid, including thes offer from HAZ. Notice of the sale will be provided to the entire Master Mailing Matrix and to any and all parties who have expressed an interest in acquiring the property. At the time a Successful Bidder is named, the Debtor will ask to have the next highest willing bidder be certified by the Court as the "Back Up Bidder." The Successful Bidder will deposit the sum of $25,000 in an interest-bearing escrow account with First American Title Insurance Co. within three business days after the Court's approval of sale. The Back Up Bidder will deposit cash equal to 10% of the bid within three business days after the Court's approval of sale. The Successful Bidder will close on the sale in no more than 10 days from the Sale Hearing, unless extended by agreement with the Debtor. The balance of the purchase price will be paid in cash or its equivalent at closing. If the sale to the Successful Bidder fails to close on a timely basis, the Back Up Bidder will have ten business days from the date of notification to close a sale in accordance with the terms of the Back Up Bid. The Back Up Bidder's Deposit will be held until closing has occurred with the Successful Bidder, but no longer than 20 days from the Sale Hearing unless the Back Up Bidder has consented. The Buyer (the Successful Bidder, the credit bidder or the Back Up Bidder, as may be the case) will pay at the closing of the sale of the property, directly to the Office of the United States Trustee (at the then prevailing rate), the fee due as a result of the payment made by the Buyer for the purchase of the property. For example, if the Quarterly Fee due the United States Trustee based upon the net sales proceeds is $12,500, the Buyer will pay that fee directly to the United States Trustee. For more information on the Quarterly Fee Calculation/Payment, parties may refer to the DOJ website (https://www.justice.gov/ust/chapter-11-quarterly-fees). The Motion provides for certain competitive bidding procedures, which establish the parameters under which the value of the property may be tested at a public auction. It is respectfully submitted that such procedures will increase the likelihood that the Debtor will receive the greatest possible consideration for the property in question, because it will ensure a competitive and fair bidding process. About Gilbert MH Gilbert MH, LLC filed its voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. D. Ariz. Case No. 21-01948) on March 19, 2021. At the time of the filing, the Debtor had between $1 million and $10 million in both assets and liabilities. Judge Eddward P. Ballinger Jr. oversees the case. The Debtor is represented by Lawrence D. Hirsch, Esq., at Parker Schwartz, PLLC. GILBERT MH: June 15 Hearing on $1.5M Gilbert Property Sale to HAZ ----------------------------------------------------------------- Gilbert MH, LLC, filed with the U.S. Bankruptcy Court for the District of Arizona a notice of proposed sale of the land parcel located at the southeast corner of Val Vista Drive and Market Street, in Gilbert, Arizona, to The HAZ Investment Trust for $1.5 million, subject to higher and better offers. A telephonic hearing on the Motion is set for June 15, 2021, at 10:00 a.m. To make appearance, parties may call 877-810-9415, access code 1064631, several minutes before the hearing. Coldwater Gilbert LLC and Coldwater Capital LLC hold a first lien position on the Property. Maricopa County holds a tax lien on the Property. ARCHSOL, LLC recorded a Notice of Pendency of Action (Lis Pendens) in Maricopa County Recording No. 2019-0404852 on May 30, 2019, that may secure an interest in the Property. Coldwater retains its rights to "credit bid" on the Property. The Property will be sold free and clear of liens, claims, interest, and encumbrances, and subject to the lienholders' rights under 11 USC Section 363(k), with all such liens, claims, interest and encumbrances to attach to the sale proceeds. Prospective purchasers are encouraged to personally inspect/perform their own due diligence of the property being sold, as the property will be sold "as is, where is," with no warranties. The Minimum Opening Bid is $1.5 million and the Minimum Increments Bid is $50,000. Bidders may participate by telephone by making a telephonic appearance at the sale hearing. The Debtor has received an offer of $1.5 million for the Property from the Purchaser of the Property. The Purchaser has no connection to the Debtor, and it is an arm's- length transaction. The offer is subject to higher and better offers. At the time a Successful Bidder is named, the Debtor will ask to have the next highest willing bidder be certified by the Court as the "Back Up Bidder." The Successful Bidder deposit the sum of $25,000 in an interest-bearing escrow account with First American Title Insurance Co. within three business days after the Court's approval of sale. The Backup Bidder will deposit a down payment in cash equal to 10% of the bid within three business days after the Court's approval of sale. The Property will be sold to the Purchaser for the purchase price of $1.5 million, or to the highest bidder at the Sale Hearing "as is, where is" with no Representations, Guarantees or Warranties. The Successful Bidder will close on the sale in no more than 10 days from the Sale Hearing, unless extended by agreement with Debtor. The balance of the purchase price will be paid in cash or its equivalent at closing. If the sale to the Successful Bidder fails to close on a timely basis, the Back Up Bidder will have 10 business days from the date of notification to close a sale in accordance with the terms of the Back Up Bid. The Back Up Bidder's Deposit will be held until closing has occurred with the Successful Bidder, but no longer than 20 days from the Sale Hearing unless the Back Up Bidder has consented and approving the payment of the broker's commission from the sale proceeds. The Debtor does not have an appraisal of the Property. There are no pending stay relief motions with regard to the Property. Any person opposing the sale will file a written objection within 21 days after the date of the notice with the Clerk of the Court. About Gilbert MH Gilbert MH, LLC filed its voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. D. Ariz. Case No. 21-01948) on March 19, 2021. At the time of the filing, the Debtor had between $1 million and $10 million in both assets and liabilities. Judge Eddward P. Ballinger Jr. oversees the case. The Debtor is represented by Lawrence D. Hirsch, Esq., at Parker Schwartz, PLLC. GOLF TAILOR: Case Summary & 20 Largest Unsecured Creditors ---------------------------------------------------------- Debtor: Golf Tailor, LLC 539 W. Commerce Street, Suite 4301 Dallas, TX 75208 Chapter 11 Petition Date: May 28, 2021 Court: United States Bankruptcy Court Northern District of Texas Case No.: 21-30995 Judge: Hon. Michelle V. Larson Debtor's Counsel: Areya Holder Aurzada, Esq. HOLDER LAW 901 Main Street, Suite 5320 Dallas, TX 75202 E-mail: areya@holderlawpc.com Total Assets: $1,617,234 Total Liabilities: $13,106,611 The petition was signed by Neil Goldstein, chief restructuring officer. A full-text copy of the petition containing, among other items, a list of the Debtor's 20 largest unsecured creditors is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/SFMWIQA/Golf_Tailor_LLC__txnbke-21-30995__0001.0.pdf?mcid=tGE4TAMA GOLF TAILOR: Seeks Cash Collateral Access ----------------------------------------- Golf Tailor, LLC asks the U.S. Bankruptcy Court for the Northern District of Texas, Dallas Division, for authority to use cash collateral. The Debtor requires the use of cash to pay its reasonable and necessary operating expenses, including, but not limited to, salaries, post-petition wages, commissions, withholdings and deductions, supplies, fees to the United States Trustee, job operating cost, taxes, insurance, and to minimally preserve and optimally increase the value of the business for the benefit of all creditors. Clear Finance Technology Corporation and American Express Bank FSB assert secured claims against the Debtor and have filed UCC financing statements with the Oklahoma County Clerk. CFTC and AMEX may hold a lien that may attach to personal property including cash collateral of the Debtor. As adequate protection for the Debtor's use of cash collateral, the Debtor proposes to grant CFTC and AMEX replacement liens and security interests in the Debtor's cash and receipts but only to the same extent, validity and priority that the liens and security interests existed prior to the bankruptcy filing. The Replacement Liens are subordinate to any prior existing, validly perfected and nonavoidable lien and security interest that existed on the Filing Date. The Debtor will also file its monthly operating reports with the Bankruptcy Court on a timely basis, thus providing monthly financial statements to CFTC and AMEX by and through the Bankruptcy Court's electronic noticing process. The adequate protection provisions have been drafted to provide protection without taking undue or inappropriate value from the Estate and its unsecured creditors. A copy of the motion is available for free at https://bit.ly/2R5CYMQ from PacerMonitor.com. About Golf Tailor, LLC Golf Tailor, LLC is an online retailer of golf products. The Debtor sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. N.D. Tex. Case No. 21-30995) on May 28, 2021. In the petition signed by Neil Goldstein, chief restructuring officer, the Debtor disclosed up to $10 million in assets and up to $50 million in liabilities. Areya Holder Aurzada, Esq., at HOLDER LAW represents the Debtor as counsel. GREAT LAKES PETROLEUM: IronPlanet Buying 14 Trucks for $461.7K -------------------------------------------------------------- Great Lakes Petroleum Corp., an affiliate of Great Lakes Petroleum Transportation, LLC, asks the U.S. Bankruptcy Court for the Eastern District of Michigan to authorize the sale of the following 14 2016 year Mack trucks to IronPlanet, Inc. ("IPI") for $461,700: 2016 Mack Tractor (1M1AX16Y4GM031998), 2016 Mack Tractor (1M1AX16Y6GM031999), 2016 Mack Tractor (1M1AX16Y6GM032000), 2016 Mack Tractor (1M1AX16Y6GM032001), 2016 Mack Tractor (1M1AX16YOGM032002), 2016 Mack Tractor (1M1AX16Y2GM032003), 2016 Mack Tractor (1M1AX16Y8GM032006), 2016 Mack Tractor (1M1AX16YXGM032007), 2016 Mack Tractor (1M1AX16Y1GM032008), 2016 Mack Tractor (1M1AX16Y3GM032012), 2016 Mack Tractor (1M1AX16Y7GM032014), 2016 Mack Tractor (1M1AX16Y9GM032016), 2016 Mack Tractor (1M1AX16Y0GM032017), and 2016 Mack Tractor (1M1AX16Y2GM032015). The Debtor is the titled owner of the Trucks, which are no longer needed in connection with its business operations. The Trucks each are fully encumbered by a valid perfected lien held by Union Bank. As of the Petition Date, the indebtedness of Debtors to the Bank included principal and interest totaling $1,479,175 under three promissory notes. The Debtors are obligors on the Notes. Additionally, two of the Debtor's shareholders, Vincent held, Sr. and Vincent Held, Jr. have personally guaranteed the Notes. The Debtor believes that it is in the best interests of the estate and its creditors if the Bank's secured claim can be reduced by selling the Trucks in an orderly advertised manner. It believes that this is preferable over simply surrendering the Trucks to the Bank and permitting the Bank to enforce its rights under applicable non-bankruptcy law which would likely result in realizing a lower forced-sale value and which would be further reduced by the costs attendant with repossession expenses and other charges against the collateral. The sale of these Trucks will benefit the estate and its creditors because, to the extent that the Bank will ultimately have an unsecured claim in the case, the sale is the best method to reduce the Bank's unsecured claim. Any reduction in the Bank's unsecured claim will necessarily inure to the benefit of other unsecured creditors. The Debtor proposes to sell the Trucks to IPI free and clear of liens. All sale proceeds to which the Debtor would otherwise be entitled from the sale will be paid to the Bank. There will be no surcharge, attorney fees or other charges assessed and paid to or on behalf of the Debtor. The Debtor has conducted an extensive investigation into how to obtain the best price possible in the shortest amount of time in the most cost effective manner. In its business judgment, it has determined that the IPI offer is superior to all other offers because of a combination of the purchase price being higher, not contingent upon inspection of the Trucks and has the best chance to pay the highest amount possible to the Bank. The Purchase Price will be paid within five business days after entry of an order approving the motion. IPI will be given clear title upon payment of the Purchase Price. IPI will then advertise the Trucks and then sell them either outright or by auction. If IPI sells the Trucks for greater than $461,700 but less than $543,000, IPI will keep the difference as its own. If IPI sells the Trucks for between $543,000 and $553,000 100% of the difference will be paid to the Bank. If IPI sells the Trucks for an amount exceeding $553,000, the sales proceeds above that amount will be evenly split between IPI and the Bank. Based on the foregoing, the Debtor prays that the Court grants the relief sought. It also requests that the Court allows immediate implementation of its Order as permitted by Fed. R. Bankr. P. 6004(h). It further requests that the Court grants such other and further relief as it deems appropriate under the circumstances. A copy of the Agreement is available at https://tinyurl.com/ur33m6b2 from PacerMonitor.com free of charge. About Great Lakes Petroleum Transportation Great Lakes Petroleum Transportation, LLC is an oil and energy company specializing in fuel storage tanks. It provides quality fuels and fuel management services to customers. Great Lakes Petroleum Transportation and its affiliates, Great Lakes Holdings, LLC and Great Lakes Petroleum Corporation, sought Chapter 11 protection (Bankr. E.D. Mich. Case Nos. 21-20285 to 21-20287). Great Lakes Petroleum Transportation disclosed total assets of between $50,000 and $1 million and liabilities of between $1 million and $10 million as of the bankruptcy filing. Gold, Lange & Majoros, P.C., led by John C. Lange, is the Debtors' legal counsel. GROW CAPITAL: Incurs $842,512 Net Loss in Third Quarter ------------------------------------------------------- Grow Capital, Inc. filed with the Securities and Exchange Commission its Quarterly Report on Form 10-Q disclosing a net loss of $842,512 on $8.07 million of total revenues for the three months ended March 31, 2021, compared to a net loss of $613,379 on $565,314 of total revenues for the three months ended March 31, 2020. For the nine months ended March 31, 2021, the Company reported a net loss of $2.62 million on $21.58 million of total revenues compared to a net loss of $1.24 million on $1.80 million of total revenues for the nine months ended March 31, 2020. As of March 31, 2021, the Company had $3.50 million in total assets, $13.12 million in total liabilities, and a total stockholders' and members' deficit of $9.62 million. As of March 31, 2021, the Company had total current assets of $1,497,423 and negative working capital of $1,553,807 compared to total current assets of $1,510,814 and negative working capital of $116,825 as of June 30, 2020. The decrease in the Company's working capital was primarily a result of an increase to current accrued liabilities in relation to commissions payable by combined entity Appreciation Financial LLC and the accrual of certain anticipated legal settlement amounts. During the nine months ended March 31, 2021, the Company reported net cash used in operations of $857,192, primarily as a result of a net loss from continuing operations of $2,626,252. Net cash used in investing activities in the nine months ended March 31, 2020 was $34,121, as compared to net cash provided of $1,066,446 in the nine months ended March 31, 2021. Net cash provided by financing activities was $607,364 in the nine months ended March 31, 2021 as compared to $336,879 in 2020. Going Concern The Company had a working capital deficit of $1,553,807, with approximately $1,097,000 of cash on hand as of March 31, 2021. Cash used in operations totaled $857,192 during the nine months ended March 31, 2021. Grow Capital said "The Company continues to work actively to increase its customer/client base and increase gross profit in Bombshell Technologies and PERA LLC, in order to achieve net profitability by the close of fiscal 2021. For any operational shortfalls, the Company intends to rely on sales of our unregistered common stock, loans and advances until such time as we achieve profitable operations. In addition, the current presentation is based on the fact that the Company is currently in negotiations to acquire Appreciation Financial LLC and its related entities. Should that not occur, its possible that the Company will no longer combine its results with those of Appreciation Financial LLC and its related entities. If the Company fails to generate positive cash flow or obtain additional financing, when required and on acceptable terms, the Company may have to modify, delay, or abandon some or all of its business and expansion plans, and potentially cease operations altogether. Consequently, the aforementioned items raise substantial doubt about the Company's ability to continue as a going concern within one year after the date that the financial statements are issued. The accompanying consolidated financial statements do not include any adjustments that might be necessary should we be unable to continue as a going concern." A full-text copy of the Form 10-Q is available for free at: https://www.sec.gov/Archives/edgar/data/1448558/000109690621001267/grwc_10q.htm About Grow Capital Grow Capital (f/k/a Grown Condos, Inc.) -- http://www.growcapitalinc.com-- was a call center that contracted out as a customer contact center for a variety of business clients throughout the United States. Over time its main business became a third-party verification service. While continuing to operate as a call center, in 2008 the Company expanded its business plan to include the development of a social networking site called JabberMonkey (Jabbermonkey.com) and the development of a location based social networking application for smart phones called Fanatic Fans. Grow Capital reported a net loss of $2.35 million for the year ended June 30, 2020, compared to a net loss of $2.33 million for the year ended June 30, 2019. As of Dec. 31, 2020, the Company had $4.32 million in total assets, $13.51 million in total liabilities, and a total stockholders' and members' deficit of $9.18 million. L J Soldinger Associates, LLC, in Deer Park, Illinois, the Company's auditor since 2017, issued a "going concern" qualification in its report dated Oct. 13, 2020, citing that the Company's significant operating losses raise substantial doubt about its ability to continue as a going concern. GROWLIFE INC: Incurs $2.9 Million Net Loss in First Quarter ----------------------------------------------------------- GrowLife, Inc. filed with the Securities and Exchange Commission its Quarterly Report on Form 10-Q disclosing a net loss of $2.88 million on $1.67 million of net revenue for the three months ended March 31, 2021, compared to a net loss of $1.29 million on $1.66 million of net revenue for the three months ended March 31, 2020. As of March 31, 2021, the Company had $5.15 million in total assets, $11.19 million in total current liabilities, $845,312 in total long-term liabilities, and a total stockholders' deficit of $6.89 million. The accompanying financial statements have been prepared assuming that GrowLife will continue as a going concern. However, since inception, GrowLife has sustained significant operating losses and such losses are expected to continue for the foreseeable future. As of March 31, 2021, GrowLife had an accumulated deficit of $157.7 million, cash and cash equivalents of $1.5 million and a working capital deficit of $4.267 million excluding derivative liability, convertible debt, right of use liability and deferred revenue). Net cash provided by (used in) operating activities was $106,000, ($1,951,000) and ($2,910,000) for the three months ended March 31, 2021 and the years ended December 31, 2020 and 2019, respectively. "We will require additional cash funding to fund operations beyond December 31, 2021. Accordingly, management has concluded that we do not have sufficient funds to support operations within one year after the date the financial statements are issued and, therefore, we concluded there was substantial doubt about the Company’s ability to continue as a going concern," GrowLife said. "To fund further operations, we will need to raise additional capital. We may obtain additional financing in the future through the issuance of its common stock, or through other equity or debt financings. Our ability to continue as a going concern or meet the minimum liquidity requirements in the future is dependent on its ability to raise significant additional capital, of which there can be no assurance. If the necessary financing is not obtained or achieved, we will likely be required to reduce its planned expenditures, which could have an adverse impact on the results of operations, financial condition and our ability to achieve its strategic objective. There can be no assurance that financing will be available on acceptable terms, or at all. The financial statements contain no adjustments for the outcome of these uncertainties. These factors raise substantial doubt about our ability to continue as a going concern and have a material adverse effect on our future financial results, financial position and cash flows," GrowLife said. A full-text copy of the Form 10-Q is available for free at: https://www.sec.gov/Archives/edgar/data/1161582/000165495421006221/phot_10q.htm About GrowLife GrowLife, Inc. (PHOT)-- http://www.shopgrowlife.com-- aims to become the nation's largest cultivation service provider for cultivating organics, herbs and greens and plant-based medicines. Through a network of local representatives covering the United States and Canada, regional centers and its e-Commerce team, GrowLife provides essential goods and services including media, industry-leading hydroponics and soil, plant nutrients, and thousands of more products to specialty grow operations. GrowLife is headquartered in Kirkland, Washington and was founded in 2012. GrowLife reported a net loss of $6.38 million in 2020, a net loss of $7.37 million in 2019, and a net loss of $11.47 million in 2018. As of Sept. 30, 2020, the Company had $4.29 million in total assets, $7.65 million in total current liabilities, $2.19 million in total long term liabilities, and a total stockholders' deficit of $5.54 million. Walnut Creek, California-based BPM LLP, the Company's auditor since 2019, issued a "going concern" qualification in its report dated April 15, 2021, citing that the Company has sustained recurring losses from operations and has an accumulated deficit since inception. These factors raise substantial doubt about the Company's ability to continue as a going concern. GRUPO AEROMEXICO: Hires Lee Group as Special Airline Counsel ------------------------------------------------------------ Grupo Aeromexico, S.A.B. de C.V. and its affiliates seek approval from the U.S. Bankruptcy Court for the Southern District of New York to hire The Lee Group pllc as its special airline transaction counsel. The firm will render these services: a) assist the Debtors in the negotiation, documentation, and/or administration of agreements and other transactions; b) support the Debtors and their professionals in connection with the evaluation of various contracts for, among other things, potential assumption or rejection, and with negotiations in connection thereto; and c) support the Debtors and their professionals in connection with miscellaneous fleet-related matters. The firm will continue to bill the Debtors at $500 per hour. Neither The Lee Group nor its sole member, Kenneth R. Lee, represents or holds any interest adverse to the Debtors or to their estates with respect to the matters upon which the firm is to be engaged. The firm can be reached through: Kenneth R. Lee, Esq. The Lee Group pllc Farragut Center 1725 I St. NW - Suite 300 Washington, DC 20006 Tel: +1 202 349 1133 Fax: +1 202 349 1134 About Grupo Aeromexico SAB de CV Grupo Aeromexico, S.A.B. de C.V. -- https://www.aeromexico.com/ -- is a holding company whose subsidiaries are engaged in commercial aviation in Mexico and the promotion of passenger loyalty programs. Aeromexico, Mexico's global airline, has its main hub at Terminal 2 at the Mexico City International Airport. Its destinations network features the United States, Canada, Central America, South America, Asia and Europe. Grupo Aeromexico and three of its subsidiaries sought Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 20-11563) on June 30, 2020. In the petitions signed by CFO Ricardo Javier Sanchez Baker, the Debtors reported consolidated assets and liabilities of $1 billion to $10 billion. Timothy Graulich, Esq., of Davis Polk and Wardell LLP, serves as counsel to the Debtors. GTT COMMUNICATIONS: Likely to File Chapter 11 Before June 30, 2021 ------------------------------------------------------------------ Josh Fineman of Seeking Alpha reports that GTT is likely to file Chapter 11 bankruptcy protection before June 30, 2021. GTT Communications (NYSE:GTT) may file for Chapter 11 bankruptcy protection before a June 30, 2021 bond coupon is due, according to a new report. The filing is likely to come before the sale of infrastructure assets to I Squared Capital is completed, according to a Reorg report. It also appears that the creditors overall recovery prospects have worsened due to new liabilities, specifically corporate taxes. Earlier this week, Bloomberg reported that GTT shareholders are expected to receive nothing in the currently conceived bankruptcy plan. In March, Bloomberg reported that GTT started formal talks about a restructuring in a potential bankruptcy filing. About GTT Communications Headquartered in McLean, Virginia, GTT Communications, Inc. -- http://www.gtt.net/-- owns and operates a global Tier 1 internet network and provides a comprehensive suite of cloud networking services. * * * As reported by the TCR on March 1, 2021, S&P Global Ratings lowered all of its ratings on U.S.-based internet protocol network operator GTT Communications Inc. by one notch, including its issuer credit rating, to 'CCC-' from 'CCC', to reflect the increased likelihood of a default or distressed exchange over the next six months. In December 2020, Moody's Investors Service downgraded GTT Communications, Inc's corporate family rating to Caa2 from B3. The downgrade reflects the continued delays in the company reaching an agreement with its lenders over a long-term cure of its reporting requirements which GTT is in breach of due to recently discovered accounting issues which have led to the company being unable to file its Q2 and Q3 financial reports. GUDORF SUPPLY: Seeks to Tap Michael Einterz as Special Counsel -------------------------------------------------------------- Gudorf Supply Company, Inc. seeks approval from the U.S. Bankruptcy Court for the Southern District of Indiana to employ Michael Einterz, Esq., at Einterz and Einterz as its special collection counsel. Mr. Einterz will assist the Debtor in collecting a claim secured by a mechanic's lien against its customer. The attorney will be compensated on a contingency fee basis of one-third of the amount actually recovered. Mr. Einterz disclosed in a court filing that he is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. The attorney can be reached at: Michael L. Einterz, Esq. Einterz and Einterz 4600 NW Plaza W Dr. Zionsville, IN 46077 Telephone: (317) 337-2021 About Gudorf Supply Company Gudorf Supply Company, Inc., a residential heating and air service company in Jasper, Ind., filed its voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Ind. Case No. 21-70158) on March 10, 2021. Michael Gudorf, president, signed the petition. At the time of the filing, the Debtor disclosed total assets of up to $50,000 and total liabilities of up to $10 million. Judge Andrea K. McCord oversees the case. The Debtor tapped KC Cohen, Lawyer PC as legal counsel; Michael L. Einterz, Esq., at Einterz and Einterz as special counsel; and Richey, Mills & Associates, LLP as financial advisor. GUMP'S HOLDINGS: Joint Liquidating Plan Confirmed by Judge ---------------------------------------------------------- Judge Mike K. Nakagawa has entered findings of fact, conclusions of law and order confirming the Joint Plan of Liquidation of Gump's Holdings, LLC, and its debtor-affiliates. The Debtors have proposed the Plan in good faith and not by any means forbidden by law. In determining that the Plan has been proposed in good faith, the Bankruptcy Court has examined the totality of the circumstances surrounding the filing of the Chapter 11 Cases and the formulation and negotiation of the Plan and the Lopez Declaration and finds that the Plan and all modifications were proposed with the legitimate and honest purpose of reorganizing and maximizing the value of the Debtors' bankruptcy estates and the recovery to holders of Claims pursuant to the terms of the Plan. The Liquidating Trust Declaration is approved and shall be fully enforceable according to its terms upon its execution. The Liquidating Trust shall be administered by Amanda Demby (the "Liquidating Trustee"), whose appointment is approved. The following sentence is inserted at the end of Sections 1.1.5 and 12.12 of the Plan: "Quarterly fees payable to the Office of the United States Trustee do not require allowance under section 503 and shall not be subject to the Administrative Expense Claim Bar Date." Upon entry of this order, this Confirmation Order, the Debtors' names shall be changed as follows: Holdings shall be "Post 135 Holdings, LLC" Retail shall be "Post 135 Retail Corp." and Direct shall be "Post 135 Direct, Inc." A full-text copy of the Plan Confirmation Order dated May 25, 2021, is available at https://bit.ly/34routR from PacerMonitor.com at no charge. Attorneys for the Debtors: WILLIAM M. NOALL GABRIELLE A. HAMM GARMAN TURNER GORDON LLP 7251 Amigo Street, Suite 210 Las Vegas, Nevada 89119 Telephone (725) 777-3000 Facsimile (725) 777-3112 E-mail: wnoall@gtg.legal E-mail: ghamm@gtg.legal About Gump's Holdings Gump's Holdings, LLC -- http://www.gumps.com/-- operates as a holding company. The company, through its subsidiaries, sells furniture, lighting, rugs, linens, apparel and jewelry. Gump's Holdings, Gump's Corp. and Gump's By Mail, Inc., sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Nev. Case Nos. 18-14683 to 18-14685) on Aug. 3, 2018. In the petitions signed by Tony Lopez, CFO and chief operating officer, the Debtor disclosed these assets and liabilities: Assets Liabilities ------------ ------------ Gump's Holdings, LLC $47,031 $16,456,335 Gump's Corp. $9,812,318 $23,713,258 Gump's By Mail, Inc. $4,198,319 $23,755,942 The Debtors tapped Garman Turner Gordon LLP as counsel; Lincoln Partners Advisors LLC as financial advisor; and Donlin, Recano & Company Inc. as claims and notice agent. The U.S. Trustee for Region 17 appointed an official committee of unsecured creditors on Aug. 20, 2018. The committee tapped Brownstein Hyatt Farber Schreck, LLP as its legal counsel. H-BAY MINISTRIES: S&P Stays 'B+' 2018A/B Bonds Rating on Watch Neg ------------------------------------------------------------------ S&P Global Ratings has extended its CreditWatch placement, with negative implications, on its 'B+' rating on Capital Trust Agency, Fla.'s series 2018A senior living bonds and its 'B-' rating on the agency's second-tier 2018B senior living bonds. The bonds were issued for H-Bay Ministries Inc., Texas' Superior Residences project in Florida. "The CreditWatch extension is due to the lack of independent third-party audited statements for fiscal 2020, which we believe would provide a sufficient description of financial performance," said S&P Global Ratings credit analyst Adam Torres. The bonds were originally put on CreditWatch on March 1, 2021, based on persistently low occupancy--reported as 60% for the full year--leading to debt service coverage for 2020 that is below 1x on both tiers of bonds, as per our calculations. S&P said, "We note that the project paid debt service in January 2021 without the use of draws on the debt service reserve fund, partially assisted by deferred payments to the owner and asset manager, and secured loans under the federal government's Paycheck Protection Program that reimbursed certain operating expenses. We further note that in terms of the upcoming July 1 debt service payment due date, according to the trustee the debt service fund's current balance reflects full funding as of the date of this publication, and the respective debt service reserve funds continue to be fully funded." Given that the audit will likely be completed in June, S&P expects to resolve this CreditWatch placement well within its 90-day CreditWatch period. HARLAN REAL: Case Summary & Unsecured Creditor ---------------------------------------------- Debtor: Harlan Real Estate LLC 2859 Mountain Springs Rd. Reno, NV 89519 Business Description: Harlan Real Estate LLC is the fee simple owner of three properties located in Nevada having an aggregate current value of $1 million. Chapter 11 Petition Date: May 27, 2021 Court: United States Bankruptcy Court District of Nevada Case No.: 21-50405 Judge: Hon. Bruce T. Beesley Debtor's Counsel: Stephen R. Harris, Esq. HARRIS LAW PRACTICE LLC 6151 Lakeside Drive Suite 2100 Reno, NC 89511 Tel: 775-786-7600 Fax: 775-786-7764 E-mail: steve@harrislawreno.com Total Assets: $1,001,000 Total Liabilities: $7,232 The petition was signed by Rollin Lazzarone, the managing member. The Debtor listed Washoe County Treasurer as its sole unsecured creditor holding a claim of $1,115. A full-text copy of the petition is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/UBTARFQ/HARLAN_REAL_ESTATE_LLC__nvbke-21-50405__0001.0.pdf?mcid=tGE4TAMA HC2 HOLDINGS: S&P Alters Outlook to Stable, Affirms 'B-' ICR ------------------------------------------------------------ S&P Global Ratings affirmed its 'B-' issuer credit rating on HC2 Holdings Inc. and revised the outlook to stable from negative. At the same time, S&P affirmed its 'B' issue-level rating on the company's senior notes. The stable outlook reflects increased financial flexibility with no material near-term holding company maturities and an improved liquidity position. The company's recent balance sheet initiatives have improved financial flexibility. HC2 no longer faces material near-term maturities at its holding company following debt refinancing this year. The company refinanced its senior notes with new notes due in 2026. Additionally, most of its senior convertible notes are now due in 2026. HC2 repaid outstanding holding company revolver borrowings and amended this priority revolver, extending the maturity to 2024 and upsizing the facility to $20 million from $15 million. At the end of 2020, the company completed a $65 million common stock rights offering. These initiatives have bolstered the holding company's liquidity position. HC2 has announced several strategic initiatives, focusing the portfolio around infrastructure, life sciences, and spectrum (broadcasting).The company is monetizing certain portfolio assets, with the pending sale of its insurance segment. Its new management team has reduced costs at the holding company level, including sales, general, and administrative costs, and intends to further reduce corporate expenses. S&P said, "HC2's asset mix comprises mostly unlisted companies, which we view as an underlying weakness for an investment holding company. A significant portion of HC2's portfolio value is its 92% controlling interest in DBM Global Inc. (DBMG). We believe HC2's significant concentration in unlisted assets limits its ability to quickly monetize its investments to repay debt, which could be important if liquidity becomes constrained unexpectedly. We continue to believe its asset diversity is limited due to the concentration of most of its portfolio value in a few larger assets. We also believe the overall credit quality of its portfolio is relatively weak, given HC2's focus on small to midsize entities with little scale. In our view, the company maintains a portfolio of low-speculative-grade investments with volatile cash flows. However, cash flows from its construction segment have supported dividends up to the holding company. "We believe HC2 will remain highly leveraged.The company's loan-to-value (LTV) ratio (based on book values) is well above 60%. We believe HC2's portfolio companies have some dividend capacity and can upstream other cash related to management fees and tax-sharing agreements to offset holding company cash, operating, and interest expenses. While we assume the cash flow adequacy ratio will remain below 0.7x, we anticipate the holding company will retain sufficient liquidity to offset this deficit. "The stable outlook on HC2 reflects our expectation that its cash flow will remain stretched over the next year, with a cash flow adequacy ratio below 0.7x. However, the outlook also reflects our expectation that liquidity will remain adequate." S&P could lower its ratings on HC2 in the next 12 months if: -- Its liquidity profile weakens such that we assess it as less than adequate. S&P believes this could occur if dividends from the company's main portfolio investments fall because of an unexpected decline in the operating performance of its infrastructure subsidiary due to project losses, for example; or -- S&P comes to view the company's capital structure as unsustainable and believe it depends on favorable business, financial, and economic conditions to meet its commitments on its obligations. S&P could raise its ratings on HC2 over the next 12 months if: -- Its LTV ratio is below 60%; and -- Cash flows improve, establishing a track record of a cash flow adequacy ratio of regularly above 0.7x. HEALTHIER CHOICES: Rights Offering Subscription Period Commences ---------------------------------------------------------------- Healthier Choices Management Corp. announced that the subscription period for the Company's rights offering has commenced. If exercising subscription rights through a broker, dealer, bank or other nominee, such as an online platform including but not limited to TD, Schwab, Fidelity, E-Trade, or others, please note that within the next few days DTC will open the window for participation and the online platforms will put in place their instructions for stockholders to elect to participate in the Rights Offering. Once available, rights holders that wish to participate in the rights offering should promptly contact their nominee, or online trading platform, and submit subscription documents and payment for the shares of common stock subscribed for in accordance with their instructions and within the time period provided by such nominee, or online trading platform. The broker, dealer, bank or other nominee, or online trading platform, may establish a deadline before June 3, 2021, by which instructions to exercise subscription rights, along with the required subscription payment, must be received in order to allow themselves enough time to process and transmit said documents and payments prior to the June 3, 2021 deadline. All record holders of rights that have their shares in book entry form with the transfer agent and wish to participate in the rights offering must deliver a properly completed and signed subscription rights certificate, together with payment of the subscription price for both basic subscription rights and any over subscription rights election, to the Subscription Agent, to be received before 5:00 PM Eastern Time on June 3, 2021. The Subscription Agent is: By mail, or overnight courier: Broadridge Corporate Issuer Solutions, Inc. Attn: BCIS IWS 51 Mercedes Way Edgewood, NY 11717 Under the Rights Offering, Healthier Choices Management Corp. will distribute one non-transferable subscription right for every four shares of common stock owned and each share of Series D preferred stock (on an as-if-converted-to-common-stock basis) held on the Record Date (May 18, 2021). Each subscription right will entitle the holder to purchase one share of common stock. When filling out the subscription rights form, the holder will use the Estimated Subscription Price, which is $0.001425. This number was calculated by taking the volume weighted average price (also known as the "VWAP") from the last 5 trading days leading up to the Record date of the Rights Offering, and multiplying that number by 75%, thereby reflecting a 25% discount to that 5 day VWAP. In an effort to ensure that the Actual Subscription Price reflects the most current average weighted price available at the close of the Rights Offering, the Actual Subscription Price will be calculated by taking the VWAP from the last 5 trading days leading up to the termination date of the Rights Offering on June 3, 2021, and multiplying that number by 75%, providing a 25% discount to that 5 day VWAP for all shares purchased. Healthier Choices Management Corp. has engaged Maxim Group LLC as dealer-manager for the proposed rights offering. In addition, Healthier Choices Management Corp. has engaged Broadridge as subscription and information agent for the proposed rights offering and Broadridge is now standing by to answer any questions regarding this Rights Offering, including but not limited to how to fill out the forms and options on how to send funds. Broadridge may be contacted via telephone at (855) 793-5068 or via email at shareholder@broadridge.com. The Company's registration statement on Form S-1 was declared effective by the U.S. Securities and Exchange Commission on May 19, 2021. The prospectus relating to and describing the terms of the Rights Offering has been filed with the SEC as a part of the registration statement and is available on the SEC's web site at http://www.sec.gov.A link to the prospectus has also been provided on the Company's website at http://HealthierCMC.comunder the Investors Tab. About Healthier Choices Headquartered in Hollywood, Florida, Healthier Choices Management Corp. -- http://www.healthiercmc.com-- is a holding company focused on providing consumers with healthier daily choices with respect to nutrition and other lifestyle alternatives. Healthier Choices reported a net loss of $3.72 million for the year ended Dec. 31, 2020, compared to a net loss of $2.80 million for the year ended Dec. 31, 2019. As of March 31, 2021, the Company had $13.99 million in total assets, $5.94 million in total liabilities, and $8.05 million in total stockholders' equity. HELIOS AND MATHESON: KLDiscovery Claim Timely Filed, Court Says --------------------------------------------------------------- Bankruptcy Judge David S. Jones ruled that a proof of claim filed by KLDiscovery Ontrack, LLC d/b/a/ KLDiscovery in the Chapter 7 bankruptcy proceedings of Helios and Matheson Analytics, Inc., is timely filed pursuant to Rule 3002(c)(6)(A) of the Federal Rules of Bankruptcy Procedure. KLDiscovery's claim sought compensation for pre-petition electronic discovery services that it provided to the Debtors. KLDiscovery was not included in the Debtors' creditor matrixes and did not receive formal notice of the claim bar date, although some KLDiscovery employees did receive communications referencing the bankruptcy before the Bar Date expired. The Chapter 7 Trustee, Alan Nisselson, opposes KLDiscovery's request, asserting that KLDiscovery is not entitled to relief under Bankruptcy Rule 3002(c)(6)(A), and that the proof of claim should instead remain classified as late-filed pursuant to 11 U.S.C. sections 502(b)(9) and 726(a)(3). The Court held that KLDiscovery was a known creditor whose omission from the Debtors' Creditor Matrix caused KLDiscovery not to receive formal bankruptcy notices including of the Bar Date, and, although each Debtor filed a Creditor Matrix that purported to comply with the requirements of the Bankruptcy Code and Rules, the omission of KLDiscovery rendered the Creditor Matrix noncompliant with Bankruptcy Rule 1007(a) as to that creditor. This failure makes potentially available the extension of time to file a claim that KLDiscovery seeks, but, as the governing rule puts it, only if KLDiscovery received notice that was "insufficient under the circumstances to give the creditor a reasonable time to file a proof of claim because the debtor failed to timely file the list of creditors' names and addresses required by Rule 1007(a)." Determining whether KLDiscovery received notice that was "insufficient under the circumstances" requires consideration of communications that the Chapter 7 Trustee asserts afforded "actual notice" to KLDiscovery notwithstanding the lack of formal bankruptcy court notices. The Court said those communications did not provide sufficient notice, and that, accordingly, relief under Bankruptcy Rule 3002(c)(6)(A) is warranted. KLDiscovery asserts a general unsecured claim for $247,507.05 against Helios in connection with "Relativity hosting and other electronic discovery services" that were provided pre-petition. Counsel for KLDiscovery Ontrack, LLC. Frank Peretore, Esq. Terri Jane Freedman, Esq. CHIESA SHAHINIAN & GIANTOMASI PC One Boland Drive West Orange, NJ 07052 Tel: (973) 325-1500 Fax: (973) 325-1501 E-mail: fperetore@csglaw.com tfreedman@csglaw.com - and – Andrew J. Glasnovich, Esq. STINSON LLP 50 South Sixth Street, Suite 2600 Minneapolis, MN 55402 Tel: (612) 335-1426 E-mail: drew.glasnovich@stinson.com A copy of the Court's Memorandum of Decision and Order is available at https://bit.ly/34qQ0aS from Leagle.com. Helios and Matheson Analytics, Inc., a/k/a MovieFone, and certain of its affiliates filed voluntary petitions for Chapter 7 relief (Bankr. S.D.N.Y. Lead Case No. 20-10242) on Jan. 28, 2020. The other debtors are Zone Technologies, Inc. a/k/a Red Zone, a/k/a Zone Intelligence; and MoviePass, Inc. Alan Nisselson was appointed Chapter 7 Trustee. Bankruptcy Judge David S. Jones presides over the cases. Counsel for Alan Nisselson, Chapter 7 Trustee: Ben J. Kusmin, Esq. WINDELS MARX LANE & MITTENDORF, LLP 156 West 56th Street New York, NY 10019 Tel: (212) 237-1169 Fax: (212) 262-1215 E-mail: bkusmin@windelsmarx.com HORSE BUTTE: Case Summary & 6 Unsecured Creditors ------------------------------------------------- Debtor: Horse Butte Equestrian Center, L.L.C. 60360 Horse Butte Rd Bend, OR 97702 Chapter 11 Petition Date: May 28, 2021 Court: United States Bankruptcy Court District of Oregon Case No.: 21-31253 Judge: Hon. Peter C. Mckittrick Debtor's Counsel: Douglas R. Ricks, Esq. VANDEN BOS & CHAPMAN, LLP 319 SW Washington Suite 520 Portland, OR 97204 Tel: 503-241-4869 Fax: 503-241-3731 E-mail: doug@vbcattorneys.com Estimated Assets: $1 million to $10 million Estimated Liabilities: $500,000 to $1 million The petition was signed by Elizabeth C. McCool, manager. A copy of the Debtor's list of six unsecured creditors is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/AIHTKXQ/Horse_Butte_Equestrian_Center__orbke-21-31253__0003.0.pdf?mcid=tGE4TAMA A full-text copy of the petition is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/ACKRICQ/Horse_Butte_Equestrian_Center__orbke-21-31253__0001.0.pdf?mcid=tGE4TAMA HUSCH & HUSCH: Simon CRE Buying Harrah Property for $175K Cash -------------------------------------------------------------- Husch & Husch, Inc., asks the U.S. Bankruptcy Court for the Eastern District of Washington to authorize the sale of portions of two parcels commonly known as Main Street/Branch Road, in Harrah, Washington, and legally described on Exhibit A to Simon CRE Budster, LLC for $175,000, cash. The Debtor proposes that upon sale, the net proceeds of sale will be disbursed, to the extent sufficient, as follows: a. First, any real estate tax due Yakima County Assessor related to the property being sold. b. Second, the standard and reasonable costs and expenses of closing, including a $6,125 real estate commission to GPS Retail, LLC and a like amount to Mike Abrams and Heritage Moultray Real Estate. c. Third, Heritage Bank to the extent of its unpaid lien. The Debtor asks that the Court enters an order authorizing the sale to be free and clear of liens and encumbrances, including, but not limited to the claims of Heritage Bank and Helena Agri-Enterprises, LLC. A copy of the Exhibit A is available at https://tinyurl.com/kjzxe8du from PacerMonitor.com free of charge. About Husch & Husch Husch & Husch, Inc. -- http://www.huschandhusch.com/-- is a family-owned and operated agricultural chemical and fertilizer company located in Harrah, Washington. It provides conventional and organic fertilizers, micronutrient technology, and chemicals to help make a lawn, garden, agronomic crops, and fruit trees grow to their full potential. Husch & Husch was founded in 1937 by Pete Husch. Husch & Husch filed a Chapter 11 petition (Bankr. E.D. Wash. Case No. 20-00465) on March 4, 2020. In the petition signed by CFO Allen Husch, the Debtor disclosed $12,284,732 in assets and $5,966,019 in liabilities. Dan O'Rourke, Esq., at Southwell & O'Rourke, P.S., is the Debtor's bankruptcy counsel. HUTCHINSON REGIONAL: Moody's Affirms Ba1 Rating, Outlook Stable --------------------------------------------------------------- Moody's Investors Service has affirmed Hutchinson Regional Medical Center, Inc's (KS) (HRMC) Ba1 rating. The system has approximately $34 million of outstanding debt. The outlook remains stable. RATINGS RATIONALE The Ba1 affirmation reflects Moody's expectations that HRMC will improve performance through execution of several strategic initiatives, which will offset revenue pressure while volumes recover from the on-going COVID-19 pandemic. Expectations of performance improvement will be driven by continued execution of revenue cycle improvement, expanded service offerings to stem volume outmigration and implementation of best practice process improvements. Further, HRMC's excellent liquidity will continue to strengthen given manageable capital spending plans. The recent inclusion of the system's foundation in unrestricted cash and investments will provide an additional cushion for performance improvement. While the on-going COVID-19 pandemic has disrupted volumes to-date, the impact has been partially offset by federal stimulus funding, expense mitigation strategies and strong investment returns. Operating headwinds will include prolonged volume recovery, reimbursement pressures from one dominant commercial payor, and a high reliance on government payors. RATING OUTLOOK The stable outlook reflects the expectation that HRMC will improve margins in fiscal 2021, with operating cash flow margins in the 5-7% range, following weak performance in fiscal 2020. Further, the outlook expects strategic initiatives to gain traction over the near-term, allowing margins to stabilize and rebound back to stronger performance levels absent external funding. Failure to gain traction on strategic initiatives and sustain improved operating performance could pressure the outlook or the rating. FACTORS THAT COULD LEAD TO AN UPGRADE OF THE RATINGS - Material enterprise growth and revenue diversification - Sustained levels of very good operating performance - Continued balance sheet strength and liquidity FACTORS THAT COULD LEAD TO A DOWNGRADE OF THE RATINGS - Inability to sustain or improve upon anticipated performance in FY2021 or reduction in headroom to debt covenants - Significant decline in balance sheet measures or additional financial leverage that dilutes metrics - Prolonged recovery or instability of volumes resulting in operating disruption - Material cash flow issues or loss in liquidity LEGAL SECURITY The bonds are secured by a pledge of gross revenues; no mortgages are given. Additional indebtedness is permitted under certain conditions. PROFILE Hutchinson Regional Medical Center, Inc. is a 501 (c)(3) 190-licensed bed hospital located in Hutchinson, Kansas. The hospital offers an array of healthcare services, including Level 3 Trauma, cardiology services, oncology and cancer services, labor and delivery, wound care, and sleep services. METHODOLOGY The principal methodology used in this rating was Not-For-Profit Healthcare published in December 2018. IG INVESTMENTS: Dividend Increase No Impact on Moody's B3 CFR ------------------------------------------------------------- Moody's Investors Service said that although IG Investments Holdings, LLC's ("Insight Global") plan to increase the amount of its previously-announced dividend to shareholders to over $575 million from around $525 million by increasing the amount of its proposed incremental senior secured first lien term loan due 2025 to $600 million from $550 million is a negative credit development since the plan will increase debt and interest expense, thereby weakening credit metrics. However, Moody's notes that Insight Global has a history of frequently incurring debt to fund distributions to common shareholders, so the ratings already reflected anticipation for such aggressive financial strategies. Therefore, the ratings, including the B3 corporate family rating and B2 senior secured first lien term loan and revolver ratings, as well as the stable outlook, remain unchanged at this time. Insight Global, headquartered in Atlanta, Georgia and controlled by affiliates of private equity sponsor Harvest Partners, is a specialized provider of temporary and project professionals. INSPIRON INC: Amended Liquidating Plan Confirmed by Judge --------------------------------------------------------- Judge Robert D. Drain has entered findings of fact, conclusions of law and order approving the First Amended Disclosure Statement and confirming the First Amended Chapter 11 Liquidating Plan of Inspiron, Inc. Paragraph 1.25 of the Plan is corrected to provide that; "Plan Distribution Fund" shall mean those monies constituting proceeds of Litigation and any other cash received by the Debtor after the Effective Date with respect to the Debtor's assets. A new Paragraph 1.32 of the Plan is inserted to provide that; "Litigation" shall mean all legal actions, proceedings, arbitrations and other efforts of the Debtor to collect its accounts receivable. Paragraph 3.2 (b) of the Plan is corrected to remove the following sentence: "Class 2 Allowed Unsecured Claims are unimpaired pursuant to Sec. 1124 of the Bankruptcy Code." The Debtor shall file a report on its progress in performing the Plan every 6 months and promptly after the Debtor's estate is fully administered for purposes of § 350(b) of the Bankruptcy Code, the Debtor shall file a Closing Report and a motion for an order closing this chapter 11 case. A full-text copy of the Plan Confirmation Order dated May 25, 2021, is available at https://bit.ly/3wCps28 from PacerMonitor.com at no charge. Attorneys for the Debtor: Dawn Kirby, Esq. KIRBY AISNER & CURLEY LLP 700 Post Road, Suite 237 Scarsdale, New York 10583 Tel: (914) 401-9500 About Inspiron Inc. Headquartered in New York, Inspiron, Inc. -- https://www.inspironconstruction.com/ -- is a privately held company specializing in general contracting and construction management. The Company also offers a wide array of advisory services including evaluating various project options and providing cost analyses during the pre-construction phase. Inspiron, Inc. filed a voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. S.D.N.Y. Case No. 19-23534) on Aug. 26, 2019. In the petition signed by Alen Gershkovich, president, the Debtor was estimated to have $1 million to $10 million in assets and $500,000 to $1 million in liabilities. The case is assigned to Judge Robert D. Drain. Dawn Kirby, Esq., at Kirby Aisner & Curley, LLP, is the Debtor's counsel. J & GC: Seeks Approval to Hire Eric A. Liepins as Legal Counsel --------------------------------------------------------------- J & GC, Inc. seeks approval from the U.S. Bankruptcy Court for the Northern District of Texas to employ Eric A. Liepins, PC as its legal counsel. The firm will render these legal services: (a) oversee the orderly liquidation of the Debtor's assets; (b) reorganize the claims of the estate; and (c) determine the validity of claims asserted against the estate. The firm received a retainer of $5,000, plus the filing fee. The compensation to be received to the firm shall be based upon the following hourly rates: Eric A. Liepins $275 Paralegals and Legal Assistants $30 - $50 The firm will seek reimbursement for out-of-pocket expenses. As disclosed in court filings, Eric A. Liepins is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. The firm can be reached through: Eric A. Liepins, Esq. Eric A. Liepins, PC 12770 Coit Road, Suite 1100 Dallas, TX 75251 Telephone: (972) 991-5591 Facsimile: (972) 991-5788 Email: eric@ealpc.com About J & GC J & GC, Inc. filed a voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. N.D. Texas Case No. 21-30964) on May 24, 2021, listing under $1 million in both assets and liabilities. Eric A. Liepins, PC serves as the Debtor's legal counsel. JACOBS ENTERTAINMENT: S&P Affirms 'B-' ICR on Expected Deleveraging ------------------------------------------------------------------- S&P Global Ratings affirmed its ratings on U.S. gaming operator Jacobs Entertainment Inc., including its 'B-' issuer credit rating, and removed all ratings from CreditWatch, where S&P placed them with negative implications on March 20, 2020. S&P said, "The positive outlook reflects the possibility that we may raise the rating if we believe Jacobs will sustain adjusted leverage in the mid-6x area or lower, and EBITDA coverage of interest above 1.5x, incorporating potential operating volatility, development spending or acquisitions. "We believe EBITDA growth will drive meaningful deleveraging this year.We forecast a significant improvement in adjusted leverage in 2021--to the high-4x area, from the mid-7x area at the end of 2020--which was negatively affected by the temporary closure of Jacobs' properties because of the pandemic. We believe EBITDA growth will be driven by a mix shift toward higher-margin gaming for at least part of the year, and expect that Jacobs will maintain reduced levels of marketing expense until more travel and leisure alternatives are available and capacity restrictions are lifted. Although our forecast for adjusted leverage is under the mid-6x area, the maximum level of leverage we would tolerate at a one-notch higher rating for Jacobs, we believe risks remain around operating volatility. This is particularly the case as more travel and leisure alternatives become available and government stimulus funds roll off and given the expansion of a competitor in the Black Hawk market, which represents about half of Jacobs' EBITDA. This could lead to higher leverage than we currently anticipate, especially in a scenario where Jacobs embarks on meaningful development spending or pursues acquisitions." Jacobs has adequate liquidity to absorb modest underperformance and development spending, even if it does not refinance or extend the maturity of its revolver. S&P said, "We believe modest excess cash on hand and operating cash flow will provide Jacobs enough liquidity to fund both maintenance capital expenditures (capex) and modest levels (around $10 million to $15 million) in development capex in the next two years, even in a scenario where EBITDA modestly underperforms our base case. Therefore, we do not believe the February 2022 maturity of Jacobs' $50 million revolver would strain liquidity. Further, we believe it is highly likely Jacobs will be able to refinance or extend the maturity of its revolver given our view that Jacobs has sound relationships with its banks as evidenced by its prior ability to extend maturities and modify covenant levels. We believe Jacobs will likely look to extend the revolver's maturity in the coming months." S&P said, "The positive outlook reflects our forecast for EBITDA generation over the next several quarters to support adjusted leverage below the mid-6x area or lower, and EBITDA coverage of interest above 1.5x, credit measures we view as aligned with a one-notch higher rating for Jacobs. "We could raise the rating one notch once Jacobs demonstrates the ability to sustain adjusted leverage below the mid-6x area and EBITDA coverage of interest above 1.5, even incorporating potential modest operating underperformance, future development spending, or acquisitions. "We may consider an outlook revision to stable if we no longer believe Jacobs will maintain adjusted leverage below 6.5x and EBITDA coverage of interest expense above 1.5x, either because of greater-than-expected operating volatility, development spending, or leveraging acquisitions. While less likely, we could lower the ratings if operating performance deteriorates meaningfully or Jacobs significantly increases development spending or pursues significant acquisitions resulting in an unsustainable level of leverage. Lower ratings could also be considered if we believed Jacobs' liquidity position could become strained." JADE PROPERTY: Seeks to Hire Dilks Law Firm as Bankruptcy Counsel ----------------------------------------------------------------- JADE Property Holdings, LLC seeks approval from the U.S. Bankruptcy Court for the Eastern District of Arkansas to hire Dilks Law Firm to handle its Chapter 11 case. Dilks Law Firm will be paid at the rate of $295 per hour for attorney services and $75 per hour for paralegal services. The firm received a retainer in the amount of $5,000. Lyndsey Dilks, Esq., disclosed in a court filing that the firm has no connection with the Debtor and its creditors or any other "party-in-interest" in the Debtor's bankruptcy case. The firm can be reached through: Lyndsey D. Dilks, Esq. Dilks Law Firm P.O. Box 34157 Little Rock, AR 72203 Tel: (501)244-9770 Fax: (888)689-7626 Email: ldilks@dilkslawfirm.com About JADE Property Holdings Little Rock, Ark.-based JADE Property Holdings, LLC filed a petition under Subchapter V of Chapter 11 of the Bankruptcy Code (Bankr. E.D. Ark. Case No. 21-11249) on May 10, 2021. Jonathan Dunkley, member, signed the petition. At the time of the filing, the Debtor had between $1 million and $10 million in both assets and liabilities. Judge Richard Taylor oversees the case. Dilks Law Firm is the Debtor's legal counsel. JB HOLDINGS: Online Auction Sale of Hobe Sound Property Approved ---------------------------------------------------------------- Judge Mindy A. Mora of the U.S. Bankruptcy Court for the Southern District of Florida authorized JB Holdings of Hobe Sound, LLC's bidding procedures in connection with the online auction sale of the real property located on SE Rohl Way, Hobe Sound, Florida, PCN 34-38-42-480-000-00020-0, legally described as Parcel 2, Mission Place, according to the Plat thereof, as recorded in Plat Book 16, Page 85, of the Public Records of Martin County, Florida. A hearing on the Motion was held on May 18, 2021, at 1:30 p.m. The Purchase and Sale Agreement that all bidders will be required to use in the matter is approved to be included as part of the bidding package related to the Auction and the Sale in the matter. Tranzon Driggers is authorized to take any and all actions necessary to implement the Bidding Procedures and to effectuate the relief granted pursuant to the Order in accordance with the Motion. Upon entry of the order approving these Bidding Procedures, all past, present and future prospective purchasers will be subject to these Bidding Procedures and the auction terms and conditions, except for the contract between the Debtor and Andrew Dickson that the Debtor is seeking to have approved by this Court as set forth in that certain Renewed Expedited Motion to Sell and to Approve Private Sale Contract with Andrew Dickson. It is understood that the Auction and these bidding procedures will only be employed in the event the private sale contract between the Debtor and Andrew Dickson fails to close. In the event that the Contract between Andrew Dickson and the Debtor is terminated or fails to close by Aug. 6, 2021, whichever event is earlier, then the Auction Bidding Procedures approved herein will commence immediately upon the filing of a Notice of Termination of the Dickson Contract, with a 45-day marketing period by the Auctioneer. The Auction sale date will be scheduled to occur at the conclusion of the marketing period on a date to be established within the sole discretion of the Auctioneer. Nothing in the Order will be deemed to authorize any extensions under the Contract between the Debtor and Andrew Dickson. A hearing to approve the Auction Sale results will be held before the Court three business days after the date set for the Auction Sale, which hearing will be scheduled by separate document upon the request of the Debtor's counsel. If the Secured Creditor (Alan Jacobson, Neil Littman and Rebecca Littman) and/or its successors or assigns is the successful bidder at a price at or below their secured credit limit in the online auction, the Secured Creditor agrees to pay a $15,000 buy-in fee to Tranzon Driggers. The sale to the Secured Creditor will be free and clear of all liens, claims and encumbrances. Neither the Debtor, nor any subsequent trustee, will attempt to surcharge the Secured Creditor for any additional amounts of any kind. Additionally, to the extent that additional funds become available to the Debtor's estate, either by litigation, the disposition of additional assets or otherwise, the Debtor agrees and is authorized to reimburse the Secured Creditor $7,500, within 10 business days of the receipt of such funds. Within 20 days of the date of the Order, the Secured Creditor will provide the Debtor with an estoppel letter detailing the amount of its secured claim. The Debtor will have 10 days from the receipt of the estoppel letter to file an objection to the amounts set forth in the estoppel letter and will seek a prompt determination from the Court as to the amount of the secured claim. Otherwise, the full amount set forth in the estoppel letter will be deemed allowed. Notwithstanding any of the rules regarding bidding increments, the Secured Creditor will be allowed to bid the full amount of its secured claim. The salient terms of the Bidding Procedures are: a. Bid Deadline: No later than 24 hours prior to the posted closing time of the auction. b. Initial Bid: The gross contract price will be equal to a high bid + a 7% Buyer's Premium. In the event a Stalking Horse Bid is received prior to the opening of the online auction event in an amount exceeding the claim of the Secured Creditor and is approved by the Debtor, the Initial Overbid by any Qualified Bidder will be $20,000. c. Deposit: $10,000 d. Auction: The online auction will be open for bidding by the qualified bidders until (TBD), subject to the auto-extend features of the Tranzon Driggers bidding platform. e. Bid Increments: $10,000 f. Sale Hearing: A hearing to approve the sale will be requested by the Debtor's counsel to occur within three business days of the online auction event. g. Break-up Fee: $10,000 h. Closing: The closing will be within 30 days of the online auction event, or within 10 days of entry of a court order approving the sale, whichever is longer. i. Neal Littman, Rebecca Littman and Alan Jacobson and/or their successors or assigns, are not required to submit a PSA to credit bid up to their secured credit limit in the online auction. The Secured Creditor, and/or its successors or assigns, and the Stalking Horse bidder, if applicable, will be deemed automatically qualified to participate in the online auction. The sale will be free and clear of certain liens, claims, and encumbrances. The Debtor believes, in its sound business judgment, that the contemplated auction sale will offer the best price and the best terms for the sale of the Offered Assets. By way of the Motion, it asks that the Court schedules a further hearing after completion of the auction wherein the Debtor will ask the entry of an order from the Court approving and authorizing the proposed sale to the successful bidder(s) on the terms and conditions of the successful bid. A copy of the Online Bidding Procedures is available at https://tinyurl.com/zccjuers from PacerMonitor.com free of charge. About JB Holdings of Hobe Sound JB Holdings of Hobe Sound, LLC owns 4.88 acres of unimproved real estate worth $1.5 million in Hobe Sound, Fla. JB Holdings of Hobe Sound filed a Chapter 11 petition (Bankr. S.D. Fla. Case No. 20-24182) on Dec. 31, 2020. In its petition, the Debtor disclosed $1,510,000 in assets and $504,526 in liabilities. John Doyle, manager, signed the petition. Judge Mindy A. Mora oversees the case. The Debtor tapped Kelley, Fulton & Kaplan, P.L. as its bankruptcy counsel and McCarthy Summers Wood Norman Melby & Scultz, P.A. as its special counsel. JC STRENGTH: Plan Exclusivity Extended Until September 8 -------------------------------------------------------- Judge James R. Sacca of the U.S. Bankruptcy Court for the Northern District of Georgia, Gainesville Division extended the period within which the Debtor JC Strength & Conditioning, Inc. has the exclusive right to file a Chapter 11 Plan through and including September 8, 2021. The Debtor operates a gym, which was severely impacted by the global Covid-19 pandemic. Now, over a year since the pandemic began, the Debtor's business is steadily increasing but has not yet reached pre-pandemic levels. The Debtor is confident that now that the State of Georgia has opened up vaccines to all individuals over the age of 16, the business will continue to increase. The Debtor's president estimates that the Debtor will reach the necessary levels of revenue to confirm a plan in August 2021. The Debtor has acted diligently during the initial months of their chapter 11 case and will continue to do so for the remainder of the case. The extension will further the Debtor's efforts to preserve value and avoid unnecessary and wasteful litigation. A copy of the Debtor's Motion to extend is available at https://bit.ly/3s0vnvr from PacerMonitor.com. A copy of the Court's Extension Order is available at https://bit.ly/34rsL01 from PacerMonitor.com. About JC Strength & Conditioning Established in 2008, JC Strength & Conditioning, Inc. is in the health and fitness business. JC Strength & Conditioning filed a voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. N.D. Ga. Case No. 20-21528) on November 12, 2020. The petition was signed by Justin Tway, president. At the time of the filing, the Debtor disclosed total assets of $1,354,709 and total liabilities of $1,353,796. Judge James R. Sacca presides over the case. The Debtor is represented by Rountree Leitman & Klein, LLC. JONES SODA: CEO and President Mark Murray Appointed as Director --------------------------------------------------------------- Jones Soda Co. CEO and President Mark Murray was appointed as a member of the Company's Board of Directors to fill a current vacancy on the Board. Mr. Murray will serve until the next annual shareholder meeting at which directors are elected and until his successor is duly qualified and elected. There are no arrangements or understandings between Mr. Murray and any other persons pursuant to which Mr. Murray was selected to serve on the Board. Mr. Murray does not have any family relationship with any director or executive officer of the Company, or any person nominated or chosen to become a director or executive officer of the Company, and there are no applicable transactions that would require disclosure under Item 404(a) of Regulation S-K. Mr. Murray has previously entered into the Company's standard form of indemnification agreement and is also a party to that certain Amended and Restated Employment Letter Agreement between the Company and Mr. Murray dated effective Dec. 1, 2020. About Jones Soda Headquartered in Seattle, WA, Jones Soda Co. -- www.jonessoda.com -- develops, produces, markets and distributes premium beverages primarily in the United States and Canada through its network of independent distributors and directly to its national and regional retail accounts. The Company also sells products in select international markets. The Company's products are sold in grocery stores, convenience and gas stores, on fountain in restaurants, "up and down the street" in independent accounts such as delicatessens, sandwich shops and burger restaurants, as well as through its national accounts with several large retailers. Jones Soda reported a net loss of $3 million for the year ended Dec. 31, 2020, compared to a net loss of $2.78 million for the year ended Dec. 31, 2019. As of March 31, 2021, the Company had $8.21 million in total assets, $3.72 million in total liabilities, and $4.49 million in total shareholders' equity. Seattle, Washington-based BDO USA, LLP, the Company's auditor since 2019, issued a "going concern" qualification in its report dated March 24, 2021, citing that the Company has suffered recurring losses from operations and has negative cash flows from operating activities that raise substantial doubt about its ability to continue as a going concern. KB HOME: Moody's Hikes CFR to Ba2 & Rates New Unsecured Notes Ba2 ----------------------------------------------------------------- Moody's Investors Service upgraded KB Home's Corporate Family Rating to Ba2 from Ba3, Probability of Default Rating to Ba2-PD from Ba3-PD, and the rating on the company's senior unsecured notes to Ba2 from Ba3. Moody's also assigned a Ba2 rating to KB Home's proposed $300 million senior unsecured notes due 2031, the proceeds of which will be used to partially prefund an upcoming debt maturity. Outlook was changed to stable from positive. Finally, the company's Speculative Grade Liquidity rating was upgraded to SGL-1 from SGL-2. The upgrade of the Corporate Family Rating to Ba2 reflects the improvement in KB Home's credit metrics, which Moody's expects will continue to strengthen over the next 12 months. The proposed refinancing transaction will result in approximately $150 million of total debt reduction and lower interest expense, benefiting homebuilding EBIT to interest coverage. Moody's expects KB Home to demonstrate strong revenue growth in fiscal 2021 of about 40% above the 2020 level, and to achieve improvements in credit statistics with gross margin approaching 21%, debt to capitalization declining to 35% and interest coverage rising toward 6.0x. The stable outlook reflects Moody's expectation of strong demand for homes and backlog conversion contributing to the company's strong performance over the next 12 to 18 months. The upgrade of Speculative Grade Liquidity rating reflects the improvement in the company's liquidity and the elimination of a near term debt maturity. The $450 million senior notes due December 2021 will be redeemed through a tender offer funded with $300 million of the new offering proceeds and cash, with notes not tendered to be repaid with cash in September 2021. The following rating actions were taken: Upgrades: Issuer: KB Home Corporate Family Rating, Upgraded to Ba2 from Ba3 Probability of Default Rating, Upgraded to Ba2-PD from Ba3-PD Speculative Grade Liquidity Rating, Upgraded to SGL-1 from SGL-2 Senior Unsecured Regular Bond/Debenture, Upgraded to Ba2 (LGD4) from Ba3 (LGD4) Assignments: Issuer: KB Home Senior Unsecured Regular Bond/Debenture, Assigned Ba2 (LGD4) Outlook Actions: Issuer: KB Home Outlook, Changed To Stable From Positive RATINGS RATIONALE KB Home's Ba2 Corporate Family Rating is supported by: 1) a conservative financial policy focused on balance sheet strengthening and deleveraging through earnings retention and debt reduction; 2) the company's large scale and position as the seventh largest homebuilder in the US by revenue and homes closed; 3) the focus on the first-time homebuyer (over 60% of home closings) which will benefit from the demand of millennials; and 4) the company's built-to-order strategy, which provides visibility into revenue and reduces inventory risk. At the same time, KB Home's credit profile is constrained by: 1) the company's concentration of revenue and home closings in California; 2) shareholder friendly activities, including dividends and share repurchases; 3) a supply of owned land of approximately four years, which could be subject to impairments in an event of a market weakening; and 4) the cyclicality of the homebuilding sector and exposure to significant volatility in results. The Speculative Grade Liquidity Rating of SGL-1 reflects Moody's expectation that KB Home will maintain very good liquidity, supported by approximately $408 million of pro forma cash balance, solid cash flow from operations, substantial availability under its $800 million unsecured revolving credit facility expiring in October 2023, good cushion under financial covenants, and the absence of debt maturities in the next 16 months following the proposed transaction. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS The ratings could be upgraded if the company significantly increases size, scale and geographic diversity, and maintains conservative financial policies, while sector conditions remain favorable. Maintenance of strong credit metrics, including debt to book capitalization below 35%, homebuilding EBIT to interest coverage above 6.0x, gross margin above 20%, along with strong cash flow and very good liquidity would also be important considerations for an upgrade. The ratings could be downgraded if the company's financial policies grow more aggressive or operating results weaken meaningfully. Specifically, ratings could be downgraded if homebuilding debt to book capitalization increases toward 45%, homebuilding EBIT to interest coverage declines below 5.0x, gross margin declines significantly, or liquidity weakens. The principal methodology used in these ratings was Homebuilding And Property Development Industry published in January 2018. KB Home, headquartered in Los Angeles, is one of the country's largest homebuilders, with a presence in 45 markets in eight states and four geographic regions. The company builds attached and detached single-family residential homes, townhomes and condominiums for first-time, first move-up, second move-up and active adult homebuyers. In the LTM period ended February 28, 2021, KB Home generated approximately $4.2 billion in homebuilding revenue and $334 million in consolidated net income. KB HOME: S&P Rates New $300MM Senior Unsecured Notes Due 2031 'BB' ------------------------------------------------------------------ S&P Global Ratings assigned its 'BB' issue-level rating and '3' recovery rating to KB Home's proposed $300 million senior unsecured notes due 2031. The '3' recovery rating indicates its expectation for meaningful (50%-70%; rounded estimate: 65%) recovery in the event of a payment default. S&P expects the company to use proceeds from these notes, along with cash on hand, to fully repay its outstanding $450 million 7% senior unsecured notes due December 2021. KELLA JUNE BABCOCK: Husband Buying Lolo Homestead for $298.5K ------------------------------------------------------------- Kella June Babcock asks the U.S. Bankruptcy Court for the District of Montana to authorize the sale of her homestead residence located at 7177 Graves Creek Rd., in Lolo, Missoula County, Montana, to her husband, Greg Kulkowsky, for $298,500. Objections, if any, must be filed within 21 days of the date of the motion. The Debtor filed the instant case "land rich and cash poor," and her reorganization plan filed on May 7, 2021, completely depends on either selling her homestead or borrowing against its equity. On April 10, 2021, the recently-married Debtor accepted an "Offer to Purchase Real Estate" from her husband, Mr. Kulkowsky. Montana is not a community property state, and Mr. Kulkowsky has no ownership interest in the property. The Buy-Sell Agreement, drawn up by the parties without benefit of the counsel, is for the Debtor's homestead residence. The Debtor estimates that she needs approximately $217,000 to fully fund her plan. The homestead property has no consensual debt against it, and Mr. Kulkowsky is paying $238,800 for the property after deducting $67,300 of gifted equity from the Debtor toward the $298,500 purchase price. The Debtor and Mr. Kulkowsky entered into the Buy-Sell Agreement to facilitate the Debtor's reorganization plan and they did not fully understand the process or their obligation to notify the counsel or the Court prior to this week. Mr. Kulkowsky needs to close the sale by June 9, 2021 or he will lose his current loan approval, and so any Order approving the Motion should be effective immediately, and not stayed for 14 days under F.R.B.P. 6004(h). The sale is in the best interests of the Debtor, her husband, and all parties to the case, and is consistent with the terms of the Debtor's plan. Secured creditors American Contractors Indemnity Co. and Farmers State Bank are the only creditors who have participated in the case beyond filing Proofs of Claim since it was filed back in April 2020, and the Debtor already has agreements with both of them to pay their claims with the proceeds, and so no party should be prejudiced by the shortened Notice and Expedited Hearing being requested contemporaneously. If an objection is filed, the Debtor asks that the Court holds a hearing on June 3, 2021 to coincide with the Plan Confirmation Hearing already scheduled on that date. A copy of the Agreement is available at https://tinyurl.com/ey6fmcjz from PacerMonitor.com free of charge. Counsel for Debtor: Daniel S. Morgan MORGAN PIERCE, PLLP P.O. Box 1690 Missoula, MT 59806-1690 Telephone: (406) 830-3875 Facsimile: (406) 830-3876 E-mail: dan@morgan-pierce.com The bankruptcy case is In re: Kella June Babcock, (Bankr. D. Mont. Case No. 9:20-bk-90090-BPH). KING'S TOWING: Seeks to Hire Parrish Agency as Accountant --------------------------------------------------------- King's Towing and Recovery, LLC seeks approval from the U.S. Bankruptcy Court for the Western District of Arkansas to employ Parrish Agency, LLC as accountant. Parrish Agency will render these services: (a) provide accounting services; (b) prepare annual tax returns and periodic tax filings; (c) prepare monthly operating reports; and (d) serve as an expert witness at the confirmation hearing if necessary. Parrish Agency will be paid a flat fee of $189 per task for the preparation of monthly operating reports and periodic tax filings, and $450 per year for the preparation of annual state and federal tax returns. Alaric Parrish, an authorized representative at Parrish Agency, 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: Alaric Parrish Parrish Agency LLC 2710 West Commercial Street, Suite A Ozark, AR 72949 About King's Towing and Recovery King's Towing and Recovery, LLC filed a voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. W.D. Ark. Case No. 21-70549) on April 19, 2021, disclosing up to $1 million in both assets and liabilities. Judge Bianca M. Rucker oversees the case. The Bond Law Office, led by Stanley V. Bond, Esq., and Parrish Agency, LLC serve as the Debtor's legal counsel and accountant, respectively. KINSER GROUP II: Seeks Cash Collateral Access --------------------------------------------- Kinser Group II, LLC asks the U.S. Bankruptcy Court for the District of Arizona for authority to use cash collateral to pay necessary postpetition operating expenses in accordance with the budget. The Debtor asserts that payment of operating expenses preserves and enhances the value of its property benefitting all creditors, including First Financial Bank. First Financial Bank asserts the Debtor is obligated to it on a secured loan in the original principal amount of $10,250,000. The First Financial Loan is evidenced by a promissory note dated July 26, 2007. The obligations owing under the Note are asserted to be secured by: (i) the Mortgage and Security Agreement With Assignment Of Rents And Fixture Financing Statement dated July 26, 2007 and recorded in Monroe County, Indiana, (ii) the Security Agreement dated July 26, 2007, and (iii) UCC financing statements filed with the Arizona Secretary of State. The Debtor owns and operates a 102-room Holiday Inn Express hotel located at 117 S. Franklin Road, Bloomington, Indiana. As of the Petition Date, the Debtor's Hotel was operated and managed by an affiliate hotel management entity, Tristar Investment Company, L.L.C. As a result of the Hotel's close proximity to Indiana University's main campus, and the number of events that happen on and around campus each year, the Hotel has historically performed well and had solid revenues. However, in 2019, three new hotels were constructed and opened in Bloomington, adding approximately 500 rooms to the market. This both increased available inventory for consumers and brought increased competition through newly constructed properties (which consumers typically prefer), but without increasing the underlying demand/need for additional hotel rooms. This negatively impacted the Debtor's revenue and profitability in 2019. Then, in early-to-mid-March 2020, the COVID-19 pandemic hit the United States, resulting in the travel and hospitality industry in Indiana (and across the United States and world) coming to a near-complete halt. The Hotel's gross revenue from January 1, 2019 through December 31, 2019 was approximately $3,136,000. For calendar year 2020, the revenue of the Hotel fell to approximately $1,978,000, even though January and February 2020 were essentially normal operating months prior to the impact of the pandemic. In 2021, the Hotel continues to suffer negative effects from the COVID-19 pandemic. As a result of the struggles, even with a deferment of payments from First Financial Bank from May 2020 – August 2020, the Debtor has had negative net income during this period. Year-to-date 2021, the Debtor has suffered negative net income of ($75,967.28) through the end of April 2021. This is despite making interest only payments to First Financial Bank from January to April 2021. If the scheduled principal and interest payments had been made, the Debtor's negative net income would be approximately ($200,000) year-to-date. The Debtor only seeks to pay its actual and necessary operating expenses, including non-insider payroll, management fees, utilities, post-petition franchise fees, inventory for its gift shops and restaurant, and cleaning/laundry expenses. Other than payment of the management fee to Tristar, the Debtor is not proposing to pay any insiders during the interim period. The Debtor claims First Financial will be adequately protected despite the Debtor's use of its Cash Collateral through a replacement lien granted to First Financial in the same type of collateral in which it held an interest prepetition, including without limitation postpetition income and accounts receivable generated by its non-cash collateral to the same extent and priority as it held prepetition. First Financial will also be adequately protected by the Debtor's ongoing and future operations enhanced by the use of Cash Collateral, and by the segregation of its Cash Collateral from other funds. First Financial will be adequately protected because the Debtor will accrue cash during postpetition and its cash collateral position will not be diminished. A copy of the motion is available for free at https://bit.ly/3c5iw65 from PacerMonitor.com. About Kinser Group II, LLC Kinser Group II, LLC is the operator of the Holiday Inn Express hotel located at 117 S. Franklin Road, Bloomington, Indiana. The Debtor sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. D. Ariz. Case No. 2:21-bk-04208) on May 28, 2021. In the petition signed by Kenneth L. Edwards, manager, the Debtor disclosed up to $10 million in both assets and liabilities. Quarles & Brady LLP is the Debtor's counsel. KINSER GROUP: Case Summary & 20 Largest Unsecured Creditors ----------------------------------------------------------- Debtor: Kinser Group II, LLC 3857 E. Tanglewood Drive Phoenix, AZ 85048 Chapter 11 Petition Date: May 28, 2021 Court: United States Bankruptcy Court District of Arizona Case No.: 21-04208 Debtor's Counsel: Isaac M. Gabriel, Esq. QUARLES & BRADY LLP Renaissance One Two North Central Avenue Phoenix, AZ 85004-2391 Tel: 602-230-4622 E-mail: isaac.Gabriel@quarles.com Total Assets: $8,543,167 Total Liabilities: $7,543,989 The petition was signed by Kenneth L. Edwards, manager. A copy of the Debtor's list of 20 largest unsecured creditors is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/YA3AJLQ/KINSER_GROUP_II_LLC__azbke-21-04208__0005.0.pdf?mcid=tGE4TAMA A full-text copy of the petition is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/KNO27XY/KINSER_GROUP_II_LLC__azbke-21-04208__0001.0.pdf?mcid=tGE4TAMA KRONOS WORLDWIDE: Fitch Alters Outlook on 'B+' LT IDR to Stable --------------------------------------------------------------- Fitch Ratings has affirmed the Long-Term Issuer Default Ratings (IDRs) of Kronos Worldwide Inc. (Kronos) and its wholly-owned subsidiary, Kronos International, Inc. at 'B+'. Fitch has also affirmed the issue ratings of Kronos International Inc.'s senior secured notes at 'BB'/'RR2', assigned a rating of 'BB+'/'RR1' to the new $225 million senior secured asset-backed lending (ABL) facility, and withdrew its issue ratings of the U.S. and European ABL facilities, which were refinanced. The Rating Outlook has been revised to Stable from Negative. Kronos' ratings reflect its strong liquidity position, conservative financial policy and low capex requirements. The company's exposure to the cyclical titanium dioxide (TiO2) industry introduces cash flow variability. Fitch expects improved pricing in a recovering demand environment to result in a neutral-to-positive FCF profile and total debt/EBITDA around 2x over the ratings horizon. With LTM 1Q21 net debt/EBITDA of 0.6x, Kronos benefits from considerable financial flexibility. In the event of a volatile pricing environment, the company has the ability to cut its dividend, which it has done in prior periods. The Stable Outlook reflects Fitch's expectations of favorable TiO2 pricing and demand trends to support revenue and EBITDA growth over the forecast horizon, which Fitch forecasts will result in total debt/EBITDA below 2.5x by YE 2021. Although Kronos' financial profile is generally consistent with 'BB' category rating tolerances, a positive rating action is unlikely without material increases in size, scale, or diversification, or structural improvements in the TiO2 industry outlook. Fitch is withdrawing its ratings of Kronos' U.S. and European ABL facilities, which were refinanced in April 2021. Fitch has accordingly assigned a rating of 'BB+'/'RR1' to the new $225 million senior secured ABL facility. KEY RATING DRIVERS Stabilizing TiO2 Demand and Pricing: Pricing for higher quality chloride and sulfate grade TiO2 exhibited improving trends in 2H20 and pricing is expected to remain favorable in the near term, as a combination of strong architectural do-it-yourself (DIY) demand and a higher percentage of value stabilization contracts helped mitigate any substantial price reductions, despite volume declines. Kronos realized yoy price declines of just (2%) in 2020 and trended positively through 1Q21. Fitch currently anticipates TiO2 pricing to generally trend upward through 2022, supported by a healthy expected demand environment. Coronavirus negatively affected end-market demand, and consequently sales volumes, primarily during 2Q20 and 3Q20, before sequentially improving in 4Q20 and 1Q21, driven by the early stages of market recovery. Kronos finished 2020 with volume declines of (6%). Fitch expects global TiO2 volumes to continue to benefit from improving economic activity through 2022, with particular upside potential in Europe attributed to pent up demand related to prolonged lockdowns in the region. Rising Feedstock Costs: Kronos realized moderately higher ore and energy costs in 2020, which modestly affected EBITDA margins. Fitch anticipates Kronos to maintain solid margins in the near term, given the expectations of upcoming TiO2 price increases through 2022 to offset further feedstock cost inflation. Kronos purchases its chloride-grade feedstock on the open market but is able to offset some of its third-party exposure through its ilmenite mines in Norway, which supply nearly all of its European sulfate needs. Fitch estimates Kronos is exposed to third-party feedstock suppliers for at least 75% of its feedstock requirements. Modest Net Debt: Fitch view Kronos' current net debt as modest when compared with Fitch's view of a normalized operating EBITDA for the company. Leverage is forecast to improve to around 2.0x, or 0.5x-1.0x on a net debt basis, through the forecast period on a return to a more normalized operating environment. The company's upcoming maturity payments are very light, averaging roughly $1 million per year until the notes are due in 2025. Fitch expects Kronos will be able to favorably refinance its secured notes prior to its maturity date in 2025. Limited Diversification: Kronos is a pure-play pigment producer that has no other business segments to act as a buffer in periods of volatility in the TiO2 industry. Fitch believes this exposure adds cash flow risk to the company's credit profile, as its financial results are highly dependent on the health of the pigment market. This concern is offset by Fitch's expectation that Kronos maintains robust liquidity throughout the forecast. Kronos believes it has leading market positions in both Europe and North America but Fitch views the company as having limited ability to affect global market dynamics. Fitch estimates the company's EBITDA generation at its European plants was severely limited during the 2015-2016 downturn in TiO2 prices, despite management's indication it is the largest TiO2 producer in Europe. DERIVATION SUMMARY Kronos' ratings reflect its relatively small size and limited diversification compared with peers in the TiO2 segment, while acknowledging its projected 2.0x leverage and neutral-to-positive cash flow profile stemming from the long-term expected pricing discipline within the TiO2 industry. Compared with industry leaders The Chemours Co. and Tronox Ltd., Kronos has limited ability to influence TiO2 supply dynamics and, as a pure-play pigment producer, has no other business segments to act as a buffer if periods of significant volatility in the TiO2 industry reappear. However, Kronos' debt load is manageable, and Fitch calculated gross leverage metrics are generally consistent with 'BB' category or better rating tolerances, which helped offset its lack of diversification during periods of cyclicality. Fitch believes the company will maintain robust liquidity throughout the forecast and that leverage will trend back toward 2.0x over the medium-term. KEY ASSUMPTIONS Fitch's key assumptions within its rating case for the issuer include: -- Revenue growth of about 5%-10% in 2021 and 2022, driven by continued volume growth, price increases, and recoveries in European demand. -- EBITDA margins improve to the 12% range as a result of assumed stabilization in energy and ore costs in 2022 coupled with a slight shift in volume mix toward chlorine process TiO2 pigment. -- Slightly elevated capex of around $80 million annually through 2022 due to costs related to expanding chlorine process production volumes in Germany, before levelling to around $75 million annually thereafter. -- Dividends of $80 million annually. KEY RECOVERY RATING ASSUMPTIONS The recovery analysis assumes Kronos would be reorganized as a going-concern in bankruptcy rather than liquidated. Fitch has assumed a 10% administrative claim. Fitch used a going-concern EBITDA of $135 million to reflect what Fitch would view as a mid-cycle amount in a post-bankruptcy scenario, which would likely be around 2014/2016 levels. The 5.0x multiple acknowledges the commoditized nature of Kronos' TiO2 products and its lack of diversification. Fitch expects Kronos draws approximately $190 million under its ABL, representing about 85% of the full $225 million amount. This is due to the likelihood the ABL borrowing base will be lessened in a distressed scenario as the TiO2 pricing environment declines over time, which would gradually reduce the borrowing base compared with a lower-rated issuer that would more likely draw on its ABL sooner. Under this scenario, Kronos' ABL and roughly $490 million secured note recoveries correspond to an 'RR1' and 'RR2', respectively. RATING SENSITIVITIES Factors that could, individually or collectively, lead to positive rating action/upgrade: -- Increases in size, scale, or diversification leading to improved mid-cycle EBITDA size or cost position; -- Maintenance of current financial policies, leading to total debt/EBITDA sustained below 3.0x and continued robust financial flexibility; -- A structurally improved sector outlook that results in EBITDA margin resiliency and reduced FCF variability. Factors that could, individually or collectively, lead to negative rating action/downgrade: -- Structural deterioration in the TiO2 market leading to expectations of negative FCF generation, weakened EBITDA margins and reduced financial flexibility; -- Total debt/EBITDA sustained above 4.0x; -- Material debt-funded dividend payments or acquisition activity. 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 Robust Liquidity: Kronos had $355.30 million of cash and cash equivalents on its balance sheet as of March 31, 2021. The company had full availability under its new $225 million global ABL revolver as of the transaction closing date of April 20, 2021. In an extended period of stress, the company has the ability to cut its dividend payment, and paired with modest capex requirements and a light maturity schedule, Fitch believes the company will maintain robust liquidity throughout the forecast period. ESG CONSIDERATIONS The highest level of Environmental, Social and Corporate Governance (ESG) Credit Relevance, if present, is a Score of '3'. This means ESG issues are credit-neutral or have only a minimal credit impact on the entity(ies), either due to their nature or to the way in which they are being managed by the entity(ies). LAKE CECILE: Seeks Access to Cash Collateral -------------------------------------------- Lake Cecile Resort Inc., asks the U.S. Bankruptcy Court for the Middle District of Florida, Orlando Division, for authority to use cash collateral. In January 2020, the Debtor's Lake Cecile Inn & Suites was damaged by fire. The Debtor entered into an agreement with Goodman-Gable-Gould/Adjusters International to serve as insurance adjuster for the damage to the Cecile Inn. The Debtor received $400,000 in insurance proceeds. Adjuster asserts a $25,000 claim for commission against the Insurance Proceeds based on the Adjuster Agreement. Best Meridian Insurance Co. asserts a claim in the approximate amount of $3.68 million, based on: (A) a mortgage and security agreement recorded July 10, 2018, in Official Records Book 5364, Pages 1114-1132, in the public records of Osceola County, Florida; and (B) a UCC-1 Financing Statement recorded (1) July 9, 2018, at #201805789455, with the Florida Secured Transaction Registry; and (2) July 10, 2018, in Official Records Book 5364, Pages 1137-1139, in the public records of Osceola County, Florida. The Debtor owns these motels: (a) Lake Cecile Inn & Suites motel located at 4900 W. Irlo Bronson Mem. Hwy, Kissimmee, Fla., with 120 rooms; (b) Star Motel at Lakeside motel located at 4880 W. Irlo Bronson Mem. Hwy, Kissimmee, Fla., with 128 rooms; and (c) Palm Lakefront Resort & Hostel motel located at 4840 W. Irlo Bronson Mem. Hwy, Kissimmee, Fla., with 99 rooms. The Debtor proposes to sell the Motels and has filed with the Court: a. a Motion (Doc. No. 103) to approve bid procedures and sale; and b. an Application (Doc. No. 94) to retain Fisher Auction Company as broker/auctioneer. The Auctioneer requires the Debtor to advance to Auctioneer up to $15,000 for marketing expenses for sale of the Motels. The Debtor seeks authority to use the Insurance Proceeds to be disbursed as follows: a. $25,000 to Adjuster on account of Auctioneer’s claim for commission; b. $310,000 to BMI on account of the claim secured by the Insurance Proceeds; c. Up to $15,000 to be used by Debtor for the Advance; and d. $50,000, as a carve out for bankruptcy counsel for Debtor, to be held in trust by counsel, with fees and costs subject to approval by the Court. The Debtor projects the sale will maximize the value of the Motels and provide for payment in full of the BMI claims. BMI's interests will be adequately protected by (i) the payment of $310,000 on account of BMI's secured claim; (ii) the continuing lien against the Motels; (iii) the sale of the Motels; and (iv) insurance coverage for the Motels. A copy of the motion is available at https://bit.ly/3wBEbKO from PacerMonitor.com. About Lake Cecile Resort Lake Cecile Resort Inc. is an Orlando, Fla.-based company primarily engaged in renting and leasing real estate properties. Lake Cecile Resort sought protection under Chapter 11 of the Bankruptcy Code (Bankr. M.D. Fla. Case No. 21-01060) on March 12, 2021. In the petition signed by Mary T. Nguyen, president, the Debtor disclosed between $10 million and $50 million in both assets and liabilities. Judge Karen S. Jennemann oversees the case. David R. McFarlin, Esq., at Fisher Rushner, P.A. is the Debtor's legal counsel. LAKEWAY PUBLISHERS: Emerges from Chapter 11 Bankruptcy ------------------------------------------------------ Tullahoma News reports that nearly two years to the day of receiving Chapter 11 protections, Lakeway Publishers, Inc., the parent company of The Tullahoma News, has emerged from bankruptcy. Judge Shelley Ricker signed the order Thursday, May 27, 2021. Lakeway Publishers, Inc. President R. Jack Fishman said the announcement is an important one for Lakeway Publishers, its papers and the communities they serve. "We greatly value our relationship with our readers, employees and customers. Throughout this process we have remained committed to maintaining the trust we have earned over the years," Fishman said. "It has not been an easy process. We entered into these protections less than a year before the arrival of a global pandemic that presented unique challenges that made the process more arduous." Still, Lakeway Publishers was founded on the idea of providing the critical information for a community to thrive while enlightening its readers. And while the times have changed and the company is adapting, the mission remains the same, Fishman said. "Newspapers, like many industries, must continue to react to new challenges in an ever-changing economic climate," Fishman said, "but they still, first and foremost, must serve their community." Lakeway Publishers, Inc., is composed of mostly smaller newspapers and websites in smaller communities in Tennessee, Missouri and Virginia. "In our democracy, it is of vital importance that our citizens remain informed, and we come out of this process with renewed commitment to our important role and with better flexibility," Fishman said. “In times of global crisis, the role of a community newspaper is even more vital. It has been our job to help deliver information that aids and informs our readers in the ways they can protect themselves and their families. "I am especially proud of the job Lakeway Publishers' newspapers have done in these trying times. That they fulfilled that role while going through the Chapter 11 process is more proof of the resiliency of our papers, our employees and our loyal readers who support us." Fishman said he is pleased that Thursday's announcement will aid Lakeway Publishers in continuing to improve, striving to do their jobs even better. "Looking ahead, we are confident we are better positioned to be able to provide the very best local news of people, government, business, schools, sports and those things affecting our daily lives and, at the same time, to build a stronger company with employees committed to our long history of supporting our local communities," Fishman said. About Lakeway Publishers Lakeway Publishers, Inc., is a multi-state publisher of newspapers, magazines, and special publications. It owns and operates community newspapers and magazines in Tennessee, Missouri, Virginia, and Florida. Lakeway Publishers was incorporated in 1966 and is based in Morristown, Tenn. Lakeway Publishers and affiliate Lakeway Publishers of Missouri, Inc., each filed a voluntary petition under Chapter 11 of the Bankruptcy Code (Bankr. E.D. Tenn. Lead Case No. 19-51163) on May 31, 2019. In the petitions signed by Jack R. Fishman, president, Lakeway Publishers disclosed $20,884,027 in assets and $9,245,645 in liabilities while Lakeway Publishers of Missouri listed $7,047,972 in assets and $9,206,193 in liabilities. The Debtors tapped Quist, Fitzpatrick & Jarrard, PLLC as bankruptcy counsel and Burnette Dobson & Pinchak and Maneke Law Group as special counsel. LINKMEYER PROPERTIES: Discl. Statement Hearing Slated for July 12 ----------------------------------------------------------------- Judge K. McCord, at the behest of Linkmeyer Properties, LLC, continued to July 12, 2021 at 10 a.m. (EDT) the telephonic hearing on the Disclosure Statement explaining the Chapter 11 Plan of Linkmeyer Properties. The objection of the City of Lawrenceburg, Indiana, will also be discussed at the hearing. About Linkmeyer Properties Linkmeyer Properties, LLC, Linkmeyer Kroger, LLC, and Linkmeyer Development II, LLC filed voluntary petitions for relief under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Ind. Lead Case No. 20-90898) on Aug. 13, 2020. At the time of the filing, each Debtor disclosed estimated assets of less than $50,000 and estimated liabilities of between $1 million and $10 million. Judge Andrea K. Mccord oversees the cases. Hester Baker Krebs, LLC serves as Debtors' legal counsel. LJ RUBY: Moody's Alters Outlook on B3 Corp. Family Rating to Stable ------------------------------------------------------------------- Moody's Investors Service affirmed the ratings of LJ Ruby Holdings, LLC (dba Kaman Distribution Group (KDG), LJ Ruby), including the B3 corporate family rating and B3-PD probability of default rating, along with the B3 rating on the first lien senior secured credit facility rating and the Caa2 rating on the senior secured second lien term loan. Moody's also changed the ratings outlook to stable from negative "LJ Ruby's operating performance indicates to an ongoing demand recovery across different markets with sequential improvement in order intake and quoting activity", says Shirley Singh, Moody's lead analyst for the company. "Debt to EBITDA at above 6.5x remains high, but we expect the company to maintain adequate liquidity into 2022", added Singh. The following rating actions were taken: Affirmations: Issuer: LJ Ruby Holdings, LLC Corporate Family Rating, Affirmed B3 Probability of Default Rating, Affirmed B3-PD Senior Secured 1st lien Bank Credit Facility, Affirmed B3 (LGD3) Senior Secured 2nd lien Bank Credit Facility, Affirmed Caa2 (LGD5) Outlook Actions: Issuer: LJ Ruby Holdings, LLC Outlook, Changed To Stable From Negative RATING RATIONALE LJ Ruby's ratings reflect the company's adjusted debt-to-EBITDA (leverage) in excess of 6.5x, particularly in the context of the inherent cyclicality in its end-markets. The company's profitability margins, although improving, is relatively lower than many of its competitors and other rated distributors. Nonetheless, the company has a good market position with long-standing customer relationships that are enhanced by its value-add services, and meaningful diversity within its supplier base, customers and end-markets. The company also generates a significant share of revenue from maintenance, repair and operations (MRO) activities, which combined with its highly variable cost structure and counter-cyclical working capital somewhat mitigate the downside risk to cash flows. The stable ratings outlook reflects Moody's expectation for gradual improvement in debt to EBITDA to below 6.5x over the next 12 to 18 months while maintaining adequate liquidity at all times. FACTORS THAT COULD LEAD TO RATINGS UPGRADES OR DOWNGRADES Ratings could be downgraded if deterioration in market conditions, loss of a customer or competitive pressure weakens earnings or compress margins. Quantitatively, adjusted debt-to-EBITDA sustained above 7.5x or weakened liquidity could prompt a rating downgrade. Ratings could be upgraded if the company's scale and operating margins improve such that adjusted debt-to-EBITDA is sustained below 5.5x and free cash flow to debt increases above 5%. Headquartered in Bloomfield, Connecticut, LJ Ruby Holdings (dba Kaman Distribution Group; LJ Ruby) is a US distributor of engineered bearings & power transmission, automation and fluid power solutions. Operating through five distribution centers and 18 fabrication and assembly centers, the company serves diverse end-markets including in the machinery, metals & mining and food & beverage sectors. The company is owned by Littlejohn & Co., LLC. Sales for the twelve months ended March 2021 were $950 million. The principal methodology used in these ratings was Distribution & Supply Chain Services Industry published in June 2018. LOGIX HOLDING: Moody's Lowers CFR to Caa2, Outlook Still Negative ----------------------------------------------------------------- Moody's Investors Service downgraded Logix Holding Company, LLC's Corporate Family Rating to Caa2 from Caa1, the Probability of Default Rating to Caa2-PD from Caa1-PD, and senior secured bank credit facility rating to Caa1 from B3. The outlook remains negative. Downgrades: Issuer: Logix Holding Company, LLC Corporate Family Rating, Downgraded to Caa2 from Caa1 Probability of Default Rating, Downgraded to Caa2-PD from Caa1-PD Senior Secured Bank Credit Facility, Downgraded to Caa1 (LGD3) from B3 (LGD3) Outlook Actions: Issuer: Logix Holding Company, LLC Outlook, Remains Negative RATINGS RATIONALE Logix credit profile is constrained by its small scale, high leverage, weak liquidity, and weak market position. With little cash and limited to no access to alternate liquidity sources, the Company has a weak liquidity profile. There is an impending maturity of the revolving credit facility at the end of 2022 (approximately $15 million outstanding ) which will most likely require the financial sponsor to inject capital should the Company be unable to refinance the facility. In addition, Moody's note tightening and little covenant headroom as the maintenance test steps down .5x (to 4.75x) through the end of 2021. Short of a recapitalization including an equity injection, Moody's believe the current capital structure may be unsustainable despite management's effort to manage the liquidity constraints by reducing capital expenditures to near maintenance levels (about 5% revenue). Governance risk is also moderate with private equity ownership, and a financial policy which tolerates high leverage that will rise to over 8x with a 15% PIK note in the capital structure that is compounding quickly. However, Moody's believe the financial sponsor is actively engaged in the investment and is committed and able to inject capital to support the liquidity position over the next year, but the commitment beyond that is uncertain. The Company operates in Texas, a very large and growing market for commercial broadband, but is challenged by strong competition evidenced by persistently falling revenues. Given its weak liquidity position, the Company has limited ability to pursue growth opportunities or defend its base. Additionally, Moody's believe Logix has some exposure to Small and Medium-sized Businesses which have been negatively impacted by the current pandemic and is also burdened by a mix of lower profit, off-net customers. Despite the weak credit profile, Moody's view positively the strong market demand for broadband / fiber services. The Company also has large number of on-net customers and subscription-based business model with contracted recurring revenues that provides a degree of visibility despite high churn. Moody's expects that Logix will have weak liquidity over the next 12 months. Moody's expect negative operating cash flow in at least one quarter (but slightly positive net free cash flow of a few million over the next year), minimal cash balances, and a mostly drawn $20 million revolver with further access prohibited by incurrence provisions. The revolver is subject to a senior secured leverage covenant with very little and declining headroom as the test steps down to 4.75x at the end of 2021. A breach of its maintenance covenant is very likely over the next 12 months (and as soon as Q2) in the absence of an equity cure. An equity injection (or some other structural remedy, e.g. recapitalization) will also be necessary to repay the outstanding revolver due at end of 2022 assuming the inability to refinance the obligations. Management is actively managing to produce break-even free cash flows by constraining capital spending to near minimum maintenance levels (reported spending at approximately 5% of revenue). The Company owns fiber assets that Moody's believe are easily divisible, highly valuable, and readily saleable. However, these are fully encumbered by the bank facilities which require any sales proceeds to be applied toward debt repayment before general corporate purposes. The Caa1 rating on the senior secured bank credit facilities, secured on a first lien basis by substantially all assets, reflects the probability of default of the Company as reflected in the Caa2-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' priority of claims/ranking in the capital structure. This includes a subordinated seller note (unrated) which provides loss absorption, lifting the first lien instruments one notch above the CFR. Trade payables and lease rejection claims are unrated, and insignificant to rated instruments. The negative rating outlook reflects Moody's expectation for (Moody's adjusted) debt to rise near $345 million (increasing with a 15% PIK note), revenue declining to about $125 million (assuming continued losses of mid-single-digit percent), and EBITDA to remain flat at between $40-$45 million over the next 12-18 months. Net of interest (assuming average borrowing costs of 5%, excluding the 15% PIK note) and reported capex (to revenue falling near 5%), Moody's project little to no free cash flows. Moody's project leverage will rise above 8x and free cash flow before non-maintenance capex in the low single-digit percent range. Moody's also expect liquidity to remain weak. Note: all figures above 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 a positive rating action if there was a significant equity infusion. A positive rating action could also be considered with an improved credit profile reflected in stronger liquidity profile and positive organic revenue growth, considered in combination with an improved business model, with a larger mix of on-net customers that generate higher profits and cash flows. Moody's would expect this to translate into positive free cash flow before estimated non-maintenance capex / debt (Moody's adjusted), and leverage sustained below 8.0x. Moody's could consider a downgrade if Moody's believe the probability of default increases or Moody's estimate recovery at default decreases. The principal methodology used in these ratings was Communications Infrastructure Industry published in September 2017. Logix Holding Company, LLC, with headquarters in Houston, TX, is a fiber-based network infrastructure operator. Logix provides fiber-based data and voice services as well as data center access to enterprise and carrier customers. Logix has more than 6,800 fiber route miles, serving more than 10,000 enterprise and carrier customers across Texas. Logix also owns and operates 105 data centers in Texas. Revenue for the last 12 months ended March 31, 2021 was approximately $140 million. LSB INDUSTRIES: S&P Upgrades ICR to 'CCC+' on Improved Pricing -------------------------------------------------------------- S&P Global Ratings raised its issuer credit rating on LSB Industries Inc. to 'CCC+' from 'CCC'. S&P also raised the issue-level ratings one notch. S&P said, "The stable outlook reflects our belief that S&P Global Ratings-adjusted leverage metrics will remain near unsustainable levels and appropriate for the 'CCC+' rating over the next 12 months, despite improved market fundamentals and a strong pricing environment. "We now expect 2021 EBITDA and credit metrics will improve beyond our previous expectations and higher than in 2020 given strong agriculture pricing and the economic recovery. Following a weak 2020, when agriculture pricing weakened and the economic downturn due to the COVID-19 pandemic weakened demand in the company's industrial segment, LSB now benefits from improved fertilizer pricing and economic recovery. Improved fertilizer pricing--driven by higher farmers income, strong corn, and soybean prices--and crop exports to China benefit LSB earnings in 2021. As a result, credit metrics and liquidity have improved beyond our previous expectations, and we expect that to be the case over the next 12 months. However, we still expect volatility in LSB's earnings over the longer term. We still view S&P Global Ratings-adjusted credit metrics as unsustainable, with weighted-average debt to EBITDA above 9x." In addition to the favorable fertilizer pricing, the economic recovery from the COVID-19 pandemic will help boost demand in key end markets including automotive, home building, and power generation. Finally, the company's industrial sales should benefit from the ramp-up of new nitric acid offtake agreements previously announced. Operations at LSB's plants continue to improve, leading to strong on-stream rates. In the past, earnings were hindered by operational issues at its plants. S&P said, "We believe LSB has taken positive steps over the past two years to improve operational performance and avoid unplanned outages. It implemented better maintenance procedures, training programs, and other business improvement initiatives that benefited ammonia on-stream rates. Although we believe the company has taken positive steps to help mitigate disruptions at its plants, we are aware that the business is subject to events such as weather disruptions that are out its control." S&P said, "The stable outlook reflects our view that LSB will continue to benefit from higher selling prices over the next 12 months. Despite higher EBITDA for 2021, we continue to view its leverage as unsustainable and that it will remain volatile in the long term. We expect high S&P Global Ratings-adjusted debt to EBITDA in the high-single digits over the next 12 months. We assume operating conditions will improve modestly, driven by the economic recovery, and operating results to remain robust on operation improvement. Our stable outlook does not consider any large debt-funded acquisitions or shareholder rewards." S&P could lower the rating on LSB within the next year if: -- Significant unplanned operating problems occur at any of the company's facilities. -- Tampa ammonia prices and urea-ammonium nitrate (UAN)/high-density ammonium nitrate (HDAN) prices deteriorate faster than expected or below historical levels. In this scenario, we envision liquidity would weaken further and cause covenant issues. -- The company consistently generates negative free cash flow. -- It funds shareholder rewards or transformational acquisitions with additional debt, or it buys back debt at a discount in an exchange that we view as distressed. S&P could take a positive rating action on LSB within the next year if: -- The company improves leverage, either through debt reduction or stronger-than-expected operating performance, led by higher selling prices. In such a scenario, S&P expects debt to EBITDA would improve and approach 7x on an S&P Global Ratings-adjusted basis. -- S&P believes such improvement is sustainable and EBITDA could remain despite volatile selling prices. -- S&P expects no significant increases to the company's capital spending plans or increased debt to fund further growth or returns to shareholders. -- The company were to address its preferred shares in a deleveraging manner leading to improved credit metrics. M&M BEDDING: Case Summary & 8 Unsecured Creditors ------------------------------------------------- Debtor: M&M Bedding LLC 1401 S. Edgewood St. Halethorpe, MD 21227 Business Description: M&M Bedding LLC owns and operates a bedding store. Chapter 11 Petition Date: May 28, 2021 Court: United States Bankruptcy Court District of Maryland Case No.: 21-13606 Judge: Hon. Michelle M. Harner Debtor's Counsel: Ronald Drescher, Esq. DRESCHER & ASSOCIATES, PA 4 Reservoir Circle Suite 107 Pikesville, MD 21208 Tel: 410-484-9000 E-mail: rondrescher@drescherlaw.com Estimated Assets: $500,000 to $1 million Estimated Liabilities: $1 million to $10 million The petition was signed by Mohamed Maghari, manager, TDA Holdings, LLC, sole member. A full-text copy of the petition containing, among other items, a list of the Debtor's eight unsecured creditors is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/5WUEJXY/MM_Bedding_LLC__mdbke-21-13606__0001.0.pdf?mcid=tGE4TAMA MACHINE TECH: KC Estimating Buying Adel Property for $130K ---------------------------------------------------------- Machine Tech, Inc., asks the U.S. Bankruptcy Court for the Middle District of Georgia to authorize the private sale of the real property described as 202 Talley Street, in Adel, Georgia, to KC Estimating & Services, LLC for $129,900. The Debtor owns the Property. It is advised that the market value of the Property is approximately $129,900.00. The Debtor wishes to sell the Property in a private sale with commission of 5% to be collected at closing. The sale is other than in the ordinary course of business free and clear of liens, claims, and encumbrances. Pursuant to an agreement entered into between the Buyer and the Debtor, the Debtor is to sell the Property for the gross amount of $129,900. The Buyer's address is 11716 Stonewood Gate Drive, Riverview FL 33579. The Buyer is an unrelated, non-insider party. The Property is encumbered by a first priority lien in favor of Respondent The Trust Bank in the amount of $557,017.96, per proof of claim no. 12. Respondent The Trust Bank will be paid the net sale proceeds at closing. Respondent Cook County Tax Commissioner claims a lien for property taxes in the amount of $1,308.37, per proof of claim no. 12. Respondent Cook County Tax Commissioner will be paid in full at closing. Respondent Georgia Department of Revenue may claim liens for taxes in the amount of $59,048.46, per proof of claim no. 1. Respondent Georgia Department of Labor may claim liens for taxes. The Property is further encumbered by a lien in favor of Respondent FC Marketplace, LLC in the amount of $265,357.65, as evidenced by a certain fi fa recorded on Lien Docket 52, Page 59, Cook County, Georgia, records. The Property is further encumbered by a lien in favor of Respondent Ryerson, Inc. in the amount of $49,115.78, as evidenced by a certain fi fa recorded on Lien Docket 73, Page 113, Colquitt County, Georgia, records. The Property is further encumbered by a lien in favor of Respondent Steel Warehouse Co., LLC in the amount of $70,720.37, as evidenced by a certain fi fa recorded on Lien Docket 75, Page 484, Colquitt County, Georgia, records. The liens of Georgia Department of Revenue; Georgia Department of Labor; FC Marketplace, LLC; Ryerson, Inc.; and Steel Warehouse Company, LLC are in bona fide dispute. The Debtor feels that the offer submitted by the Buyer is fair and reasonable under the circumstances and that a sale of the Property would be beneficial to all parties in interest. It prays that after notice to all parties as required by law, that the Court approves the sale of the Property free and clear of liens, claims, and encumbrances, as requested. A copy of the Agreement is available at https://tinyurl.com/y75zj5r9 from PacerMonitor.com free of charge. About Machine Tech Machine Tech, Inc., based in Adel, GA, filed a Chapter 11 petition (Bankr. M.D. Ga. Case No. 19-71340) on Nov. 1, 2019. In the petition signed by Joseph A. Bell, president, the Debtor was estimated to have $100,000 to $500,000 in assets and $1 million to $10 million in liabilities. Wesley J. Boyer, Esq., at Boyer Terry LLC serves as bankruptcy counsel. MALLINCKRODT PLC: Bid to Move Acthar Cases to Delaware Questioned ----------------------------------------------------------------- Law360 reports that a member of the Judicial Panel on Multidistrict Litigation on Thursday, May 27, 2021, questioned Mallinckrodt ARD LLC's push to have a battery of antitrust cases over sales of the anti-seizure drug Acthar transferred to federal court in Delaware where the company is currently making its way through bankruptcy proceedings. Mallinckrodt is fighting a bid to have about a dozen cases over Acthar pricing consolidated into an MDL program in the Northern District of Illinois as it argues that it would create needlessly "duplicative" litigation in two separate forums. About Mallinckdrodt PLC Mallinckrodt -- http://www.mallinckrodt.com/-- is a global business consisting of multiple wholly-owned subsidiaries that develop, manufacture, market and distribute specialty pharmaceutical products and therapies. The company's Specialty Brands reportable segment's areas of focus include autoimmune and rare diseases in specialty areas like neurology, rheumatology, nephrology, pulmonology and ophthalmology; immunotherapy and neonatal respiratory critical care therapies; analgesics and gastrointestinal products. Its Specialty Generics reportable segment includes specialty generic drugs and active pharmaceutical ingredients. As of March 27, 2020, the Company had $10.17 billion in total assets, $8.27 billion in total liabilities, and $1.89 billion in total shareholders' equity. On Oct. 12, 2020, Mallinckrodt plc and certain of its affiliates sought Chapter 11 protection in Delaware in the U.S. (Bankr. D. Del. Lead Case No. 20-12522) to seek approval of a restructuring that would reduce total debt by $1.3 billion and resolve opioid-related claims against the Company. Mallinckrodt plc disclosed $9,584,626,122 in assets and $8,647,811,427 in liabilities as of Sept. 25, 2020. Latham & Watkins LLP, Ropes & Gray LLP and Wachtell, Lipton, Rosen & Katz are serving as counsel to the Company, Guggenheim Securities, LLC, is serving as investment banker and AlixPartners LLP is serving as restructuring advisor to Mallinckrodt. Hogan Lovells is serving as counsel with respect to the Acthar Gel matter. Prime Clerk LLC is the claims agent. MALLINCKRODT PLC: Chubb Companies Say Plan Patently Unconfirmable ----------------------------------------------------------------- ACE American Insurance Company, Illinois Union Insurance Company, Westchester Fire Insurance Company, Insurance Company of North America, ACE Property and Casualty Insurance Company, ACE Fire Underwriters Insurance Company, Pacific Employers Insurance Company, Federal Insurance Company, Pacific Indemnity Company, Vigilant Insurance Company, Great Northern Insurance Company, Chubb Insurance Company of New Jersey, Executive Risk Indemnity Inc., and ESIS, Inc. (collectively and together with each of their U.S.-based affiliates and successors, the "Chubb Companies"), object to the Disclosure Statement for the Joint Plan of Reorganization of Mallinckrodt Plc and Its Debtor Affiliates. The Chubb Companies claim that the Disclosure Statement Should Not Be Approved Because the Plan Is Patently Unconfirmable. Without the Chubb Companies' and perhaps other insurers' tender of their respective policies and/or any proceeds thereof, the Plan is largely unfunded and, as such, is not feasible. The Chubb Companies point out that the Disclosure Statement and the Plan do not adequately address the continuing obligations of the Debtors or their successors under each of the Insurance Programs, or the fact that the Insurance Programs must each be treated as a single program and the rights and benefits under the each of Insurance Programs are part of, and inseparable from, the balance of the respective Insurance Program. The Chubb Companies assert that the Disclosure Statement and Plan fail to state with sufficient clarity what insurance rights and benefits are purported to be assigned or otherwise transferred to the Opioid Trust under the Plan, leaving the Chubb Companies without adequate information regarding the proposed treatment of the Insurance Programs under the Plan. The Chubb Companies further assert that the Disclosure Statement and Plan must clarify that nothing in the Disclosure Statement, the Plan, Plan Supplement, or the Confirmation Order shall modify, alter or impair the Insurance Programs, including the rights and obligations of the Chubb Companies and the Debtors or their successors thereunder, and that, for all issues relating to insurance coverage, including all rights and obligations under the Insurance Programs, the terms and conditions of the Insurance Programs shall control. The Chubb Companies state that the Disclosure Statement and Plan must clarify that workers' compensation and direct action claims must continue to be administered, handled, defended, settled, and/or paid in the ordinary course, and, relatedly, that the Chubb Companies may continue to so administer, handle, defend, settle, and/or pay such covered claims in the ordinary course, and pursuant to the terms of the Insurance Programs and applicable non-bankruptcy law. Counsel for the Chubb Companies: Drew S. McGehrin DUANE MORRIS LLP 222 Delaware Avenue, Suite 1600 Wilmington, DE 19801 Telephone: (302) 657-4900 Facsimile: (302) 657-4901 E-mail: DSMcGehrin@duanemorris.com - and - Wendy M. Simkulak, Esquire Catherine B. Heitzenrater, Esquire Elisa M. Hyder, Esquire 30 South 17th Street Philadelphia, PA 19103-4196 Telephone: (215) 979-1000 E-mail:wmsimkulak@duanemorris.com E-mail: cheitzenrater@duanemorris.com E-mail: ehyder@duanemorris.com About Mallinckdrodt PLC Mallinckrodt -- http://www.mallinckrodt.com/-- is a global business consisting of multiple wholly owned subsidiaries that develop, manufacture, market and distribute specialty pharmaceutical products and therapies. The company's Specialty Brands reportable segment's areas of focus include autoimmune and rare diseases in specialty areas like neurology, rheumatology, nephrology, pulmonology and ophthalmology; immunotherapy and neonatal respiratory critical care therapies; analgesics and gastrointestinal products. Its Specialty Generics reportable segment includes specialty generic drugs and active pharmaceutical ingredients. As of March 27, 2020, the Company had $10.17 billion in total assets, $8.27 billion in total liabilities, and $1.89 billion in total shareholders' equity. On Oct. 12, 2020, Mallinckrodt plc and certain of its affiliates sought Chapter 11 protection in Delaware in the U.S. (Bankr. D. Del. Lead Case No. 20-12522) to seek approval of a restructuring that would reduce total debt by $1.3 billion and resolve opioid related claims against the Company. Mallinckrodt plc disclosed $9,584,626,122 in assets and $8,647,811,427 in liabilities as of Sept. 25, 2020. Latham & Watkins LLP, Ropes & Gray LLP and Wachtell, Lipton, Rosen & Katz are serving as counsel to the Company, Guggenheim Securities, LLC, is serving as investment banker and AlixPartners LLP is serving as restructuring advisor to Mallinckrodt. Hogan Lovells is serving as counsel with respect to the Acthar Gel matter. Prime Clerk LLC is the claims agent. On April 20, 2021, the Debtors filed their Plan of Reorganization and the Disclosure Statement related thereto. The Bankruptcy Court will hold a hearing to consider approval of the Disclosure Statement on May 26, 2021, at 1 p.m. (prevailing Eastern Time) before the Honorable John T. Dorsey. MALLINCKRODT PLC: Committee Taps Cushman & Wakefield as Appraiser ----------------------------------------------------------------- The official committee of unsecured creditors appointed in the Chapter 11 cases of Mallinckrodt plc and its affiliates seeks approval from the U.S. Bankruptcy Court for the District of Delaware to employ Cushman & Wakefield, Inc. as its real property appraiser. Cushman & Wakefield will render these appraisal, advisory, and litigation support services: (a) estimate the market value of each of the identified properties via the sales comparison approach; (b) in separate reports, estimate the investment value of the real property and personal property to the Debtors; (c) estimate the value of each of the identified properties using other valuation methodologies, as the committee may request; (d) research trends and conditions in the pharmaceutical and Life Sciences industry; (e) collect and analyze data on local and national property markets; (f) conduct site visits; (g) perform additional research of property markets and the pharmaceutical and Life Sciences industry; (h) collect and analyze additional information; (i) financial modeling; (j) participate on conference calls; (k) attend meetings; (l) conduct detailed review of personal property; and (m) provide general expert advice. (n) review of opposing experts' reports and testimony; (o) prepare rebuttal reports; (p) forensic real property investigations; (q) document reviews; (r) assist in preparing cross examination; (s) review of Cushman & Wakefield's files; and (t) prepare for testimony and give actual testimony. Cushman & Wakefield will be compensated at a flat fee equal to $520,000 for appraisal services and on an hourly basis for its advisory and litigation support services ranging from $325 to $800 per hour. In addition, the firm will seek reimbursement for expenses incurred. Richard Marchitelli, an executive managing director at Cushman & Wakefield, 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: Richard Marchitelli Cushman & Wakefield, Inc. 5605 Carnegie Boulevard, Suite 100 Charlotte, NC 28209 Telephone: (704) 916-4447 Facsimile: (212) 412-9059 Email: richard.marchitelli@cushwake.com About Mallinckrodt PLC Mallinckrodt is a global business consisting of multiple wholly-owned subsidiaries that develop, manufacture, market and distribute specialty pharmaceutical products and therapies. The company's Specialty Brands reportable segment's areas of focus include autoimmune and rare diseases in specialty areas like neurology, rheumatology, nephrology, pulmonology and ophthalmology; immunotherapy and neonatal respiratory critical care therapies; analgesics; and gastrointestinal products. Its Specialty Generics reportable segment includes specialty generic drugs and active pharmaceutical ingredients. Visit http://www.mallinckrodt.comfor more information. On Oct. 12, 2020, Mallinckrodt plc and certain of its affiliates sought Chapter 11 protection in Delaware in the U.S. (Bankr. D. Del. Lead Case No. 20-12522) to seek approval of a restructuring that would reduce total debt by $1.3 billion and resolve opioid-related claims against them. Mallinckrodt plc disclosed $9,584,626,122 in assets and $8,647,811,427 in liabilities as of Sept. 25, 2020. Judge John T. Dorsey oversees the cases. The Debtors tapped Latham & Watkins LLP and Richards, Layton & Finger P.A. as their bankruptcy counsel; Arthur Cox and Wachtell, Lipton, Rosen & Katz as corporate and finance counsel; Ropes & Gray LLP as litigation counsel; Torys LLP as CCAA counsel; Guggenheim Securities LLC as investment banker; and AlixPartners LLP as restructuring advisor. Prime Clerk, LLC is the claims agent. The official committee of unsecured creditors retained Cooley LLP as its legal counsel, Robinson & Cole LLP as co-counsel, and Dundon Advisers LLC as its financial advisor. On Oct. 27, 2020, the U.S. Trustee for Region 3 appointed an official committee of opioid related claimants. The OCC tapped Akin Gump Strauss Hauer & Feld LLP as its lead counsel, Cole Schotz as Delaware co-counsel, Province Inc. as financial advisor, and Jefferies LLC as investment banker. On April 20, 2021, the Debtors filed their plan of reorganization and disclosure statement. MALLINCKRODT PLC: DMPs Say Plan Contains Ambiguous Provisions ------------------------------------------------------------- The Distributors, Manufacturers, and Pharmacies (collectively, the "DMPs") submit this Joint Objection to the Disclosure Statement Motion of Mallinckrodt Plc and Its Debtor Affiliates. The Disclosure Statement does not provide adequate disclosures to parties-in-interest as they determine whether to support the Proposed Plan. Chiefly, the Disclosure Statement and Proposed Plan contain numerous confusing and ambiguous provisions that render both documents unclear as to who is impacted and to what extent. In particular, the Disclosure Statement fails to: * adequately describe the scope of the release provisions under the Proposed Plan and whether the Proposed Plan intends to effectuate a release of all of the DMPs' rights, remedies and defenses in the Opioid Litigation, including rights of setoff and recoupment, reimbursement, contribution, indemnity, apportionment of fault, judgment reduction and all other similar rights that would be operative as a matter of law (the "Defensive Rights"). * adequately describe the proposed treatment of the DMPs' claims arising from the assumption or rejection of the DMPs' executory contracts with the Debtors that involve opioids as well as other Products; and include the Opioid Trust Documents, which contain vital material terms relating to the treatment of creditor claims. The Proposed Plan violates the explicit commands of the Bankruptcy Code and well-established principles of bankruptcy law and is accordingly patently unconfirmable apart from the inadequacy of the Disclosure Statement. In particular, the Proposed Plan: * contains improper and overbroad non-consensual third-party releases; * fails the best interest of creditors test inputted into Section 1129(a)(7) by eliminating the DMPs' vested state law and contractual rights they would retain in a chapter 7 liquidation; and * fails the feasibility test imposed by Section 1129(a)(11) because the Proposed Plan predicates its success on future business relationships with the DMPs, but proposes to eliminate many of the DMPs' substantive and procedural rights in a manner that makes it unreasonable to assume their continued support, even as the Debtors acknowledge that maintaining relationships with their Distributors and some of the other DMPs is vital to their ongoing operations. Counsel for AmerisourceBergen: REED SMITH LLP Katelin A. Morales (No. 6683) 1201 North Market Street, Suite 1500 Wilmington, Delaware 19801 Telephone: (302) 778-7500 E-mail: kmorales@reedsmith.com - and - Lauren S. Zabel Three Logan Square 1717 Arch Street, Suite 3100 Philadelphia, Pennsylvania 19103 Telephone: (215) 851-8100 E-mail: lzabel@reedsmith.com Counsel for Johnson & Johnson: THE POWELL FIRM, LLC Jason C. Powell (No. 3768) 1201 N. Orange Street, Suite 500 P.O. Box 289 Wilmington, Delaware 19899 Telephone: (302) 650-1572 E-mail: jpowell@delawarefirm.com - and - O’MELVENY & MYERS LLP Evan M. Jones (admitted pro hac vice) Jordan Weber (admitted pro hac vice) 400 South Hope Street Los Angeles, California 90071 Telephone: (213) 430-6000 E-mail: ejones@omm.com E-mail: jweber@omm.com - and - O’MELVENY & MYERS LLP Adam P. Haberkorn (admitted pro hac vice) 7 Times Square New York, New York 10036 Telephone: (212) 326-2000 E-mail: ahaberkorn@omm.com Counsel for McKesson Corporation: THE POWELL FIRM, LLC Jason C. Powell (No. 3768) 1201 N. Orange Street, Suite 500 P.O. Box 289 Wilmington, Delaware 19899 Telephone: (302) 650-1572 E-mail: jpowell@delawarefirm.com - and - BUCHALTER a Professional Corporation Jeffrey K. Garfinkle Paul S. Arrow 18400 Von Karman Ave., Suite 800 Irvine, California 92612-0514 Telephone: (949) 760-121 E-mail: jgarfinkle@buchalter.com Counsel for Henry Schein, Inc.: MURPHY & LANDON Francis J. Murphy Jonathan L. Parshall 1011 Centre Road, Suite 210 Wilmington, Delaware 19805 Telephone: (302) 472-8103 E-mail: fmurphy@msllaw.com E-mail: jonp@msllaw.com - and - LOCKE LORD LLP John P. McDonald Brandan J. Montminy 2200 Ross Avenue, Suite 2800 Dallas, Texas 75201 Telephone (214) 740-8000 E-mail: jpmcdonald@lockelord.com E-mail: brandan.montminy@lockelord.com Counsel for Walgreen Co.: THE POWELL FIRM, LLC Jason C. Powell (No. 3768) 1201 N. Orange Street, Suite 500 P.O. Box 289 Wilmington, Delaware 19899 Telephone: (302) 650-1572 E-mail: jpowell@delawarefirm.com - and - FRANKGECKER LLP Joseph D. Frank Jeremy C. Kleinman 1327 W. Washington Blvd., Suite 5 G-H Chicago, Illinois 60607 Telephone: (312) 276-1400 E-mail: jfrank@fgllp.com E-mail: jkleinman@fgllp.com Counsel to Cardinal Health, Inc. and Related Entities: THE POWELL FIRM, LLC Jason C. Powell (No. 3768) 1201 N. Orange Street, Suite 500 P.O. Box 289 Wilmington, Delaware 19899 Telephone: (302) 650-1572 E-mail: jpowell@delawarefirm.com - and - CHIESA SHAHINIAN & GIANTOMASI PC Scott A. Zuber (admitted pro hac vice) Terri Jane Freedman (admitted pro hac vice) One Boland Drive West Orange, New Jersey 07052 Telephone: (973) 530-2046 E-mail: szuber@csglaw.com E-mail: tfreedman@csglaw.com Counsel for Endo International plc and its wholly-owned subsidiaries: THE POWELL FIRM, LLC Jason C. Powell (No. 3768) 1201 N. Orange Street, Suite 500 P.O. Box 289 Wilmington, Delaware 19899 Telephone: (302) 650-1572 E-mail: jpowell@delawarefirm.com - and - TOGUT, SEGAL & SEGAL LLP Albert Togut Kyle J. Ortiz One Penn Plaza, Suite 3335 New York, New York 10119 Telephone: (212) 594-5000 Counsel for CVS Pharmacy, Inc. and its Related Entities: THE POWELL FIRM, LLC Jason C. Powell 1201 N. Orange Street, Suite 500 P.O. Box 289 Wilmington, Delaware 19899 Telephone: (302) 650-1572 E-mail: jpowell@delawarefirm.com - and - FOLEY & LARDNER LLP Geoffrey S. Goodman Emil P. Khatchatourian 321 N. Clark Street, Suite 3000 Chicago, Illinois 60654-4762 Telephone: (312) 832-4500 Fax: (312) 832-4700 E-mail: ggoodman@foley.com E-mail: ekhatchatourian@foley.com About Mallinckdrodt PLC Mallinckrodt -- http://www.mallinckrodt.com/-- is a global business consisting of multiple wholly owned subsidiaries that develop, manufacture, market and distribute specialty pharmaceutical products and therapies. The company's Specialty Brands reportable segment's areas of focus include autoimmune and rare diseases in specialty areas like neurology, rheumatology, nephrology, pulmonology and ophthalmology; immunotherapy and neonatal respiratory critical care therapies; analgesics and gastrointestinal products. Its Specialty Generics reportable segment includes specialty generic drugs and active pharmaceutical ingredients. As of March 27, 2020, the Company had $10.17 billion in total assets, $8.27 billion in total liabilities, and $1.89 billion in total shareholders' equity. On Oct. 12, 2020, Mallinckrodt plc and certain of its affiliates sought Chapter 11 protection in Delaware in the U.S. (Bankr. D. Del. Lead Case No. 20-12522) to seek approval of a restructuring that would reduce total debt by $1.3 billion and resolve opioid related claims against the Company. Mallinckrodt plc disclosed $9,584,626,122 in assets and $8,647,811,427 in liabilities as of Sept. 25, 2020. Latham & Watkins LLP, Ropes & Gray LLP and Wachtell, Lipton, Rosen & Katz are serving as counsel to the Company, Guggenheim Securities, LLC, is serving as investment banker and AlixPartners LLP is serving as restructuring advisor to Mallinckrodt. Hogan Lovells is serving as counsel with respect to the Acthar Gel matter. Prime Clerk LLC is the claims agent. On April 20, 2021, the Debtors filed their Plan of Reorganization and the Disclosure Statement related thereto. The Bankruptcy Court will hold a hearing to consider approval of the Disclosure Statement on May 26, 2021, at 1 p.m. (prevailing Eastern Time) before the Honorable John T. Dorsey. MALLINCKRODT PLC: FCR Complains, Opioid PI Claimants UnCategorized ------------------------------------------------------------------ Roger Frankel, legal representative of Future Claimants in the Chapter 11 cases of Mallinckrodt PLC and its debtor-affiliates, told the Court that he objects to the Debtors' Plan, Disclosure Statement, and Solicitation Motion because these documents do not classify opioid personal-injury claimants separately from NAS claimants and Other Opioid Claimants whose claims are not based on personal injuries. The Future Claimants Representative (FCR) pointed out that these issues need to be brought to the Debtors' attention: (1) the separate classification of personal-injury claims; (2) the need for ballots and solicitation procedures that will allow parties to differentiate the votes of opioid personal-injury claimants from the votes of claimants with neonatal abstinence syndrome (NAS) and Other Opioid Claimants whose claims are not based on personal injuries; and (3) certain revisions necessary to provide creditors with adequate information, such as revisions and additional disclosures to further clarify certain terminologies in the documents. The FCR added that the ballots and solicitation procedures set forth in the Solicitation Motion should be amended to separately tabulate the votes of opioid personal-injury claimants. A copy of the objection is available for free at https://bit.ly/3c0WKAa from Prime Clerk, claims agent. Counsel for Roger Frankel, Representative of Future Claimants: James L. Patton, Jr., Esq. Robert S. Brady, Esq. Edwin J. Harron, Esq. Jaime Luton Chapman, Esq. Travis G. Buchanan, Esq. YOUNG CONAWAY STARGATT & TAYLOR, LLP Rodney Square 1000 North King Street Wilmington, DE 19801 Telephone: (302) 571-6600 Facsimile: (302) 571-1253 E-mail: jpatton@ycst.com rbrady@ycst.com eharron@ycst.com jchapman@ycst.com tbuchanan@ycst.com - and - Richard H. Wyron, Esq. FRANKEL WYRON LLP 2101 L Street, NW, Suite 800 Washington, DC 20037 Telephone: (202) 367-9127 Email: rwyron@frankelwyron.com About Mallinckdrodt PLC Mallinckrodt -- http://www.mallinckrodt.com/-- is a global business consisting of multiple wholly-owned subsidiaries that develop, manufacture, market and distribute specialty pharmaceutical products and therapies. The company's Specialty Brands reportable segment's areas of focus include autoimmune and rare diseases in specialty areas like neurology, rheumatology, nephrology, pulmonology and ophthalmology; immunotherapy and neonatal respiratory critical care therapies; analgesics and gastrointestinal products. Its Specialty Generics reportable segment includes specialty generic drugs and active pharmaceutical ingredients. As of March 27, 2020, the Company had $10.17 billion in total assets, $8.27 billion in total liabilities, and $1.89 billion in total shareholders' equity. On Oct. 12, 2020, Mallinckrodt plc and certain of its affiliates sought Chapter 11 protection in Delaware in the U.S. (Bankr. D. Del. Lead Case No. 20-12522) to seek approval of a restructuring that would reduce total debt by $1.3 billion and resolve opioid-related claims against the Company. Mallinckrodt plc disclosed $9,584,626,122 in assets and $8,647,811,427 in liabilities as of Sept. 25, 2020. Latham & Watkins LLP, Ropes & Gray LLP and Wachtell, Lipton, Rosen & Katz are serving as counsel to the Company, Guggenheim Securities, LLC, is serving as investment banker and AlixPartners LLP is serving as restructuring advisor to Mallinckrodt. Hogan Lovells is serving as counsel with respect to the Acthar Gel matter. Prime Clerk LLC is the claims agent. On April 20, 2021, the Debtors filed their Plan of Reorganization and the Disclosure Statement related thereto. The Bankruptcy Court will hold a hearing to consider approval of the Disclosure Statement on May 26, 2021, at 1 p.m. (prevailing Eastern Time) before the Honorable John T. Dorsey. MALLINCKRODT PLC: OCC Tells Qualms re Debtors' Solicitation Method ------------------------------------------------------------------ The Official Committee of Opioid Related Claimants (OCC) in the Chapter 11 cases of Mallinckrodt PLC and its debtor-affiliates disclosed in a reservation of rights filed with the Court relating to the Debtors' Solicitation Procedures Motion, that the OCC has suggested various modifications to procedures aimed at improving: * the Debtors' proposed Additional Opioid Notice Plan; * the Opioid Claimants Notice; and * the Solicitation Procedures. This, the OCC said, is to ensure that notice to Opioid Claimants is reasonably calculated to apprise such claimants not only of the voting deadline (given that there is no bar date for Opioid Claimants), but also of the Chapter 11 cases generally, the Debtors' proposed Plan (and potential procedures for recovery) and Opioid Claimants' rights to cast a vote on the Plan and be heard in connection with the same. According to the OCC, the vast majority of Opioid Claimants in the Debtors' cases will be solicited for voting purposes indirectly (as opposed to through direct mailing) through the various publications, advertisements and media communications placed pursuant to the Additional Opioid Notice Plan. The Additional Opioid Notice Plan, as of the date of the current filing, has not yet been made public but has only been shared on a confidential basis for review and comment. In order to ensure that Opioid Claimants have the ability to make an informed voting decision regarding the proposed Plan, the OCC emphasized that the Plan Supplement must be filed sufficiently far in advance of the hearing on the Solicitation Procedures Motion, and the proposed trust distribution procedures should be included in the Debtors' Solicitation Package. Since the Debtors' proposed solicitation timeline is insufficient to provide the potentially hundreds of thousands of unknown Opioid Claimants with notice of the proposed Plan and a meaningful opportunity to cast an informed vote, the OCC submits that the solicitation of Opioid Claimants should commence no less than 90 days before the Voting Deadline, and the OCC should have the right to seek an extension of the Voting Deadline in the event the OCC determines that additional noticing is required to comport with due process or Opioid Claimants need additional time to submit their Ballots. The OCC reserves all rights with respect to the Plan, the Disclosure Statement and the Solicitation Procedures Motion. The OCC also reserves all rights to seek to compel the Debtors to establish a bar date for Opioid Claimants. A copy of the OCC's reservation of rights is available for free at https://bit.ly/3yKW8bF from Prime Clerk, claim agent. About Mallinckdrodt PLC Mallinckrodt -- http://www.mallinckrodt.com/-- is a global business consisting of multiple wholly-owned subsidiaries that develop, manufacture, market and distribute specialty pharmaceutical products and therapies. The company's Specialty Brands reportable segment's areas of focus include autoimmune and rare diseases in specialty areas like neurology, rheumatology, nephrology, pulmonology and ophthalmology; immunotherapy and neonatal respiratory critical care therapies; analgesics and gastrointestinal products. Its Specialty Generics reportable segment includes specialty generic drugs and active pharmaceutical ingredients. As of March 27, 2020, the Company had $10.17 billion in total assets, $8.27 billion in total liabilities, and $1.89 billion in total shareholders' equity. On Oct. 12, 2020, Mallinckrodt plc and certain of its affiliates sought Chapter 11 protection in Delaware in the U.S. (Bankr. D. Del. Lead Case No. 20-12522) to seek approval of a restructuring that would reduce total debt by $1.3 billion and resolve opioid-related claims against the Company. Mallinckrodt plc disclosed $9,584,626,122 in assets and $8,647,811,427 in liabilities as of Sept. 25, 2020. Latham & Watkins LLP, Ropes & Gray LLP and Wachtell, Lipton, Rosen & Katz are serving as counsel to the Company, Guggenheim Securities, LLC, is serving as investment banker and AlixPartners LLP is serving as restructuring advisor to Mallinckrodt. Hogan Lovells is serving as counsel with respect to the Acthar Gel matter. Prime Clerk LLC is the claims agent. On April 20, 2021, the Debtors filed their Plan of Reorganization and the Disclosure Statement related thereto. The Bankruptcy Court will hold a hearing to consider approval of the Disclosure Statement on May 26, 2021, at 1 p.m. (prevailing Eastern Time) before the Honorable John T. Dorsey. MARTIN CARPENTER'S: Seeks to Hire Shannon Sheridan as Accountant ---------------------------------------------------------------- Martin Carpenter's Air Conditioning and Heating, Inc. seeks authority from the U.S. Bankruptcy Court for the Southern District of Alabama to employ Shannon Sheridan, EA, LLC as its accountant. The firm's services include: a. preparing and filing tax returns and conducting tax research; b. performing normal accounting and other services as required by the Debtor; and c. preparing or assisting the Debtor in preparing monthly operating reports, financial projections and other reports. The firm will be paid as follows: a. An $1,800 retainer for the preparation of the 2020 federal tax returns; and b. $2,455 monthly for full accounting services. As disclosed in court filings, Shannon Sheridan neither represents nor holds any interest adverse to the Debtor and its creditors. The firm can be reached through: Shannon Sheridan, EA Shannon Sheridan, EA, LLC 34744 US Highway North Palm Harbor, FL 34684 Phone: (727)877-8293/(727) 999-9160 Fax: (727) 493-1894 Email: shannon@sheridantax.net About Martin Carpenter's Air Conditioning and Heating Inc. Martin Carpenter's Air Conditioning and Heating, Inc. sought protection under Chapter 11 of the Bankruptcy Code (Bankr. M.D. Fla. Case No. 21-00722) on Feb. 16, 2021. At the time of the filing, the Debtor had estimated assets of between $100,001 and $500,000 and liabilities of between $500,001 and $1 million. Judge Caryl E. Delano oversees the case. The Debtor tapped Buddy D. Ford, P.A. as its bankruptcy counsel. Elevate Accounting Solutions, LLC and Shannon Sheridan, EA, LLC serve as the Debtor's accountants. MAUNESHA RIVER: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: Maunesha River Dairy, LLC 6790 Twin Lane Road Sun Prairie, WI 53590 Chapter 11 Petition Date: May 27, 2021 Court: United States Bankruptcy Court Western District of Wisconsin Case No.: 21-11157 Judge: Hon. Catherine J. Furay Debtor's Counsel: Jane F. Zimmerman, Esq. MURPHY DESMOND S.C. 33 East Main Street, Suite 500 P.O. Box 2038 Madison, WI 53701-2038 Tel: (608) 257-7181 E-mail: jzimmerman@murphydesmond.com Estimated Assets: $1 million to $10 million Estimated Liabilities: $1 million to $10 million The petition was signed by Dennis E. Ballweg, the member. A full-text copy of the petition containing, among other items, a list of the Debtor's 20 largest unsecured creditors is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/ZPGMM3A/Maunesha_River_Dairy_LLC__wiwbke-21-11157__0001.0.pdf?mcid=tGE4TAMA MEDIACOM COMMUNICATIONS: Moody's Withdraws Ba1 Corp. Family Rating ------------------------------------------------------------------ Moody's Investors Service withdrew its ratings for Mediacom Communications Corporation, including the Ba1 Corporate Family Rating and Ba1-PD Probability of Default Rating. Moody's also withdrew the ratings of the Ba1 senior secured bank credit facilities at MCC Iowa LLC ("Iowa") and Mediacom Illinois LLC ("Illinois"), two wholly-owned subsidiaries of Mediacom. The stable outlook was also withdrawn. The following ratings/assessments are affected by the action: Ratings Withdrawn: Issuer: Mediacom Communications Corporation Corporate Family Rating, Withdrawn , previously rated Ba1 Probability of Default Rating, Withdrawn , previously rated Ba1-PD Issuer: MCC Iowa LLC Senior Secured Bank Credit Facility, Withdrawn , previously rated Ba1 (LGD4) Issuer: Mediacom Illinois LLC Senior Secured Bank Credit Facility, Withdrawn , previously rated Ba1 (LGD4) Outlook Actions: Issuer: MCC Iowa LLC Outlook, Changed To Rating Withdrawn From Stable Issuer: Mediacom Communications Corporation Outlook, Changed To Rating Withdrawn From Stable Issuer: Mediacom Illinois LLC Outlook, Changed To Rating Withdrawn From Stable RATINGS RATIONALE Moody's has decided to withdraw the ratings for its own business reasons. Mediacom Communications Corporation, headquartered in Mediacom Park, New York, offers traditional and advanced video services such as digital television, video-on-demand, digital video recorders, and high-definition television, as well as high-speed Internet access and phone service. The company primarily serves smaller cities in the Midwestern and southern United States, operating two wholly owned subsidiaries, Mediacom Broadband LLC and Mediacom LLC. Revenue in for the LTM period ending March 31, 2021 was about $2.2 billion. MEDLEY LLC: Committee Seeks to Hire Kelley Drye as Lead Counsel --------------------------------------------------------------- The official committee of unsecured creditors of Medley, LLC seeks approval from the U.S. Bankruptcy Court for the District of Delaware to retain Kelley Drye & Warren LLP as its lead counsel. The firm will render these services: (a) advise the Committee with respect to its rights, duties and powers in these cases; (b) assist and advise the Committee in its consultations with the Debtor in connection with the administration of these cases; (c) assist the Committee in its investigation of the acts, conduct, assets, liabilities, and financial condition of the Debtor; (d) assist the Committee in connection with the proposed sale process; (e) assist the Committee in analyzing the claims of the Debtor's creditors; (f) advise and represent the Committee in connection with matters generally arising in these cases, including the Debtor's motion to incur post-petition financing and the Debtor's motion to approve bidding procedures for the sale of substantially all of the Debtor's assets; (g) appear before this Court, and any other federal or state court; (h) prepare, on behalf of the Committee, any pleadings, including motions, memoranda, complaints, objections, and responses to any of the foregoing; and (i) perform such other legal services as may be required. Kelley Drye will be paid at these rates: Partners $745 to $1,315 per hour Special Counsel $625 to $870 per hour Associates $455 to $680 per hour Paraprofessionals $285 to $380 per hour Kelley Drye will also be reimbursed for out-of-pocket expenses incurred. James Carr, Esq., a partner at Kelley Drye, 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. In accordance with Appendix B-Guidelines for Reviewing Applications for Compensation and Reimbursement of Expenses Filed under 11 U.S.C. Sec. 330 for Attorneys in Larger Chapter 11 Cases, Mr. Carr disclosed that: -- it has not agreed to any variations from, or alternatives to, its standard or customary billing arrangements for this engagement; -- none of the professionals included in the engagement vary their rate based on the geographic location of the bankruptcy case; -- the firm has not represented the Committee in the 12 months prepetition; and -- the Committee has approved the budget and staffing plan for the first budgeted for the period of Feb. 6, 2020 through April 30, 2020. Kelley Drye can be reached at: James S. Carr, Esq. Kristin S. Elliott, Esq. Lauren S. Schlussel, Esq. Kelley Drye & Warren LLP 101 Park Avenue New York, NY 10178 Tel: (212) 808-7800 Fax: (212) 808-7897 Email: jcarr@kelleydrye.com kelliott@kelleydrye.com lschlussel@kelleydrye.com About Medley LLC Medley LLC, through its direct and indirect subsidiaries, including Medley Capital LLC, is an alternative asset management firm offering yield solutions to retail and institutional investors. It provides investment management services to a permanent capital vehicle, long-dated private funds, and separately managed accounts, and serves as the general partner to the private funds. Medley is headquartered in New York City and incorporated in Delaware. As of Sept. 30, 2020, Medley had $3.4 billion of assets under management in two business development companies, Medley Capital Corporation (NYSE: MCC) and Sierra Income Corporation, and several private investment vehicles. Over the past 18 years, Medley has provided capital to over 400 companies across 35 industries in North America. Medley filed a Chapter 11 bankruptcy petition (Bankr. D. Del. Case No. 21-10526) on March 7, 2021. The Debtor disclosed $5,422,369 in assets and $140,752,116 in liabilities as of March 2, 2021. The Debtor tapped Lowenstein Sandler LLP and Morris James LLP as bankruptcy counsel, Eversheds Sutherland (US) LLP as special counsel, B. Riley Securities Inc. as investment banker, and Andersen Tax LLC as tax accountant. Kurtzman Carson Consultants, LLC is the claims agent, maintaining the page https://www.kccllc.net/medley The U.S. Trustee for Region 3 appointed an official committee of unsecured creditors on April 22, 2021. The committee is represented by Potter Anderson & Corroon, LLP and Kelley Drye & Warren, LLP. MEDLEY LLC: Committee Taps FTI Consulting as Financial Advisor -------------------------------------------------------------- The official committee of unsecured creditors of Medley, LLC seeks approval from the U.S. Bankruptcy Court for the District of Delaware to retain FTI Consulting, Inc. as its financial advisor. The firm's services include: -- assisting in the review of financial related disclosures required by the Court, including the Schedules of Assets and Liabilities, the Statement of Financial Affairs and Monthly Operating Reports; -- assisting in the preparation of analyses required to assess any proposed Debtor in Possession (DIP) financing or use of cash collateral; -- assisting with the assessment and monitoring of the Debtor's short term cash flow, liquidity, and operating results; -- assisting with the review of the Debtor's proposed key employee retention and other employee benefit programs; -- assisting with the review of the Debtor's core and non-core asset base and financial terms of investment management and other contracts related thereto; -- assisting with the review of transactions with non-debtor affiliates and related parties; -- assisting with the review of the Debtor's cost/benefit analysis with respect to the affirmation or rejection of various executory contracts and leases; -- assisting with the review of the Debtor's identification of potential cost savings, including overhead and operating expense reductions and efficiency improvements; -- assisting with review of any tax issues associated with, but not limited to, tax receivable agreements, preservation of deferred tax assets, and plans of reorganization; -- assisting in the review of the claims reconciliation and estimation process; -- assisting 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, any proposed exit financing, and the economic analysis of proposed transactions for which Court approval is sought; -- attending meetings and assistance in discussions with the Debtor, potential lenders, the Committee, and any other official committees organized in this chapter 11 proceeding, the U.S. Trustee, other parties in interest and professionals hired by the same, as requested; -- assisting in the review and/or preparation of information and analysis necessary for the confirmation of a plan of reorganization and related disclosure statement in this chapter 11 proceeding, and provide assistance in formulating alternative plan of reorganization structures, if appropriate; -- assisting in the evaluation and analysis of avoidance actions, including fraudulent conveyances and preferential transfers; -- assisting in the prosecution of Committee responses/objections to the Debtor's motions, including attendance at depositions and provision of expert reports/testimony on case issues as required by the Committee; and -- rendering such other general business consulting or such other assistance as the Committee or its counsel may deem necessary that are consistent with the role of a financial advisor and not duplicative of services provided by other professionals in this proceeding. The firm will be paid at these hourly rates: Senior Managing Directors $950 - $1,295 Directors / Senior Directors / Managing Directors $715 - $935 Consultants/Senior Consultants $385 - $680 Administrative / Paraprofessionals $155 - $290 The firm will also be reimbursed for out-of-pocket expenses incurred. Samuel Star, 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: Samuel Star FTI Consulting, Inc. Three Times Square, 9th Floor New York, NY 10036 Tel: +1 212 841 9368 Email: samuel.star@fticonsulting.com About Medley LLC Medley LLC, through its direct and indirect subsidiaries, including Medley Capital LLC, is an alternative asset management firm offering yield solutions to retail and institutional investors. It provides investment management services to a permanent capital vehicle, long-dated private funds, and separately managed accounts, and serves as the general partner to the private funds. Medley is headquartered in New York City and incorporated in Delaware. As of Sept. 30, 2020, Medley had $3.4 billion of assets under management in two business development companies, Medley Capital Corporation (NYSE: MCC) and Sierra Income Corporation, and several private investment vehicles. Over the past 18 years, Medley has provided capital to over 400 companies across 35 industries in North America. Medley filed a Chapter 11 bankruptcy petition (Bankr. D. Del. Case No. 21-10526) on March 7, 2021. The Debtor disclosed $5,422,369 in assets and $140,752,116 in liabilities as of March 2, 2021. The Debtor tapped Lowenstein Sandler LLP and Morris James LLP as bankruptcy counsel, Eversheds Sutherland (US) LLP as special counsel, B. Riley Securities Inc. as investment banker, and Andersen Tax LLC as tax accountant. Kurtzman Carson Consultants, LLC is the claims agent, maintaining the page https://www.kccllc.net/medley The U.S. Trustee for Region 3 appointed an official committee of unsecured creditors on April 22, 2021. The committee is represented by Potter Anderson & Corroon, LLP and Kelley Drye & Warren, LLP. MEDLEY LLC: Committee Taps Potter Anderson as Delaware Counsel -------------------------------------------------------------- The official committee of unsecured creditors of Medley, LLC seeks approval from the U.S. Bankruptcy Court for the District of Delaware to retain Potter Anderson & Corroon LLP as its Delaware counsel. The firm's services include: a. providing legal advice regarding local rules, practices, and procedures and providing substantive and strategic advice on how to accomplish Committee goals, bearing in mind that the Delaware Bankruptcy Court relies on Delaware counsel such as Potter Anderson to be involved in all aspects of each bankruptcy proceeding; b. drafting, reviewing and commenting on drafts of documents to ensure compliance with local rules, practices, and procedures; c. drafting, filing and service of documents as requested by Kelley Drye; d. preparing certificates of no objection, certifications of counsel, and notices of fee applications; e. printing of documents and pleadings for hearings, preparing binders of documents and pleadings for hearings; f. appearing in Court and at any meetings of creditors on behalf of the Committee in its capacity as Delaware counsel with Kelley Drye; g. monitoring the docket for filings and coordinating with Kelley Drye on pending matters that may need responses; h. participating in calls with the Committee; i. providing additional administrative support to Kelley Drye, as requested; and j. taking on any additional tasks or projects the Committee may assign. The firm will be paid at these rates: Partners $715 - $745 Associates $400 - $450 Paraprofessionals $290 The firm will also be reimbursed for out-of-pocket expenses incurred. Christopher Samis, Esq., a partner at Potter Anderson, 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. Potter Anderson can be reached at: Christopher M. Samis, Esq. Aaron H. Stulman, Esq. Potter Anderson & Corroon, LLP 1313 N. Market Street, 6th Floor Wilmington, DE 19801 Tel: (302) 984-6000 Fax: (302) 658-1192 Email: csamis@potteranderson.com astulman@potteranderson.com About Medley LLC Medley LLC, through its direct and indirect subsidiaries, including Medley Capital LLC, is an alternative asset management firm offering yield solutions to retail and institutional investors. It provides investment management services to a permanent capital vehicle, long-dated private funds, and separately managed accounts, and serves as the general partner to the private funds. Medley is headquartered in New York City and incorporated in Delaware. As of Sept. 30, 2020, Medley had $3.4 billion of assets under management in two business development companies, Medley Capital Corporation (NYSE: MCC) and Sierra Income Corporation, and several private investment vehicles. Over the past 18 years, Medley has provided capital to over 400 companies across 35 industries in North America. Medley filed a Chapter 11 bankruptcy petition (Bankr. D. Del. Case No. 21-10526) on March 7, 2021. The Debtor disclosed $5,422,369 in assets and $140,752,116 in liabilities as of March 2, 2021. The Debtor tapped Lowenstein Sandler LLP and Morris James LLP as bankruptcy counsel, Eversheds Sutherland (US) LLP as special counsel, B. Riley Securities Inc. as investment banker, and Andersen Tax LLC as tax accountant. Kurtzman Carson Consultants, LLC is the claims agent, maintaining the page https://www.kccllc.net/medley The U.S. Trustee for Region 3 appointed an official committee of unsecured creditors on April 22, 2021. The committee is represented by Potter Anderson & Corroon, LLP and Kelley Drye & Warren, LLP. MERCY HOSPITAL: Buyer Reaches Operational Deal With Chicago ----------------------------------------------------------- Lauren Coleman-Lochner of Bloomberg News reports that the buyer of Mercy Hospital and Medical Center agreed to operate a full-service community hospital through 2029 "and beyond" and to restore services cut after the Chicago facility filed for bankruptcy in February 2021. Insight, the buyer, says it's committed to stabilizing finances and restoring hospital as a teaching facility, along with periodic reporting on its progress, according to emailed statement from representative. It agrees to community representation on its board. The city of Chicago agreed to terminate redevelopment agreement as part of transaction scheduled to close June 1, 2021. About Mercy Hospital Mercy Hospital operates the general acute care hospital known as Mercy Hospital & Medical Center located at 2525 South Michigan Ave., Chicago. The hospital offers inpatient and outpatient services. Mercy Health System of Chicago, an Illinois not-for-profit corporation, is the sole member of Mercy Hospital. The health care facilities are part of Trinity Health's network of health care providers. On the Web: http://www.mercy-chicago.org/ Mercy Hospital and Medical Center and Mercy Health System of Chicago sought Chapter 11 protection (Bankr. N.D. Ill. Case Nos. 21-01805 and 21-01806) on Feb. 10, 2021. Mercy Hospital estimated $100 million to $500 million in assets and liabilities as of the bankruptcy filing. Judge Timothy A. Barnes oversees the cases. Foley Lardner LLP, led by Matthew J. Stockl, is the Debtors' legal counsel. Epiq Corporate Restructuring, LLC is the claims, noticing, solicitation and administrative agent. The U.S. Trustee for Region 11 appointed an official committee of unsecured creditors on March 3, 2021. The committee is represented by Sills Cummis & Gross, P.C. and Perkins Coie LLP. David N. Crapo is the patient care ombudsman appointed in the Debtors' Chapter 11 cases. The PCO is represented by Sugar Felsenthal Grais & Helsinger, LLP. METHODIST UNIVERSITY: S&P Lowers 2012 Revenue Bonds Rating to 'BB' ------------------------------------------------------------------ S&P Global Ratings lowered its long-term rating to 'BB' from 'BB+' on Methodist University (MU or Methodist), N.C.'s series 2012 revenue bond debt. The outlook is stable. "The lowered rating reflects our opinion of the university's continued, significant enrollment declines, with no recovery expected in the outlook period," said S&P Global Ratings credit analyst Megan Kearns. "The negative enrollment trend has driven declines in net tuition revenue, operating margins, and available resources," Ms. Kearns added. "In our opinion, the 'BB' rating more accurately reflects the university's reduced financial flexibility." S&P said, "The stable outlook reflects our expectation that while Methodist will continue to face enrollment pressure, the projected surplus in fiscal 2021 and the availability of federal relief funds to support fiscal 2022 operations should ensure MU's balance sheet remains commensurate with the rating. The stable outlook also reflects our expectation that the university will remain in compliance with covenants on its privately placed debt. "We could consider a negative rating action if the university's enrollment experiences additional material declines accompanied by significant reductions in net tuition revenue and operating margins that drive financial resources below those of the current rating. We could also consider a negative rating action if the university were to issue additional debt without commensurate growth in financial resources or if covenant calculations for the university's direct purchase debt were to continue to weaken relative to the set covenants. "We could consider a positive rating action if the university is able to stabilize or improve its enrollment and demand profile, particularly application rates and selectivity. Additionally, we would expect the university to return to break-even or positive operations without the support of federal relief funds while improving financial resources." Methodist had $30.3 million of long-term debt as of June 30, 2020, including a small amount of capital leases. METRO-GOLDWYN-MAYER: Moody's Puts B1 CFR Under Review for Upgrade ----------------------------------------------------------------- Moody's Investors Service placed Metro-Goldwyn-Mayer Inc.'s (MGM) B1 corporate family rating, B1-PD probability of default rating, Ba3 1st lien senior secured credit facility rating, and B3 2nd lien senior secured credit facility rating on review for upgrade following Amazon.com, Inc.'s (A1 stable) announced [1] definitive agreement to acquire MGM for $8.45 billion. MGM had about $2.1 billion of debt (including Moody's adjustments) as of March 31, 2021. All of the company's debt is first and second lien bank debt which have change of control provisions. Therefore, Moody's anticipate that it will be repaid at the close of the transaction at which time Moody's would likely withdraw all of the company's credit ratings. Moody's expect the transaction will be subject to regulatory approvals and will close in around twelve months or less. MGM's rating outlook was changed from stable to ratings under review. On Review for Upgrade: Issuer: Metro-Goldwyn-Mayer Inc. - Corporate Family Rating, Placed on Review for Upgrade, currently B1 - Probability of Default Rating, Placed on Review for Upgrade, currently B1-PD - Senior Secured 1st Lien Bank Credit Facility, Placed on Review for Upgrade, currently Ba3 (LGD3) - Senior Secured 2nd Lien Bank Credit Facility, Placed on Review for Upgrade, currently B3 (LGD5) Outlook Actions: Issuer: Metro-Goldwyn-Mayer Inc. - Outlook, Changed To Rating Under Review From Stable RATINGS RATIONALE / FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS The review for upgrade was prompted by the announcement that Amazon and MGM have signed an agreement for Amazon to acquire MGM for $8.45 billion. The review will focus on the completion of the announced acquisition plan. MGM has a century-long history of film making and television production, and a deep library consisting of approximately 4,000 feature films and 17,000 episodes of television programming. The library includes ownership and interests in a number of notable franchises such as 12 Angry Men, Basic Instinct, Creed, James Bond, Legally Blonde, Moonstruck, Poltergeist, Raging Bull, Robocop, Rocky, Silence of the Lambs, Stargate, Thelma & Louise, Tomb Raider, The Magnificent Seven, The Pink Panther, The Thomas Crown Affair, and The Hobbit. The company's television library consists of episodes of Stargate SG-1, Vikings, Fargo, Get Shorty, Fame, American Gladiators, Teen Wolf, In the Heat of the Night, and The Handmaid's Tale. The company is also an award-winning independent film producer, a producer of appealing television dramas, and a major producer of unscripted television programming headed by the leader of this genre, Mark Burnett. All of the company's debt is first and second lien bank debt which have change of control provisions. Therefore, Moody's anticipate that it will be repaid at the close of the transaction at which time Moody's would likely withdraw all of the company's credit ratings. However, if any debt remains in the post-acquisition capital structure, an upgrade is likely given Amazon's substantially stronger credit profile. The principal methodology used in these ratings was Business and Consumer Service Industry published in October 2016. Metro-Goldwyn-Mayer Inc., based in Beverly Hills, California, produces and distributes motion pictures, television programming, home videos, interactive media, music, and licensed merchandise. It owns a library of films and television programs and holds ownership interests in domestic and international television channels. Revenues for LTM ended 3/31/2021 were approximately $1.4 billion. As of March 31, 2021, Anchorage Capital Partners, Highland Capital Management and Davidson, Kempner Capital Management each individually, or together with their respective affiliated entities, owned more than 10% of the issued and outstanding shares of common stock of MGM Holdings. MGM Holdings is the ultimate parent company of the MGM families of companies, including its subsidiary Metro-Goldwyn-Mayer Inc. MICROCHIP TECHNOLOGY: Moody's Alters Outlook on Ba1 CFR to Positive ------------------------------------------------------------------- Moody's Investors Service affirmed the Ba1 corporate family rating, Baa3 senior secured rating, and Ba2 senior unsecured rating of Microchip Technology Inc. Microchip's Speculative Grade Liquidity rating was upgraded to SGL-1 from SGL-2, reflecting the company's improved liquidity profile following the recently launched June 2021 senior secured note refinancing. The outlook was revised to positive from stable. The positive outlook contemplates a steady application of free cash flow to debt reduction over the next two years, with approximately 0.75x to 1.0x decline of leverage per year. Affirmations: Issuer: Microchip Technology Inc. Probability of Default Rating, Affirmed Ba1-PD Corporate Family Rating, Affirmed Ba1 Senior Secured Revolving Credit Facility, Affirmed Baa3 (LGD3) Senior Secured Regular Bond/Debenture, Affirmed Baa3 (LGD3) Senior Unsecured Regular Bond/Debenture, Affirmed Ba2 (LGD5) Upgrades: Issuer: Microchip Technology Inc. Speculative Grade Liquidity Rating, Upgraded to SGL-1 from SGL-2 Outlook Actions: Issuer: Microchip Technology Inc. Outlook, Changed To Positive From Stable RATINGS RATIONALE Microchip's credit profile is supported by the company's leading position as a provider of microcontroller, analog, mixed signal, and specialized semiconductor solutions. Moody's expects demand conditions will remain robust and outpace the ability to supply all customer orders, leading to about 18% year-over-year revenue growth in the June quarter with double digit growth likely for the rest of 2021 and solid growth expected for 2022. Microchip benefits from its broad diversification by product, process, end market, customer, and geography. Given the company's broad product portfolio and long product cycles of primarily proprietary products, gross margins should remain in the low-to-mid 60% range (record margins achieved in the March quarter) with EBITDA margins sustained at the low 40% level while cash flow remains robust. Moody's expect the company will continue to apply all its free cash flow after dividends to repay debt incurred to fund the $8.2 billion acquisition of Microsemi in May 2018, leading to a 0.75x to 1.0x annual decline from the current level of 4.1x. Microchip has a proven track record of successfully integrating large debt-funded acquisitions, improving the acquired entities' operating performance, and deleveraging rapidly. The positive ratings outlook reflects Moody's expectation for consistent repayment of debt with gross adjusted debt to EBITDA declining below 3.5x within the next year, steady execution in the currently supply constrained environment that Moody's expect will persist into 2022, and maintenance of strong margins over the next 12 to 18 months. Microchip's SGL rating of SGL-1 reflects its very good liquidity, with $282 million of cash at March 2021 and approximately $1.2 billion available under its revolving credit facility that matures May 2023, under whose covenants the company has ample room. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS Microchip's rating could be upgraded if adjusted gross debt to EBITDA approaches 3.5x, if there is an expectation for a substantial reduction of secured debt, if EBITDA margins are sustained around 40%, and the company maintains solid liquidity. The ratings could be downgraded if adjusted gross debt to EBITDA is expected to be sustained above 4.5x, if EBITDA margins migrate towards 35%; or if liquidity falls below $500 million of total cash and revolving credit availability. The principal methodology used in these ratings was Semiconductor Methodology published in December 2020. Microchip Technology Inc., headquartered in Chandler Arizona, is a leading provider of microcontroller, analog, mixed signal, and specialized semiconductor solutions. Microchip reported revenue of $5.4 billion for the twelve months ended March 2021. MILLER'S ALE: Moody's Alters Outlook on 'Caa1' CFR to Stable ------------------------------------------------------------ Moody's Investors Service affirmed the ratings of Miller's Ale House, Inc. including its Caa1 corporate family rating and Caa1-PD probability of default rating. In addition, Moody's affirmed Miller's Caa1 senior secured bank credit facility rating. The ratings outlook was changed to stable from negative. "The change in outlook to stable reflects our expectation that Miller's operating performance and credit metrics will gradually recover in 2021 as government restrictions continue to lessen and pent-up consumer demand," stated Bill Fahy, Moody's VP, Senior Credit Officer. Moody's also expects the trends in same store sales in 2021 to benefit from easier comparisons to prior year. Affirmations: Issuer: Miller's Ale House, Inc. Corporate Family Rating, Affirmed Caa1 Probability of Default Rating, Affirmed Caa1-PD Gtd Senior Secured Term Loan, Affirmed Caa1 (LGD3) Gtd Senior Secured Revolving Credit Facility, Affirmed Caa1 (LGD3) Outlook Actions: Issuer: Miller's Ale House, Inc. Outlook, Changed To Stable From Negative RATINGS RATIONALE Miller's Caa1 CFR reflects its high leverage and weak interest coverage as well as its modest scale and high geographic concentration in Florida. In addition, the Caa1 reflects that while Miller's liquidity is adequate, there is no excess liquidity cushion outside Miller's moderate cash balances. Miller's revolving credit facility remains fully drawn and cash flow from operations are expected to be just enough to cover its capital spending requirements. As a result, any shortfall in earnings would need to be supported by Miller's moderate level of balance sheet cash. Miller benefits from its reasonable level of brand awareness evidenced by its high average restaurant sales volumes, good day-part distribution and product mix with a relatively high margin alcohol percentage. The stable outlook reflects Moody's view that same store sales will continue to improve and help drive higher earnings that Moody's expect to result in lower leverage and higher coverage over time while maintaining adequate liquidity despite ongoing government restrictions in certain states. The restaurant sector has been one of the sectors most significantly affected by the coronavirus outbreak given its exposure to widespread location restrictions and closures as well as its sensitivity to consumer demand and sentiment. Moody's regard the coronavirus outbreak as a social risk under its ESG framework, given the substantial implications for public health and safety. Miller'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 by their nature and relationship with sourcing food and packaging, as well as an extensive labor force and constant consumer interaction are deeply entwined with sustainability, social and environmental concerns. While these factors may not directly impact the credit, they should positively impact brand image and result in a more positive view of the brands overall. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS Ratings could be upgraded should operating performance improve such that debt to EBITDA is sustained below 6.5 times and EBIT to interest is sustained above 1.1x while maintaining good liquidity including positive free cash flow and a reasonable level of revolver availability. Rating could be downgraded should there be a deterioration in liquidity or an inability to strengthen credit metrics despite a lifting of restrictions and subsequent recovery across the restaurant industry in the US. Miller's, with headquarters in Orlando, Florida, owns and operates 93 casual dining restaurants in Florida and Eastern US. Annual net revenues are more than $350 million. Miller's is majority owned by affiliates of Roark Capital. The company is not required to release financial statements publicly. The principal methodology used in these ratings was Restaurant Industry published in January 2018. MINESEN COMPANY: Hires Goodsill Anderson as Special Counsel ----------------------------------------------------------- The Minesen Company received approval from the U.S. Bankruptcy Court for the District of Hawaii to employ Goodsill Anderson Quiin & Stifel as its special counsel. The Debtor requires the assistance of special litigation counsel to represent it in an evidentiary hearing on its motion to authorize the assumption of executory contracts and leases. The Debtor has agreed to pay the firm a $50,000 retainer. The firm will be paid at these rates: Johnathan C. Bolton $480 per hour Jan Futa $400 per hour Lawyers $200 to $500 per hour Paralegals $150 to $250 per hour Johnathan Bolton, Esq., a partner at Goodsill, 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. Goodsill Anderson can be reached at: Johnathan C. Bolton, Esq. Goodsill Anderson Quiin & Stifel 999 Bishop Street, Suite 1600 Honolulu, HI 96813 Tel: (808) 547-5600 About The Minesen Co. The Minesen Company -- http://www.innatschofield.com/-- owns a transient military lodging facility at Schofield Barracks in central Oahu known as the Inn at Schofield Barracks. Amenities include queen-sized beds, coffee maker, refrigerator, microwave, television, Internet, air conditioning, laundry, and 24-hour convenience store. The Minesen Company sought protection for relief under Chapter 11 of the Bankruptcy Code (Bankr. D. Hawaii Case No. 19-00849) on July 4, 2019. In the petition signed by Max Jensen, president, the Debtor disclosed total assets of up to $50 million and total liabilities of up to $10 million. Chuck C. Choi, Esq., at Choi & Ito, represents the Debtor as bankruptcy counsel. Snell & Wilmer LLP and Goodsill Anderson Quiin & Stifel serve as the Debtor's special counsel. MISSION BROADCASTING: Moody's Rates New $300MM Secured Loan 'Ba2' ----------------------------------------------------------------- Moody's Investors Service assigned a Ba2 rating to Mission Broadcasting Inc.'s proposed $300 million senior secured term loan B. Mission is a variable interest entity (VIE) of Nexstar Broadcasting, Inc. Mission's Ba2 rating on the company's existing senior secured revolving credit facility and Nexstar's Ba3 corporate family rating, Ba3-PD probability of default rating, Ba2 senior secured credit facility rating, and B2 senior unsecured rating are all unaffected by the transaction. Nexstar's SGL-2 speculative grade liquidity rating is unchanged. Nexstar's outlook is stable. The proceeds from Mission's $300 million senior secured term loan B will be used to pay down borrowings under the existing Mission revolving credit facility, pay shared service fees to Nexstar and for general corporate purposes. Concurrent with the proposed transaction, Mission will also be re-allocating $255 million of Mission's revolving credit facility commitments to Nexstar's revolving credit facility. Nexstar and its subsidiaries guarantee full payment of all obligations incurred under the Mission senior secured credit facility. The following ratings/assessments are affected by the action: New Assignments: Issuer: Mission Broadcasting, Inc. Senior Secured Term Loan B4, Assigned Ba2 (LGD2) RATINGS RATIONALE Nexstar's Ba3 CFR reflects the company's large quasi-national scale. Nexstar is currently the largest US local broadcaster with 198 TV stations in 116 markets across 40 U.S. states. The company reaches approximately 39% of U.S. households (including UHF discount), the maximum allowable reach under current FCC rules. In 2021, the company is expected to generate around half of its revenue from retransmission fees which are contractual and expected to grow by low double digit percentage in 2021. The company has committed to applying some of its large free cash flow to voluntarily debt repayment, which along with EBITDA growth will lead to Moody's adjusted debt/EBITDA (on a two year average basis) declining below 4.5x in 2021 and remaining at or around 4x in 2022. The Ba3 also takes into account the company's strong free cash flow ability, boosted in even years by political advertising spending. Nexstar generated free cash flow of $979 million in 2020, despite core TV advertising demand declining by more than 20%. The Ba3 CFR also reflects Nexstar's historical tolerance for elevated leverage at times of M&A although with the FCC cap reached, there is little room for any further local broadcast acquisition. The rating also reflects the structural pressures faced by core TV advertising which is expected to decline by mid-single digit as advertising budgets continue to shift towards digital media. Given the lack of further large M&A opportunities in broadcast TV, Moody's expects Nexstar to focus on growing its existing businesses organically and apply a large part of its free cash flow to shareholder returns through increased dividends and a newly announced $1 billion share buyback program. Moody's however expects Nexstar to continue to focus part of its free cash flow to debt reduction in line with the company's track record of maintaining a prudent financial policy. In 2021, Moody's expects core advertising to continue improving to pre-pandemic levels. In 2020, core TV ad spend improved sequentially after an initial drop of more than 30% in the second quarter of the year. In the longer term, Moody's expects continued mid-single digit declines in TV advertising demand as the share of budgets spent on digital media increases. Core advertising represents around 40% of Nexstar's total revenue. The majority of Nexstar's revenue are today derived from the company's retransmission fees, paid on a per subscriber basis by traditional MVPDs (cable and satellite pay-TV operators) and vMVPDs (virtual MVPDs such as Sling TV, Hulu Live TV or YouTube TV). While traditional MVPD cord cutting has accelerated due to the increase of direct to consumer and over the top services (Hulu, Netflix etc.), Nexstar's subscriber attrition trends have been slowing down to around 5% in Q1 2021 vs around 6% in the prior year as a result of improved carriage on vMVPDs which started carrying the full Nexstar slate in the past year. Absent any material change in cord cutting trends, Nexstar has very strong visibility over retransmission revenue through the end of 2022 as it has recently renegotiated both its distribution and its big four network affiliate fee contracts for the large majority of its subscribers. During the pandemic, local TV viewership increased materially as people sought local information from reliable sources and tuned in their local news programs in numbers. While Nexstar's viewership peaked in the summer of 2020 and has since declined, it remains above pre-pandemic levels and enhances further the company's position to both advertisers and pay-TV providers. Nexstar's SGL-2 speculative grade liquidity (SGL) rating is supported by a sizeable cash balance of about $370 million and about $366 million of available capacity under the company's $425 million revolving credit facilities, as of March 31, 2021 and pro forma for the company's proposed term loan issuance. Nexstar's credit agreement contains a 4.25x first lien net leverage maintenance covenant, and the company's covenant leverage was 2.14x at March 2021. The company is expected to be well below this first lien net leverage covenant over the next 12-18 months. The company generates sizable free cash flow part of which Moody's expects will be used to voluntarily reduce debt in the remainder of 2021 and in 2022. The ratings for the debt instruments reflect the overall probability of default of Nexstar, reflected in the Ba3-PD probability of default rating (PDR), an average family loss given default (LGD) rate of 50% and the priority ranking of the debt instruments in the capital structure. The senior secured facilities are rated Ba2 (LGD2) given their secured, priority claim on material owned property and assets over the unsecured notes, rated B2 (LGD5). The stable outlook reflects Moody's expectations that Nexstar's leverage (Moody's adjusted and on a two-year average basis) will remain well below 4.5x through 2021 and below 4x in 2022. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS Further positive pressure on the ratings could develop should Moody's adjusted leverage (on a two-year average) improve to below 3.5x on a sustainable basis and should the company maintain Moody's adjusted free cash flow to debt (on a two year average) above 10%. Negative ratings pressure could develop should the company's Moody's adjusted leverage (on a two-year average) increase above 4.5x on a sustained basis or should the company's liquidity weaken materially. The principal methodology used in this rating was Media Industry published in June 2017. Based in Irving, Texas, Nexstar is the largest US television broadcaster, owning, operating or providing sales and services to 198 television stations in 40 states, across 116 markets covering approximately 39% of US television households (including the UHF discount). The company operates in 38 of the top 50 markets and ranks #1 or #2 in about 80% of its markets. In 2020, Nexstar reported revenue of $4.5 billion and EBITDA of $1.95 billion. MOMENTIVE PERFORMANCE: Moody's Alters Outlook on B3 CFR to Stable ----------------------------------------------------------------- Moody's Investors Service has changed Momentive Performance Materials Inc.'s outlook to stable from negative. At the same time, Moody's has affirmed Momentive's B3 Corporate Family Rating, B3-PD probability of default rating, and B2 rating on the company's first lien senior secured term loan facilities. "The change to stable outlook reflects the expected improvement in Momentive's credit metrics in 2021 from 2020 lows thanks to earnings contribution from KCC's silicone business, good demand from many end markets, as well as Momentive's business transformation to improve its cost base and business competitiveness," says Jiming Zou, Moody's lead analyst for Momentive. Outlook actions: Issuer: Momentive Performance Materials Inc. Outlook, Changed to Stable from Negative Rating affirmations: Issuer: Momentive Performance Materials Inc. Corporate Family Rating, affirmed B3 Probability of Default Rating, affirmed B3-PD Gtd. First Lien Senior Secured Term Loan Facilities, affirmed B2 (LGD3) RATINGS RATIONALE Momentive's earnings will meaningfully improve in 2021 thanks to the contribution from KCC's silicone business, demand recovery and rising silicone prices amid economic reopening. The company more than doubled its reported EBITDA in Q1 2021 from a year ago. Business conditions remain favorable for the rest of 2021, with strong pent-up demand for silicones from automotive, construction, consumer and electronics industries. Several industry peers such as Wacker, Elkem and Dow confirmed market strength and positive momentum for silicone business in 2021, despite higher raw material and logistic costs. The expected earnings improvement will improve Momentive's rolling twelve months adjusted debt/EBITDA towards 6x or lower by the end of 2021, versus 8.1x at the end of 2020. Momentive's rating reflects its high debt leverage, exposure to the cyclical end markets, as well as the ongoing business restructuring and reinvestment to stay competitive in the global silicone industry. The company is exposed to the cyclical and competitive silicone industry and is likely to experience peak performance in 2021 after market trough in 2020. The phase-out of its basics chemicals production in Waterford, New York by 2022 will help lower its cost base, increase the share of revenues from specialty high-margin products and better weather industry cycles. However, business restructuring costs, coupled with working capital requirements, will result in a negative free cash flow in 2021. The company's lack of consistent free cash flow generation and ongoing restructuring continue to constrain its rating. Momentive's credit rating is supported by its status as one of the largest silicone producers globally, its large customer base in many industries including automotive, electronics, consumer and construction and geographically diversified production facilities. The company has invested in high-margin specialty silicones and silanes products. KCC's majority ownership (60.4%) offers certain operational benefits to Momentive, such as cross-sales opportunities to Korean customers and potential procurement savings. KCC's guarantee of about half of Momentive's debt indicates its willingness to provide support to Momentive when needed. Momentive's rating has not factored in any explicit support uplift by KCC, given the strong financial influence and exit conditions by a private equity investor—SJL, which holds the remaining 39.6% stake in Momentive. Momentive's good liquidity is supported by its cash balance of $160.5 million, no near term maturity (except for about $8 million annual term loan amortization) and $238 million availability under the $300 million ABL facility at the end of 2020. There was no outstanding amount, except for $44 million in letter of credit, at the end of 2020 under the ABL facility, which will mature in May 2024. Moody's expects slightly negative free cash flow generation in 2021 due to the expected one-off restructuring expenses, business investments as well as working capital requirement. Its ABL facility has a springing financial maintenance covenant -- a minimum fixed charge coverage ratio of 1.0x. KCC's guaranteed term loan agreement requires Momentive to comply with a net leverage maintenance covenant of not exceeding 6.0x at the end of 2021 and 5.5x at the end of 2022 and 2023. The company should be well in compliance with these financial covenants over the next one to two years. The stable outlook reflects the expected improvement in earnings and credit metrics, despite the expectation of negative free cash flow in 2021. Rating upside will require free cash flow on a more consistent basis to enable debt reduction. ESG CONSIDERATIONS Momentive's rating also factors in its above-average environmental risk under Moody's ESG framework. The production of silicone products also requires substantial energy and water consumption. Although silicone polymers are generally considered harmless, siloxanes (e.g. D4, D5 and D6) as an intermediate to make silicone polymers are being investigated by regulatory bodies for their impact on human health and environment after certain restrictions have been imposed by the EU in recent years. Momentive's phase-out of its basic silicones production will reduce its production-related environmental exposure, but requires site cleanup and decontamination. Momentive's reported obligations for environmental remediation at the end of 2020 were relatively small compared to its debt and pension obligations. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS Rating upgrade would be considered, if the company is able to improve earnings, reduce debt leverage and substantially improve its financial flexibility. In particular, an upgrade would require consistently positive free cash flow and adjusted debt/EBITDA sustainably below 6.0x. Momentive's ratings will be downgraded, if the company's liquidity profile deteriorates with negative free cash flow or its adjusted debt/EBITDA increases above 7.0x for an extended period of time. The principal methodology used in these ratings was Chemical Industry published in March 2019. Momentive Performance Materials Inc., based in New York, US, is one of the largest global producers of silicones and silicone derivatives. Silicones, or more accurately, polymerized siloxanes or polysiloxanes, are mixed inorganic-organic polymers that are used in a wide variety of industrial and consumer applications including agriculture, automotive, electronics, healthcare, personal care, textiles, and sealants. KCC Corporation and SJL Partners LLC acquired MPM Holdings Inc., the holding company of Momentive, for approximately $3.1 billion in 2019. Momentive generated $2.1 billion in revenues in 2020. MOOG INC: Moody's Alters Outlook on 'Ba2' CFR to Stable ------------------------------------------------------- Moody's Investors Service, Inc. has affirmed its ratings of Moog Inc., including the corporate family rating of Ba2 and senior unsecured rating of Ba3. Moody's changed the rating outlook to stable from negative. The outlook change reflects Moody's view that Moog has absorbed the impact of the pandemic reasonably well with sufficient resilience in the credit metrics for the stable rating outlook RATINGS RATIONALE The ratings, including the Ba2 CFR, have been affirmed because the pandemic related fall-off in demand has troughed for Moog and the company's income generation and credit metrics will return to pre-pandemic levels near term. While revenue will decline about 2% in the fiscal year to end October 3, 2021, revenue will grow by a 3% annual rate across FY2022-FY2023. Cost reduction measures undertaken since the pandemic hit will enable EBITDA margin of 13% to 14%, up from 11% over the last twelve months April 3, 2021. Leverage will decline to low-3x by the end of FY2021 from just over 4x at April 3, 2021. Annual free cash flow will be about $100 million or 7% of debt over the next two fiscal years. The ratings also benefit from Moog's ongoing R&D and capital spending programs that heavily focus on precision controls within aerospace and industrial automation components/applications, resulting in an improved product set compared to several years ago. Moog's past ability to expand its position on many aircraft and weapon systems will continue in coming years. However, following the pandemic, realization of return from prior investments on some commercial widebody aircraft programs will be more gradual than Moog had originally envisioned. With that, M&A will probably become a larger part of the company's intermediate term strategy. Moody's expects free cash flow to go toward M&A. Should M&A not develop the free cash flow will probably go toward stock repurchases. But Moody's does not expect that leverage will exceed low-4x in an M&A scenario or that Moog will borrow to fund stock repurchases. The speculative grade liquidity rating of SGL-2 is unchanged, reflecting good liquidity, based on the expected free cash flow and a well sized backstop revolving credit line. The next debt maturity is the $80 million accounts receivable securitization due in October 2021, then nothing is due until the revolver expires in October 2024. Over $600 million of unused capacity existed under the $1.1 billion revolving credit facility at April 3, 2021. Headroom under the facility's maximum net leverage test will likely permit only $426 million of borrowing access to the revolver, still a significant amount relative to basic needs. The Ba3 senior unsecured note rating, one notch below the corporate family rating, reflects its first loss position in the capital structure. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS Upward rating momentum would depend on the company's continued evolution of engineering capabilities into contracts and products that add scale and market prominence. Expectations of a good liquidity profile with debt/EBITDA sustained in the mid-2x range and EBITDA margins above 15% could prompt consideration for a ratings upgrade. Downward rating pressure would mount with debt/EBITDA approaching 4.5x, or expectations of a weakening liquidity profile. A significant reduction in R&D spending would be viewed unfavorably as would debt financed stock repurchases. The following rating actions were taken: Affirmations: Issuer: Moog Inc. Corporate Family Rating, Affirmed Ba2 Probability of Default Rating, Affirmed Ba2-PD Senior Unsecured Regular Bond/Debenture, Affirmed Ba3 (LGD5) Outlook Actions: Issuer: Moog Inc. Outlook, Changed To Stable From Negative Moog Inc., headquartered in East Aurora, New York, is a designer and manufacturer of high performance precision motion and fluid controls and control systems for the commercial aerospace, defense, industrial and medical markets. Moog reported FY2019 revenues of $2.9 billion The principal methodology used in these ratings was Aerospace and Defense Methodology published in July 2020. MUSCLEPHARM CORP: Posts $94K Net Income in First Quarter -------------------------------------------------------- MusclePharm Corporation filed with the Securities and Exchange Commission its Quarterly Report on Form 10-Q disclosing net income of $94,000 on $13.12 million of net revenue for the three months ended March 31, 2021, compared to a net loss of $60,000 on $16.23 million of net revenue for the three months ended March 31, 2020. As of March 31, 2021, the Company had $9.95 million in total assets, $34.27 million in total liabilities, and a total stockholders' deficit of $24.32 million. The Company has incurred significant losses and experienced negative cash flows since inception. As of March 31, 2021, the Company had cash of $0.6 million, a decline of $1.4 million from the Dec. 31, 2020 balance of $2.0 million. As of March 31, 2021, the Company had a working capital deficit of $20.5 million, a stockholders' deficit of $24.3 million and an accumulated deficit of $192.6 million resulting from recurring losses from operations. As a result of the Company's history of losses and financial condition, there is substantial doubt about the Company's ability to continue as a going concern. "The ability to continue as a going concern is dependent upon us generating profitable operations in the future and/or obtaining the necessary financing to meet our obligations and repay our liabilities arising from normal business operations when they come due. Management is evaluating different strategies to obtain financing to fund our expenses and achieve a level of revenue adequate to support our current cost structure. Financing strategies may include, but are not limited to, private placements of capital stock, debt borrowings, partnerships or collaborations," the Company said. Management Commentary Mr. Ryan Drexler, the Chairman of the Board of Directors and chief executive officer, stated, "I am very pleased with our profitable quarter, despite the sales shortfall due to the temporary supply shortage affecting our industry. With March and April achieving sales increases over the prior year periods we have momentum going into the second quarter, which indicates the great strides we have made during the past year. We have some of the leading brands in the health and fitness industry and are proud to be leveraging the tremendous reach they offer by entering new categories such as energy beverages. With the rollout of three new energy beverages, in addition to tapping into the gender specific market with our popular FitMiss brand, we are very well positioned to capture a meaningful share of this rapidly growing market." "We have delivered positive profit for the last two quarters and it is a testament that the turnaround strategy we started two years ago to dramatically restructure MusclePharm and increase our focus on profitability is working. The expansion into the energy beverage market is only the beginning for our Company and I am optimistic we are in the very early stages of a tremendous long-term growth opportunity at MusclePharm," said Ms. Sabina Rizvi president and chief financial officer. "We will continue to focus on cost containment, while driving top line growth with our three-prong strategy of growing the core MP brand through broadened distribution and product offerings, focusing on omni-channel by meeting customers where they prefer to shop, and expanding into new distribution and brand expansion opportunities, as illustrated by our upcoming launch into the energy beverage sector." A full-text copy of the Form 10-Q is available for free at: https://www.sec.gov/Archives/edgar/data/1415684/000149315221012724/form10-q.htm About MusclePharm Headquartered in Denver, Colorado, MusclePharm Corporation (OTCQB:MSLP) -- http://www.musclepharm.comand http://www.musclepharmcorp.com-- is a lifestyle company that develops, manufactures, markets and distributes branded nutritional supplements. The Company offers a broad range of performance powders, capsules, tablets, gels and on-the-go ready to eat snacks that satisfy the needs of enthusiasts and professionals alike. MusclePharm reported net income of $3.18 million for the year ended Dec. 31, 2020, compared to a net loss of $18.93 million for the year ended Dec. 31, 2019. As of Dec. 31, 2020, the Company had $13 million in total assets, $37.42 million in total liabilities, and a total stockholders' deficit of $24.42 million. Los Angeles, California-based SingerLewak LLP issued a "going concern" qualification in its report dated March 29, 2021, citing that the Company has suffered recurring losses from operations, has an accumulated deficit and its total liabilities exceed its total assets. This raises substantial doubt about the Company's ability to continue as a going concern. NEOVASC INC: Fails to Comply With Nasdaq Bid Price Requirement -------------------------------------------------------------- Neovasc Inc. has received written notification from The Nasdaq Stock Market LLC notifying the Company that it is not in compliance with the minimum bid price requirement set forth in Nasdaq Rules for continued listing on the Nasdaq. Nasdaq Listing Rule 5550(a)(2) requires listed securities to maintain a minimum bid price of US$1.00 per share, and Listing Rule 5810(c)(3)(A) provides that a failure to meet the minimum bid price requirement exists if the deficiency continues for a period of 30 consecutive business days. Based on the closing bid price of the Company's common shares for the 30 consecutive business days from April 12, 2021 to May 21, 2021, the Company no longer meets the minimum bid price requirement. The Notification Letter does not impact the Company's listing on the Nasdaq Capital Market at this time. In accordance with Nasdaq Listing Rule 5810(c)(3)(A), the Company has been provided 180 calendar days, or until Nov. 22, 2021, to regain compliance with Nasdaq Listing Rule 5550(a)(2). To regain compliance, the Company's common shares must have a closing bid price of at least US$1.00 for a minimum of 10 consecutive business days. In the event the Company does not regain compliance by Nov. 22, 2021, the Company may be eligible for additional time to regain compliance or may face delisting. The Company's business operations are not affected by the receipt of the Notification Letter. The Company is also listed on the Toronto Stock Exchange and the Notification Letter does not affect the Company's compliance status with such listing. About Neovasc Inc. Neovasc is a specialty medical device company that develops, manufactures and markets products for the rapidly growing cardiovascular marketplace. The Company is a leader in the development of minimally invasive transcatheter mitral valve replacement technologies, and minimally invasive devices for the treatment of refractory angina. Its products include the Neovasc Reducer, for the treatment of refractory angina, which is not currently commercially available in the United States (2 U.S. patients have been treated under Compassionate Use) and has been commercially available in Europe since 2015, and Tiara, for the transcatheter treatment of mitral valve disease, which is currently under clinical investigation in the United States, Canada, Israel and Europe. For more information, visit: www.neovasc.com. Neovasc reported a net loss of $28.69 million for the year ended Dec. 31, 2020, compared to a net loss of $35.13 million for the year ended Dec. 31, 2019. As of Dec. 31, 2020, the Company had $17.88 million in total assets, $15.90 million in total liabilities, and $1.98 million in total equity. Grant Thornton, LLP, in Vancouver, Canada, the Company's auditor since 2002, issued a "going concern" qualification in its report dated March 10, 2021, citing that the Company incurred a comprehensive loss of $30.2 million during the year ended Dec. 31, 2020 . These conditions, along with other matters, raise substantial doubt about the Company's ability to continue as a going concern as at Dec. 31, 2020. NEWMARK GROUP: S&P Alters Outlook to Stable, Affirms 'BB+' ICR -------------------------------------------------------------- S&P Global Ratings revised the outlook on its ratings on Newmark Group Inc. to stable from negative. At the same time, S&P affirmed its 'BB+' issuer credit and unsecured debt ratings. The recovery rating on the debt remains '3', reflecting its expectation of meaningful recovery (50%-70%; rounded estimate 65%) in the event of default. S&P said, "The outlook revision indicates our view that the company will maintain leverage below 2.0x in 2022 and beyond. On Feb. 2, 2021, NASDAQ announced it had entered into a definitive agreement to sell its U.S. fixed-income business--the closing of which will accelerate Newmark's receipt of NASDAQ shares and is expected to accelerate and settle the company's 2018 monetization transactions. Net of the monetization settlement, Newmark estimates it will receive about 5.2 million shares of NASDAQ, worth approximately $850 million. We estimate leverage, as measured by net debt to EBITDA, will be below 1x in 2021, before normalizing to its longer-term range of 1.5x-2.0x. (We include amounts from the NASDAQ earnout in our measure of EBITDA and measure debt on a net basis when calculating leverage.) "We expect Newmark will use proceeds from the accelerated NASDAQ earnout, and from cash flows generated from operations, to invest in its operating businesses and repurchase shares. We forecast that investments and growth from its current businesses will be sufficient to replace EBITDA generated from the NASDAQ earnout over time and maintain leverage consistent with our long-term expectation. Risks to our forecast include the timing of investments, which can be difficult to predict. We expect that slower-than-expected investments to grow EBITDA will result in lower-than-expected net debt, offsetting the impact to our measure of leverage. Higher-than-expected leverage will likely be caused by larger-than-expected share repurchases." On a 12-month basis, net debt to EBITDA was above 2.0x at the end of the first quarter--affected by declines in revenues and earnings from capital markets and leasing. Notably, these contributed to commission-based revenues being down 25% for 2020 compared with 2019. Nevertheless, commission-based revenue in first-quarter 2021 was essentially flat compared with the same period a year ago. The company expects substantial year-over-year growth starting in the second quarter, including revenue growth of 37%-42% for the quarter based on its current pipeline. S&P said, "We remain skeptical about full-year EBITDA growth given the amount of EBITDA usually generated in the fourth quarter, and how things may evolve between now and then. We are currently forecasting 25% adjusted EBITDA growth year over year, excluding the NASDAQ earnout impact for 2021." S&P said, "We believe the acceleration of the earnout further simplifies Newmark's earnings and accelerates a potential EBITDA cliff, and also reduces our calculation of debt. That said, declines in commissions last year were mitigated by growth in the company's earnout, which had little correlation with its operating businesses. The company's cash flows will likely be more closely correlated and depend on leasing and capital markets, though it expects to increase management revenues from the integration of the Knotel acquisition. "The stable outlook on Newmark reflects our view that the company will operate with net debt to EBITDA below 2.0x over the next 12 months. Although investments in the business are difficult to predict, we expect it will make sufficient investments over the next 18 months to offset EBITDA decline from the loss of NASDAQ earnout beyond 2021. "We could lower our rating on Newmark if net debt to adjusted EBITDA rises above 2.0x. This could be caused by insufficient investment in the business to replenish lost NASDAQ earnings, or through larger-than-expected debt increases." An upgrade is unlikely in the next 12 months. Longer term, S&P could raise the rating if it expects net debt to EBITDA to be 1.5x-2.0x on a sustained basis after the company has spent NASDAQ proceeds and demonstrates a longer track record of stable operating performance. NIELSEN FINANCE: Moody's Rates New $1BB Sr. Unsecured Notes 'B2' ---------------------------------------------------------------- Moody's Investors Service assigned B2 ratings to Nielsen Finance LLC's ("Nielsen Finance") proposed senior unsecured notes comprising 8-year and 10-year tranches totaling $1 billion in aggregate. Nielsen Holdings plc's ("Nielsen" or the "company") Ba3 Corporate Family Rating and positive outlook remain unchanged. Following is a summary of the rating action: Assignments: Issuer: Nielsen Finance LLC (Co-Borrower: Nielsen Finance Co.) $500 Million Gtd. Senior Unsecured Notes due 2029, Assigned B2 (LGD5) $500 Million Gtd. Senior Unsecured Notes due 2031, Assigned B2 (LGD5) The assigned ratings are subject to review of final documentation and no material change to the size, terms and conditions of the transaction as advised to Moody's. Nielsen Finance is a wholly-owned pass-through subsidiary of Nielsen Holdings plc, which is the ultimate parent, financial reporting entity and guarantor of the notes. The new senior unsecured notes will be pari passu with the existing senior unsecured notes residing at Nielsen Finance. RATINGS RATIONALE The transaction is leverage neutral since Moody's expects Nielsen to use the net proceeds to fully repay the $239 Million USD equivalent outstanding Senior Secured Euro Term Loan B-2 due 2023 and $430 Million outstanding Senior Secured Term Loan B-5 due 2025, both issued by Nielsen Finance, and partially repay the $621 Million USD equivalent outstanding Senior Secured Euro Term Loan B-3 due 2025 issued by Nielsen Holding and Finance B.V. Moody's views the transaction favorably given the extension of the debt maturity. To the extent that any of the term loan facilities are fully extinguished, Moody's will withdraw the Ba1 ratings. Nielsen's Ba3 CFR reflects the company's leading international positions within its core Media business solutions, comprising audience measurement (73% of revenue), audience outcomes (20%) and Gracenote content services (7%); relatively high entry barriers with high client switching costs; long-standing customer relationships of which roughly 80% of client revenue is contracted at the start of each year; and high pro forma adjusted EBITDA margins in the 42% range (as calculated by Moody's). The company's ratings are the foremost metrics used to determine the value of programming and advertising in US television and streaming advertising markets and the industry's benchmark on which advertising is bought and sold. Nielsen's market position is solidified by its importance as an independent third party measurement standard, or currency, which is accepted by advertisers and media companies. The rating also considers Nielsen's investments in new product offerings to adapt to shifts in advertising spend and consumer viewing habits beyond traditional platforms. Following the recent sale of the Connect segment, Nielsen is now a more narrowly focused business with reduced revenue and profitability that is concentrated in the US (roughly 83% of revenue), however this is offset by mid-single digit organic revenue growth prospects, higher margins and improved free cash flow generation. A further challenge includes the moderately high pro forma financial leverage of approximately 4.5x (Moody's adjusted) subsequent to the Connect spin, albeit expected to improve by year end 2021. While cyclical and secular spending pressures exist, Nielsen's sizable contractual revenue provides some cushion against reduced client spend in short-cycle products and verticals that have been more impacted by the recession and lingering effects of the pandemic, and are likely to experience a lag as the global economy rebounds. As audience viewership continues to shift from linear TV to digital streaming platforms, Nielsen must expand beyond its traditional advertising and ad-supported media client base by creating new measurement and analytic solutions relevant to non-ad supported SVOD/PVOD content streaming services. The positive outlook reflects Moody's view that Nielsen will prioritize deleveraging via a combination of debt reduction with free cash flow (FCF) generation and EBITDA growth in the mid-single digit percentage range leading to leverage approaching 3.7x (Moody's adjusted) and adjusted EBITDA margins rising to the 42%-44% area (as calculated by Moody's) by year end 2022. The positive outlook also embeds improved corporate governance given management's commitment to de-lever to a target leverage of 3x-3.5x on an as-reported basis by 2023 (equivalent to around 3x-3.5x Moody's adjusted) and an expectation that annual dividends will remain low in the $85 million to $90 million range to support higher FCF generation for voluntary debt repayment. The outlook reflects Moody's forecast for a global economic recovery following the economic recession triggered by the COVID-19 pandemic. Moody's projects global GDP will expand 5.3% in 2021 (4.7% in the US) and 4.5% in 2022 (5.0% in the US). Through 2022, Moody's expects Nielsen to maintain good liquidity (SGL-2 Speculative Grade Liquidity) supported by positive free cash flow generation in the range of 4% of total debt (Moody's adjusted) or 7% excluding one-time spin-related cash costs, solid cash levels (cash balances totaled $1.2 billion at March 31, 2021 or $352 million pro forma for the Connect spin-off and April 2021 repayment of the $825 Million outstanding 5.0% Senior Unsecured Notes due 2022) and access to an undrawn $850 million revolving credit facility (RCF) maturing in 2023. From a governance standpoint, Moody's view favorably the separation of the weaker performing Connect business, modest dividend and establishment of a public leverage target because this will facilitate debt reduction and efficient capital allocation strategies that are better aligned with Nielsen's growth objectives. Moody's believes this reflects a healthier corporate governance profile since it will lead to a more manageable debt capital structure and improved cash flow generation for deleveraging and strategic investing to develop new services and integrated offerings that are relevant to clients' expanding measurement and analytics requirements. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS A ratings upgrade could occur if Nielsen demonstrates further client penetration into non-ad supported SVOD/PVOD content streaming services, constant currency organic revenue growth in the mid-single digit percentage range and increasing adjusted EBITDA margins approaching the 42%-44% area (as calculated by Moody's). Additionally, upward rating pressure could occur if Moody's expects that total debt to EBITDA will decline below 3.75x (Moody's adjusted) and free cash flow to debt (Moody's adjusted) will improve to the 5% to 6% range. Ratings could be downgraded if EBITDA margins contracted or debt levels increased resulting in total debt to EBITDA above 4.5x (Moody's adjusted) on a sustained basis and free cash flow generation weakened to below 3% of adjusted debt due to deterioration in operating performance. A deterioration in liquidity could also result in ratings pressure. With headquarters in Oxford, England and New York, NY, and operations in 60 countries, Nielsen Holdings plc is a global measurement and data analytics company providing audience measurement, audience outcomes and content metadata solutions. Pro forma for the Connect business spin-off, revenue totaled approximately $3.4 billion for the twelve months ended March 31, 2021. The principal methodology used in these ratings was Business and Consumer Service Industry published in October 2016. NIELSEN FINANCE: S&P Rates New Senior Unsecured Notes 'BB' ---------------------------------------------------------- S&P Global Ratings assigned its 'BB' issue-level rating and '4' recovery rating to Nielsen Finance LLC's proposed senior unsecured notes, raised its issue-level ratings on the company's outstanding senior unsecured notes to 'BB' from 'BB-', and revised its recovery rating on the outstanding notes to '4' from '5'. The company plans to use the proceeds from the proposed unsecured notes to repay its secured term loan debt. The revised recovery rating and issue-level ratings on the outstanding notes reflects the increased recovery prospects for the company's unsecured debt following the repayment of a portion of the secured debt pro forma for the issuance. The '4' recovery rating indicates its expectation of average (30%-50%; rounded estimate: 30%) recovery of principal in the event of a payment default. Key Analytical Factors -- S&P's default risk factors include the following: a shift in the competitive landscape stemming from the proliferation of media outlets and increased audience fragmentation, intensifying competition, pressure on the company's revenues as clients demand more information for the same price, higher-than-expected capital expenditures to boost the company's technical capabilities to ensure customer satisfaction and preserve its competitive position, and potential financial strain from underperforming, debt-financed acquisitions. -- Nielsen's debt capitalization included about $2.6 billion of senior secured credit facilities and $3.2 billion of senior unsecured notes pro forma the proposed transaction and debt repayment. -- Nielsen Finance LLC, TNC (US) Holdings Inc. (unrated), and Nielsen Holding and Finance B.V. are co-borrowers under the credit facilities, and Nielsen Finance LLC, Nielsen Finance Co., and Nielsen Co. (Luxembourg) S.ar.l. are issuers of the senior notes. -- The credit facilities are secured by a lien on substantially all of the co-borrowers and guarantors' capital stock, and tangible and intangible property (subject to 65% of the voting stock of first-tier foreign subsidiaries and other excluded assets). The first-lien debt benefits from a priority claim on the collateral. -- S&P assumes the first-lien collateral accounts for about 60% of our estimated emergence value. -- S&P assumes that debt maturing prior to 2025 is refinanced at similar terms. -- Nielsen's foreign operating subsidiaries do not guarantee the company's secured and unsecured debt. Therefore, the debt and other liabilities (including trade payables) of foreign operating subsidiaries could be effectively senior to the claim of secured or unsecured lenders. In S&P's recovery analysis, it assumed that most foreign subsidiaries would continue to operate outside of bankruptcy, and foreign subsidiary liabilities would be unimpaired. -- S&P values the company on a going-concern basis given its expectation that, in event of a bankruptcy, the reorganized company would benefit from its large market presence in TV audience measurement and from the inherent value of its client relationships and the organizational knowledge and expertise in audience measurement and data analytics. Simulated Assumptions: -- Simulated year of default: 2026 -- Jurisdiction: U.S. -- The revolving credit facility is 85% drawn at default EBITDA at emergence: $671 million -- Multiple: 7x -- Gross recovery value: About $4.7 billion Simplified Waterfall: -- Net recovery value for waterfall after admin expenses (5%): About $4.5 billion -- Estimated senior secured debt claims: About $3.4 billion* --Recovery range: 90%-100% (rounded estimate 95%) -- Estimated senior unsecured debt claims: About $3.3 billion* --Recovery range: 30%-50% (rounded estimate 30%) *All debt amounts include six months of prepetition interest. OASIS MIDSTREAM: S&P Affirms 'B' Long-Term ICR, Outlook Stable -------------------------------------------------------------- S&P Global Ratings affirmed its 'B' long-term issuer credit rating on Texas-based midstream energy company Oasis Midstream Partners L.P. (OMP) following the assignment of its 'B' issuer credit rating to its parent and general partner owner, Oasis Petroleum Inc. (OAS). S&P said, "We view OMP as an important part of OAS' long-term strategy. OAS supports OMP with long-term fixed-fee agreements in the Bakken through 2032. Furthermore, with more than 80% of its revenues derived from OAS, OMP's creditworthiness and growth depend on its parent's performance and drilling activities. OAS receives major cost benefits from OMP, along with the ability to dictate OMP's financial policy, including distributions. If OAS reduced its ownership of OMP to below 50%, it would be able to deconsolidate OMP from its financials. Despite the strong link between the two companies, we believe that there is some likelihood that OMP could be sold in the future. As a result, our rating on OAS caps our rating on OMP. "The stable outlook on OMP reflects the stable outlook on OAS. The stable outlook on OAS reflects our expectation that OAS will maintain moderate capital spending to modestly grow production while generating substantial FOCF, which we expect it will use primarily for shareholder returns. We expect funds from operations (FFO) to debt to average more than 50% over the next 12-24 months, with debt to EBITDA of 1.5x-1.75x. "We could lower the rating if OAS's credit quality deteriorates. A downgrade would most likely result from significant deterioration in the company's credit metrics, including FFO to debt of below 20%." This would most likely result from: -- Unforeseen operational issues; or -- A significant decrease in commodity prices affecting cash flow. While unlikely at this time, S&P could raise its rating on OMP if it raises the rating on OAS. An upgrade would most likely result from: -- OAS improving its scale of production and proved reserves such that they're more in line with higher-rated peers while maintaining leverage metrics appropriate for the rating, including FFO to debt of at least 30%; and -- OAS establishing a post-bankruptcy track record of prudent financial management. OASIS PETROLEUM: Moody's Assigns B1 CFR Amid Williston Deal ----------------------------------------------------------- Moody's Investors Service assigned new ratings to Oasis Petroleum Inc. (Oasis or OAS), including a B1 Corporate Family Rating, B1-PD Probability of Default Rating, B3 rating to its proposed $400 million senior unsecured notes due 2026 and a SGL-2 Speculative Grade Liquidity Rating. The rating outlook is stable. Oasis has agreed to acquire certain Williston Basin assets from a wholly-owned subsidiary of Diamondback Energy, Inc. (Diamondback, Ba1 positive) for approximately $745 million. Oasis has also agreed to sell its Permian Basin assets for $406 million and certain contingent earn-out payments over time. Closing of the acquisition should occur in July and closing of the sale transaction exiting the Permian Basin should occur at the end of June, subject to customary closing conditions. Net proceeds from the proposed notes offering, in combination with sale proceeds, will be used to fund the Williston Basin asset acquisition. If the acquisition agreement is terminated or the acquisition is not consummated, then the new notes will be redeemed at 100% of the issue price of the notes. Moody's ratings are subject to review of all final documentation. "The proposed notes will help fund the acquisition and enhance Oasis' scale in the Williston Basin, while achieving good liquidity and sound leverage metrics," said Amol Joshi, Moody's Vice President and Senior Credit Officer. Assignments: Issuer: Oasis Petroleum Inc. Probability of Default Rating, Assigned B1-PD Speculative Grade Liquidity Rating, Assigned SGL-2 Corporate Family Rating, Assigned B1 Senior Unsecured Notes, Assigned B3 (LGD5) Outlook Actions: Issuer: Oasis Petroleum Inc. Outlook, Assigned Stable RATINGS RATIONALE Oasis' B1 CFR is constrained by its limited scale and single-basin asset portfolio pro forma for the sale of its Permian Basin assets and acquisition of additional Williston Basin assets. The company's credit profile benefits from sound leverage metrics including a stated net debt to EBITDA target of less than 1x, following the restructuring of its debt and emergence from bankruptcy in November 2020. Oasis will enhance its Williston Basin asset base upon completing the announced acquisition of approximately 95 thousand net acres from Diamondback. The acquired assets produced about 27 thousand barrels of oil equivalent (boe) per day in the first quarter of 2021, about two-thirds of which comprised of crude oil. Oasis' assets are oil-weighted, and the company should generate meaningful free cash flow in 2021 supported by modest capital spending. Oasis has limited operating history post-emergence, has recently appointed a new CEO and has yet to establish a track record regarding business objectives, including further acquisitions, and financial policies. The company is expected to spend within cash flow and its midstream subsidiary, Oasis Midstream Partners LP (OMP, B2 positive) should remain supportive in providing gathering infrastructure. Oasis pursues shareholder returns through an equity dividend and share repurchase program, modestly reducing cash flow available for capital spending or credit improvement. The proposed senior unsecured notes are rated B3, two notches below the B1 CFR, reflecting the relatively large potential priority claim of Oasis' secured revolving credit facility over the notes. Oasis' SGL-2 rating reflects good liquidity into 2022. At March 31, 2021, Oasis had $113 million of balance sheet cash, with no outstanding borrowings and $1.3 million of letters of credit under its credit facility. Oasis' 2021 cash flow should comfortably fund its anticipated capital spending and equity dividends. The secured revolving credit facility matures in May 2024, and has a borrowing base of $500 million but an elected commitment of $450 million. Oasis' revolver borrowing base should increase based on its pro forma assets, although the company could continue to elect a lower commitment amount. The revolver has financial covenants including a maximum Total Net Debt to EBITDAX of 3x and a minimum Current Ratio of 1x. Oasis should remain in compliance with its covenants into 2022. Oasis controls OMP's general partner, and its roughly 77% ownership of OMP's limited partner interests provides an additional source of liquidity. Oasis' stable outlook reflects Moody's expectation that the company will likely spend within cash flow while maintaining sound leverage metrics. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS Oasis' ratings could be upgraded if the company grows its production volumes meaningfully at competitive returns and the company develops a track-record of financial policies balancing the maintenance of resilient credit metrics with shareholder returns, including those for shareholder dividends and share repurchases. In addition, to consider an upgrade, the company's retained cash flow (RCF) to debt should exceed 40% and leveraged full-cycle ratio (LFCR) should exceed 1.5x. The ratings could be downgraded if RCF to debt falls below 20%, or there is a material deterioration in the company's liquidity or debt to average daily production metrics. Oasis Petroleum Inc., headquartered in Houston, Texas, is an independent exploration & production company with operations focused in the Williston Basin. Oasis conducts midstream services through its MLP, Oasis Midstream Partners LP, which is about 23% owned by the public (as of March 31, 2021). The principal methodology used in these ratings was Independent Exploration and Production Industry published in May 2017. OASIS PETROLEUM: S&P Assigns 'B' ICR, Outlook Stable ---------------------------------------------------- S&P Global Ratings assigned its 'B' issuer credit rating to Oasis Petroleum Inc. (OAS). S&P said, "We also assigned our 'B+' issue-level rating to the company's proposed unsecured notes, with a '2' recovery rating. The '2' recovery rating indicates our expectation of substantial (70%-90%, rounded estimate: 85% capped) recovery of principal in the event of payment default. "The stable outlook reflects our expectation that OAS will maintain moderate capital spending to modestly grow production while generating substantial free operating cash flow, which we expect will be used primarily for shareholder returns. We expect FFO to debt to average above 50% over the next 12-24 months, with debt to EBITDA of 1.5-1.75x including S&P adjustments. "Our 'B' issuer credit rating on OAS follows a series of announced acquisition and divestiture transactions and the company's speculative-grade offering. The rating on OAS reflects our evaluation of its credit risk following its previously announced acquisition of certain Williston Basin assets from Diamondback Energy for up to $745 million, which will ultimately be funded by $400 million of new unsecured notes and proceeds from OAS' $406 million divestiture of its exploration and production (E&P) assets in the Permian Basin. The new notes will help refinance a second-lien bridge facility before the purchase transaction closing in July. On a pro forma basis, we expect OAS to have more than $500 million of liquidity, including an undrawn $450 million revolver-based lending (RBL) facility and over $60 million of cash at OAS guarantors. The acquired Williston assets contain about 95,000 core acres with first-quarter production of 27 thousand barrels of oil equivalent per day (Mboe/d), which will more than offset the Permian sale encompassing 24,000 net acres and around 7 Mboe/d of production. Nevertheless, we view OAS' scale as limited versus higher-rated peers, which is reflected in a one-notch downward adjustment to the anchor score. "Our assessment of OAS' business risk as weak primarily reflects its relatively small scale, single-basin concentration, higher profitability from an oil-focused production mix, and vertical integration from its majority ownership of OMP. Pro forma for the transactions, OAS will have approximately 235 million boe (MMboe) of proved reserves (about 80% developed) and we anticipate production of more than 65 Mboe/d (65% oil) this year. The company's Williston Basin footprint will comprise almost 500,000 net acres (98% of which are held by production), and its developed reserve life of over seven years is slightly better than its peer group. However, its cash operating costs of over $14/boe are quite high relative to peers despite the consolidating effect of Oasis Midstream Partners LLC (OMP), which reduces lease operating and GPT expenses by more than $5.50/boe. Additionally, OAS' proved reserves have shrunk in each of the past two years, and its production is significantly lower than it was in 2018. Nevertheless, the acquisition provides growth opportunities and potentially some modest synergies. We expect the company to run 1-1.5 rigs this year, with near-term drilling and completions activity focused mainly in the Wild Basin and Indian Hills areas before increasingly shifting its focus to newly acquired properties in Fort Berthold and South Antelope in 2022 and beyond. Given OAS' improved financial strength, we also expect management will continue to explore regional consolidation opportunities in the Bakken formation. "We expect OAS' financial performance over the next 12-24 months will dramatically improve after its balance sheet was restructured in late 2020, eliminating $1.8 billion of debt. Over the next two years, we are forecasting average funds from operations (FFO) to debt above 50%, with average debt to EBITDA of around 1.5x including S&P adjustments. We anticipate OAS will generate more than $200 million of free operating cash flow in each of the next few years, which will facilitate debt reduction and shareholder returns, including an annual base dividend of about $40 million and potentially more shareholder-focused initiatives such as the recently implemented share buyback program. We believe these credit metrics will be supported by OAS' significant hedge portfolio, which covers approximately 70% of anticipated oil production in 2021 and 2022. "Nonetheless, we remain mindful of historical oil and gas price volatility as well as comparatively wide Bakken basis differentials. We also incorporate uncertainty surrounding the direction of OAS' controlling stake in OMP and its transport capacity on the Dakota Access Pipeline (DAPL), either of which could hinder future cash flows. Management has publicly stated that it is open to monetizing some or all of its 77% ownership position in the midstream subsidiary, which, if deconsolidated, would significantly elevate E&P operating costs. In a similar vein, the company's oil price basis could worsen materially if DAPL is eventually shuttered. The company moves about a third of its oil production on the pipeline, which has been subject to regulatory scrutiny and is undergoing an environmental impact study that is expected to conclude early next year. OAS also has no track record of post-bankruptcy financial management, and a smaller scale of production and reserves than higher-rated peers. "The stable outlook reflects our expectation that OAS will maintain moderate capital spending to modestly grow production while generating substantial free operating cash flow, which we expect will be used primarily for shareholder returns. We expect FFO to debt to average above 50% over the next 12-24 months, with debt to EBITDA of 1.5-1.75x." A downgrade would most likely result from significant deterioration in the company's credit metrics, including FFO to debt below 20%. This would most likely result from: -- Unforeseen operational issues; or -- A significant decrease in commodity prices impacting cash flows. An upgrade would most likely result from: -- The company improving its scale of production and proved reserves more in line with higher-rated peers while maintaining leverage metrics appropriate for the rating, including FFO to debt of at least 30%; and -- The company establishing a post-bankruptcy track record of prudent financial management. OBITX INC: Taps RedChip as Investor Relations Firm -------------------------------------------------- OBITX, Inc. engaged RedChip Companies as a non-exclusive Investor Relations Firm. The terms of the agreement are for 12 months effective June 1, 2021. After the initial four months the Company may cancel the agreement with a 30-days' notice. RedChip Companies shall develop an Investor Relations Strategy for the Company. During the term, the Company will be featured on Bloomberg International (Europe). Compensation for these services, and more, is $12,500 per month and 75,000 shares of common stock. About OBITX Headquartered in Fleming Island, Florida, OBITX -- www.obitx.com -- is engaged in the business of consulting and developing blockchain technologies. OBITX reported net loss of $49.30 million for the year ended Jan. 31, 2021, compared to a net loss of $188,192 for the ear ended Jan. 31, 2020. As of Jan. 31, 2021, the Company had $1.71 million in total assets, $172,819 in total liabilities, and $1.54 million in total stockholders' equity. Tel Aviv, Israel-based Weinstein International CPA, the Company's auditor since 2021, issued a "going concern" qualification in its report dated May 13, 2021, citing that as of Jan. 31, 2021, the Company suffered losses from operations in all years since inception and has a nominal working capital deficit. These and other factors raise substantial doubt about the Company's ability to continue as a going concern. OCTAVE MUSIC: Moody's Affirms B3 CFR & Alters Outlook to Stable --------------------------------------------------------------- Moody's Investors Service has affirmed The Octave Music Group, Inc.'s B3 Corporate Family Rating and Caa1-PD Probability of Default Rating. Concurrently, Moody's affirmed the B3 ratings on the senior secured first-lien bank credit facilities. The outlook was revised to stable from negative. Following is a summary of the rating actions: Affirmations: Issuer: The Octave Music Group, Inc. Corporate Family Rating, Affirmed at B3 Probability of Default Rating, Affirmed at Caa1-PD $25 Million Amended Senior Secured First-Lien Revolving Credit Facility due 2024, Affirmed at B3 (LGD3) $290 Million ($282.5 Million outstanding) Amended Senior Secured First-Lien Term Loan due 2025, Affirmed at B3 (LGD3) Outlook Actions: Issuer: The Octave Music Group, Inc. Outlook, Changed to Stable from Negative RATINGS RATIONALE The revision of the outlook to stable reflects Octave Music's good execution on cost management and liquidity during the COVID-19 health crisis and global economic recession, the revenue recovery in Q1 2021 to near pre-pandemic levels and Moody's expectation that operating performance will improve over the next year as the global economy rebounds. Moody's projects US GDP will expand 6.5% in 2021 (6.1% globally) and 4.5% in 2022 (4.4% globally). The stable outlook also embeds Moody's expectation that Octave Music will continue to effectively navigate the muted, albeit improving, consumer discretionary spending environment, manage operating expenses and return to positive organic revenue growth beginning in Q2 2021 and all of 2021. On April 30, 2021, Moody's published its inaugural outlook for the global hospitality sector, which is positive. As hospitality and retail establishments reopen in North America and customer traffic rises amid the easing of capacity restrictions and more widely administered vaccines coupled with a recovery in household consumption, Moody's believes the company will experience solid EBITDA growth and reduce financial leverage to the 6x-7x range by year end 2021 from 10.7x at LTM March 28, 2021 (both metrics are Moody's adjusted). Notwithstanding the demand recovery in the services sector expected in 2021-22 boosted by the economic rebound, the rating considers the lingering economic scarring from the recession that could affect consumers' purchasing behavior given the income weakness within some demographic segments and risks associated with the timing of the abatement of the pandemic. Offsetting these risks is Moody's view that a greater reopening of the economy combined with pent-up demand for visiting social gathering venues such as bars and restaurants where Octave Music's jukeboxes are located, will lead to increased out-of-home mobility and support growth in user activity and engagement. Moody's also considers the investments that the company has made to expand its presence in both the interactive jukebox and background music segments. The affirmation of the B3 CFR reflects Octave Music's: (i) market leadership position with the largest network of digitally connected jukeboxes in North America; (ii) barriers to entry that stem from its highly fragmented network of 2,500+ independent operators, patented technology and cumulative R&D spend; (iii) low jukebox-related capital expenditures given that the operator network is responsible for all installation, repair and maintenance of the installed fleet; (iv) good cash flow dynamics from increasing mobile penetration and higher mobile application pricing during the pandemic, which facilitated positive free cash flow generation (FCF) in 2020; (v) recurring music and media services revenue supported by multi-year contracts and rising average weekly coinage per jukebox despite declines in average active jukeboxes; (vi) diversification from the PlayNetwork segment, which provides exposure to enterprise and international customers, and potential for new revenue streams longer-term from the Apple Music partnership; and (vii) long-standing relationships with major labels, publishers and performance rights organizations (PROs) that provide music content via multi-year licensing agreements. The B3 rating is constrained by Octave Music's: (i) high financial leverage, albeit expected to decline; (ii) small revenue base; (iii) exposure to consumer discretionary spend and small-to-medium sized (SMB) bars and restaurants in the jukebox segment, which could produce near-term pressure on revenue growth, which is likely to experience a lag as the global economy rebounds due to the lingering effects of the pandemic on some customers, as well as the closure of some jukebox locations, coupled with temporary inventory supply constraints; (iv) historically (pre-pandemic) modest revenue growth in the jukebox segment amid flat-to-declining unit volume growth and secular pressures on customer traffic; (v) declining locations and recurring monthly revenue within the PlayNetwork background music segment, which has relatively lower operating margins and uneven systems integration revenue; (vi) background music segment's exposure to repricing risk arising from contract renewals and a challenged retail operating environment, as well as increasing churn in North America, partially offset by growth in Asia-Pacific; and (vii) ownership by a private equity sponsor, which poses governance risks. Over the next 12-15 months, Moody's expects Octave Music to maintain good liquidity supported by projected FCF in the $20 - $30 million range and sufficient cash balances (cash totaled around $44 million at March 28, 2021). The company produced approximately $21 million in FCF for the LTM period ended March 28, 2021, equivalent to 7% of total debt (as calculated by Moody's). External liquidity is supported by a $25 million amended revolving credit facility (RCF), which currently has $15.3 million of availability following a $15 million repayment in Q1 2021. The term loan has a mandatory amortization of approximately $10 million annually or $2.5 million quarterly, which Moody's expects the company will pay via internal cash sources. In March 2021, Octave Music completed a second amendment to its bank credit agreement, which provided covenant relief by implementing a minimum LTM Adjusted EBITDA test through Q2 2021 and relaxing the Maximum Total Secured Net Leverage Ratio to 10x (as defined in the amended credit agreement) beginning in Q3 2021 stepping down each quarter until it reaches 4.5x in Q4 2023, and remaining at this level thereafter. 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 corporate assets arising from the current weakness in US and overseas economic activity and gradual recovery over 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 Moody's ESG framework, given the substantial implications for public health and safety. As a portfolio company of private equity sponsor Searchlight Capital Partners, Moody's expects the company's financial strategy to be relatively aggressive and governance risk to be elevated given that equity sponsors have a tendency to tolerate high leverage and favor high capital return strategies. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS A ratings upgrade could occur if Octave Music exhibits revenue growth and EBITDA margin expansion that lead to a sustained reduction in total debt to EBITDA leverage below 6x (Moody's adjusted) and free cash flow to adjusted debt of at least 5%. The company would also need to maintain a good liquidity position and continue to exhibit prudent financial policies. Ratings could experience downward pressure if financial leverage, as measured by total debt to EBITDA, were sustained above 8x (Moody's adjusted) or liquidity experiences deterioration such that free cash flow generation becomes meaningfully negative. The Octave Music Group, Inc., headquartered in New York, N.Y. and privately majority-owned by Searchlight Capital Partners, L.P., is a leading provider of out-of-home digital-based interactive music and entertainment jukeboxes (TouchTunes), with a total global installed base of roughly 60,000 units featured in bars, restaurants, retail stores, hospitality establishments and other locations across North America (approximately 53,000 units) and Europe (approximately 7,000 units). Octave Music maintains a network of over 2,500 jukebox operators in North America who install the equipment in local venues and take responsibility for maintenance, promotion, service and support. In May 2017, Octave Music acquired PlayNetwork, Inc., a leading global provider of in-store audio, visual and branded multimedia entertainment and marketing solutions to department stores, specialty retailers, restaurants, supermarkets and corporations with approximately 94,600 locations. Revenue totaled approximately $147.7 million for the twelve months ended March 28, 2021. The principal methodology used in these ratings was Business and Consumer Service Industry published in October 2016. ODYSSEY ENGINES: July 21 Plan Confirmation Hearing Set ------------------------------------------------------ On May 12, 2021, the U.S. Bankruptcy Court for the Southern District of Florida conducted a hearing to consider approval of the disclosure statement filed by Odyssey Leasing LLC, a debtor affiliate of Odyssey Engines, LLC. On May 25, 2021, Judge Robert A. Mark approved the Disclosure Statement and ordered that: * July 21, 2021 at 11:00 a.m. via video conference is the hearing to consider confirmation of the plan. * June 11, 2021 is fixed as the last day to file objections to claims. * June 30, 2021 is fixed as the last day to file fee applications. * July 7, 2021 is fixed as the last day to file objections to confirmation. * July 7, 2021 is fixed as the last day to file ballots accepting or rejecting plan. A full-text copy of the order dated May 25, 2021, is available at https://bit.ly/3uy8scf from PacerMonitor.com at no charge. About Odyssey Engines Odyssey Engines, LLC and its affiliates own, lease, and maintain aircraft engines. On June 23, 2020, Odyssey Engines and its affiliates concurrently filed voluntary petitions for relief under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Fla. Lead Case No. 20-16772). The petitions were signed by David Alan Boyer, president. At the time of the filing, each Debtor disclosed assets of $1 million to $10 million and liabilities of $10 million to $50 million. Judge Robert A. Mark oversees the cases. The Debtors have tapped David R. Softness, P.A. as legal counsel; GGG Partners, LLC as a chief restructuring officer; Bedford Advisers as financial advisor; and Pat Duggins Consulting Services Inc. as an appraiser. Synovus Bank is represented by Daniel Gold, Esq. -- Daniel.gold@bipc.com -- at Buchanan Ingersoll & Rooney as counsel. Preferred Bank is represented by Daniel DeSouza, Esq. --ddesouza@desouzalaw.com -- as counsel. OPTIV INC: Moody's Alters Outlook on Caa1 CFR to Positive --------------------------------------------------------- Moody's Investors Service affirmed Optiv Inc.'s Corporate Family Rating at Caa1. Moody's also affirmed the company's first lien senior secured term loan at Caa1 and second lien senior secured term loan at Caa3. The outlook was revised to positive from negative. The change in outlook reflects Moody's view of continued revenue and EBITDA growth in security products and services, resulting in strengthened credit metrics and potential that adjusted leverage will improve below 8x over the next 12-18 months and free cash flow will continue to improve. RATINGS RATIONALE The Caa1 corporate family rating reflects Optiv's high leverage level and low margins reflecting its operations as a value added reseller. Moody's adjusted leverage was approximately 9x as of the LTM period ended March 31, 2021 (adjusted for certain one-time charges), with leverage on a GAAP EBITDA basis at 9.4x for the same period. The company's EBITDA margins remain near 4% of gross revenue impacted by a continued shift to subscription sales, which are still below historic levels of near 5%. The credit profile is supported by the company's leading position as a supplier of security solutions driven by the company's domestic coverage, distribution capabilities, in-house service offerings and security products from both software and hardware providers. The company grew revenues and EBITDA in 2020 after several years of declines and well below industry performance. Moody's expects continued growth in gross revenue over the next 12 to 18 months with the potential to match or exceed high single digit industry growth levels. Debt to EBITDA is expected to improve to below 8x over the next 12 to 18 months driven by EBITDA growth. EBITDA margins are expected to remain stable due to moderate pressure from the continued shift to lower margin subscription sales. The positive ratings outlook reflects Moody's expectation for continued sales and EBITDA growth, with the potential for leverage to decline below 8x and free cash flow to debt to be sustained in the low-mid single digits over the next 12 to 18 months . FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS The ratings could be upgraded if the company is able to sustain leverage below 8x and free cash flow to debt greater than 3%. The ratings could be downgraded if revenues decline and margins deteriorate further or free cash flow is sustained below breakeven. Optiv's liquidity is good, supported by $22 million of cash as of March 31, 2021, and availability under a $200 million revolving credit facility due April 2024. Additionally, Moody's expects the company to generate positive free cash flow over the next 12 to 18 months. Borrowings under the ABL were $34 million as of quarter end but the company uses its ABL extensively to fund working capital throughout any given quarter and outstandings can be far larger. Affirmations: Issuer: Optiv Inc. Corporate Family Rating, Affirmed Caa1 Probability of Default Rating, Affirmed Caa1-PD Senior Secured 1st Lien Bank Credit Facility, Affirmed Caa1 (LGD3) Senior Secured 2nd Lien Bank Credit Facility, Affirmed Caa3 (LGD5) Outlook Actions: Issuer: Optiv Inc. Outlook, Changed To Positive From Negative The principal methodology used in these ratings was Business and Consumer Service Industry published in October 2016. Optiv is a value-added-reseller of cyber security technology and provider of cyber security services. The company headquartered in Denver, CO, had gross revenues of approximately $2.7 billion for the twelve months ended March 31, 2021. PADDOCK ENTERPRISES: Plan Exclusivity Extended Until July 6 ----------------------------------------------------------- At the behest of Debtor Paddock Enterprises, LLC, Judge Laurie Selber Silverstein of the U.S. Bankruptcy Court for the District of Delaware extended the period in which the Debtors may file a Chapter 11 Plan through and including July 6, 2021, and to solicit acceptances through and including September 6, 2021. As disclosed in the Certification of Counsel Regarding Successful Mediation, the Debtor has reached an agreement in principle with the ACC and the FCR for a consensual plan of reorganization under sections 524(g) and 105(a) of the Bankruptcy Code that would resolve the Debtor's legacy asbestos-related liabilities. The agreement was the culmination of the court-approved mediation process conducted by Kenneth Feinberg and Honorable Layn R. Phillips and provides that the total consideration to funding a section 524(g) trust on the effective date of a confirmed plan would be $610 million. The agreement remains subject to definitive documentation and satisfaction of certain conditions including, but not limited to, confirmation of a plan for the Debtor that will channel all current and future asbestos claims against the Debtor to a trust created under section 524(g) and establish an injunction protecting the Debtor, O-I Glass, Inc., and each of their affiliates from assertions of current and future liability from such channeled claims. While the agreement marks a significant milestone in the Chapter 11 Case, the process of implementing its terms and addressing the various issues that must be resolved in formulating a consensual plan and requires extensive time and effort on the part of the Debtor, the ACC, the FCR, and their respective professionals. The hearing date is scheduled for June 9, 2021, at 2:00 p.m.(Eastern Time). The granted extensions will allow the parties to devote their time to implementing the terms of the Mediation Proposal without the distraction, cost, and delay of a competing plan process. A copy of the Debtor's Motion to extend is available at https://bit.ly/3yCu4qS from Primeclerk.com. A copy of the Court's Extension Order is available at https://bit.ly/2SrH2Hk from Primeclerk.com. About Paddock Enterprises Paddock Enterprises, LLC's business operations are exclusively focused on (i) owning and managing certain real property and (ii) owning interests in, and managing the operations of, its non-debtor subsidiary, Meigs, which is developing an active real estate business. It is the successor-by-merger to Owens-Illinois, Inc., which previously served as the ultimate parent of the company. Paddock Enterprises is a direct, wholly-owned subsidiary of O-I Glass. Paddock Enterprises sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Del. Case No. 20-10028) on January 6, 2020. At the time of the filing, the Debtor disclosed assets of between $100 million and $500 million and liabilities of the same range. Judge Laurie Selber Silverstein oversees the case. The Debtor tapped Richards, Layton & Finger P.A. and Latham & Watkins LLP as legal counsel, Alvarez & Marsal North America LLC as a financial advisor, Riley Safer Holmes & Cancila, LLP as special counsel, and David J. Gordon of DJG Services, LLC as a chief restructuring officer. Prime Clerk, LLC is the claims, noticing, and solicitation agent and administrative advisor. PAPS CAB: June 30 Plan Confirmation Hearing Set ----------------------------------------------- On April 21, 2021, Paps Cab Corp., et al., filed with the U.S. Bankruptcy Court for the Eastern District of New York a Revised Amended Plan of Reorganization and a Revised Amended Disclosure Statement for the Plan of Reorganization. On May 25, 2021, Judge Jil Mazer-Marino approved the Disclosure Statement and ordered that: * June 30, 2021, at 11:00 a.m., at the 271-C Cadman Plaza East, Brooklyn, New York, Courtroom 3529 is the telephonic hearing for confirmation of the Plan. * June 23, 2021, is fixed as the last day for filing and serving written objections to confirmation of the Plan. * June 23, 2021, at 4:00 p.m., is fixed as the last day to submit all ballots voting in favor of or against the Plan. * June 23, 2021, at 4:00 p.m., is fixed as the last day to file objections to confirmation of the Plan. * June 24, 2021, at 12:00 p.m. is fixed as the last day for counsel of Debtors to file a ballot tally and an affidavit and/or brief in support of confirmation. A full-text copy of the order dated May 25, 2021, is available at https://bit.ly/3wVg5er from PacerMonitor.com at no charge. About Paps Cab Corp. Paps Cab Corp., Vicmarie Hacking, Corp., and Snowstorm Hacking, Corp. concurrently filed voluntary petitions under Chapter 11 of the Bankruptcy Code (Bankr. E.D.N.Y. Lead Case No. 19-47238) on Dec. 2, 2019, listing under $1 million in both assets and liabilities. Alla Kachan, Esq., at LAW OFFICES OF ALLA KACHAN, P.C., represents the Debtors. PARK RIVER: Fitch Rates New $340MM Unsecured Notes 'CCC+' --------------------------------------------------------- Fitch Ratings has affirmed Park River Holdings, Inc.'s ratings, including the company's Long-Term Issuer Default Rating at 'B', following the announcement of its acquisition of NWI Enterprises (Nationwide). Fitch has also assigned a 'CCC+'/'RR6' rating to Park River's proposed offering of $340 million senior unsecured notes. Proceeds from the notes offering will be used to fund the purchase of Nationwide. The Rating Outlook is Stable. Park River's IDR reflects the company's aggressive growth strategy and elevated leverage levels, although Fitch's expectation for residential housing growth in 2021 supports modest deleveraging in the intermediate term through EBITDA growth and FCF allocated to debt reduction. The IDR also reflects the company's competitive position within the fragmented building products distribution market, exposure to the cyclical residential construction end-market, and modest profitability and FCF metrics. The company's large scale, breadth of product offerings, extended debt maturity schedule and adequate liquidity position are also factored into the ratings. KEY RATING DRIVERS Aggressive Growth Strategy: In December 2020, Clearlake Capital Partners, L.P. completed the acquisition of PrimeSource Building Products, Inc., a leading distributor and provider of specialty building materials serving residential, commercial and industrial new construction and remodeling markets. Clearlake subsequently merged PrimeSource with Dimora Brands, a designer, manufacturer and seller of hardware and home accessories, to form Park River. Most recently, Park River signed a definitive agreement to acquire Nationwide, a provider of branded specialty hardware for outdoor residential applications including fence and gate hardware, railing systems and perimeter security. The Nationwide acquisition expands the company's product offerings into the specialty fence and gate market and further improves Park River's portfolio of branded products, which carry higher margins. Elevated Leverage: The Nationwide acquisition will increase Park River's leverage slightly, as the transaction will be 100% debt financed. On a pro forma basis, Park River's Fitch-calculated debt to operating EBITDA is estimated to be about 7.3x following the close of the Nationwide acquisition. Fitch expects the company to delever through EBITDA growth and some debt pay down beyond the required term loan amortization. The strong residential backdrop through at least the first half of 2021 supports modest, albeit slow, deleveraging. Fitch's rating case projects total debt to operating EBITDA to be around 6.6x on a proforma basis at the end of 2021 and 6.0x at YE 2022. Modest Overall Competitive Position: The company's competitive position is relatively weak compared to more highly-rated building products manufacturers in Fitch's coverage, due to its position as a distributor and provider in the supply chain, the highly fragmented nature of the industry, and some commoditized product offerings. Fitch believes the company's scale, broad product offering, and brand equity associated with its proprietary brands such as Grip-Rite and Pro-Twist, and the addition of branded products from the Nationwide acquisition, provide competitive advantages relative to other building products distributors, as demonstrated by its higher pro forma profitability margins. Broad Product Offering: Park River has a broad product offering of more than 52,000 SKUs, including a well-recognized portfolio of proprietary branded products (which carry higher gross margins) that represent more than 60% of pro forma sales. This broad product offering is further enhanced by Nationwide, which offers a diverse portfolio of 8,000 SKUs focused on residential outdoor living and perimeter security. Park River's breadth of offerings and the 'one-stop shop' nature of the business provide modest competitive advantages relative to smaller distributors with only a local presence and limited product offerings. This product breadth enhances customer relationships, provides some competitive advantage over smaller distributors and diversifies the company's supplier base. Modest Profitability: Park River's profitability metrics are commensurate with building products issuers in the 'B' category and are modestly higher than its large distributor peers. Pro forma for the Nationwide acquisition, Fitch expects EBITDA margins in the 13.5%-14.5% range during the forecast period, driven by Dimora and Nationwide's relatively higher margins and some fixed-cost synergies. Cyclical but Balanced End-Market Exposure: While the company is exposed to the highly-cyclical residential construction end-market, management estimates more than 60% of revenues come from the more stable repair and replacement sector. Park River's substantial exposure to repair and replacement reflects positively on the credit profile when compared with other building products distributors with more exposure to the cyclical new construction end-markets. Through the construction cycle, Park River's credit metrics and profitability are expected to be slightly more stable than peers with less exposure to repair and replacement driven demand. DERIVATION SUMMARY Park River Holdings, Inc. has weaker credit and profitability metrics than Fitch-rated public building products manufacturers, which are concentrated in low-investment grade rating categories. These peers typically have total debt to operating EBITDA of less than or equal to 3.0x, global operating profiles, and market positions compared with Park River. Park River has similar leverage metrics as LBM Acquisition, LLC (B/Stable). LBM is meaningfully larger but has lower EBITDA margins and higher exposure to the new construction market compared with Park River. The company is smaller in scale but has similar profitability metrics and product offerings as its closest publicly-traded peer, Beacon Roofing Supply, Inc. (BECN). Park River and BECN also have similar end-market exposure, although BECN has a bit more exposure to the less-cyclical repair and replacement sector. KEY ASSUMPTIONS Fitch's key assumptions within the rating case for the issuer include: -- Mid-single digit organic revenue growth in 2021 and low-single digit organic revenue growth in 2022; -- EBITDA margins of 13.5%-14.5% in 2021 and 2022; -- FCF margin of 2.5%-3% in 2021 and 4%-5% in 2022; -- Debt paydown beyond required TL amortization; -- Pro forma debt to EBITDA of 6.6x at YE 2021 and at or below 6.0x at the end of 2022. Recovery Analysis Assumptions The recovery analysis assumes that Park River would be considered a going-concern (GC) in bankruptcy and that the company would be reorganized rather than liquidated. Fitch has assumed a 10% administrative claim. Fitch's GC EBITDA estimate of $198 million estimates a post-restructuring sustainable level of EBITDA. This is about 23% below Fitch-calculated pro-forma levels for the LTM ending March 31, 2021. The GC EBITDA is based on Fitch's assumption that distress would arise from weakening in the housing market combined with losses of certain customers. Fitch estimates annual revenues of $1.6 billion that are about 15% below pro forma March 31, 2021 LTM levels and Fitch-calculated EBITDA margins of about 12.4% (roughly 120 bps below March 31, 2021 LTM pro forma EBITDA margins) would capture the lower revenue base of the company after emerging from a housing downturn plus a sustainable margin profile after right sizing, which leads to Fitch's $198 million GC EBITDA assumption. Fitch applied a 5.5x multiple, which is below the 9.1x purchase multiple when Bain Capital acquired LBM Acquisition, LLC in December 2020. This is also below the 8.4x EBITDA multiple when BLDR acquired ProBuild for $1.6 billion in 2015. Additionally, Beacon Roofing Supply acquired distributor Allied Building Products for $2.6 billion in 2017 at an 8.7x multiple. Fitch does not have recent data on recovery multiples for building products distributors. The ABL revolver is assumed to be 70% drawn at default, which accounts for potential shrinkage in the available borrowing base during a contraction in revenues that provokes a default, and is assumed to have priority-ranking claims to the term loan in the recovery analysis. The analysis results in a recovery corresponding to an 'RR1' for the $405 million ABL facility, a recovery corresponding to an 'RR3' for the $1.095 billion secured term loan and a recovery corresponding to an 'RR6' for the $400 million senior unsecured notes and the proposed $340 million senior unsecured notes offering. RATING SENSITIVITIES Factors that could, individually or collectively, lead to positive rating action/upgrade: -- Fitch's expectation that total debt to operating EBITDA will be sustained below 5.0x; -- The company lowers its exposure to the new home construction end-market in order to reduce earnings cyclicality and credit metric volatility through the housing cycle; -- The company maintains a strong liquidity position with no material short-term debt obligations. Factors that could, individually or collectively, lead to negative rating action/downgrade: -- Fitch's expectation that total debt to operating EBITDA will be sustained above 6.5x; -- Operating EBITDA/Interest paid falls below 2.0x; -- Fitch's expectation that FCF generation will approach neutral or turn negative. 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: Park River has adequate liquidity with cash of $17.9 million and $388.1 million of borrowing availability (after accounting for $16.9 million of LCs) under its $405 million ABL facility that matures in December 2025. Pro forma for the Nationwide acquisition, the company will have about $17 million of cash and $348 million of borrowing availability under the ABL facility. Park River's debt maturities are well laddered, with the ABL maturing in 2025 and the TL maturing in 2028. The amortization under the TL is manageable at 1% per annum or $10.95 million. 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. PARK RIVER: Moody's Affirms B2 CFR & Rates New Unsecured Notes Caa1 ------------------------------------------------------------------- Moody's Investors Service affirmed the B2 Corporate Family Rating and B2-PD Probability of Default Rating for Park River Holdings, Inc. operating as PrimeSource Building Products, Inc. Moody's also assigned a Caa1 rating to the company's proposed senior unsecured notes. Moody's expects the terms and conditions of this debt instrument to be similar to PrimeSource's existing senior unsecured notes due 2029. In addition, Moody's upgraded PrimeSource's senior secured term loan to B1 from B2 and affirmed the Caa1 rating on the company's senior unsecured notes due 2029. The outlook is stable. Proceeds from the new notes issuances and cash on hand will be used to fund the acquisition of Nationwide Enterprises, Inc. (Nationwide), which is a national distributor of specialty fence and gate hardware and expands PrimeSource's product offerings, and to pay related fees and expenses. The affirmation of PrimeSource's B2 CFR follows the aggressive financial strategy pursued by the company. PrimeSource is financing the acquisition of Nationwide with debt. Balance sheet debt is increasing by about 25% to $1.9 billion from $1.5 billion at Q1 2021, resulting in PrimeSource remining highly leveraged. Moody's projects adjusted debt-to-LTM EBITDA approaching 6.5x at year-end 2022 and delaying potential deleveraging by a year. Moody's previously forecasted PrimeSource's leverage to be about 6.2x by December 31, 2021. Fixed charges including cash interest, term loan amortization and operating and finance lease payments will approach $165 million per year, significantly reducing financial flexibility. The stable outlook reflects Moody's expectation that PrimeSource will eschew large debt financed acquisitions as it consolidates recent acquisitions. End market dynamics that support growth and good liquidity further support the stable outlook. The upgrade of the rating on PrimeSource's senior secured term loan to B1 from B2 results from the expansion in unsecured debt as a result of the proposed notes issuance, which in-turn increases the recovery value for the holders of the senior secured debt relative to total debt. The following ratings are affected by the action: Assignments: Issuer: Park River Holdings, Inc. Senior Unsecured Notes, Assigned Caa1 (LGD5) Upgrades: Issuer: Park River Holdings, Inc. Gtd. Senior Secured 1st Lien Term Loan, Upgraded to B1 (LGD3) from B2 (LGD3) Affirmations: Issuer: Park River Holdings, Inc. Probability of Default Rating, Affirmed B2-PD Corporate Family Rating, Affirmed B2 Senior Unsecured Global Notes, Affirmed Caa1 to (LGD5) from (LGD6) Outlook Actions: Issuer: Park River Holdings, Inc. Outlook, Remains Stable RATINGS RATIONALE PrimeSource's B2 CFR reflects Moody's expectation that the company will remain highly leveraged over the next eighteen months at over 6.5x. Moody's forecasts adjusted free cash flow-to-debt will be only moderately positive in 2022. At the same time PrimeSource may face challenges integrating Nationwide as it continues to integrate Dimora Brands, Inc. (acquired on December 28, 2020), future bolt-on acquisitions, and strong competition. Providing an offset to PrimeSource's leveraged capital structure is good profitability. Moody's forecasts adjusted EBITDA margin in the range of 12.5% - 15% through 2022, which is a key credit strength of the company. Profitability will benefit from higher volumes due to growth in the domestic construction end market, the driver of PrimeSource's revenue, and resulting operating leverage from that growth. Moody's projects revenue will approach $2.0 billion by 2022 from $1.5 billion for 2020. Moody's also calculates interest coverage, measured as EBITA-to-interest expense, will be over 2.0x through 2022, which is reasonable given the company's considerable interest expense. Good liquidity characterized by ample revolver availability and no maturities until 2025 further support PrimeSource's credit profile. The Caa1 rating assigned to the company's proposed senior unsecured notes and on the Caa1 rating on PrimeSource's existing senior unsecured notes due 2029, two notches below the Corporate Family Rating, results from their subordination to the company's considerable amount of secured debt. The two notes are pari passu. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS Factors that could lead to an upgrade: - Debt-to-LTM EBITDA approaching 5.0x - EBITA-to-interest expense is maintained near 2.5x - Preservation of good liquidity Factors that could lead to a downgrade: - EBITA-to-interest expense trending towards 1.5x - Debt-to-LTM EBITDA does not improve and fails to trend below 6.5x - Deterioration in liquidity profile - Excessive usage of the revolving credit facility - Aggressive acquisition or shareholder return activity The principal methodology used in these ratings was Distribution & Supply Chain Services Industry published in June 2018. PrimeSource Building Products, Inc., headquartered in Irving, Texas, is a distributor of building materials, selling its products and services to retailers and other distributors for new housing construction and repair and remodeling activity. Clearlake Capital Group, L.P., through its affiliates, is the owner of PrimeSource. PARK RIVER: S&P Downgrades ICR to 'B-' on Debt-Funded Acquisition ----------------------------------------------------------------- S&P Global Ratings lowered the issuer credit rating on Park River Holdings Inc. to 'B-' from 'B' and at the same time assigned a 'CCC' rating to the proposed senior unsecured note. S&P said, "We assigned our 'CCC' issue-level and '6' recovery ratings to the new $340 million senior unsecured notes due 2029, which reflects our expectation of negligible (0%-10%; rounded estimate: 0%) recovery. Additionally, we lowered the rating on Park River Holdings' $1.095 billion senior secured term loan to 'B-' from 'B', and lowered the rating on the $400 million senior unsecured notes to 'CCC' from 'CCC+'. "Our stable outlook reflects our view that strong end-market demand will mitigate a higher debt load. "Pro forma adjusted debt to EBITDA will be above 8x-8.5x, which we view as commensurate with a 'B-' rating. We expect the combined company (Park River Holdings) will produce pro forma annual revenue of approximately $2 billion and adjusted EBITDA of $235 million-$255 million. The recently established capital structure will comprise a $1.095 billion term loan facility, $400 million of senior unsecured note, proposed $340 million senior unsecured note, and a $405 million asset-based lending (ABL) facility (which would be drawn $40 million at the close of the transaction). The proposed capital structure results in incremental debt and with the proceeds the company will fund the acquisition of Nationwide. We expect Park River Holdings' adjusted debt to EBITDA to be above 8x for 2021. "We expect Park River Holdings' operating performance to remain strong for 2021. Our projection for robust operating performance for 2021 is based on continued growth in the residential construction sector. Residential construction will produce most of the combined company's revenue, while organic top-line growth is aided by growing residential new construction and repair and remodel forecasts through 2021. As the company continues to integrate the businesses of PrimeSource, Dimora Brands, and now Nationwide Enterprise (which all have been acquired in the first part of 2021), we expect the company to realize some cost savings and synergistic benefits over the next 12-18 months. The company will innately have to handle rising input costs that will pressure the company's earnings, but we believe these cost savings and pricing strategy will provide some offset. As such, we expect adjusted EBITDA margins of 11%-12% over the next 12 months. We believe the company's ability to pass through higher input costs (steel, metals, logistics, and labor) will be key to the sustainability of its margins and earnings. As per our projections, we expect profitability to improve through higher operating efficiencies, potentially lower tariff costs, and improved product mix as Dimora Brands and Nationwide Enterprises SKUs are higher margin in nature than that of PrimeSource. "We expect the company's EBITDA interest coverage to be 2x and it will generate positive free cash flows over the next 12 months. Despite the increased interest costs, we believe the company's earnings will continue to support EBITDA interest coverage of about 2x. Further, we expect the company to generate operating cash flows of $65 million-$85 million after working capital needs, which will be higher because of the company's strong revenue growth. We also expect capital expenditure of about $15 million-$20 million. As such, we forecast the company to generate positive free operating cash flow of about $45 million-$65 million over the next 12 months. "The stable outlook reflects our view that strong revenue and earnings growth will somewhat offset higher debt over the next 12 months; we expect adjusted leverage of above 8x and EBITDA interest coverage of 2x." S&P could lower the rating over the next 12 months if: -- S&P views the capital structure as unsustainable, exhibited by adjusted leverage deteriorating toward 10x, EBITDA interest coverage trending below 2x, or free cash flow turning negative. This scenario could materialize in the case of a severe downturn such that demand for the company's products drastically declines, compressing margins by more than 100 basis points, or forecast earnings synergies are not realized; or -- The company maintains an aggressive financial policy--for instance, using debt to fund distributions or acquisitions--keeping leverage elevated. Although unlikely over the next 12 months, S&P could raise the rating if: -- Earnings are stronger than S&P's base-case scenario, resulting in adjusted leverage lower than 6x and it expects the company will maintain this level. This could occur if the company achieves the targeted synergies faster than expected and/or has a higher-than-expected pass-through costs; and -- The financial sponsors commit to maintaining leverage below 6x. PATERSON CHARTER SCHOOL: S&P Raises Revenue Bonds Rating to 'BB' ---------------------------------------------------------------- S&P Global Ratings raised its rating on the New Jersey Economic Development Authority's revenue bonds, issued for Paterson Charter School for Science and Technology (PCSST), to 'BB' from 'BB-'. The outlook is positive. "The higher rating and positive outlook reflect our view of PCSST's meaningful improvement over the past three audited years, which reflect a track record of maximum annual debt service coverage, days' cash on hand, and financial operating performance consistent with the 'BB' rating," said S&P Global credit analyst Mel Brown. Additionally, it is S&P's expectation based on year-to-date budget to actuals and fiscal 2022 expectations that these metrics will remain steady over the outlook reflecting a sustained credit profile commensurate with 'BB' peers. The outlook also reflects its anticipation that PCSST will continue growing its enrollment toward facility capacity, receive a charter renewal for the maximum term in fiscal year 2022, and that the state funding will remain steady. PENSKE AUTOMOTIVE: S&P Rates New $500MM Senior Sub. Notes 'BB-' --------------------------------------------------------------- S&P Global Ratings assigned its 'BB-' issue-level rating and '6' recovery rating to auto retailer Penske Automotive Group Inc.'s proposed $500 million senior subordinated notes due 2029. The '6' recovery rating indicates its expectation for negligible (0%-10%; rounded estimate: 0%) recovery in the event of a payment default. Penske will use the proceeds from these notes to redeem its existing $500 million 5.5% notes due 2026 in a leverage-neutral transaction, which will potentially reduce its interest costs. The proposed senior subordinated notes will rank junior in right of payment to all of Penske's existing and future senior debt and will be structurally subordinated to all debt and other liabilities of subsidiaries that do not guarantee the notes. PESCRILLO NEW YORK: June 24 Plan Confirmation Hearing Set --------------------------------------------------------- On Sept. 29, 2020, debtor Pescrillo New York, LLC filed with the U.S. Bankruptcy Court for the Western District of New York a First Amended Disclosure Statement referring to a First Amended Plan. On May 20, 2021, Judge Michael J. Kaplan approved the First Amended Disclosure Statement and ordered that: * June 24, 2021, at 12:00 p.m. at the Robert H. Jackson United States Courthouse, 2 Niagara Square, 5th Floor-Orleans Courtroom, Buffalo, NY 14202 is the hearing on confirmation of the plan. * June 21, 2021, is fixed as the last day for filing and serving written objections to confirmation of the plan. * Ballots accepting or rejecting the plan may be filed at any time before the confirmation hearing. A full-text copy of the order dated May 20, 2021, is available at https://bit.ly/3uvpPKo from PacerMonitor.com at no charge. About Pescrillo New York Pescrillo New York, LLC, a real estate lessor, is the fee simple owner of 113 real properties in Niagara Falls and Buffalo New York, having an aggregate value of $1.71 million. The Debtor first sought bankruptcy protection (Bankr. W.D.N.Y. Case No. 15-74305) on Oct. 8, 2015. Pescrillo New York again sought protection under Chapter 11 of the Bankruptcy Code (Bankr. W.D.N.Y. Case No. 18-10656) on April 9, 2018. In the petition signed by Ralph T. Pescrillo, managing member, the Debtor disclosed $1.72 million in assets and $1.84 million in liabilities. Judge Michael J. Kaplan presides over the case. PESCRILLO NIAGARA: June 24 Plan Confirmation Hearing Set -------------------------------------------------------- On Sept. 29, 2020, debtor Pescrillo Niagara, LLC filed with the U.S. Bankruptcy Court for the Western District of New York a First Amended Disclosure Statement referring to a First Amended Plan. On May 20, 2021, Judge Michael J. Kaplan approved the First Amended Disclosure Statement and ordered that: * June 24, 2021, at 12:00 p.m. at the Robert H. Jackson United States Courthouse, 2 Niagara Square, 5th Floor-Orleans Courtroom, Buffalo, NY 14202 is the hearing on confirmation of the plan. * June 21, 2021, is fixed as the last day for filing and serving written objections to confirmation of the plan. * Ballots accepting or rejecting the plan may be filed at any time before the confirmation hearing. A full-text copy of the order dated May 20, 2021, is available at https://bit.ly/3fu33OT from PacerMonitor.com at no charge. The Debtors are represented by: GLEICHENHAUS, MARCHESE & WEISHAAR, PC Michael A. Weishaar, Esq. 930 Convention Tower Buffalo, New York 14202 Tel: (716) 845-6446 Fax: (716) 845-6475 E-mail: mweishaar@gmwlawyers.com About Pescrillo Niagara Pescrillo Niagara, LLC, a domestic limited liability company in Niagara Falls, N.Y., sought protection under Chapter 11 of the Bankruptcy Code (Bankr. W.D.N.Y. Case No. 20-10379) on March 6, 2020, listing under $1 million in assets and liabilities. Judge Michael J. Kaplan oversees the case. Debtor hired Gleichenhaus, Marchese & Weishaar PC as its legal counsel. PG&E CORP: Fitch Affirms 'BB' IDRs, Outlook Stable -------------------------------------------------- Fitch Ratings has affirmed both PG&E Corporation's (PCG) and Pacific Gas and Electric Company's (PG&E) Issuer Default Ratings at 'BB'/Stable. In addition, Fitch has affirmed PCG's secured debt rating at 'BB'/'RR4' and PG&E's first mortgage debt and preferred securities ratings at 'BBB-' and 'BB', respectively. PG&E's first mortgage instrument Recovery Ratings (RR) have been revised to 'RR2' from 'RR1' and its preferred securities to 'RR5' from 'RR4'. The security ratings have been removed from Under Criteria Observation (UCO). The instrument rating actions reflect application of Fitch's updated Corporates Recovery Ratings and Instrument Ratings to PCG's and PG&E's debt ratings. Fitch placed the securities on UCO following the April 9, 2021 conversion of Fitch's Exposure Draft: Corporates Recovery Ratings and Instrument Ratings Criteria to Final. KEY RATING DRIVERS Recovery Ratings Criteria Update: Recovery Ratings and instrument ratings for PCG and PG&E are based on Fitch's newly introduced rating grid for issuers with 'BB' category Issuer Default Ratings (IDRs). Ratings for PCG reflect average recovery characteristics consistent with similarly positioned entities with average recovery prospects given default, while PG&E's ratings reflect above-average recovery prospects given default and utility sector uplift. PCG's senior secured debt ratings map to a category 2 first-lien secured by an equity interest in its utility subsidiary and structural subordination to more than $35 billion of outstanding utility debt. The utility's secured debt is subordinated to PG&E's accounts receivable program, mapping to an 'RR2' under the criteria grid and receives one-notch uplift from the IDR before considering utility sector uplift. Application of sector uplift, results in widening to two-notch uplift from the IDR of 'BB' and a 'BBB-'/'RR2' first mortgage debt instrument rating. Similarly, PG&E's preferred securities map to an instrument rating one-notch below PG&E's IDR before sector uplift. Factoring in sector uplift results in a preferred securities rating of 'BB'/'RR5'. More information on the updated Corporates Recovery Ratings and Instrument Ratings Criteria is available at www.fitchratings.com. Elevated Wildfire Risk: PG&E's ratings and Stable Outlook primarily reflect credit risk from potential liabilities associated with catastrophic wildfires sparked by utility equipment amid cycles of drought-rain-drought, high heat, low humidity and high winds and a growing urban-wildland interface. PG&E's relatively mature asset base has been prone to failure, igniting a large number of large, destructive wildfires in 2017-2018 and smaller fires in both 2019 (Kincade) and 2020 (Zogg). PG&E, along with PCG, filed for protection under Chapter 11 of the U.S. Bankruptcy Code in January 2019 due to large third-party liability claims associated with wildfires. The debtors emerged from Chapter 11 on July 1, 2020, completing their restructuring. Recent Wild Fire Activity: California wildfires based on California Department of Forestry and Fire Protection Fire (Cal Fire) data for 2020 burned approximately 4.3 million acres and damaged or destroyed just under 10,500 structures, highlighting the persistent nature of catastrophic wildfire activity. Unlike 2017 and 2018, however, a majority of wildfire activity in 2020 was not attributable to utility equipment. Rather, a lightning siege from August 2020 storm activity ignited hundreds of wildfires and a majority of the most damaging firestorms of 2020. The significantly lower count of utility-triggered catastrophic wildfires in 2019 and 2020 compared with 2017 and 2018 is a constructive development from a credit perspective. The respite implies traction from initiatives deployed in recent years by investor-owned utilities (IOU) and governmental agencies to enhance wildfire resilience and response. The dual effects of the reduction in the number of utility-triggered firestorms in 2019 and 2020 and implementation of the wildfire insurance fund and other aspects of AB 1054 and other legislative initiatives are key elements supporting PG&E's ratings and the Stable Rating Outlook. Zogg and Kincade Fires: In September 2020, the Zogg Fire ignited in PG&E's service territory when a pine tree contacted electric facilities owned by the utility, according to Cal Fire. The Zogg Fire burned 56,338 acres and destroyed and damaged 231 structures and resulted in the loss of four lives. The Cal Fire report has been referred to the Shasta County District Attorney. In October 2019, the Kincade Fire burned 77,758 acres, destroyed 374 structures and damaged 60 structures and was, according to Cal Fire, caused by electric transmission lines owned by PG&E. While the magnitude of potential liabilities associated with the fires is yet-to-be-determined, PG&E has accrued losses $300 million and $800 million for the Zogg Fire and Kincade Fire, respectively. In Fitch's opinion, the financial impact of third-party liabilities from the fires will prove manageable within the current rating category. Potentially more troubling from a credit perspective, however, is the filing of 33 criminal charges against PG&E in the Kincade Fire. PG&E disagrees with and is expected to challenge the charges. Nonetheless, Fitch believes an adverse outcome in criminal proceedings heightens reputational risk and could lead to fines and penalties and is a concern from a credit perspective. Legislation Stabilizes Credit: A.B. 1054, Senate Bill (S.B.) 901 and a number of other laws were enacted in California during 2018 and 2019 to protect the public against deadly wildfires. A.B. 1054 creates a $21 billion wildfire insurance fund for the three large electric IOUs in California, including PG&E, to address the timing mismatch between payment and recovery of wildfire-related liabilities under inverse condemnation. While access to the wildfire fund provides a robust source of funds to buffer risk of firestorms in the near-to-intermediate term, a key concern is a potential trend of large fires ignited by utility equipment exhausting the fund more quickly than expected. PG&E has an Environmental, Social and Governance (ESG) Relevance Score (RS) of '5' for customer welfare - fair messaging, privacy and data, and ESG RS score of '5' for exposure to environmental impacts and an ESG RS of '5' for exposure to social impacts. These scores are linked to the increase in the size and destructive force of the 2017-2018 firestorms and related adverse impacts to the utility's relationship with ratepayers and regulators. The ESG RS scores also consider reputational damage and risk associated with PG&E's criminal conviction on six felony counts and corporate probation related to the 2010 San Bruno pipeline explosion and fire. PG&E has been subject to fines and penalties in recent years due to violation of laws and regulations at both its electric and natural gas operations. PG&E entered a guilty plea to 84 counts of manslaughter and one count of unlawfully causing a fire resolving criminal proceedings in connection with the 2018 Camp Fire. Due to the threat of wildfires, PG&E is potentially exposed to large third-party liabilities, heightened regulatory uncertainty regarding full and timely recovery of wildfire related costs and criminal prosecution. PG&E's ESG RS scores for exposure to environmental and social impacts have a negative impact on the company's credit profile and are relevant to the ratings in conjunction with other factors. DERIVATION SUMMARY PG&E Corporation, similar to peer utility holding companies Edison International (EIX; BBB-/Stable) and Pinnacle West Capital (PNW; A-/Negative), is solely dependent on earnings and cash flows from its utility subsidiary. Virtually all of PCG's, EIX's and PNW's earnings and cash flows are attributable to their respective operating utilities, Pacific Gas and Electric, Southern California Edison Company (SCE; BBB-/Stable) and Arizona Public Service Company (APS; A-/Negative). Conversely, Sempra Energy Inc. (SRE; BBB+/Stable), has a more diverse business mix with approximately 80% of consolidated earnings from Texas and California utility operations and the remainder from non-utility businesses. PG&E, is one of the nation's largest combination electric and gas utilities with total assets as of Dec. 31, 2020 of $97 billion, considerably larger than SCE ($69 billion), SDG&E ($22 billion) and APS ($20 billion). The regulatory environment in Arizona, similar to California prior to the advent of outsized wildfires in 2017-2018, has generally been supportive from a credit point of view with both jurisdictions providing utilities operating in the state with a reasonable opportunity to earn their authorized ROE. However, unlike APS, meaningful uncertainty exists for California utilities regarding the risk of future firestorms and recovery of potentially large third-party liabilities. Uncertainty regarding the magnitude, frequency and destructive force of future wildfires and efforts to enhance wildfire resilience is a key risk factor to the creditworthiness of PG&E, SCE and, to a somewhat lesser degree, SDG&E. The significant reduction in utility-triggered catastrophic wildfire destruction in 2019 and 2020 offers a modicum of hope that measures deployed by the California utilities and state and local authorities (including an extensive legislative response) will meaningfully reduce catastrophic wildfire activity, destruction and liability. Fitch projects FFO leverage at SCE to be well over 6x in 2021 but improving to under 5x in 2023 and SDG&E to be in the high 3x range in the next few years. FFO leverage for PG&E is estimated by Fitch at 6.0x in 2021 and is expected by Fitch to improve to 5.0x in 2022. KEY ASSUMPTIONS Fitch's key assumptions in its base case include the following: -- 10.25% CPUC and FERC authorized ROE; -- Total 2021-2025 capex range of $38.9 billion-$43.5 billion; -- No equity return on approximately $3.2 billion of wildfire mitigation capex; -- Incorporates CPUC authorized capital structure waiver and a hypothetical 52% equity ratio for regulatory purposes; -- CPUC authorizes issuance of $7.5 billion securitization bonds; -- FERC jurisdiction transmission wildfire costs are fully recovered; -- Rate base CAGR of 8%; -- Full recovery of $2.5 billion of deferred wildfire-related restoration, prevention and insurance costs. RATING SENSITIVITIES Factors that could, individually or collectively, lead to positive rating action/upgrade: PG&E Corporation -- An upgrade at Pacific Gas and Electric; -- Improvement in reputational, safety culture and potential catastrophic wildfire risks along with consolidated PCG FFO leverage of 5.5x on a sustained basis. Pacific Gas and Electric Company -- Meaningful reduction in the size and scale of prospective wildfire activity in PG&E's service territory; -- Consistent improvement in PG&E's safety culture leading to resolution of legal, regulatory and reputational challenges; -- Robust A.B. 1054 wildfire fund levels relative to future utility claims; -- Improvement in FFO-leverage to better than 5.5x on a sustained basis. Factors that could, individually or collectively, lead to negative rating action/downgrade: PG&E Corporation -- A downgrade at Pacific Gas and Electric Company; -- Inability to reduce parent-only debt as expected; -- PCG FFO-leverage of 6.0x on a sustained basis. Pacific Gas and Electric Company -- Continuation of catastrophic wildfire activity on par with the Northern California wildfires of 2017 and the Camp fire in 2018 and resulting large third-party liabilities under inverse condemnation; -- Failure to ameliorate reputational challenges; -- Disallowance of wildfire liabilities due to imprudence; -- More rapid than expected drawdown of the AB 1054 wildfire fund due to persistent wildfire activity and large third-party liabilities; -- Inability to address asset failures and deliver demonstrable improvement in safety culture; -- Deterioration in rate regulation; -- Adverse developments stemming from PG&E's corporate probation; -- Unfavorable legislative developments; -- These or other factors resulting in FFO-leverage of worse than 6.0x on a sustained basis. BEST/WORST CASE RATING SCENARIO International scale credit ratings of Non-Financial Corporate issuers have a best-case rating upgrade scenario (defined as the 99th percentile of rating transitions, measured in a positive direction) of three notches over a three-year rating horizon; and a worst-case rating downgrade scenario (defined as the 99th percentile of rating transitions, measured in a negative direction) of four notches over three years. The complete span of best- and worst-case scenario credit ratings for all rating categories ranges from 'AAA' to 'D'. Best- and worst-case scenario credit ratings are based on historical performance. LIQUIDITY AND DEBT STRUCTURE Adequate Liquidity: As of Mar. 31, 2021, PCG had access to credit facilities with total consolidated borrowing capacity of $5.0 billion. The $5.0 billion of consolidated borrowing capacity is comprised of a $3.5 billion revolving credit facility and $1.0 billion accounts receivable securitization program at the utility and a $500 million revolving credit facility at the corporate parent. Approximately $3.4 billion was available under the facilities at the end of 1Q 2021 net of $979 million of letters of credit outstanding and $650 million of borrowings outstanding under the utility's revolving credit facility and accounts receivable program, respectively. No borrowings were outstanding under the corporate parent's $500 million revolving credit facility as of Mar. 31, 2021. Like most utilities, PG&E is expected to be FCF negative based on Fitch's assumptions and its large capex program. Negative FCF is a function of high capex driven by spending to mitigate catastrophic wildfire activity and meet California's greenhouse gas reduction goals, which are among the most aggressive in the nation. Fitch expects cash shortfalls to be funded with a balanced mix of debt and equity. PCG and PG&E have access to debt capital markets and Fitch believes debt maturities are manageable. Consolidated cash and cash equivalents totaled $229 million at the end of 1Q 2021 with $127 million of that amount residing at the utility. ESG CONSIDERATIONS Pacific Gas and Electric Company has an ESG Relevance Score of '5' for Customer Welfare - Fair Messaging, Privacy & Data Security due to catastrophic wildfires triggered by utility equipment, which has a negative impact on the credit profile, and is highly relevant to the rating, resulting in credit rating downgrades. Pacific Gas and Electric Company has an ESG Relevance Score of '5' for Exposure to Environmental Impacts due to environmental challenges posed by drought, insect infestation, high winds and low humidity and its impact on the utility's infrastructure, which has a negative impact on the credit profile, and is highly relevant to the rating, resulting in credit rating downgrades. Pacific Gas and Electric Company has an ESG Relevance Score of '5' for Exposure to Social Impacts due to the impact of deadly, destructive fires and a poor safety record on customer satisfaction and relations with regulators and local authorities, which has a negative impact on the credit profile, and is highly relevant to the rating, resulting in credit rating downgrades. 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. PG&E CORP: Names 5 Regional VPs, New Chief Info Security Officer ---------------------------------------------------------------- As part of its commitment to enhance focus on safety, security, and operational performance, PG&E on May 27, 2021, announced the appointment of five Regional Vice Presidents and the appointment of Jerry L. Davis as Vice President and Chief Information Security Officer. Regional Vice Presidents The announcement of the regional leaders marks a milestone in PG&E's plan to move to a regional service model, as outlined in its Chapter 11 Plan of Reorganization and its Updated Regionalization Proposal filed Feb. 26, 2021, with the California Public Utilities Commission. PG&E had committed to appoint a regional leadership team by June 1, 2021. "We have assembled a strong and experienced group of leaders who will live and work in the communities they serve. This will position them to better understand and address the challenges unique to their regions. In doing so, they will have the full support of PG&E's executive leadership and the functional expertise of our 25,000 coworkers. I know they're eager to settle in and get to work, and I'm excited to welcome them to the team," said PG&E Corporation Chief Executive Officer Patti Poppe. The Regional Vice Presidents are: * Teresa Alvarado, Vice President, South Bay & Central Coast Region: Ms. Alvarado has 20 years of executive experience in the energy and water sectors and has held civic leadership roles focused on environmental justice and equity. She currently chairs the California Water Commission, which provides a public forum for discussing water issues, advises the Director of the Department of Water Resources, and approves rules and regulations. Previously, she was Chief of Local Impact for the San Francisco Bay Area Planning & Urban Research Association, where she led a team responsible for implementing effective and equitable policy and planning solutions in San Francisco, San Jose, and Oakland. Before that, she was Deputy Administrative Officer for the Santa Clara Valley Water District. Earlier in her career, she served as the founding Executive Director of the Hispanic Foundation of Silicon Valley, and worked as a Charitable Contributions Program Manager and Government Relations Representative for PG&E. * Aaron J. Johnson, Vice President, Bay Area Region. Mr. Johnson has been with PG&E for 12 years, most recently as Vice President, Wildfire Safety & Public Engagement, with responsibility for improving operational practices and situational awareness to mitigate wildfire risk and leading strategic planning for rebuilding infrastructure damaged by wildfires. Previously, he was Vice President, Customer Energy Solutions, overseeing customer and clean energy programs, including customer and technology research; program design, launch and process improvement; and assessment and integration of third-party services markets. Earlier, he was Director, Renewable Energy Procurement, shaping policy and commercial strategy for wholesale procurement to meet ambitious renewable portfolio standard targets, and led solar and wind resource development. Before joining PG&E, he served the California Public Utilities Commission as a consumer advocate, policy advisor, and regulatory analyst. * Ronald P. Richardson, Vice President, North Coast Region: Mr. Richardson joined PG&E more than 20 years ago as a utility worker and apprentice lineman, and steadily progressed through a variety of leadership roles to his current position as Senior Director of Transmission Substation Maintenance & Construction. In this role, he held responsibility for the timely repair and maintenance of transmission and substation assets; supporting efforts to reduce wildfire risk and reducing the footprint of Public Safety Power Shutoffs; and driving the delivery of the Transmission Substation Maintenance & Construction workplan. Previously, Mr. Richardson was Director, North Coast, Field Operations region, which included Humboldt, Sonoma and North Bay. Throughout his career with PG&E, he has focused on field operations, overseeing service delivery, safety inspections, maintenance and construction work, and engaging with customers to resolve escalated issues. * Joshua M. Simes, Vice President, Central Valley Region: Mr. Simes comes to PG&E from Comcast, where he spent more than two decades in field operations leadership roles. Most recently, he held the position of Vice President, Field Operations, South Valley, California, where he was responsible for all field operational activity for Comcast's South Valley Region and led a team of more than 300 members serving more than 800,000 video, internet, digital voice, home security and commercial customers. Mr. Simes initially joined Comcast as an installation technician and was subsequently promoted to a series of supervisory and leadership positions, including Field Operations Supervisor, Field Operations Manager, and Director of Field Operations. He has served as a member of the California Comcast Diversity and Inclusion Council and as an executive sponsor for the Young Professional Network. * Joe Wilson, Vice President, North Valley & Sierra Region: Mr. Wilson joined PG&E in 2012 and currently serves as Director, Community Rebuild and Resiliency Program. In this role, he has led financial planning, engineering, customer strategy, stakeholder engagement, and construction for the regional rebuilding program in Butte County, which was created in response to the impact of the Camp Fire in late 2018. Previously, he was the Regional Local Public Affairs Manager based in Sacramento, where he headed emergency response coordination with state and local agencies during wildfires, floods, and storms, and served as Liaison Officer during the North Bay, Carr, Camp Fire. He joined PG&E as a Senior Government Relations Representative in the Northern Sacramento Valley and Sierra Region after working with public utilities in Plumas County and Indian Valley. He has been active as a volunteer for civic and community organizations focused on employment, education, and economic development. The Regional Vice Presidents will report to Marlene Santos, Executive Vice President and Chief Customer Officer, and will be accountable for delivering high-quality performance and for ensuring the safety, availability, and reliability of regional operations. These leaders will be based in their assigned regions, enabling them to stay closely connected with local customers, business organizations, local counties and cities, and other community groups and be responsive to their concerns. Each Regional Vice President will be supported by a local team that will include a Regional Safety Director charged with monitoring and improving safety performance across their assigned regions and partnering with functional leaders to ensure consistency across the company. All Regional Vice Presidents are scheduled to assume their new roles effective June 1, with the exception of Mr. Simes, who starts July 6. To ensure a diverse slate of candidates for these new positions, PG&E performed a competitive national search, considering both internal and external candidates. The individuals selected were identified as the best qualified based on their skills, experiences, and leadership capabilities, including a deep understanding of utility operations and demonstrated success in building strong relationships with customers and communities. Jerry L. Davis Joins PG&E as Vice President and Chief Information Security Officer As Vice President and Chief Information Security Officer of the Utility, Mr. Davis will report to Ajay Waghray, PG&E's Senior Vice President and Chief Information Officer, effective June 7. In this position, he will lead a team responsible for overseeing and maintaining enterprise technology security to ensure that PG&E's technology assets are adequately protected. Before joining PG&E, Mr. Davis founded Gryphon X, LLC, a technology risk advisory firm, where he counseled corporate clients on strategic cybersecurity problem solving and cybersecurity readiness and served as a retained expert witness on cybersecurity matters. Prior to establishing his consulting firm, Mr. Davis served for more than 20 years in executive-level roles in physical, personnel, and cyber security. He was Vice President and Global Chief Security Officer for a global semiconductor equipment manufacturing company and served as Chief Information Officer for the NASA Ames Research Center in Silicon Valley. Previously, Mr. Davis was the Chief Information Security Officer for the U.S. Department of Education; before that, he was the Deputy Assistant Security for Cybersecurity for the U.S. Department of Veterans Affairs. "I am thrilled that Jerry is joining our team. Jerry is a proven leader in his field and brings a great depth of experience and technical expertise to this critical role. Under his leadership, we will enhance the security of our infrastructure and information systems and continue to build a world-class IT function," said Ms. Popp. About PG&E Corp. PG&E Corporation (NYSE: PCG) -- http://www.pgecorp.com/-- is a Fortune 200 energy-based holding company, headquartered in San Francisco. It is the parent company of Pacific Gas and Electric Company, an energy company that serves 16 million Californians across a 70,000-square-mile service area in Northern and Central California. As of Sept. 30, 2018, the Debtors, on a consolidated basis, had reported $71.4 billion in assets on a book value basis and $51.7 billion in liabilities on a book value basis. PG&E Corp. and Pacific Gas employ approximately 24,000 regular employees, approximately 20 of whom are employed by PG&E Corp. Of Pacific Gas' regular employees, approximately 15,000 are covered by collective bargaining agreements with local chapters of three labor unions: (i) the International Brotherhood of Electrical Workers; (ii) the Engineers and Scientists of California; and (iii) the Service Employees International Union. On Jan. 29, 2019, PG&E Corp. and its primary operating subsidiary, Pacific Gas and Electric Company, filed voluntary Chapter 11 petitions (Bankr. N.D. Cal. Lead Case No. 19-30088). PG&E Corporation and its regulated utility subsidiary, Pacific Gas and Electric Company, said they are facing extraordinary challenges relating to a series of catastrophic wildfires that occurred in Northern California in 2017 and 2018. The utility said it faces an estimated $30 billion in potential liability damages from California's deadliest wildfires of 2017 and 2018. Weil, Gotshal & Manges LLP and Cravath, Swaine & Moore LLP are serving as PG&E's legal counsel, Lazard is serving as its investment banker and AlixPartners, LLP is serving as the restructuring advisor to PG&E. Prime Clerk LLC is the claims and noticing agent. In order to help support the Company through the reorganization process, PG&E has appointed James A. Mesterharm, a managing director at AlixPartners, LLP, and an authorized representative of AP Services, LLC, to serve as Chief Restructuring Officer. In addition, PG&E appointed John Boken also a Managing Director at AlixPartners and an authorized representative of APS, to serve as Deputy Chief Restructuring Officer. Mr. Mesterharm, Mr. Boken and their colleagues at AlixPartners will continue to assist PG&E with the reorganization process and related activities. Morrison & Foerster LLP, as special regulatory counsel. Munger Tolles & Olson LLP, as special counsel. The Office of the U.S. Trustee appointed an official committee of creditors on Feb. 12, 2019. The Committee retained Milbank LLP as counsel; FTI Consulting, Inc., as financial advisor; Centerview Partners LLC as investment banker; and Epiq Corporate Restructuring, LLC as claims and noticing agent. On Feb. 15, 2019, the U.S. trustee appointed an official committee of tort claimants. The tort claimants' committee is represented by Baker & Hostetler LLP. PG&E Corporation and Pacific Gas and Electric Company announced July 1, 2020, that PG&E has emerged from Chapter 11, successfully completing its restructuring process and implementing PG&E's Plan of Reorganization that was confirmed by the Bankruptcy Court on June 20, 2020. POINT LOOKOUT: Trustee's $1.25M Sale of Ridge Property Approved --------------------------------------------------------------- Judge Lori S. Simpson of the U.S. Bankruptcy Court for the District of Columbia authorized the sale proposed by Gary A. Rosen, the Trustee for the estate of Point Lookout Marine Properties, Inc., to Point Lookout Marina, LLC, for $1.25 million of all of the Debtor's right, title and interest in and to the following property: (a) all of that improved real property commonly known and described as 16244 Millers Wharf Road, Ridge, Maryland, and being all that same real property conveyed unto the Debtor by that Deed dated Dec. 29, 2011 and recorded among the Land Records of St. Mary's County, Maryland at Liber 3658 folio 0541; and (b) all of the personal property formerly used or usable by the Debtor and the Estate in the operation of that commercial marina business located on the Realty and commonly known as "Point Lookout Marina." The Sale is free and clear of all Interests. Subject to the terms of the Agreement and the occurrence of the Closing, the assumption by the Trustee of the Assigned Agreements and the assignment of such Assigned Agreements to the Purchaser, as provided for or contemplated by the Agreement s, authorized and approved pursuant to sections 363 and 365 of the Bankruptcy Code. Notwithstanding Bankruptcy Rules 6004, 6006 and 7062, the Sale Order will be effective and enforceable immediately upon entry and its provisions will be self-executing, and the Sale Motion or notice thereof will be deemed to provide sufficient notice of the Debtor's request for waiver of the otherwise applicable stay of the Sale Order. In the absence of any person or entity obtaining a stay pending appeal, the Debtor and the Purchaser are free to close under the Agreement at any time, subject to the terms of the Agreement. All time periods set forth in the Sale Order will be calculated in accordance with Bankruptcy Rule 9006(a). About Point Lookout Marine Properties Point Lookout Marine Properties, Inc. is the owner of fee simple title to real property and improvements located at 16244 Whitaker Court St. Inigoes, Md., having a current value of $1.7 million. Point Lookout Marine Properties filed a voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. D. Md. Case No. 20-20986) on Dec. 24, 2020. Joseph N. Salvo, president of Point Lookout, signed the petition. At the time of the filing, the Debtor disclosed total assets of $1,700,000 and total liabilities of $1,993,421. Cohen Baldinger & Greenfeld, LLC and the Law Office of Joann M. Wood, LLC serve as the Debtor's bankruptcy counsel and special counsel, respectively. POWDR CORP: S&P Alters Outlook to Stable, Affirms 'B-' ICR ---------------------------------------------------------- S&P Global Ratings affirmed its 'B-' issuer credit rating on POWDR Corp. and revised its outlook to stable from negative. S&P also affirmed its 'B-' issue-level and '3' recovery ratings on the company's $300 million senior secured notes due 2025. S&P said, "The stable outlook reflects our forecast for leverage, excluding the company's subordinated payment-in-kind (PIK) debt due in 2043 held by a strategic partner, around or modestly below our 6x upgrade threshold through fiscal 2022. "We expect POWDR to end fiscal 2021 with S&P Global Ratings' adjusted leverage of approximately 6x in fiscal 2021, as a result of stronger-than-anticipated demand for its season passes and lift tickets. POWDR's results for the second quarter, ended March 31, outperformed our previously published base case." Demand for outdoor recreation increased significantly throughout the pandemic and remains elevated due to the perception that outdoor activities, such as skiing, are safe and compatible with social distancing guidelines. Due to capacity and travel restrictions that curtailed the number of skiers allowed at the company's resorts, POWDR's resort revenue, which incorporates season pass and lift ticket revenue as well as ancillary revenue from food and beverage, retail, rental, and lodging operations, declined approximately 13% through the second quarter. Additionally, POWDR implemented cost controls, and because a larger proportion of revenue was derived from higher-margin season passes and lift tickets, the company was able to moderate the decline in EBITDA to be in line with revenue. S&P said, "In our updated base case, we forecast resort revenue to decline 5%-10% in fiscal 2021. We assume capacity and travel restrictions will be largely lifted during the summer as the U.S. vaccination effort continues and that POWDR could begin the 2021/2022 ski season with few capacity limitations. As a result, we expect a significant recovery in ancillary revenue and for resort revenue to grow in the 5%-10% range in fiscal 2022. We have assumed that EBITDA margin remains in the 19%-20% range as increased skier visitation is offset by low-margin ancillary revenue. Additionally, we expect the company to spend approximately $15 million-$25 million in capital expenditures through fiscal 2023, which is significantly lower than what the company has spent in recent years, resulting in positive free operating cash flow of approximately $20 million-$30 million in 2021 and approximately $15 million in 2022 and 2023." S&P said, "Under these base-case assumptions, we expect the company to generate adjusted EBITDA of approximately $50 million in 2021 and $55 million-$60 million in 2022. We expect the company to maintain S&P Global Ratings' adjusted debt to EBITDA of approximately 6x in 2021 and that leverage could improve to the mid-5x area in fiscal 2022. We expect EBITDA coverage of interest will be between 2x-2.5x in fiscal 2022. Prior to any ski season, there is typically some level of uncertainty around demand, revenue, and EBITDA generation based on snowfall conditions, and that adverse weather conditions in one or more of POWDR's major markets could cause EBITDA to be lower and leverage higher than our base-case forecast. Lastly, while not currently incorporated in our base case, we believe POWDR could engage in some level of merger and acquisition (M&A) activity or make a distribution to shareholders given its high cash balances, which totaled approximately $144 million on March 31. Incorporating modest levels of leveraging M&A activity and shareholder distributions, we believe the company could burn cash in 2021 and 2022. However, we believe the company would likely maintain leverage and EBITDA coverage of interest in line with its current rating. "We believe POWDR's portfolio of primarily regional and drive-to resorts favorably positions the company to recover in fiscal 2022. We believe regional, drive-to resorts could continue to experience elevated demand for as long as lingering consumer apprehension regarding commercial air travel persists. While we expect air travel to begin to recover as the United States moves toward widespread immunization, there could be some level of hesitancy among travelers, at least over the near term. This could lead to strong skier visitation at POWDR's resorts during the 2021/2022 ski season. However, somewhat offsetting this factor is POWDR's lower level of presold season pass revenue. POWDR derives a lower percentage of its revenue from season pass sales sold prior to the start of the ski season. We believe that a higher proportion of presold revenue provides ski operators with greater visibility into skier visitation and positions operators to be able to favorably withstand shifts in demand due to adverse weather conditions during the ski season." Business risks include the company's exposure to consumer discretionary and travel spending, the small scale of its revenue base, reliance on favorable snow conditions, revenue and EBITDA concentration at its Copper Mountain resort, and lower profitability than that of rated peers. While POWDR has diversified its product offerings in recent years by acquiring Woodward action sports camps, the winter season still accounts for over 85% of revenue. Lift access, inclusive of lift tickets and season pass sales, accounts for approximately 50% of total revenue, which S&P believes leaves POWDR reliant on a single line of business to drive profitability and that revenue and EBITDA generation are vulnerable to variations in seasonal snowfall patterns, and the cyclical nature of consumer discretionary and travel spending. Its revenue base is smaller than that of rated peers, even those with a comparable number of resorts and similar skiable acres. Its EBITDA margin is modestly lower as well, likely due to lower pricing power. The company also has significant revenue and EBITDA concentration at Copper Mountain in Colorado, which S&P believes accounts for approximately 35% of revenue and a large portion of the company's EBITDA. S&P said, "The stable outlook reflects our expectation that POWDR Corp. will maintain leverage in the 6x area through fiscal 2021 even if the company makes a modest amount of leveraging acquisitions in 2021 and 2022. "We could lower our ratings if the company experienced a significant decline in skier visitation, revenue, and EBITDA to the extent that we view POWDR's capital structure as unsustainable. This would likely be the result of a combination of an unanticipated, severe economic recession causing discretionary spending to decline and adverse weather patterns across the United States. "We could raise the rating if POWDR sustains S&P Global Ratings' adjusted debt to EBITDA under our 6x upgrade threshold, excluding PIK debt, incorporating a pullback in demand or moderately adverse weather conditions and leveraging M&A transactions." PREMIERE GLOBAL SERVICES: S&P Lowers ICR to 'CCC-', Outlook Neg. ---------------------------------------------------------------- S&P Global Ratings lowered all of its ratings on U.S.-based global audio conferencing service provider Premiere Global Services Inc.'s (PGi) by two notches, including its issuer credit rating, to 'CCC-' from 'CCC+' to reflect the increased likelihood of a default or distressed exchange over the next six months. The negative outlook reflects the potential that S&P will downgrade PGi to 'CC' if it announces a default or distressed exchange. The downgrade reflects the deterioration in the company's liquidity profile, which has made a default or distressed exchange appear almost inevitable over the next six-months absent external liquidity support. S&P said, "We expect that PGi will only have about $5 million-$15 million of total liquidity, including cash and revolver availability, by the end of 2021 based on its declining earnings. While we recognize that the company received some support from its private-equity sponsor in 2020 ($25 million in the first quarter), we believe there is a decreased likelihood that its sponsor will provide it with additional cash infusions in 2021 given the accelerated declines in its operating performance." S&P said, "We also believe the company's lower earnings and negative free operating cash flow (FOCF) will weaken its credit metrics such that they continue to render its capital structure unsustainable. For example, we forecast PGi's S&P Global Ratings-adjusted leverage will likely rise above 15x (from about 8x as of fiscal year-end 2020) in 2021 with limited prospects for improvement in 2022. We believe this could make it more difficult for the company to raise incremental funding, particularly given current industry conditions." Similar to its industry peers, PGi faces secular industry pressures because its customers have been shifting to less-expensive web collaboration business services. Although a temporary rise in the demand for audio conferencing services due to COVID-19 led to a strong increase in the company's organic earnings in the first half of 2020, the trend was not sustainable given the secular pressures facing the segment. The automated audio conferencing market is declining at an accelerated pace (with sales falling by the 30%-50% area annually) due to continued price compression because of the highly competitive communications market and increased competition from Skype for Business. S&P believes that PGi will be unable to offset the pricing pressure in this segment, which accounts for about 40% of its total revenue, with volume growth because the increased competition from new and existing entrants will likely lead to a decline in the number of calls made per month. The negative outlook on PGi reflects that a default or distressed exchange or redemption appears inevitable over the next six months absent an unanticipated and significantly favorable change in its circumstances. S&P said, "We could lower our rating on PGi to 'CC' if we believe a default is a virtual certainty, which would likely occur if management announces a missed interest payment or distressed exchange. "Although unlikely, we could raise our rating on PGi if it improves its liquidity position such that it no longer faces a near-term cash default or covenant breach, which would most likely occur if it received an equity infusion from its private-equity sponsor and reported a material deceleration of the revenue declines in its automated conferencing business." PRO VIDEO: Case Summary & 10 Unsecured Creditors ------------------------------------------------ Debtor: Pro Video Instruments, LLC 6457 Hazeltine National Drive, Ste. 125 Orlando, FL 32822 Business Description: Pro Video Instruments is a hi-tech manufacturer of digital video distribution products, providing solutions for the homes, hospitality, entertainment, advertising, sport, broadcast, Internet, security, surveillance, industrial, educational, scientific, and consumer markets. Chapter 11 Petition Date: May 28, 2021 Court: United States Bankruptcy Court Middle District of Florida Case No.: 21-02491 Debtor's Counsel: Justin M. Luna, Esq. LATHAM LUNA EDEN & BEAUDINE LLP P.O. Box 3353 Orlando, FL 32802-3353 Tel: (407) 481-5800 Fax: (407) 481-5801 E-mail: jluna@lathamluna.com Estimated Assets: $100,000 to $500,000 Estimated Liabilities: $1 million to $10 million The petition was signed by Silvia Fioravanti, manager. A full-text copy of the petition containing, among other items, a list of the Debtor's 10 unsecured creditors is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/L7UCOWA/Pro_Video_Instruments_LLC__flmbke-21-02491__0001.0.pdf?mcid=tGE4TAMA PROFESSIONAL DIVERSITY: Receives Noncompliance Notice From Nasdaq ----------------------------------------------------------------- Professional Diversity Network, Inc. received a letter from Nasdaq notifying the Company that it is not in compliance with the minimum stockholders' equity requirement for continued listing on the Nasdaq Capital Market. Nasdaq Listing Rule 5550(b)(1) requires listed companies to maintain stockholders' equity of at least $2.5 million. In the Company's Quarterly Report on Form 10-Q for the period ended March 31, 2021, the Company reported stockholders' equity of $964,288, which is below the minimum stockholders' equity required for continued listing. Further, as of May 21, 2021, the Company does not meet the alternatives of market value of listed securities or net income from continuing operations. This notification has no immediate effect on the Company's listing on the Nasdaq Capital Market. Nasdaq has provided the Company with 45 calendar days, or until July 5, 2021, to submit a plan to regain compliance with the minimum stockholders' equity standard. If the Company's plan to regain compliance is accepted, Nasdaq may grant an extension of up to 180 calendar days from the date of the notification letter, or until Nov. 17, 2021, to evidence compliance. As previously disclosed, on April 22, 2021, the Company learned that RMB 18,841,064.15 (approximately $2.87 mm) had been seized from the PDN China Account by Chinese local authorities to satisfy a judgment in favor of the plaintiffs in the Gatewang case. On April 26, 2021, the Company concluded that the seizure of such cash assets is a material reduction of Company assets and reduced the Company's stockholders' equity by an equal amount. The Company plans to pursue all possible legal alternatives to have these funds returned to the Company but such return is uncertain at this time. The Company is presently evaluating other courses of action to regain compliance with the Nasdaq minimum stockholders' equity standard and intends to timely submit a plan to Nasdaq to regain compliance with that standard. About Professional Diversity Headquartered in Chicago, Illinois, Professional Diversity Network, Inc. -- https://www.prodivnet.com -- is a global developer and operator of online and in-person networks that provides access to networking, training, educational and employment opportunities for diverse professionals. Through an online platform and its relationship recruitment affinity groups, the Company provides its employer clients a means to identify and acquire diverse talent and assist them with their efforts to recruit diverse employees. Its mission is to utilize the collective strength of its affiliate companies, members, partners and unique proprietary platform to be the standard in business diversity recruiting, networking and professional development for women, minorities, veterans, LGBT and disabled persons globally. Professional Diversity reported a net loss of $4.35 million for the year ended Dec. 31, 2020, compared to a net loss of $3.84 million for the year ended Dec. 31, 2019. As of March 31, 2021, the Company had $6.04 million in total assets, $5.07 million in total liabilities, and $964,228 in total stockholders' equity. Wilmington, DE-based Ciro E. Adams, CPA, LLC, the Company's auditor since 2018, issued a "going concern" qualification in its report dated April 9, 2021, citing that the Company has a significant working capital deficiency, has incurred significant losses, and needs to raise additional funds to meet its obligations and sustain its operations. These conditions raise substantial doubt about the Company's ability to continue as a going concern. PUERTO RICO: PREPA Board Seeks Bankruptcy Exit in 2021 ------------------------------------------------------ Michelle Kaske of Bloomberg News reports that Puerto Rico's financial oversight board is aiming to get the commonwealth out of its record bankruptcy by the end of 2021, a move that is expected to help lift the island out of years of economic decline. The oversight board, which Congress created in 2016 to fix Puerto Rico's financial crisis, filed a restructuring plan this month to the bankruptcy court to reduce $22 billion of debt. Judge Laura Taylor Swain is set to hear arguments on the restructuring at a July 13, 2021 hearing. About Puerto Rico Puerto Rico is a self-governing commonwealth in association with the United States that's facing a massive bond debt of $70 billion, a 68% debt-to-GDP ratio and negative economic growth in nine of the last 10 years. The Commonwealth of Puerto Rico has sought bankruptcy protection, aiming to restructure its massive $74 billion debt-load and $49 billion in pension obligations. The debt restructuring petition was filed by Puerto Rico's financial oversight board in U.S. District Court in Puerto Rico (Case No. 17-01578) on May 3, 2017, and was made under Title III of 2016's U.S. Congressional rescue law known as the Puerto Rico Oversight, Management, and Economic Stability Act ('PROMESA'). The Financial Oversight and Management Board later commenced Title III cases for the Puerto Rico Sales Tax Financing Corporation (COFINA) on May 5, 2017, and the Employees Retirement System (ERS) and the Puerto Rico Highways and Transportation Authority (HTA) on May 21, 2017. On July 2, 2017, a Title III case was commenced for the Puerto Rico Electric Power Authority ("PREPA"). U.S. Chief Justice John Roberts has appointed U.S. District Judge Laura Taylor Swain to oversee the Title III cases. The Honorable Judith Dein, a United States Magistrate Judge for the District of Massachusetts, has been designated to preside over matters that may be referred to her by Judge Swain, including discovery disputes, and management of other pretrial proceedings. Joint administration of the Title III cases, under Lead Case No. 17-3283, was granted on June 29, 2017. The Oversight Board has hired as advisors, Proskauer Rose LLP and O'Neill & Borges LLC as legal counsel, McKinsey & Co. as strategic consultant, Citigroup Global Markets, as municipal investment banker, and Ernst & Young, as financial advisor. Martin J. Bienenstock, Esq., Scott K. Rutsky, Esq., and Philip M. Abelson, Esq., of Proskauer Rose; and Hermann D. Bauer, Esq., at O'Neill & Borges are on-board as attorneys. McKinsey & Co. is the Board's strategic consultant, Ernst & Young is the Board's financial advisor, and Citigroup Global Markets Inc. is the Board's municipal investment banker. Prime Clerk LLC is the claims and noticing agent. Prime Clerk maintains a case web site at https://cases.primeclerk.com/puertorico Epiq Bankruptcy Solutions LLC is the service agent for ERS, HTA, and PREPA. O'Melveny & Myers LLP is counsel to the Commonwealth's Puerto Rico Fiscal Agency and Financial Advisory Authority (AAFAF), the agency responsible for negotiations with bondholders. The Oversight Board named Professor Nancy B. Rapoport as fee examiner and chair of a committee to review professionals' fees. PURDUE PHARMA: Judge Says Disclosures Gives Creditors Enough Info ----------------------------------------------------------------- Law360 reports that a New York bankruptcy judge gave a preliminary nod Wednesday, May 26, 2021, to Purdue Pharma's Chapter 11 plan disclosures, but held off on an approval order after the drugmaker said it needed to clear up some disputes and add a few details to the statement. Following a seven-hour hearing held virtually, U.S. Bankruptcy Judge Robert Drain said that as it stands Purdue's disclosure gives creditors enough information to decide how to vote on the plan, but that he would hold off on a final order until possibly next week while Purdue fills in some blanks and resolves what the company said were "tiny". 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. QUANTUM CORP: Widens Net Loss to $35.5 Million in Fiscal 2021 ------------------------------------------------------------- Quantum Corporation filed with the Securities and Exchange Commission its Annual Report on Form 10-K disclosing a net loss of $35.46 million on $349.58 million of total revenue for the year ended March 31, 2021, compared to a net loss of $5.21 million on $402.95 million of total revenue for the year ended March 31, 2020. As of March 31, 2021, the Company had $194.92 million in total assets, $307.17 million in total liabilities, and a total stockholders' deficit of $112.25 million. Cash and cash equivalents of $33.1 million as of March 31, 2021, compared to $12.7 million as of March 31, 2020. Both balances include $5.0 million in restricted cash required under the Company's Credit Agreements, and $0.8 million and $0.7 million of short-term restricted cash as of March 31, 2021 and March 31, 2020, respectively. Outstanding long-term debt as of March 31, 2021 was $90.9 million, net of $9.7 million in unamortized debt issuance costs and $1.9 million in current portion of long-term debt. This compares to $146.8 million of outstanding debt as of March 31, 2020, net of $13.7 million in unamortized debt issuance costs and $7.3 million in current portion of long-term debt. Fourth Quarter Fiscal 2021 vs. Prior Quarter Customer demand during the fourth fiscal quarter of 2021 returned to pre-COVID order levels, however the Company experienced similar component shortage supply issues as many of its peers. As a result of these supply chain constraints, revenue was $92.4 million for the fourth quarter fiscal 2021 representing a decline of 5.7% sequentially. Gross profit in the fourth quarter of fiscal 2021 was $38.9 million, or 42.1% of revenue, compared to $42.3 million, or 43.1% of revenue, in the prior quarter. The decrease in gross margin reflects a less favorable product mix during the quarter. Total operating expenses in the fourth quarter of fiscal 2021 were $36.6 million, or 39.6% of revenue, compared to $36.2 million, or 36.9% of revenue, in the prior quarter. Selling, general and administrative expenses were $24.1 million in the quarter, compared to $26.4 million in the third fiscal quarter. Research and development expenses were $11.7 million in the fourth quarter of fiscal 2021, compared to $9.6 million last quarter. GAAP net loss in the fourth quarter of fiscal 2021 was $17.5 million, or ($0.35) per share, compared to a net loss of $2.7 million, or ($0.07) per share, in the third fiscal quarter. Fourth quarter 2021 included a debt extinguishment charge of $14.8 million related to the early retirement of $92.3 million of a senior secured term loan. Excluding stock compensation, restructuring charges and other non-recurring costs, non-GAAP adjusted net income in the fourth fiscal quarter improved to $2.1 million, or $0.03 per diluted share, compared to adjusted net income of $0.0 million, or $0.00 per basic and diluted share, last quarter. Adjusted EBITDA in the fourth quarter of fiscal 2021 was $8.3 million, compared to $9.4 million in the prior quarter. Management Commentary Jamie Lerner, chairman and CEO, Quantum commented, "Demand in the fiscal fourth quarter was strong as demonstrated by the third consecutive quarter of increasing customer orders, with demand returning to pre-COVID levels. However, supply chain shortages experienced industry-wide materialized late in the quarter, which restricted our ability to fulfill all orders. These shortages combined with our increased levels of bookings have created a significant backlog as we enter the first quarter of fiscal 2022. Most notable in the fourth quarter, the year-over-year increase in revenue, coupled with prudent expense management, resulted in EBITDA of $8.3 million, as well as adjusted net income and adjusted EPS, both of which exceeded our guidance. "Our strong cash management enabled us to improve our cash position for the quarter resulting in an ending balance of $33.1 million with no funds drawn on the revolving line of credit. Our significant improvement in our cash balance during the fourth fiscal quarter was supported by the successful completion of a secondary offering in early February, in which we raised over $100 million that allowed us to reduce our senior secured term loan by half. We expect to refinance the remaining portion of our senior secured loan at more favorable terms early in the second fiscal quarter, allowing for a reduction in future interest payments that will provide additional strategic operating flexibility to support our future growth initiatives." Mr. Lerner further commented, "Our business transformation is progressing as Quantum's software and subscription customers exceeded 120 in the quarter and continues to expand. Although, we remain in the early stages of this shift towards software revenue, we expect to secure an increasing number of recurring subscriptions in the quarters ahead. Looking forward, we expect customer demand to continue expanding and are working closely with our suppliers to manage the current supply chain challenges." Outlook Mike Dodson, CFO, Quantum stated, "As we enter the first fiscal quarter of 2022, Quantum has built a sizable backlog and expects demand and customer orders to continue expanding, at or above pre-COVID levels. However, the industry-wide supply chain constraints are expected to continue restricting our ability to fulfill all orders." As a result, the Company expects revenues to be $92 million, plus or minus $3 million for the first fiscal quarter of 2022. Non-GAAP adjusted net loss is expected to be $1 million, plus or minus $1 million, and related adjusted loss per share of $0.01, plus or minus $0.01. Adjusted EBITDA is expected to be $5 million, plus or minus $1 million. Dodson further commented, "Despite these near-term supply chain constraints, we expect strong demand to continue throughout the coming fiscal year, further supported by an expanding pipeline of opportunities across our business. Although we remain cautious regarding the timing as to the normalization of the supply chain, we continue to manage through the constraints and are working closely with our key suppliers and extending supply commitments as we address these short-term challenges. As such, we expect revenue for the full year fiscal 2022 to be in the range of $380 to $420 million, determined by the timing of supply chain improvements." A full-text copy of the Form 10-K is available for free at: https://www.sec.gov/ix?doc=/Archives/edgar/data/709283/000070928321000024/qtm-20210331.htm About Quantum Corp. Based in San Jose, California, Quantum Corp. (NYSE:QTM) -- http://www.quantum.com-- provides technology and services that stores and manages video and video-like data delivering the industry's top streaming performance for video and rich media applications, along with low cost, high density massive-scale data protection and archive systems. The Company helps customers capture, create and share digital data and preserve and protect it for decades. QUEST PATENT: Incurs $5.2 Million Net Loss in First Quarter ----------------------------------------------------------- Quest Patent Research Corporation filed with the Securities and Exchange Commission its Quarterly Report on Form 10-Q disclosing a net loss of $5.15 million on $0 of revenues for the three months ended March 31, 2021, compared to a net loss of $682,798 on $870,103 of revenues for the three months ended March 31, 2020. As of March 31, 2021, the Company had $2.95 million in total assets, $12.28 million in total liabilities, and a total stockholders' deficit of $9.33 million. At March 31, 2020, the Company had current assets of approximately $883,000, and current liabilities of approximately $11,443,000. The Company's current liabilities include approximately $1,385,000 payable to Intellectual Ventures, a non-interest bearing total monetization proceeds obligation to Intelligent Partners in the amount of $2,805,000 under the Restructure Agreement, which is only payable from money generated from the monetization of intellectual property, funding liabilities of $2,500,000 payable to QFL, and loans payable of $147,000 and accrued interest of approximately $289,000 due to former directors and minority stockholders. As of March 31, 2021, the Company has an accumulated deficit of approximately $26,438,000 and a negative working capital of approximately $10,560,000. Other than salary and pension benefits to our chief executive officer, the Company does not contemplate any other material operating expense in the near future other than normal general and administrative expenses, including expenses relating to the Company's status as a public company filing reports with the SEC. "We cannot assure you that we will be successful in generating future revenues, in obtaining additional debt or equity financing or that such additional debt or equity financing will be available on terms acceptable to us, if at all, or that we will be able to obtain any third party funding in connection with any of our intellectual property portfolios. We have no credit facilities," Quest Patent said. "We cannot predict the success of any pending or future litigation. Typically, our agreements with the funding sources provide that the funding sources will participate in any recovery which is generated. We believe that our financial condition, our history of losses and negative cash flow from operations, and our low stock price make it difficult for us to raise funds in the debt or equity markets," the Company said. A full-text copy of the Form 10-Q is available for free at: https://www.sec.gov/Archives/edgar/data/824416/000121390021028745/f10q0321_questpatent.htm About Quest Patent Rye, New York-based Quest Patent Research Corporation -- http://www.qprc.com-- is an intellectual property asset management company. The Company's principal operations include the development, acquisition, licensing and enforcement of intellectual property rights that are either owned or controlled by the Company or one of its wholly owned subsidiaries. The Company currently owns, controls or manages eleven intellectual property portfolios, which principally consist of patent rights. Quest Patent reported a net loss of $1.31 million for the year ended Dec. 31, 2020, compared to a net loss of $1.30 million for the year ended Dec. 31, 2019. As of Dec. 31, 2020, the Company had $3.49 million in total assets, $10.33 million in total liabilities, and a total stockholders' deficit of $6.84 million. Houston, Texas-based MaloneBailey, LLP, the Company's auditor since 2013, issued a "going concern" qualification in its report dated April 15, 2021, citing that the Company has suffered recurring losses from operations and has a net capital deficiency that raises substantial doubt about its ability to continue as a going concern. RANDOLPH HOSPITAL: Wins June 4 Solicitation Exclusivity Extension ----------------------------------------------------------------- At the behest of Debtor Randolph Hospital, Inc. and its affiliates, Judge Lena Mansori James of the U.S. Bankruptcy Court for the Middle District of North Carolina, Greensboro Division extended the Debtors' period to solicit acceptances of their Chapter 11 Plan through and including June 4, 2021. On February 1, 2021, the Debtors filed their Joint Plan of Liquidation and Disclosure Statement. The Plan is premised upon the distribution of the proceeds of the sale to American Healthcare Systems, LLC ("AHS"). Since the entry of the Sale Order, the Debtors have been diligently working to satisfy all conditions and close the sale to AHS. Nonetheless, critical pre-closing requirements remain outstanding, including without limitation obtaining a commitment for funding under the Program and finalizing (and receiving necessary regulatory approvals for) the AHS and Cone Health transaction relating to the Cancer Center and StayWell. Since the Debtors timely filed their Plan within their filing exclusivity period, the Debtors sought to extend the Soliciting Exclusivity Period to June 4, 2021, which is the anticipated date of the confirmation hearing on the Debtors' Plan. The Debtors believe they have satisfied the requirements of Section 1121(d), as well as the other factors that courts generally examine when determining whether to extend a Debtor's exclusivity periods. Given the pendency of critical contingencies and pre-closing requirements, the Debtors received a continuance of the hearing on the Disclosure Statement on April 1, 2021. The extension of the Debtors' Soliciting Exclusivity Period is in the best interests of their estates. It will help the Debtors to focus their resources on satisfying the remaining items to close the sale transaction. Otherwise, there is the risk the Debtors would be forced to make costly amendments or supplements to the solicitation materials if the Debtors initiated solicitation before the resolution of the material conditions to the AHS sale. A copy of the Debtors' Motion to extend is available at https://bit.ly/3yHXZhk from Epiq11.com. A copy of the Court's Extension Order is available at https://bit.ly/3hWbyUC from Epiq11.com. About Randolph Hospital Randolph Hospital -- https://www.randolphhealth.org/ -- operates as a hospital that provides inpatient and outpatient services in North Carolina. The Company offers, among other services, cancer care, imaging, maternity services, cardiac services, surgical services, outpatient specialty clinics, rehabilitation services, and emergency services. Randolph Hospital, Inc. and its affiliates, MRI of Asheboro, LLC and Randolph Specialty Group Practice, each filed a voluntary petition for relief under chapter 11 of the Bankruptcy Code (Bankr. M.D.N.C. Lead Case No. 20-10247) on March 6, 2020. In the petition signed by CRO Louis E. Robichaux IV, Randolph Hospital was estimated to have $100 million to $500 million in both assets and liabilities. Judge Lena Mansori James oversees the case. The Debtor is represented by Jody A. Bedenbaugh, Esq., and Graham S. Mitchell, Esq., at Nelson Mullins Riley & Scarborough LLP. William Miller, the bankruptcy administrator for the U.S. Bankruptcy Court for the Middle District of North Carolina, appointed a committee to represent unsecured creditors in the Chapter 11 cases. The committee retained Spilman Thomas & Battle, PLLC as counsel; Sills Cummis & Gross, P.C., as co-counsel; and Gibbins Advisors, LLC, as financial advisor. Melanie L. Cyganowski was appointed as patient care ombudsman in the Debtors' bankruptcy cases. The PCO is represented by Otterbourg P.C. as her legal counsel effective May 5, 2020. REALOGY GROUP: Moody's Hikes CFR to B1, Outlook Remains Stable -------------------------------------------------------------- Moody's Investors Service upgraded Realogy Group LLC's corporate family rating to B1 from B2, probability of default rating to B1-PD from B2-PD, senior secured bank credit facilities to Ba1 from Ba2, senior secured 2nd lien notes to B1 from B2, and senior unsecured notes to B3 from Caa1. The speculative grade liquidity rating was upgraded to SGL-1 from SGL-2. The outlook is stable. Realogy announced it is selling $300 million of exchangeable senior unsecured notes due 2026 (unrated) and will use the proceeds to pay related fees, expenses and the cost of certain exchangeable note hedge transactions, as well as for general corporate purposes. RATINGS RATIONALE "Recent and anticipated debt repayment, as well as Moody's expectation that Realogy will continue to generate good free cash flow, drive the upgrade of the CFR to B1 from B2," said Edmond DeForest, Moody's Senior Vice President. The B1 CFR reflects Moody's expectations for over $200 million of free cash flow and debt to EBITDA around 5.0 times in 2021. Financial leverage may rise from debt to EBITDA of 4.8 times as of March 31, 2021 due to the increase in debt from the exchangeable notes offer and as approximately $150 million of temporary cost cuts implemented in 2020 roll off. Moody's anticipates that Realogy will use cash, free cash flow and the net proceeds of the exchangeable notes to repay a substantial portion of its other debts over the next 12 to 18 months. All financial metrics cited reflect Moody's standard adjustments. Moody's expects the existing home sales market nationally will remain robust in the second half of 2021, but that the market is likely to peak this year. Therefore, Moody's also expects that Realogy's revenue may decline in 2022 versus 2021, driven by the maturing of the post-COVID economic recovery leading to fewer existing home sale transactions, mitigated somewhat by rising average home sale prices. Operating leverage in Realogy's owned brokerage unit and permanent cost reductions should help EBITA rates rebound to above 10% in 2022. Additional support is provided by a strong portfolio of brands and leading existing homes sale brokerage market position. Realogy's owned brokerage operations are concentrated in the largest US markets, including most large suburban markets experiencing an existing home sale market boom, but also in New York City, where Realogy has a large, multi-brand owned brokerage presence and existing home sales conditions are not as robust as elsewhere in the country. Moody's considers the residential real estate brokerage market volatile, cyclical and seasonal. Although commission costs are variable, Realogy's owned brokerages have a high degree of fixed operating costs. A high proportion of its profits reflect home sale market activity as opposed to less-transactional franchise fees. Realogy's leading position in the residential real estate brokerage market positions the company well to improve financial metrics steadily while existing home sale volumes and price continue to grow. Moody's expects the residential real estate brokerage industry will continue to benefit from low interest rates and the strong housing market that has developed over the previous year into the second half of 2021. However, Moody's anticipates that the number of home sale transactions may plateau or decline in the second half of 2021 versus late 2020 levels as the post-COVID boom concludes, and that transactions may decline further in 2022, although likely remain above 2019 levels. Competition from non-traditional technology-enabled competitors including RedFin and Zillow, own-to-rent buyers and home flippers has grown. Additionally, Realogy's high operating and financial leverage could limit its flexibility if competition increases or the negative impacts of the pandemic on the existing home sale market linger for an extended period. Moody's regards the coronavirus outbreak as a social risk under its ESG framework, given the substantial implications for public health and safety. As a public company, Realogy provides transparency into its governance and financial results and goals. The 11-person board of directors is controlled by independent directors. Moody's expects Realogy to maintain conservative financial strategies including repaying debt, building liquidity and eschewing large debt-funded M&A or any share repurchase activity until its financial leverage is reduced. Additionally, Realogy does not exhibit material environmental risks. The Ba1 rating on the senior secured bank credit facilities reflects their priority position in the capital structure and a Loss Given Default ("LGD") assessment of LGD2. The debt is secured by a pledge of substantially all of the company's domestic assets (other than excluded entities and excluding accounts receivable pledged for the securitization of the facility) and 65% of the stock of foreign subsidiaries. The Ba1 rating, three notches above the CFR, benefits from loss absorption provided by the junior ranking debt and non-debt obligations. The B1 rating on the senior secured second lien notes reflects their subordination to the existing first lien senior secured bank facilities, seniority to the senior unsecured notes, and a LGD assessment of LGD3. The second lien is secured by a second lien on substantially all of the company's domestic assets (other than excluded entities and excluding accounts receivable pledged for the securitization facility) and 65% of the stock of foreign subsidiaries. The B3 rating on the senior unsecured notes reflects the B1-PD PDR and a LGD assessment of LGD5. The LGD assessment reflects effective subordination to all the secured debt. The senior notes are guaranteed by substantially all of the company's domestic assets (other than excluded entities and excluding accounts receivable pledged for the securitization facility) and 65% of the stock of foreign subsidiaries). The unrated exchangeable notes are ranked pari passu with Realogy's rated unsecured notes in Moody's hierarchy of claims at default. The SGL-1 speculative grade liquidity rating reflects Realogy's very good liquidity profile. As of March 31, 2021 and pro forma for a $150 million term loan repayment made in April, Realogy had a cash balance of $254 million that will grow to about $500 million with the net proceeds of the exchangeable note sale. Moody's anticipates more than $230 million of free cash flow in 2021 and full availability under the company's $1.425 billion revolving credit facilities. A $477 million portion of the revolver matures in 2023 while $948 million matures in 2025 so long as Realogy repays or refinances its 4.875% senior notes due June 2023 before March 2023 and repays or refinances its senior secured 1st lien term loan B due February 2025 before November 2024. Realogy's cash flow is seasonal, with negative cash flow typically in the 1st fiscal quarter. Moody's expects Realogy will maintain a comfortable margin below the maximum senior secured net debt to EBITDA (as defined in the facility agreement) financial maintenance covenant applicable to the secured 1st lien debt over the 12 to 15 months. Realogy has only around $15 million of annual required term loan principal payments. The stable outlook reflects Moody's expectations for Realogy to repay debt, maintain debt to EBITDA around 5.0 times, very good liquidity and creditor-friendly financial strategies. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS The ratings could be upgraded if Moody's expects Realogy will sustain through market cycles: 1) debt to EBITDA below 4.5 times, 2) free cash flow to debt of at least 8%, 3) very good liquidity, and 4) balanced financial strategies, including an emphasis upon repaying debt and extending its debt maturity profile. The ratings could be downgraded if Moody's anticipates: 1) debt to EBITDA to remain above 5.5 times, 2) diminished liquidity, or 3) Realogy will not repay debt and adopt more aggressive financial strategies featuring large, debt-financed acquisitions or shareholder returns. The principal methodology used in these ratings was Business and Consumer Service Industry published in October 2016. Issuer: Realogy Group LLC Corporate Family Rating, Upgraded to B1 from B2 Probability of Default Rating, Upgraded to B1-PD from B2-PD Speculative Grade Liquidity Rating, Upgraded to SGL-1 from SGL-2 Senior Secured Bank Credit Facility, Upgraded to Ba1 (LGD2) from Ba2 (LGD2) Senior Secured 2nd Lien Regular Bond/Debenture, Upgraded to B1 (LGD3) from B2 (LGD4) Gtd Senior Unsecured Regular Bond/Debenture, Upgraded to B3 (LGD5) from Caa1 (LGD5) Senior Unsecured Regular Bond/Debenture, Upgraded to B3 (LGD5) from Caa1 (LGD5) Realogy Holdings Corp. (NYSE: RLGY) provides integrated US residential real estate services, encompassing franchise, brokerage, relocation, and title and settlement businesses as well as a mortgage joint venture. Realogy's brand portfolio includes Better Homes and Gardens(R) Real Estate, CENTURY 21(R), Coldwell Banker(R), Coldwell Banker Commercial(R), Corcoran(R), ERA(R), and Sotheby's International Realty(R). Moody's expects 2021 revenues of approaching $7 billion. RENOVATE AMERICA: Unsecureds to Split Liquidating Trust Pro Rata ---------------------------------------------------------------- Renovate America, Inc. (RAI) and its debtor-affiliates filed with the Bankruptcy Court a Combined Disclosure Statement and Joint Chapter 11 Plan on May 21, 2021. With the Plan, the Debtors intend to (i) resolve outstanding claims and interest in their cases; (ii) accomplish their reorganization and the provision for the issuance and sale of the New Common Stock in the Reorganized Debtor; (iii) the liquidation of their remaining assets; and (iv) the distribution of the proceeds of the assets to the holders of Allowed Claims in their cases. Treatment of Claims under the Plan: A. These Claims will recover 100% of their allowed amounts: * Class 1A Allowed Priority Claims against RAI; * Class 1B Allowed Priority Claims against PEFI; * Class 2 Secured Credit Facility Claims; * Class 3A Other Secured Claims against RAI * Class 3B Other Secured Claims against PEFI Claims against PEFI are claims against Personal Energy Finance, Inc., a wholly-owned debtor affiliate. * Class 2 Secured Credit Facility Claims Holders of these Claims are presumed to accept the Plan except for the holders of Class 2 Claims, who are entitled to vote on the Plan. Class 2 Claims shall be deemed allowed for $1,252,944, plus any accrued and unpaid interest, fees, expenses, and disbursements payable under the Credit Documents, including legal fees and fees due to service providers aggregating $130,000. The holder of the Allowed Class 2 Claims shall receive: -- the Credit Facility Collateral, including any Cash that is Credit Facility Collateral, shall be assigned to the holder of the AllowedClass 2 Claim or its designee; -- any proceeds from the realization, sale, or other disposition of the Credit Facility Collateral shall first be applied, Pro Rata, free and clear of any liens and other encumbrances to (x) the Collateral Agent and the Escrow Agent for the amount of accrued and unpaid Collateral Agent Fees, including reasonable attorneys' fees, expenses, and costs; and (y) the Administrative Agent for any accrued and unpaid Administrative Fees), including reasonable attorneys' fees, legal fees, and collection costs. -- after the distributions in Section 4.2(2)(b)(ii) under the Plan are made, the holder of the Allowed Class 2 Claim shall receive, free and clear of any liens and other encumbrances, 100% of any proceeds of the Credit Facility Collateral in respect of all Obligations under the RAI Credit Agreement; provided that the holder of the Allowed Class 2 Claim shall carve out 30% of such proceeds for the benefit of the RAI Beneficiaries of the Liquidating Trust, free and clear of any liens and encumbrances, and shall remit those funds to the Liquidating Trust. -- if the Allowed Class 2 Claim is indefeasibly paid in full in Cash, any remaining proceeds of the Credit Facility Collateral, net of any fees and expenses under Section 4.2(2)(b)(ii) of the Plan, shall be paid to the Liquidating Trust, free and clear of liens and encumbrances. -- if the proceeds of the Credit Facility Collateral are insufficient to pay the Allowed Class 2 Claim in full in Cash, the remaining unpaid portion of the Allowed Class 2 Claim shall be deemed and treated as an Allowed Class 5A Claim. B. Class 4A and 4B Homeowner Claims shall recoup their interest at 0% to 3%, plus additional consideration. C. These Classes shall recover 0% to 5% of Allowed Claims under the Plan: * Class 5A General Unsecured Claims against RAI; * Class 5B General Unsecured Claims against PEFI; * Class 6 Issuer Claims; * Class 7A Thrivepoint Claims against RAI; * Class 7B Thrivepoint Claims against PEFI; * Class 8 Loyola Class Action Claims; and * Class 9 Other Class Action Claims. * Classes 5A and 5B General Unsecured Claims Each holder of an Allowed Class 5A Claim shall receive a Pro Rata beneficial interest in the RAI Liquidating Trust Assets, and each holder of an Allowed Class 5B Claim shall receive a Pro Rata beneficial interest in the PEFI Liquidating Trust Assets. D. The rest of the Classes of Claims -- Classes 10 Intercompany Claims, Classes 1 Sec. 510(b) Claims, and Classes 12 Interest in Debtors -- receive no distribution under the Plan. A copy of the Combined Plan and Disclosure Statement is available for free at https://bit.ly/3frESk7 from Stretto, claims agent. About Renovate America Renovate America -- http://www.renovateamerica.com/-- is one of the nation's preeminent providers of home improvement financing through its industry-leading home financing product, Benji. The Company offers a proprietary technology platform that helps Americans improve their homes while giving contractors the tools they need to grow their business. In addition to offering intuitive financing options, Renovate America offers industry-leading education, training, and mentoring to contractor teams in the field. Renovate America, Inc., and two affiliates sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 20-13173) on December 21, 2020. Renovate America was estimated to have $50 million to $100 million in assets and $100 million to $500 million in liabilities as of the bankruptcy filing. Judge Laurie Selber Silverstein is the case judge. The Debtors tapped Bryan Cave Leighton Paisner LLP as the Company's legal counsel, Culhane Meadows, PLLC, is the bankruptcy co-counsel, Armanino LLP as a sales consultant, GlassRatner Advisory & Capital Group, LLC, is the restructuring advisor. Stretto is the claims agent. On January 4, 2021, the U.S. Trustee for Regions 3 and 9 appointed an official committee of unsecured creditors. The committee tapped Troutman Pepper Hamilton Sanders LLP as its legal counsel, Island Capital Advisor LLC as an investment banker, and Dundon Advisers LLC as financial advisor. RIOT BLOCKCHAIN: Appoints Benjamin Yi as Executive Chairman ----------------------------------------------------------- Riot Blockchain, Inc. has appointed Benjamin Yi as executive chairman. Benjamin Yi has served as an independent director on the Riot's Board of Directors since October 2018 and as Chairman of the Board since November 2020. As executive chairman, he will support and continue to work closely with Riot's executive management team to execute upon the Company's mission to become one of the most relevant and significant companies supporting the Bitcoin network and greater Bitcoin ecosystem. During Mr. Yi's tenure to-date, the Company's collective achievements include: * Significantly improved operating and financial profiles, including the attainment of profitability; * A reconstituted and more diverse Board of Directors; * A reconstituted, operationally-streamlined management team; * The announcement of a transformative transaction, creating a US-based industry leader in Bitcoin mining via the planned acquisition of Whinstone US, the largest Bitcoin hosting facility in North America, as measured by developed capacity. Mr. Yi brings significant experience in corporate strategy, corporate development, and governance to the Riot management team. In addition to having served as a director of several public and private companies, he also brings over 16 years of unique capital markets experience to the management team, with a particular expertise in fintech-enabled businesses, specialty finance, and special situations investing throughout a company's capital structure. Appointment of New Director Lance D'Ambrosio has been appointed to the Company's Board of Directors, effective May 24, 2021. Lance D'Ambrosio, age 64, is a successful entrepreneur, private investor, corporate director, and a past recipient of the Ernst & Young and Merrill Lynch Entrepreneur of the Year Award in the category of e-Software & Services. Currently, he serves as managing partner of 4 D Investments, which focuses on technology and real estate investments. Mr. D'Ambrosio has founded and grown several companies spanning several industries, including the telecommunications, materials, and automotive sectors. Over the course of his career, he has led capital raising efforts totalling hundreds of millions of dollars, executed on over thirty corporate acquisitions, successfully taken a number of companies public on both US and international exchanges, and successfully sold several businesses to larger market participants, including Sprint Telecommunications and Comsat International, a subsidiary of Lockheed Martin. Mr. D'Ambrosio brings significant corporate governance experience to Riot's Board, including expertise in financial analysis, mergers and acquisitions, and complex international structuring. Mr. D'Ambrosio graduated from the University of Utah in 1979 with a Degree of Bachelor of Science in Marketing and a Bachelor of Science Degree in Management as a member of the Dean's Honor List. Appointment of New Lead Independent Director Riot's Board of Directors has unanimously elected Hubert Marleau as Lead Independent Director, effective May 24, 2021. Mr. Marleau has served as an independent director since November 2020 and currently serves as the Chair of the Governance and Nominating Committee. About Riot Blockchain Headquartered in Castle Rock, Colorado, Riot Blockchain -- http://www.RiotBlockchain.com-- specializes in cryptocurrency mining with a focus on bitcoin. The Company is expanding and upgrading its mining operations by securing the most energy efficient miners currently available. Riot is headquartered in Castle Rock, Colorado, and the Company's mining facility operates out of upstate New York, under a co-location hosting agreement with Coinmint. Riot Blockchain reported a net loss of $12.67 million for the year ended Dec. 31, 2020, compared to a net loss of $20.30 million for the year ended Dec. 31, 2019. As of March 31, 2021, the Company had $375.91 million in total assets, $8.09 million in total liabilities, and $367.82 million in total stockholders' equity. RITORI LLC: Seeks to Hire Alex Cooper as Auctioneer --------------------------------------------------- Ritori, LLC and Marsalret, LLC seek approval from the U.S. Bankruptcy Court for the District of Maryland to hire Alex Cooper Auctioneers, Inc. to market their properties for sale. Ritori owns a real property located at 8323 Bayside Road, Chesapeake Beach, Md., where Marsalret operates its Mama Lucia's Italian Restaurant. Alex Cooper will receive a 6 percent commission on the sales price. As disclosed in court filings, Alex Cooper is a disinterested person as defined in Section 101(14) of the Bankruptcy Code. The firm can be reached through: Paul Cooper Alex Cooper Auctioneers, Inc. 908 York Road Towson, MD 21204 Phone: 800-272-3145 Fax: 410-828-4838 Email: info@alexcooper.com About Ritori LLC Ritori LLC and its affiliates, Marsalret LLC and Triplet LLC, sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Md. Lead Case No. 19-24473) on Oct. 29, 2019. Lori S. Simpson oversees the cases. At the time of the filing, Ritori had between $1 million and $10 million in both assets and liabilities. Marsalret and Triplet disclosed total assets of up to $50,000 and total liabilities of up to $10 million. The Debtors are represented by Steven L. Goldberg, Esq., at McNamee, Hosea, Jernigan, Kim, Greenan & Lynch, P.A. RLCH INC: Seeks to Sell Barclay Building to Fund Reorganization --------------------------------------------------------------- RLCH Inc. filed with the Bankruptcy Court a Disclosure Statement accompanying its Chapter 11 Plan of Reorganization. The Plan provides for a reorganization and continuation of the Debtor's business. The Debtor owns the Barclay Building, a seven-story building (with 23 residential apartments, a community facility, and parking spaces for automobiles), which the Debtor built on two adjacent parcels of real property it bought pre-petition for a total of $2.3 million. Because the Barclay Building was vacant, and the Offering Plan required to offer Condominiums Units for sale had not been approved, the Barclay Building had generated no revenue. The Debtor intends that, after confirmation of the Plan, the Debtor will either: (i) sell the Barclay Building; or (ii) obtain approval of the Offering Plan and sell the Condominium Units. The Debtor's shareholders voted unanimously for the Board of Directors to seek a sale of the Barclay Building. If the Debtor is not successful in selling the Barclay Building, it will pursue remediation of the existing construction defects at that Building, approval of the Offering Plan and the sale of Condominium Units as an alternative. If the Board determines to sell Condominium Units, the Debtor will file all documents with the Attorney General necessary for approval of the Offering Plan. Upon approval of such Offering Plan, the Debtor will market and sell the Condominium Units, such sales to be free and clear of all Liens, Claims, and encumbrances (except for any assumed executory contracts and unexpired leases). A price that the Debtor's Board of Directors determines for each of the Condominium Units is reasonable, and the Debtor shall not be required to seek the Bankruptcy Court's approval for such sales so long as the Debtor sells any Condominium Unit (a) for a price in excess of $650/sq. ft. until Maxim Credit Group, LLC, the Debtor's Pre-petition Lender, is paid in full; or (b) after the Pre-petition Lender is paid in full. The Debtor borrowed up to $4,000,000 from Maxim Credit Group, LLC, which loan was secured by a mortgage on the Barclay Building. As of the Petition Date, the Debtor has borrowed $1,194,489 to pay certain debts, taxes, and operating costs, and prepare and file the Chapter 11 case. The Pre-petition Lender shall have the right under Section 363(k) of the Bankruptcy Code to credit bid for the Debtor's property up to the Allowed Amount of its Secured Claim against the Debtor and may assign such bid to its designee. All prospective bidders except the Pre-petition Lender or its designee are required to deposit 10% of their opening bid. The Debtor will sell the Barclay Building for a sale price in excess of $13,000,000. The Debtor has proposed a set of Bidding and Auction Procedures that is annexed to the proposed Plan. The Plan contains two Classes: Class 1 Allowed Pre-petition Lender's Secured Claims; and Class 2 Interests in the Debtor. Both Classes of Claims are impaired and are entitled to vote to accept or reject the Plan. Holders of Interests in Class 2 shall be entitled to receive Pro Rata dividends, provided that no such dividends may be declared or made unless and until the holders of Allowed Class 1 Claims have been paid in full. The Debtor will establish a reserve for the benefit of each holder of a Disputed Claim in an amount equal to the Distributions which the holder of such Disputed Claim would be entitled to if such Disputed Claim were an Allowed Claim; provided that the Debtor may request that the Bankruptcy Court estimate the amount to be held in reserve in respect of a Disputed Claim. After the Confirmation Date, RLCH shall be managed by its Board of Directors, consisting of Lisa Lam and Steven Cheung. The Plan confirmation hearing will be held by the Honorable Robert E. Grossman on July 12, 2021, at 10 a.m. (EST). Written objections or responses to Confirmation of the Plan must be received no later than July 6, 2021 at 5:00 p.m. (EST). A copy of the Disclosure Statement is available for free at https://bit.ly/3fRwAB4 from PacerMonitor.com. Counsel for Maxim Credit Group, LLC, Pre-petition Lender: Allan B. Mendelson, Esq. ALLAN B. MENDELSOHN, LLP 38 New Street Huntington, NY 11743 Email: amendelsohn@amendelsohnlaw.com -and- Eric Sadkin, Esq. MAVRIDES, MOYAL, PACKMAN & SADKIN, LLP 276 Fifth Ave., Suite 404 New York, NY 10001 Email: ESadkin@mmps.com About RLCH Inc. RLCH Inc. engages in activities related to real estate. It owns real property and building located at 144-69 Barclay Ave., Flushing, N.Y. RLCH sought protection under Chapter 11 of the Bankruptcy Code (Bankr. E.D.N.Y. Case No. 20-43052) on Aug. 24, 2020. RLCH president Lisa Lam signed the petition. At the time of the filing, the Debtor was estimated to have assets of between $10 million and $50 million and liabilities of between $1 million and $10 million. Judge Robert E. Grossman presides over the case. The Debtor has tapped Herrick, Feinstein, LLP as its legal counsel and Daniel Scouler of Scouler Kirchhein, LLC as its chief restructuring officer. ROLLING MEADOWS: Fitch Affirms BB+ Rating on $15MM Revenue Bonds ---------------------------------------------------------------- Fitch Ratings has assigned a 'BB+' Issuer Default Rating (IDR) to Rolling Meadows and affirmed the 'BB+' revenue rating on approximately $15 million of revenue bonds issued by Red River Health Facilities Development Corporation on behalf of Rolling Meadows. The Rating Outlook is Stable. SECURITY The bonds are secured by a gross revenue pledge, a mortgage and a debt service reserve fund. ANALYTICAL CONCLUSION Adept cost management has allowed Rolling Meadows to maintain sound profitability despite stagnant independent living census. Due to its relatively small revenue base, Rolling Meadows is sensitive to fluctuations in occupancy, which underscores the 'BB+' rating, despite a relatively resilient financial profile. Consistent profitability and adequate liquidity are key credit strengths, providing flexibility for rental agreement facilities like Rolling Meadows. KEY RATING DRIVERS Revenue Defensibility: 'bb' Soft, Albeit Stable, Occupancy in a Declining Market Rolling Meadows' demand profile is weak, with independent living unit (ILU) occupancy that averaged 80% over the four years leading up to 2020, when occupancy softened due to the coronavirus pandemic. Fitch attributes Rolling Meadows' stagnant ILU occupancy over the past several years to declining service area population, moderate competition and the trend of seniors aging in place within their residences. Operating Risk: 'bbb' Steady Operating Performance Fitch's assessment of Rolling Meadows' operating risk is based on a demonstrated track record of good cost management, within the context of its rental contract mix. Of some concern, is Rolling Meadows elevated average age of plant and the potential need for future capital spending to address its consistently soft demand profile. Financial Profile: 'bb' Resilient Financial Profile Through the Cycle At YE 2020, Rolling Meadows had unrestricted cash-to-adjusted debt of about 102% and MADS coverage of 1.3x. Given Rolling Meadows' weak revenue defensibility and midrange operating risk assessments and Fitch's forward-looking scenario analysis, Rolling Meadows' key leverage metrics remain consistent with the rating level through a moderate stress. ASYMMETRIC ADDITIONAL RISK CONSIDERATIONS No asymmetric risks informed the rating decision. RATING SENSITIVITIES Factors that could, individually or collectively, lead to positive rating action/upgrade: -- Sustained liquidity growth such that cash to adjusted debt exceeds 160%; -- MADS coverage sustained at greater than 2.6x. Factors that could, individually or collectively, lead to negative rating action/downgrade: -- Addition of debt or deterioration in liquidity such that liquidity is sustained at less than 70% cash to debt; -- Major construction or expansion projects that are expected to significantly disrupt ongoing operations; -- Further deterioration in census levels that pressure operating ratios above 95%. BEST/WORST CASE RATING SCENARIO International scale credit ratings of Sovereigns, Public Finance and Infrastructure issuers have a best-case rating upgrade scenario (defined as the 99th percentile of rating transitions, measured in a positive direction) of three notches over a three-year rating horizon; and a worst-case rating downgrade scenario (defined as the 99th percentile of rating transitions, measured in a negative direction) of three notches over three years. The complete span of best- and worst-case scenario credit ratings for all rating categories ranges from 'AAA' to 'D'. Best- and worst-case scenario credit ratings are based on historical performance. CREDIT PROFILE Rolling Meadows is a type D (rental) continuing care retirement community located in Wichita Falls, TX (2018 population 104,576), approximately 130 miles northwest of the Dallas-Fort Worth (DFW) metroplex. Wichita Falls is the primary population center between DFW and Oklahoma City (OK) and is home to the Sheppard Air Force Base. The Rolling Meadows 25.2-acre community includes 167 ILUs (cottages and apartments), 86 SNF beds, and 22 memory care units. Rolling Meadows provides home health agency services for its residents on a fee for service basis. REVENUE DEFENSIBILITY Rolling Meadows' ILU occupancy averaged 80% over the four years leading up to 2020. Despite the challenges in marketing and sales brought on by the coronavirus pandemic, Rolling Meadows was able to maintain ILU occupancy of 72% in 2020, which is fairly consistent, though somewhat softer than past years. Rolling Meadows continues to market to improve occupancy and leadership has kept the facility operating positively despite weak occupancy. Assisted living unit (memory care) has improved since the opening of the Pines in 2017. Rolling Meadows has seen an impact on SNF occupancy, which dipped to 60%, at the end of March, 2021 due to impacts of coronavirus and increased rehab competition. Fitch expects SNF occupancy to remain pressured over the Outlook period. Rolling Meadows operates with a moderate amount of competition in its 50-mile market area. Fitch expects the competitive market conditions to endure. Additionally, the population in Rolling Meadow's primary service area is declining, with average household income below state and national averages. Despite relatively weak demographics in its primary market area, Rolling Meadows has a demonstrated history of regular rate increases. As a rental facility, local real estate values are minimally relevant to Fitch's pricing characteristics assessment. OPERATING RISK Rolling Meadows offers a rental contract allowing management to increases rates and manage expenses across the continuum of care given the minimal healthcare liability. Rolling Meadows has a history of maintaining good cost management, with a five-year average operating ratio of 86.1% and net operating margin (NOM) of 23.2%. Core operating performance remained relatively stable in 2020, with an operating ratio of 90% and NOM of 20%. The combination of good cost management relative to the fluctuations in occupancy, and the recognition of approximately $685,000 CARES Act funding helped Rolling Meadows maintain its performance despite the softer occupancies across the continuum. Fitch believes good cost management along with improving IL occupancy should help Rolling Meadows sustain current levels of performance as it rebuilds its personal care occupancies over the next 10 to 15 months. Fitch does not expect SNF census to rebound to pre-pandemic levels. Direct hospital admissions have declined due to coronavirus factors as well as pressure from local competition. Fitch believes management's history of good cost containment along with improved AL and IL census levels will allow management to maintain its midrange operating risk assessment over the outlook period. Rolling Meadows' capex has averaged about 7% of depreciation over the last three years, and 500% from 2016 to 2017 during the construction of the Pines ALUs. Near term capex are expected to be limited to routine maintenance. An average age of plant of 24 years as of 2020 indicates the possibility of increased future capital expenditure requirements to remain competitive. Rolling Meadows' capital-related metrics are solidly midrange, with revenue-only MADS coverage of 1.3x and debt-to-net available of 9x in 2020, consistent with historical levels. MADS represented 15.6% of 2020 revenues, an indication of Rolling Meadow's adequate ability to absorb the modest planned capex in the context of current operations. Any future large-scale debt-funded capital improvements could pressure the rating downward. FINANCIAL PROFILE Given Rolling Meadows' weak revenue defensibility and midrange operating risk assessments and Fitch's forward-looking scenario analysis, Fitch expects key leverage metrics to remain consistent with the current financial profile, throughout the current economic and business cycle. As of YE 2020, Rolling Meadows had unrestricted cash and investments of approximately $17 million. This represents about 102% of total adjusted debt. DCOH was strong at 787 days at the end of 2020. Fitch's baseline scenario, which is a reasonable forward look of financial performance over the next five years given current economic expectations, shows Rolling Meadows maintaining operating and financial metrics that are largely consistent with the current rating and with historical levels of performance (operating ratios in the low-80% range and NOMs in the 20% range). Capital spending is expected to remain consistent with the past few years with no major projects factored in. Fitch's forward look assumes an economic stress (to reflect both operating and equity volatility). The equity stress is specific to Rolling Meadows' asset allocation. Rolling Meadows' cash-to-adjusted debt and MADS coverage maintain levels consistent with the rating throughout Fitch's baseline forward looking scenario and remain resilient even under a stress case scenario. DCOH remains consistently well above 200 days through the base case which is neutral to the rating outcome ASYMMETRIC ADDITIONAL RISK CONSIDERATIONS No asymmetric risk considerations were relevant to the rating. In January 2022, Cindy Noe, who had been serving as the Chief Financial Officer, will assume the role of CEO, succeeding Marsha Conyea, Rolling Meadows' long tenured CEO who plans to retire. Fitch has worked with both the current CEO and CFO and views the continuity in leadership as positive. 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. ROMANS HOUSE: Wins Cash Collateral Access Thru June 30 ------------------------------------------------------ The U.S. Bankruptcy Court for the Northern District of Texas, Fort Worth Division, has authorized Romans House, LLC and Healthcore System Management, LLC to use the cash collateral of Pender Capital Asset Based Lending Fund I, LP, on an interim basis in accordance with the Approved Budget, with a 10% variance through June 30, 2021. Pender Capital is the transferee of and successor in interest to Pender West Credit 1 REIT, L.L.C. The Court says the Approved Budget and any modification thereto, or extension, amendment or update thereof, will be in form and substance acceptable to and approved in writing by Pender Capital in its sole discretion. The Approved Budget may be amended or modified in writing from time to time only with the written consent of Pender Capital. Prior to the Petition Date, Pender West as Original Lender and the Debtors entered into and consummated a series of related transactions to, among other benefits provided to the Debtors, enable Romans to refinance and retire existing indebtedness. A March 2019 Refinancing included the Original Lender's provision to Romans of a senior secured loan facility in the original principal amount of $9,450,000. As of the Petition Date, the Prepetition Obligations included Romans' indebtedness under the Prepetition Loan Agreement to the Original Lender for unpaid principal in the amount of $9,450,000, plus accrued and unpaid interest and default interest, costs, expenses, fees and other charges and obligations. On December 15, 2020, the Original Lender executed the Transfer and Assignment of Note, Lien and Other Documents, pursuant to which Original Lender transfer and assigned to its affiliate, Pender Capital, all of the Original Lender's right, title and interest in and to the Promissory Note, the other obligations of the RH Debtor identified therein, and the Security Instruments. As adequate protection of the interests of the Prepetition Lenders against any Diminution in Value of their interest in the Prepetition Collateral, the Prepetition Lenders are granted additional and replacement continuing valid, binding, enforceable, non-avoidable, and automatically perfected post-petition security interests in and liens on any and all presently owned and hereafter acquired personal property, real property and all other assets of the Debtors and their estates, together with any proceeds thereof. The Adequate Protection Liens will be junior only to: (i) the Carve Out; and (ii) Priority Liens (other than the Prepetition Liens). The Adequate Protection Liens will otherwise be senior to all other security interests in, liens on, or claims against any of the Adequate Protection Collateral. As further adequate protection against any Diminution in Value of the interests of the Prepetition Lenders in the Prepetition Collateral, the Prepetition Lenders are each granted as and to the extent provided by sections 503(b) and 507(b) of the Bankruptcy Code an allowed superpriority administrative expense claim in each of the Chapter 11 Cases and any Successor Case. Except for the Carve Out, the Adequate Protection Superpriority Claims will have priority over all administrative expense claims and unsecured claims against the Debtors or their estates, now existing or hereafter arising, of any kind or nature. As an accommodation to Michael A. McConnel, the Chapter 11 Trustee and the Debtors, the Prepetition Lenders have agreed to defer any requests for adequate protection payments from Romans to Pender Capital during the Specified Period, but reserve in full the rights of the Prepetition Lenders as to any future demands for adequate protection payments from Romans. The Prepetition Lenders also agree to defer any requirement that Healthcore make use and occupancy payments to the Current Lender for the land and improvements thereon commonly known as 4607 E. California Parkway, Fort Worth, Texas, and consisting of an assisted living facility operating under the name "Vincent Victoria Village Assisted Living" for the duration of the Specified Period, but reserve in full the rights of the Prepetition Lenders to require future use and occupancy payments from Healthcore. A final hearing on the matter is scheduled for June 17 at 9:30 a.m., via Webex. A copy of the order is available for free at https://tinyurl.com/vunnfn6b from PacerMonitor.com. About Romans House Based in Fort Worth, Texas, Romans House, LLC operates Tandy Village Assisted Living, a continuing care retirement community and assisted living facility for the elderly in Fort Worth, Texas. Affiliate Healthcore System Management, LLC, operates Vincent Victoria Village Assisted Living, also an assisted living facility for the elderly. Romans House, LLC, and Healthcore System sought Chapter 11 protection (Bankr. N.D. Tex. Case No. 19-45023 and 19-45024) on Dec. 9, 2019. Romans House was estimated to have $1 million to $10 million in assets and liabilities while Healthcore was estimated to have $1 million to $10 million in assets and $10 million to $50 million in liabilities. The Hon. Edward L. Morris is the case judge. Demarco Mitchell, PLLC, is the Debtors' legal counsel. Levene, Neale, Bender, Yoo & Brill L.L.P., serves as their co-bankruptcy counsel. Pender Capital Asset Based Lending Fund I, LP, as lender is represented by Ross and Smith, P.C. RONALD DWAYNE COLLINS: $4K Sale of 2001 Ford F350 Truck Approved ---------------------------------------------------------------- Judge Suzanne H. Bauknight of the U.S. Bankruptcy Court for the Eastern District of Tennessee authorized Ronald Dwayne Collins' sale of his 2001 Ford F350 Truck, VIN 1FDWW37F61EB38940, to Jim Dilbert for $4,000. The sale is free and clear of all liens and encumbrances. Ronald Dwayne Collins sought Chapter 11 protection (Bankr. E.D. Tenn. Case No. 20-31765) on July 23, 2020. The Debtor tapped Thomas Tarpy, Esq., as counsel. ROY LOMPA: Bates Properties Buying Dunlap Property for $7.4 Million ------------------------------------------------------------------- Roy Ernest Lompa and Rita Katherine Lompa ask the U.S. Bankruptcy Court for the Northern District of California to authorize the sale of several parcels of land, otherwise known as the Dunlap Property, to Bates Properties, Inc., and The Stringer Co. for $7,415,000. A hearing on the Motion is set for June 17, 2021, at 10:00 a.m. Any opposition to the Motion will be filed and served upon the initiating party at least 14 days prior to the scheduled hearing date. The sale will be free and clear of the following claims of liens, with the claims of lien attaching to the proceeds of sale. United States of America, acting through Farm Service Agency, United States Department of Agriculture. The Debtors anticipate that the USDA will consent to the sale of the Dunlap Property free and clear of liens prior to the hearing, in which case, the Motion is made pursuant to section 363(f)(2). The sale will be "as is, where is," without any representations or warranties, express or implied. It is not subject to overbids. The Debtors intend to pay from the proceeds of sale the secured claim held by the USDA. They intend to pay out of escrow any amount owed to the County of San Benito secured by its liens against the Dunlap Property. The Motion is made on the grounds that the sale will generate funds for the bankruptcy Estate for unsecured creditors and is in the best interests of creditors and the bankruptcy Estate and is appropriate for sound business reasons. About Roy Ernest Lompa and Rita Katherine Lompa Roy Ernest Lompa and Rita Katherine Lompa sought Chapter 11 protection (Bankr. N.D. Cal. Case No. 07-51463) on May 16, 2007. Judge Arthur S. Weissbrodt is assigned to the case. The Debtors estimated total assets at $95,485 and $13,109,756 in total debts. The Debtors tapped John T. Hansen, Esq., at Nossaman, Guthner, Knox and Elliott, L.L.P., as counsel. ROYALE ENERGY: Appoints Weaver and Tidwell as Accountant -------------------------------------------------------- The Audit Committee of the Board of Directors of Royale Energy, Inc. appointed Weaver and Tidwell, L.L.P. as the Company's independent registered public accounting firm for the fiscal year ending Dec. 31, 2021. During the fiscal years ended Dec. 31, 2020 and Dec. 31, 2019, respectively, and the subsequent interim period through May 25, 2021, neither the Company nor anyone acting on its behalf has consulted with Weaver on any of the matters or events set forth in Item 304(a)(2)(i) or 304(a)(2)(ii) of Regulation S-K. About Royale El Cajon, CA-based Royale Energy, Inc. -- http://www.royl.com-- is an independent oil and natural gas producer incorporated under the laws of Delaware. Royale's principal lines of business are the production and sale of oil and natural gas, acquisition of oil and gas lease interests and proved reserves, drilling of both exploratory and development wells, and sales of fractional working interests in wells to be drilled by Royale. Royale was incorporated in Delaware in 2017 and is the successor by merger to Royale Energy Funds, Inc., a California corporation formed in 1983. Royale Energy reported a net loss of $8.15 million for the year ended Dec. 31, 2020, compared to a net loss of $348,383 for the year ended Dec. 31, 2019. As of March 31, 2021, the Company had $8.02 million in total assets, $14.62 million in total liabilities, $22.41 million in convertible preferred stock, and a total stockholders' deficit of $29.01 million. San Diego, California-based Moss Adams, the Company's auditor since 2019, issued a "going concern" qualification in its report dated March 30, 2021, citing that the Company has suffered recurring losses from operations and has a net capital deficiency that raise substantial doubt about its ability to continue as a going concern. ROYALE ENERGY: Moss Adams Quits as Accountant --------------------------------------------- Moss Adams LLP resigned as Royale Energy, Inc.'s independent accountant effective as of May 18, 2021. During the Company's fiscal years ended Dec. 31, 2020 and 2019, and the subsequent interim period through May 18, 2021, there were no disagreements with Moss Adams on matters of accounting principles or practices, financial statement disclosure or auditing scope or procedure which, if not resolved to the satisfaction of Moss Adams would have caused Moss Adams to make reference to such matter in connection with its report. The resignation of Moss Adams was accepted by the Company's Board of Directors on May 19, 2021. The Company said there were no disagreements with Moss Adams on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure, which, if not resolved to Moss Adams satisfaction, would have caused it to make reference to the subject matter of the disagreement in connection with its report. Moss Adams's report on the Financials did not contain an adverse opinion or disclaimer of opinion and were not qualified or modified as to uncertainty, audit scope or accounting principles, except for the explanatory paragraph included in the reports of Moss Adams on the Company's consolidated financial statements as of and for the years ended Dec. 31, 2020 and 2019, which noted that there was substantial doubt as to the Company ability to continue as a going concern. There were no reportable events, as defined in Item 304(a)(1)(v) of Regulation S-K, except for the material weakness that existed because the Company did not maintain effective controls over its financial close and reporting process, and concluded that the financial close and reporting process needed additional formal procedures to ensure there are appropriate reviews over all financial reporting analysis. Updated procedures have been implemented through the close process for the year ended Dec. 31, 2019, but the material weakness on our financial close and reporting process was not alleviated. Management is in the process of designing and implementing updated control procedures that it believes will mitigate this material weakness. The Company will continue to monitor these throughout 2021 to be able to fully assess whether the procedures and controls are effective. About Royale El Cajon, CA-based Royale Energy, Inc. -- http://www.royl.com-- is an independent oil and natural gas producer incorporated under the laws of Delaware. Royale's principal lines of business are the production and sale of oil and natural gas, acquisition of oil and gas lease interests and proved reserves, drilling of both exploratory and development wells, and sales of fractional working interests in wells to be drilled by Royale. Royale was incorporated in Delaware in 2017 and is the successor by merger to Royale Energy Funds, Inc., a California corporation formed in 1983. Royale Energy reported a net loss of $8.15 million for the year ended Dec. 31, 2020, compared to a net loss of $348,383 for the year ended Dec. 31, 2019. As of March 31, 2021, the Company had $8.02 million in total assets, $14.62 million in total liabilities, $22.41 million in convertible preferred stock, and a total stockholders' deficit of $29.01 million. San Diego, California-based Moss Adams, the Company's auditor since 2019, issued a "going concern" qualification in its report dated March 30, 2021, citing that the Company has suffered recurring losses from operations and has a net capital deficiency that raise substantial doubt about its ability to continue as a going concern. RT DEVELOPMENT: Seeks to Hire Michael Jay Berger as Legal Counsel ----------------------------------------------------------------- RT Development, LLC seeks approval from the U.S. Bankruptcy Code for the Central District of California to hire the Law Offices of Michael Jay Berger to handle its Chapter 11 case. The hourly rates of the firm's attorneys and staff are as follows: Michael Jay Berger $595 Sofya Davtyan $525 Debra Reed $435 Carolyn M. Afari $435 Samuel Boyamian $350 Senior Paralegals and Law Clerks $225 Bankruptcy Paralegals $200 The firm received a retainer of $18,262 from the Debtor. It will also receive reimbursement for out-of-pocket expenses incurred. Michael Jay Berger, Esq., 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 may be reached at: Michael Jay Berger, Esq. Law Offices of Michael Jay Berger 9454 Wilshire Boulevard, 6th Floor Beverly Hills, CA 90212-2929 Tel: (310) 271-6223 Fax: (310) 271-9805 Email: michael.berger@bankruptcypower.com About RT Development RT Development, LLC filed its voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. C.D. Calif. Case No. 21-10809) on May 3, 2021. Brett P. Miles, managing member, signed the petition. At the time of the filing, the Debtor had between $1 million and $10 million in both assets and liabilities. Judge Victoria S. Kaufman presides over the case. The Law Offices of Michael Jay Berger represents the Debtor as legal counsel. RYAN 1000: Seeks to Hire Strouse Law Offices as Legal Counsel ------------------------------------------------------------- Ryan 1000, LLC seeks approval from the U.S. Bankruptcy Court for the Eastern District of Wisconsin to hire Strouse Law Offices as its legal counsel. The firm's services include: a. advising the Debtor regarding its duties and powers under the Bankruptcy Code; b. advising the Debtor on the conduct of its Chapter 11 case, including the legal and administrative requirements of operating in Chapter 11; c. attending meetings and negotiating with representatives of creditors and other parties in interest; d. prosecuting actions on behalf of the Debtor, defending actions commenced against the Debtor and representing the Debtor's interests in negotiations concerning litigation in which the Debtor is involved; e. preparing legal papers; f. advising the Debtor in connection with any potential sale of its assets; g. appearing before the court; h. assisting the Debtor in preparing, negotiating and implementing a Chapter 11 plan; i. assisting the Debtor in state court actions related to judgments and collection actions initiated by or against the Debtor; and j. other legal services. The firm will be paid at these rates: Paul Strouse $150 per hour Non-Attorney Paraprofessional $75 per hour As disclosed in court filings, Strouse is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code . The firm can be reached through: Paul A. Strouse, Esq. Strouse Law Offices 825 W. Wisconsin Avenue Milwaukee, WI 53233 Phone: (414) 390-0820 Fax: (414) 220-5115 Email: StrouseLawOffices@gmail.com About Ryan 1000 LLC Ryan 1000, LLC, a single asset real estate company based in Milwaukee, Wisc., filed a petition under Subchapter V of Chapter 11 of the Bankruptcy Code (Bankr. E.D. Wisc. Case No. 21-21326) on March 15, 2021. David Ryan, sole shareholder, signed the petition. At the time of the filing, the Debtor disclosed up to $50,000 in both assets and liabilities. Judge Beth E. Hanan oversees the case. Strouse Law Offices represents the Debtor as legal counsel. RYAN 8641: Seeks to Hire Strouse Law Offices as Legal Counsel ------------------------------------------------------------- Ryan 8641, LLC seeks approval from the U.S. Bankruptcy Court for the Eastern District of Wisconsin to hire Strouse Law Offices as its general counsel. The firm's services include: a. advising the Debtor regarding its duties and powers under the Bankruptcy Code; b. advising the Debtor on the conduct of its Chapter 11 case, including the legal and administrative requirements of operating in Chapter 11; c. attending meetings and negotiating with representatives of creditors and other parties in interest; d. prosecuting actions on behalf of the Debtor, defending actions commenced against the Debtor and representing the Debtor's interests in negotiations concerning litigation in which the Debtor is involved; e. preparing legal papers; f. advising the Debtor in connection with any potential sale of its assets; g. appearing before the court; h. assisting the Debtor in preparing, negotiating and implementing a Chapter 11 plan; i. assisting the Debtor in state court actions related to judgments and collection actions initiated by or against the Debtor; and j. other legal services. The firm will be paid at these rates: Paul Strouse $150 per hour Non Attorney Paraprofessional $75 per hour As disclosed in court filings, Strouse is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code . The firm can be reached through: Paul A. Strouse, Esq. Strouse Law Offices 825 W. Wisconsin Avenue Milwaukee, WI 53233 Phone: (414) 390-0820 Fax: (414) 220-5115 Email: StrouseLawOffices@gmail.com About Ryan 8641 LLC Ryan 8641 LLC, a single asset real estate company based in Milwaukee, Wisc., filed a petition under Subchapter V of Chapter 11 of the Bankruptcy Code (Bankr. E.D. Wisc. Case No. 21-21327) on March 15, 2021. David Ryan, sole shareholder, signed the petition. Judge Beth E. Hanan presides over the case. Strouse Law Offices represents the Debtor as legal counsel. SEADRILL LTD: Appoints New Management Members --------------------------------------------- Soren Pico of Shipping Watch reports that John Fredriksen-controlled rig company Seadrill has appointed new chief officers to the management. At the same time, the beleaguered company's board has found its newest director. While crisis-hit rig company Seadrill still struggles to land a rescue plan and is currently under bankruptcy protection in the US, the company has appointed new members to join the management and board of directors. Thursday, May 27, 2021, the company announced that it will appoint Grant Creed and Leif Nelson as the new chief financial officer and chief operating Officer, according to a press release. About Seadrill Ltd. Seadrill Limited (OSE:SDRL, OTCQX:SDRLF) -- http://www.seapdrill.com/-- is a deepwater drilling contractor providing drilling services to the oil and gas industry. As of March 31, 2018, it had a fleet of over 35 offshore drilling units that include 12 semi-submersible rigs, 7 drillships, and 16 jack-up rigs. On Sept. 12, 2017, Seadrill Limited sought Chapter 11 protection after reaching terms of a reorganization plan that would restructure $8 billion of funded debt. It emerged from bankruptcy in July 2018. Demand for exploration and drilling has fallen further during the COVID-19 pandemic as oil firms seek to preserve cash, idling more rigs and leading to additional overcapacity among companies serving the industry. In June 2020, Seadrill wrote down the value of its rigs by $1.2 billion and said it planned to scrap 10 rigs. Seadrill said it is in talks with lenders on a restructuring of its $5.7 billion bank debt. Seadrill Partners LLC, a limited liability company formed by deep-water drilling contractor Seadrill Ltd. to own, operate and acquire offshore drilling rigs, along with its affiliates, sought Chapter 11 protection (Bankr. S.D. Tex. Lead Case No. 20-35740) on Dec. 1, 2020, after its parent company swept one of its bank accounts to pay disputed management fees. Mohsin Y. Meghji, authorized signatory, signed the petitions. On Feb. 7, 2021, Seadrill GCC Operations Ltd., Asia Offshore Drilling Limited, Asia Offshore Rig 1 Limited, Asia Offshore Rig 2 Limited, and Asia Offshore Rig 3 Limited sought Chapter 11 protection. Seadrill GCC estimated $100 million to $500 million in assets and liabilities as of the bankruptcy filing. Additionally, on Feb. 10, 2021, Seadrill Limited and 114 affiliated debtors each filed a voluntary petition for relief under Chapter 11 of the United States Bankruptcy Code with the Court. The lead case is In re Seadrill Limited (Bankr. S.D. Tex. Case No. 21-30427). Seadrill Limited disclosed $7.291 billion in assets against $7.193 billion in liabilities as of the bankruptcy filing. In the new Chapter 11 cases, Kirkland & Ellis LLP is counsel for the Debtors. Houlihan Lokey, Inc., is the financial advisor. Alvarez & Marsal North America, LLC, is the restructuring advisor. The law firm of Jackson Walker L.L.P. is co-bankruptcy counsel. The law firm of Slaughter and May is co-corporate counsel. Advokatfirmaet Thommessen AS is serving as Norwegian counsel. Conyers Dill & Pearman is serving as Bermuda counsel. Prime Clerk LLC is the claims agent. SEALED AIR: Moody's Hikes CFR to Ba1, Outlook Stable ---------------------------------------------------- Moody's Investors Service upgraded Sealed Air Corp.'s Corporate Family Rating to Ba1 from Ba2 and Probability of Default Rating to Ba1-PD from Ba2-PD. Moody's also upgraded the ratings on Sealed Air's 1st lien senior secured credit facilities to Baa1 from Baa3 and the rating on the company's senior unsecured notes to Ba2 from Ba3. The outlook for Sealed Air is stable. Finally, Moody's upgraded Sealed Air's Speculative Grade Liquidity Rating to SGL-1 from SGL-2. The upgrade of the CFR reflects Moody's expectation that recent improvements to Sealed Air's credit metrics are sustainable given management's stated policy to maintain adjusted debt to LTM EBITDA at 4.0x and the company's strong free cash generation. The upgrade also reflects Moody's expectation of continued good margins given Sealed Air's track record of innovation and continued investment in R&D. Moody's expects debt to LTM EBITDA to remain at 4.0x through the end of 2022 with an EBITDA margin of over 20.0%. The stable outlook reflects Moody's expectation that credit metrics will be supported by the company's high exposure to stable end markets, a continued focus on innovation and management's stated policy to maintain adjusted debt to LTM EBITDA at 4.0x over the long-term. The upgrade of the Speculative Grade Liquidity Rating to SGL-1 reflects Moody's expectation of strong free cash flow, a significant amount of cash on hand and good cushion under the financial covenant. Upgrades: Issuer: Sealed Air Corp. Corporate Family Rating, Upgraded to Ba1 from Ba2 Probability of Default Rating, Upgraded to Ba1-PD from Ba2-PD Speculative Grade Liquidity Rating, Upgraded to SGL-1 from SGL-2 Senior Secured Bank Credit Facility, Upgraded to Baa1 (LGD2) from Baa3 (LGD2) Senior Unsecured Regular Bond/Debenture, Upgraded to Ba2 (LGD4) from Ba3 (LGD4) Issuer: Sealed Air Limited Senior Secured Term Loan, Upgraded to Baa1 (LGD2) from Baa3 (LGD2) Outlook Actions: Issuer: Sealed Air Corp. Outlook, Remains Stable Issuer: Sealed Air Limited Outlook, Changed To Stable From No Outlook RATINGS RATIONALE Moody's expects Sealed Air to continue to benefit from its high exposure to food, medical and e-commerce end markets. Moody's also expects the company to continue to benefit from a continued focus on higher margin, value added packaging solutions and investments in R&D. The company has a base of automated equipment installed on the customers' premises, which is used to apply its protective packaging, and is expected to drive sales of related materials in the food, e-commerce, and industrial segments. Sealed Air also benefits from geographic diversity with about 40.0% of revenue generated outside of North America. Recognizing Sealed Air is a specialty packaging company focusing on perishable foods and product protection, the credit profile is constrained by the concentration of sales in cyclical and event risk prone end markets (industrial, transportation, meat) and continued use of free cash flow for dividends and share repurchases. Sealed Air is an innovative leader in the markets they serve, yet operates in a fragmented and competitive packaging industry, which has many private, unrated competitors and strong price competition, particularly on the protective packaging side of the business. While only 20% of the company's business is under long-term contracts, the company does not have high customer turnover due to its integrated approach of automated equipment, specialty materials and services. The remaining 80% of Sealed Air's business lacks contractual raw material cost pass-throughs, which could leave the company exposed to increases in resin prices if unable to increase prices for its products. Sealed Air's SGL-1 rating reflects Moody's expectation that the company will maintain very good liquidity, characterized by a considerable amount of cash, expectation of enough cash flow to fund all normal cash needs, and abundant availability under committed credit facilities. Credit facilities include a $1 billion revolver which expires in July 2023. In addition, the company has a $50 million US and a EUR80 million European accounts receivable securitization program, which both expire annually and are renewable. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS A ratings upgrade would require a commitment to an investment grade financial profile and capital structure. An upgrade would also be dependent upon a sustainable improvement in credit metrics and a stable competitive environment. Specifically, the ratings could be upgraded if: Adjusted debt to LTM EBITDA is below 3.5x Adjusted EBITDA margin is above 22.0% Free cash flow to debt is above 12.0% The ratings could be downgraded if there is deterioration in credit metrics, the competitive environment or liquidity. Additionally, the ratings could be downgraded if there is a large, debt financed acquisition. Specifically, the ratings could be downgraded if: Adjusted debt to LTM EBITDA is above 4.25x Adjusted EBITDA margin is below 18.0% Free cash flow to debt is below 8.0% The principal methodology used in these ratings was Packaging Manufacturers: Metal, Glass and Plastic Containers Methodology published in September 2020. Headquartered in Charlotte, NC, Sealed Air Corp. (NYSE: SEE) is a global manufacturer of packaging products, performance-based materials and equipment systems for various food, industrial, medical and consumer applications. Sealed Air reports in two segments, Food (60% of revenue) and Protective (40% of revenue). Revenue was approximately $5.0 billion for the 12 months ended March 31, 2021. SEARS HOLDING: Buyer Not Liable for Warranty Lawsuit, Says Judge ---------------------------------------------------------------- Law360 reports that a New York bankruptcy judge on Thursday, May 27, 2021, ruled that Sears Holding Co. did not pass along liability for a class action alleging that the retail chain sold extended warranties it never intended to honor when it sold its assets to its ex-CEO in Chapter 11 two years ago. U.S. Bankruptcy Judge Robert Drain found that the terms of Sears' "free and clear" sale of its assets precluded the class action plaintiffs from adding the new owner of the retail chain's stores to their suit, despite their arguments that the warranties themselves were passed on in the sale. About Sears Holdings Corp. Sears Holdings Corporation -- http://www.searsholdings.com/-- began as a mail ordering catalog company in 1887 and became the world's largest retailer in the 1960s. At its peak, Sears was present in almost every big mall across the U.S., and sold everything from toys and auto parts to mail-order homes. Sears claims to be a market leader in the appliance, tool, lawn and garden, fitness equipment, and automotive repair and maintenance retail sectors. Sears and Kmart merged to form Sears Holdings in 2005 when they had 3,500 US stores between them. Kmart emerged in 2005 from its own bankruptcy. Unable to keep up with online stores and other brick-and-mortar retailers, a long series of store closings left it with 687 retail stores in 49 states, Guam, Puerto Rico, and the U.S. Virgin Islands as of mid-October 2018. At that time, the Company employed 68,000 individuals. As of Aug. 4, 2018, Sears Holdings had $6.93 billion in total assets against $11.33 billion in total liabilities. Unable to cover a $134 million debt payment due Oct. 15, 2018, Sears Holdings Corporation and 49 subsidiaries sought Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 18-23538) on Oct. 15, 2018. The Hon. Robert D. Drain is the case judge. The Debtors tapped Weil, Gotshal & Manges LLP as legal counsel; M-III Partners as restructuring advisor; Lazard Freres & Co. LLC as investment banker; DLA Piper LLP as real estate advisor; and Prime Clerk as claims and noticing agent. The U.S. Trustee for Region 2 appointed nine creditors, including the Pension Benefit Guaranty Corp., and landlord Simon Property Group, L.P., to serve on the official committee of unsecured creditors. The committee tapped Akin Gump Strauss Hauer & Feld LLP as legal counsel; FTI Consulting as financial advisor; and Houlihan Lokey Capital, Inc. as investment banker. The U.S. Trustee for Region 2 on July 9, 2019, appointed five retirees to serve on the committee representing retirees with life insurance benefits in the Chapter 11 cases. * * * In February 2019, Bankruptcy Judge Robert Drain authorized Sears Holdings approval to sell the business to majority shareholder and CEO Eddie Lampert for approximately $5.2 billion. Lampert's ESL Investments, Inc., won an auction to acquire substantially all of Sears' assets, including the "Go Forward Stores" on a going-concern basis. The proposal allowed 425 stores to remain open and provided ongoing employment to 45,000 employees. The new parent is Transform SR Brands LLC, doing business as Transformco, referred to as "New Sears". Transform is an American privately held company formed on Feb. 11, 2019, to acquire some of the assets of Sears Holdings Corporation. The new company is owned by Eddie Lampert's ESL Investments. SECURE HOME: Joint Prepackaged Plan Confirmed by Judge ------------------------------------------------------ Judge J. Kate Stickles has entered findings of fact, conclusions of law and order approving the Disclosure Statement and confirming the Joint Prepackaged Chapter 11 Plan of Reorganization of Secured Home Holdings LLC and Its Affiliate Debtors. The Debtors have proposed the Plan (and all other documents necessary or appropriate to effectuate the Plan) in good faith and not by any means forbidden by law. In determining that the Plan has been proposed in good faith, the Bankruptcy Court has examined the totality of the circumstances surrounding the filing of the Chapter 11 Cases and the formulation of the Plan. The Plan was proposed with the legitimate and honest purpose of maximizing the value of the Debtors' Estates and to effectuate the successful reorganization of the Debtors. The Plan is the result of extensive arm's-length negotiations among the Debtors and their key stakeholders and is supported by their creditors and other parties in interest in the Chapter 11 Cases. Notwithstanding any other provision or the plan or this order, any allowed secured claims (the "Allowed Secured Tax Claims") of Spring Branch Independent School District and Tyler Independent School District, (the "Certain Texas Taxing Entities") shall be paid in full in cash the latter of the Effective Date or the date such Claim is Allowed, if different, or as soon thereafter as is reasonably practical, or when due according to their terms. Proposed Counsel for the Debtors: Van C. Durrer, II, Esq. Destiny N. Almogue, Esq. SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP 300 S. Grand Avenue, Suite 3400 Los Angeles, CA 90071 Telephone: (213) 687-5416 - and - William E. Chipman, Jr. Robert W. Weber Mark D. Olivere CHIPMAN BROWN CICERO & COLE, LLP Hercules Plaza 1313 North Market Street, Suite 5400 Wilmington, Delaware 19801 Telephone: (302) 295-0191 About Secure Home Holdings Newtown Square, Pa.-based Secure Home Holdings, LLC, and its affiliates are a national provider of technologically advanced security solutions, including residential and commercial security systems, home automation systems, smoke and carbon monoxide detectors, and other security solutions in communities throughout the United States. On April 25, 2021, Secure Home Holdings LLC and its affiliates sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 21-10745). At the time of the filing, Secure Home had between $100 million and $500 million in both assets and liabilities. Judge J. Kate Stickles oversees the cases. The Debtors tapped Chipman Brown Cicero & Cole, LLP as bankruptcy counsel; Skadden, Arps, Slate, Meagher & Flom, LLP as special bankruptcy counsel; M3 Advisory Partners, LP as financial advisor; and Raymond James & Associates, Inc., as their investment banker. Kurtzman Carson Consultants, LLC, is the claims and noticing agent. SHADDEN LLC: Court Confirms Reorganization Plan ----------------------------------------------- Judge Kimberly H. Tyson confirmed the Plan of Reorganization of Shadden, LLC dated November 9, 2020 on May 21, 2021. The Court ruled that on the Effective Date of the Plan, all property of the estate shall revest in the Debtor free and clear of liens except those specifically set forth in the Plan. The Chapter 11 case allowed the Debtor to (i) borrow funds to complete work on the Debtor's main asset consisting of a residential real property in Greenwood Village, Colorado, and (ii) thereafter market the property, (iii) restructure its debts, (iv) generate a small amount of funds to repay unsecured creditors. The Debtor's case shall also allow the Debtor to continue its business operation in the ordinary course. The Funding of the Plan will be derived from the sale proceeds of the Debtor's main asset. The first lien holder has agreed to a reduced payment on account of the sale, and the creditors with liens against the property in the second and third secured positions received nothing from the sale of the Property as their claims were fully unsecured. A copy of the order confirming the Plan is available for free at https://bit.ly/3yHPMKj from PacerMonitor.com. Prior to confirmation, certain amendments to the provisions on the claim of the Internal Revenue Service were made to the Plan. A copy of the amendments is available at https://bit.ly/3yMm4Ug from PacerMonitor.com at no charge. A copy of the approved Disclosure Statement is available for free at https://bit.ly/3yD0vpc About Shadden LLC Shadden LLC is a Colorado limited liability company formed May 27, 2008 by Hayden Meier as an investment vehicle for real property interests and business investments, including the purchase and sale of a mobile home park, a residence in Michigan, and a condo in Downtown Denver. Shadden LLC sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Colo. Case No. 19-18726) on Oct. 8, 2019. At the time of the filing, the Debtor had estimated assets of less than $50,000 and liabilities of between $1 million and $10 million. The case has been assigned to Judge Kimberley H. Tyson. The Debtor tapped Keri L. Riley, Esq., at Kutner Brinen, P.C., as its legal counsel. SHARE ENERGY: Voluntary Chapter 11 Case Summary ----------------------------------------------- Debtor: Share Energy Group, LLC 3811 Fuqua St. Houston, TX 77047 Chapter 11 Petition Date: May 28, 2021 Court: United States Bankruptcy Court Southern District of Texas Case No.: 21-31764 Judge: Hon. Marvin Isgur Debtor's Counsel: Reese W. Baker, Esq. BAKER & ASSOCIATES 950 Echo Ln Ste 300 Houston, TX 77024-2824 E-mail: courtdocs@bakerassociates.net Estimated Assets: $1 million to $10 million Estimated Liabilities: $1 million to $10 million The petition was signed by Omar Pimentel, president. The Debtor failed to include in the petition a list of its 20 largest unsecured creditors. A full-text copy of the petition is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/GWCBLAA/Share_Energy_Group_LLC__txsbke-21-31764__0001.0.pdf?mcid=tGE4TAMA SOUTHERN PRODUCE: Proposed $6K Sale of Faison Property Approved --------------------------------------------------------------- Judge Stephani W. Humrickhouse of the U.S. Bankruptcy Court for the Eastern District of North Carolina, Wilmington Division, authorized Southern Produce Distributors, Inc.'s private sale of the real property, plus all improvements and all rights appurtenant thereto, located at 108 N. Sampson Street, in Faison, Duplin County, North Carolina, to Southern Produce, LLC for $6,000, free and clear of liens or encumbrances. The sale is subject to (i) ad valorem taxes, which will be pro-rated to the date of the closing, with the Seller's portion paid at the closing from the sales proceeds, (ii) reasonable and normal costs of closing, including, without limitation, reasonable costs or expenses of sale required to be paid by the Debtor as the Seller pursuant to the respective sale contract, and (iii) a real estate broker commission of 5% to be paid to David Kornegay of Kornegay Realty, Inc., at the closing from the applicable sale proceeds. The net sale proceeds received from the sale will be subject to the following uses: (i) Quarterly Fees generated by the sale when and as applicable, (ii) reasonable attorney for Debtor fees relating to the sale and closing, and (iii) applicable capital gain taxes when and if applicable. About Southern Produce Southern Produce Distributors, Inc. -- http://southern-produce.com/ -- is a provider of sweet potatoes and peppers to markets across the US, Canada, UK and Europe. Southern Produce was founded in 1942 and is based in Faison, North Carolina. Southern Produce Distributors filed for bankruptcy protection (Bankr. E.D.N.C. Case No. 18-02010) on April 20, 2018. In the petition signed by Randy W. Swartz, president and CEO, the Debtor disclosed total assets of $27.12 million and total liabilities of $19.96 million. Gregory B. Crampton, Esq., of Nichols & Crampton, P.A., serves as counsel to the Debtor. Janvier Law Firm, PLLC, serves as special counsel. SOVOS BRANDS: Moody's Rates New $580MM First Lien Term Loan 'B2' ---------------------------------------------------------------- Moody's Investors Service affirmed the ratings of Sovos Brands Intermediate, Inc. including its Corporate Family Rating at B3, and its Probability of Default Rating at B3-PD. In addition, Moody's assigned a B2 rating to a proposed $125 million revolving credit facility, and a B2 rating to a proposed $580 million senior secured 1st lien term loan. The B3 ratings on the company's existing $45 million senior secured 1st lien revolving credit facility and $380 million senior secured 1st lien term loan are not affected and will be withdrawn at closing. The outlook was revised to stable from positive. Proceeds from the proposed $580 million 1st lien term loan and an unrated $200 million 2nd lien term loan will be used to refinance an existing $380 million senior secured 1st lien term loan as well as to fund a shareholder distribution, along with associated transaction fees and expenses. Moody's changed the outlook to stable from positive reflecting the significant increase in pro forma debt-to-EBITDA leverage to 7.3x from 3.5x as of March 31, 2021. The shareholder distribution is credit negative as it materially increases the company's LTM leverage and reflects an aggressive financial policy. Moody's affirmed the B3 CFR recognizing the company's strong operating performance mainly driven by the Rao's franchise. Moody's expects that EBITDA generation will continue to be highly concentrated in the fast-growing Rao's franchise, which represents over 60% of total EBITDA. All of the company's brands are currently benefiting from the effects of coronavirus that has boosted retail sales of retail packaged foods including pasta sauce. Moody's believes a portion of the company's sales gains are not likely to be sustained into 2022 as the positive effects gradually abate, which creates risk that the current leverage and free cash flow levels might not be sustained. The following ratings/assessments are affected by the action: New Assignments: Issuer: Sovos Brands Intermediate, Inc. - GTD Senior Secured 1st Lien Term Loan, Assigned B2 (LGD3) - GTD Senior Secured 1st Lien Multicurrency Revolving Credit Facility, Assigned B2 (LGD3) Ratings Affirmed: Issuer: Sovos Brands Intermediate, Inc. - Corporate Family Rating, Affirmed B3 - Probability of Default Rating, Affirmed B3-PD Outlook Actions: Issuer: Sovos Brands Intermediate, Inc. - Outlook, Changed To Stable From Positive RATINGS RATIONALE Sovos Brands Intermediate, Inc.'s B3 CFR reflects its moderately high financial leverage, limited operating history (since 2017) as a combined company, and execution risks associated with its acquisition driven growth strategy. The rating is supported by the growing brand equities of its "Rao's", "noosa", and "Birch Benders" brands. Sovos has good segmental sales diversification in pasta sauce, yogurt, frozen meals, and pancake mix although Rao's represents more than half of total sales. The company's credit profile is constrained by its high financial policy risk reflecting aggressive debt-funded shareholder distributions and possible future acquisitions; concentration of earnings in the highly competitive pasta sauce and yogurt categories; weak long-term growth prospects of the US yogurt category; and small scale of its "Michael Angelo's" frozen food brand. The coronavirus outbreak and the government measures put in place to contain it 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, there is uncertainty around Moody's forecasts. Moody's regard the coronavirus outbreak as a social risk under its ESG framework, given the substantial implications for public health and safety. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS The stable rating outlook reflects Moody's view that Sovos will maintain good liquidity including positive free cash flow, modestly grow revenue and EBITDA, and reduce debt-to-EBITDA to a 7.0x range in 2022. Ratings could be upgraded if Sovos Brands sustains stable operating performance in key segments, debt/EBITDA below 6.5x, and EBITA/interest above 1.5x. In addition, the company will need to maintain earnings close to the higher base achieved in 2020, sustainably generate positive free cash flow, and maintain financial policies that would sustain lower leverage before Moody's would consider an upgrade. Ratings could be downgraded if operating performance deteriorates because of lower revenue or market share, financial leverage moves meaningfully higher, or EBITA/interest falls below 1.0x. Ratings also could be downgraded if free cash flow is weak or negative, or if liquidity deteriorates. As proposed, the new $125 million senior secured revolving credit facility and $580 million senior secured first lien term loan facility are expected to provide covenant flexibility that if utilized could negatively impact creditors. Notable terms include the following: Incremental debt capacity up to the greater of corresponding dollar amount based on closing date EBITDA and 100% of pro forma Consolidated EBITDA, plus unlimited amounts subject to closing date first lien net leverage ratio (and unlimited amounts subject to 0.25x turns of EBITDA greater than the closing date secured net leverage ratio). Additionally, revolving commitments may be increased to 75% of EBITDA. Term loan amounts up to the greater of corresponding dollar amount based on closing date EBITDA and 100% of Consolidated pro forma EBITDA may be incurred with an earlier maturity than the initial first lien term loans. The credit agreement permits the transfer of assets to unrestricted subsidiaries, up to the carve-out capacities, subject to "blocker" provisions which prohibit any IP Separation and Relicense Transaction of Material Intellectual Property. Non-wholly-owned subsidiaries are not required to provide guarantees; dividends or transfers resulting in partial ownership of subsidiary guarantors could jeopardize guarantees subject to protective provisions which only permit guarantee releases if (i) the subsidiary ceases to be a subsidiary of the borrower, (ii) the borrower is deemed to have made a new investment in such person on a pro forma basis, or (iii) such disposition is a good faith disposition to a bona fide unaffiliated third party for fair market value and a bona fide business purpose (all as determined by the borrower in good faith). There are no express protective provisions prohibiting an up-tiering transaction. The above are proposed terms and the final terms of the credit agreement may be materially different. The principal methodology used in these ratings was Consumer Packaged Goods Methodology published in February 2020. Louisville, Colorado-based Sovos Brands was formed in 2016 by private equity firm Advent International as a platform to build a diversified branded packaged food company, principally through acquisitions. Since inception, the company has acquired four major brands: Michael Angelo's frozen Italian meals in January 2017, Rao's pasta sauces in July 2017, Noosa yogurt in November 2018, and Birch Benders in October 2020. The company's sales, pro forma for the Birch Benders acquisition, were approximately $609 million for the twelve months ending December 31, 2020. SOVOS BRANDS: S&P Alters Outlook to Negative, Affirms 'B' ICR ------------------------------------------------------------- S&P Global Ratings affirmed its 'B' issuer credit rating on U.S.-based branded food company Sovos Brands Intermediate Inc. and revised the outlook to negative because of the much higher pro forma leverage. S&P said, "At the same time, we assigned our 'B' issue-level and '3' recovery ratings to the proposed first-lien term loan and our 'CCC+' issue-level and '6' recovery ratings to the proposed second-lien term loan. We will withdraw the issue-level ratings on the existing first-lien term loan when this transaction closes. All ratings are based on preliminary terms and are subject to review of final documentation. "The negative outlook reflects our view that the incremental debt burden will result in elevated leverage over the next 12 months with limited cushion to absorb any operational missteps, consider acquisitions, or incur additional restructuring charges, which could delay deleveraging below our downgrade trigger. "The dividend recapitalization significantly increases S&P Global Ratings-adjusted leverage for the next few quarters and limits rating cushion. We expect Sovos' leverage to remain high over the next several quarters following the dividend despite its strong operating performance. Specifically, we anticipate S&P Global Ratings-adjusted leverage will increase to about 8x following the transaction close. We expect continued solid 15%-18% revenue growth even after lapping the pandemic, and adjusted EBITDA margins in the mid-teen area over the next year, supported by strong demand for its Rao's brand and stronger-than-expected performance of its recently acquired Birch Benders brand. Still, because of the over $400 million debt funded dividend the adjusted debt to EBITDA will likely remain in the mid-6x area in 2021. In our view there is limited cushion in the rating at these leverage levels to withstand weak operating conditions or unexpected one-time costs. In addition, if it continues to pursue debt-funded dividends or acquisitions that result in leverage sustained above 6.5x, we could consider a downgrade to reflect much more aggressive debt leverage." Given the company's financial sponsor ownership it could pursue additional debt funded activities. As part of this transaction, Sovos' majority owner, Advent International, is realizing most of its invested capital. It has been invested in the company since 2017. S&P said, "We believe the sponsor will likely continue to seek return on its investment over the next few years. We believe event risk remains and that leverage could remain elevated above our base case if the company pursues debt financed acquisitions to grow scale and brand portfolio as it did with the Birch Benders in October 2020." S&P said, "We forecast EBITDA margins in the mid-teen percent area, which will lead to consistent free cash flow generation over $50 million. The company incurred large one-time costs in 2020 related to its search for acquisitions, resulting in modestly lower-than-expected adjusted EBITDA margins. We expect these costs to roll off by the end of 2021 and forecast EBITDA margins in the 15% range as it realizes better economies of scale from the Birch Benders acquisition and increases its channel distribution and household penetration. This expected margin stability, coupled with its modest annual maintenance capex requirements of $5 million to $7 million, will enable the company to consistently generate annual free operating cash flow (FOCF) of more than $50 million. This level of cash flow generation can continue to support the existing rating if applied to debt repayment. If not, we believe operating results need to exceed our base-case forecast to meaningfully decrease leverage during the next year. "The negative outlook reflects the possibility that we could lower the ratings within the next several quarters if the company's S&P Global Ratings-adjusted debt to EBITDA does not trend to below 6.5x by the end of fiscal 2021. We believe this could occur if the company underperforms our base-case forecast." These scenarios include: -- The company does not continue to generate organic revenue growth as it laps outsized growth due to pantry loading during the pandemic; -- Its high one-time costs do not roll off in the coming quarters as expected, or it faces integration challenges with Birch Benders; or -- It pursues a more-aggressive financial policy such as an additional debt-funded dividend to its financial sponsors or debt-funded acquisitions. S&P could revise its outlook to stable over the next 12 months if the company reduces leverage to 6.5x leverage or below by the end of fiscal 2021. -- This could occur if the company meets and/or modestly outperforms our base-case forecast; and -- Repays debt with cash flow by prioritizing debt reduction of leveraged acquisitions or dividends. SOVOS BRANDS: S&P Withdraws 'CCC+' Rating on Second-Lien Debt ------------------------------------------------------------- S&P Global Ratings withdrew its 'CCC+' issue-level rating and '6' recovery rating on Sovos Brands Intermediate Inc.'s second-lien debt at the issuer's request. All of S&P's other ratings on Sovos, including the 'B' issuer credit rating and its 'B' issue-level rating and '3' recovery rating on the company's first-lien credit facility, remain unchanged. STONEMOR INC: S&P Upgrades ICR to 'CCC+' on Improved Liquidity -------------------------------------------------------------- S&P Global Ratings raised the issuer credit rating on StoneMor Inc. (STON) to 'CCC+', reflecting improved liquidity and diminished near-term default risk. Concurrently, S&P raised the rating on the newly issued senior secured notes rating by one notch to 'CCC+'. S&P's stable outlook reflects improving EBITDA and free cash flow generation. It also reflects its expectation that liquidity will be sufficient over the next twelve months as well as diminished covenant violation risk. By refinancing the old paid-in-kind notes, STON now has a better liquidity profile and less covenant constraints. The new notes have no maintenance covenants and increased unrestricted cash by $30 million to $78 million as of March 31, 2021. This gives the company more flexibility to deploy capital to merger and acquisition (M&A) activities after years of divestitures and declining revenue. Though the indenture permits up to $40 million super senior revolver, it will likely come with maintenance covenants. Still, the improved liquidity and removal of maintenance on the majority of the company's debt reduces near term default risk. Uncertain prospects for sustained positive free cash flow generation and a potentially more aggressive financial policy limits the rating. Management has signaled a desire to resume M&A activities. In addition, STON is controlled by a hedge fund shareholder who owns 75% of common stocks outstanding. The company has little M&A track record in recent history. Financial policy could become more aggressive to the detriment of credit investors. A turnaround strategy is taking hold, but sustainability of operational improvement is still uncertain. The new management has implemented several operational and financial initiatives to turn around the business. S&P sees early results of these turnaround efforts, with several quarters of positive free cash flow and EBITDA. However, the COVID-19 pandemic has been a tailwind for STON, as well as the death care industry, because it has resulted in a higher number of deaths, increased cemetery preneed sales, and cost reductions. However, it is still unclear how profitability and cash flow may trend if these COVID-19 tailwinds taper off and as vaccination rates increase. S&P said, "Our stable outlook reflects improving EBITDA and free cash flow generation. It also reflects our expectation that liquidity will be sufficient over the next twelve months as well as diminished covenant violation risk. "We could consider a lower rating if liquidity deteriorates significantly, likely through unexpected cash flow deficits, raising the default risk over the next 12 months. "We could consider a higher rating if the company can demonstrate a longer track record of generating solid EBITDA and free cash flow, leading us to believe the capital structure is sustainable over the long term." SUFFERN PARTNERS: Seeks to Hire Davidoff Hutcher as Legal Counsel ----------------------------------------------------------------- Suffern Partners, LLC seeks approval from the U.S. Bankruptcy Court for the Southern District of New York to hire Davidoff Hutcher & Citron, LLP as its legal counsel. The firm will render these services: a. give advice to the Debtor with respect to its powers and duties and the continued management of its property and affairs; b. negotiate with creditors, work out a plan of reorganization and take the necessary legal steps in order to effectuate such a plan; c. prepare legal papers; d. appear before the bankruptcy court; e. attend meetings and negotiate with representatives of creditors and other parties in interest; f. advise the Debtor in connection with any potential refinancing of secured debt and any potential sale of its business; g. represent the Debtor in connection with obtaining post-petition financing; h. take any necessary action to obtain approval of a disclosure statement and confirmation of a plan of reorganization; and i. perform all other legal services. The firm will be paid at these rates: Attorneys $400 - $725 per hour Paraprofessionals $195 - $260 per hour As disclosed in court filings, Davidoff Hutcher is a "disinterested person" as defined in Bankruptcy Code Section 101(14). The firm can be reached through: Robert L. Rattet, Esq. Davidoff Hutcher & Citron, LLP 605 Third Avenue, 34th Floor New York, NY 10158 Tel: 212-557-7200 Email: rlr@dhclegal.com About Suffern Partners Suffern, N.Y-based Suffern Partners, 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 25 Old Mill Road, Suffern, N.Y., valued at $52.5 million. Suffern Partners filed its voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. S.D.N.Y. Case No. 21-22280) on May 16, 2021. Isaac Lefkowitz, chief executive officer, signed the petition. In its petition, the Debtor disclosed $58,000,000 in assets and $48,716,042 in liabilities. Judge Sean H. Lane presides over the case. Davidoff Hutcher & Citron, LLP represents the Debtor as its legal counsel. SUFFERN PARTNERS: Seeks to Hire Hahn & Hessen as Special Counsel ---------------------------------------------------------------- Suffern Partners, LLC seeks approval from the U.S. Bankruptcy Court for the Southern District of New York to hire Hahn & Hessen, LLP as its special counsel. The Debtor needs the firm's legal services in two pre-bankruptcy litigations styled (i) Suffern Partners LLC v. Old Republic National Title Insurance Company, et al., U.S. District Court, Southern District of New York, Index No. 7:20-cv-08905-CS; and (ii) RS Old Mills Rd, LLC v. Suffern Partners LLC, et al., Supreme Court of the State of New York, Rockland County, Index No. 031809/202. The Debtor also requires legal assistance in connection with the sale of its property. The firm will be paid at these rates: Gilbert Backenroth $1,025 per hour Stephen Grable $750 per hour Mark Graham $785 per hour Steven Aquino $570 per hour Other Attorneys $360 to $1,050 per hour Paralegal assistants $150 to $300 per hour As disclosed in court filings, Hahn & Hessen does not have any connection with the Debtor, its creditors or any other party in interest. The firm can be reached through: Stephen J. Grable, Esq., Hahn & Hessen LLP 488 Madison Avenue New York, NY 10022 Tel: 212-478-7213 Fax: 212-478-7400 Email: sgrable@hahnhessen.com About Suffern Partners Suffern, N.Y-based Suffern Partners, 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 25 Old Mill Road, Suffern, N.Y., valued at $52.5 million. Suffern Partners filed its voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. S.D.N.Y. Case No. 21-22280) on May 16, 2021. Isaac Lefkowitz, chief executive officer, signed the petition. In its petition, the Debtor disclosed $58,000,000 in assets and $48,716,042 in liabilities. Judge Sean H. Lane presides over the case. Davidoff Hutcher & Citron, LLP and Hahn & Hessen, LLP serve as the Debtor's bankruptcy counsel and special counsel, respectively. SUFFERN PARTNERS: TT Holder Buying Suffern Property for $52.5M -------------------------------------------------------------- Suffern Partners LLC asks the U.S. Bankruptcy Court for the Southern District of New York to authorize the private sale of the real property located at 25 Old Mill Road, in Suffern, New York, to TT Holder Entity LLC for $52.5 million, in accordance with the terms of the Purchase and Sale Agreement, as amended. In 2017, the Debtor was formed to acquire title to the commercial property located at 25 Old Mill Road, Town of Ramapo, Village of Suffern, and 19 Hemion Road in the Village of Montebello, Suffern, New York (collectively, "Property"). The Property was formerly owned and occupied by Novartis Corp. and consists of 162 acres with a 600,000 square foot building located thereon. The Property is zoned for light industrial use. A Certificate of Occupancy is in place and the Property is fully insured, secured and maintained. A small portion of the building is currently occupied by a holdover tenant, Continental Kosher Catering, whose lease was terminated by the Debtor for non-payment, has been served with a warrant and is subject to pending eviction proceedings before the local town court. The Debtor's acquisition of the Property is well known to the Court, as the successor owner to Novartis, RS Old Mill, LLC ("RS1"), was a Chapter 7 debtor before the Court under Case No. 17-22218(RDD). The relevant circumstances leading up to the Debtor's Chapter 11 filing begin in February 2017, when RS1 filed a petition for Chapter 11 bankruptcy protection in the U.S. Bankruptcy Court for the Southern District of New York, Case No. 17-22218-RDD, under which RS1 allegedly sought to protect its rights under an agreement to purchase the Property from Novartis Corp. for $18 million. As the Bankruptcy Court later found, RS1 had made a $2.5 million deposit for the purchase, and was at risk of forfeiting that deposit because it had been unable to procure the balance of the funds needed and was running out of time to close on the purchase. After filing its Chapter 11 petition, RS1 assumed the purchase agreement, and the Bankruptcy Court ultimately ordered that RS1's purchase of the Property had to close by no later than Aug. 17, 2017. The Bankruptcy Court's later findings confirmed certain critical facts that RS1 was ultimately still unable to secure direct financing for its acquisition of the Property. To try and protect its right to purchase the Property and avoid forfeiture of the $2.5 million deposit, RS1 -- by and through its 100% owner Yehuda Salamon -- implemented and structured a deal whereby it would both purchase and sell the Property in a single transaction, by assigning the Property to an affiliated corporate strawman of Yehuda Salamon -- RS Old Mills Rd, LLC ("RS2") -- which would then immediately assign the Property to the Debtor, which had secured financing and thus was able to fund the additional balance due for purchase of the Property from Novartis. Testimony received during the RS Bankruptcy Action confirmed that all parties -- RS1, RS2 and the Debtor -- viewed the deal structure as "one collapsed transaction" through which the Debtor would receive title to the Property through a transfer from RS1. The Debtor obtained a $33 million loan from CPIF Lending, LLC to permit its acquisition and also anticipated development of the Property. To secure such additional funding above the $18 million purchase price due to Novartis, the Debtor also secured an additional $12.5 million private loan as an "equity show" in the transaction, and arranged for two additional commercial properties located in Brooklyn to serve as collateral for the $33 million loan ("Brooklyn Collateral"). The transaction was heavily documented and negotiated at arm's-length, with all parties represented by counsel. Additionally, the Debtor obtained title insurance and CPIF obtained mortgage insurance in connection with the Debtor's purchase and financing on the Property. Riverside Abstract, LLC served as escrow agent for receipt and distribution of the sale proceeds. The sale closed on Sept. 5, 2017. CPIF transferred approximately $25.5 million to be held in escrow by Riverside, with the remainder of the Debtor's obtained $33 million loan held back by CPIF for lender fees, reserves, and other expenses. Riverside also received an additional $12.5 million to be held in escrow, reflecting the short-term private loan needed to facilitate the transaction In order to maximize the value of the Property and cut off the continuing accruals and costs associated with the ownership and management of the Property, the Debtor, pursuant to a written agreement dated Oct. 30, 2019, engaged CBRE as broker to lease or sell the Property. After an extensive marketing period which resulted in multiple expressions of interest, on March 9, 2020, the Debtor entered into a Purchase and Sale Agreement ("PSA") with the Purchaser, an entity owned or controlled a well-known New Jersey commercial property developer and a party wholly unaffiliated or related to the Debtor or its owners, managers or insiders, for $55 million, reduced to $52.5 million pursuant to the First Amendment to the PSA. Since the PSA was entered into prior to the Petition Date, the PSA is an executory contract, or unexpired agreement, within the meaning of Section 365 of the Bankruptcy Code 45. The sale closing has been time and time again delayed and held hostage by the litigation tactics of RS1, RS2, Salamon and their related entities/individuals to the direct material detriment and peril of the Debtor’s mortgagee and other legitimate creditors. Notwithstanding, the Purchaser is currently still ready, willing and able to close on the sale. However, if the sale is further delayed, the Debtor risks the Purchaser walking away and losing the contract and perhaps ultimately the Property through foreclosure, as the Debtor is currently in default under the CPIF mortgage. The Debtor submits the Application for authority to (a) assume the PSA and Broker Agreement and (b) sell the Property pursuant to the terms and provisions of the PSA, free and clear of all liens, claims, interests and encumbrances, including but not limited to the RS2 Notices of Pendency, pursuant to Sections 363(b),(f) and (m) and 365(b) of the Bankruptcy Code and Bankruptcy Rules 2002 and 6004. It is in the best interests of the Debtor to approve a private sale of the Property under the PSA, and the Debtor's creditors will be well served with the proposed sale since it will result in a 100% distribution to all administrative, secured and priority creditors as well as a significant distribution to the Debtor's unsecured creditors, with a possible return even to equity. The Debtor submits that the private sale of the Property is reasonable and a sale at auction, subject to higher and better offers, would only cause risk, uncertainly and a possible erosion of the estate. The Debtor has not yet determined the best course of action with respect to the chapter 11 proceeding; to confirm a plan of reorganization or seek the approval of the Court to dismiss the case. However, it is in the best interest of the estate to obtain immediate approval of the PSA so as to cut off all ongoing interest, taxes and expenses associated with the Property, as well as to comply with the current closing deadlines thereunder. The Debtor requests that any order approving the sale contain a provision, inter alia, that cancels the RS Notices of Pendency or deems them as canceled. The Debtor seeks an Order of the Court rendering the sale of the Property free and clear of, inter alia, the possessory interests, if any, of Continental Kosher Catering Inc. ("CKC") pursuant to Section 363(f) of the Bankruptcy Code. On Aug. 25, 2020, the Town of Ramapo Justice Court executed a warrant of eviction for non-payment against CKC, whose lease was previously terminated but remains a holdover tenant awaiting eviction for the Town Sherriff pending the results of CKC's pending appeal in State Court pursuant to which the eviction has been stayed due to the posting of a supersedeas bond in favor of the Debtor. It is a condition to closing that the Property be delivered free and clear of, inter alia, the CKC terminated lease and all interests and rights thereunder. A copy of the Agreement is available at https://tinyurl.com/6e4u252a from PacerMonitor.com free of charge. About Suffern Partners LLC Suffern Partners LLC is a Single Asset Real Estate debtor. The Debtor is the fee simple owner of a property located at 25 Old Mill Road, Suffern, NY 10901 valued at $52.5 million. The Debtor sought Chapter 11 protection (Bankr. S.D.N.Y. Case No. 21-22280) on May 16, 2021. The case is assigned to Judge Sean H. Lane. The Debtor has a total assets of $58 million and $48,716,042 in liabilities. The Debtor tapped Robert L. Rattet, Esq., at Davidoff Hutcher & Citron, LLP as counsel. The petition was signed by Isaac Lefkowitz, CEO. SURVEYMONKEY INC: Moody's Hikes CFR to B2, Outlook Stable --------------------------------------------------------- Moody's Investors Service upgraded SurveyMonkey Inc.'s corporate family rating to B2 from B3, probability of default rating to B2-PD from Caa1-PD and senior secured bank credit facility rating to B2 from B3. The Speculative Grade Liquidity rating was upgraded to SGL-1 from SGL-2, indicating very good liquidity. The outlook remains stable. "Continued strategic investments in products and its sales force drive our expectations of at least 15% revenue growth over the next three years and that revenue or remaining performance obligations (RPO, the sum of deferred revenue and backlog) will outgrow expenses," said Sean Cray, Moody's Analyst. Cray continued: "The upgrade is also driven by strong cash flow metrics relative to B2-rated issuers and our expectation that free cash flow to debt will remain at least in the mid-teen percentages." The upgrade is also driven by governance considerations. Moody's expects that cash balances and free cash flow will continue being used towards growth initiatives, including potential acquisitions, rather than return capital to shareholders in the form of share repurchases or dividends. SurveyMonkey has not repurchased shares or paid dividends since becoming a public company in August 2018, nor does Moody's expect the company to repurchase shares or pay dividends for at least the next few years as the company reinvests for growth. Upgrades: Issuer: SurveyMonkey Inc. Corporate Family Rating, Upgraded to B2 from B3 Probability of Default Rating, Upgraded to B2-PD from Caa1-PD Speculative Grade Liquidity Rating, Upgraded to SGL-1 from SGL-2 Gtd Senior Secured Bank Credit Facility, Upgraded to B2 (LGD3) from B3 (LGD3) Outlook Actions: Issuer: SurveyMonkey Inc. Outlook, Remains Stable RATINGS RATIONALE SurveyMonkey's B2 CFR reflects its small size, its concentration in the web-based survey market, large investment spending in growth to expand its product sales in the Enterprise market, and weak credit metrics when expensing stock compensation. Gross debt to EBITDA leverage (Moody's adjusted, including adding back the change in deferred revenue and expensing capitalized software costs and stock compensation) is expected to remain negative or very high for 2021 and 2022. The company is also exposed to competitive threats from other survey, customer experience, and market research participants, particularly if its technology doesn't keep up with emerging product trends. The rating is supported by the company's strong market position within a niche segment, over 100% net revenue retention, strong cash flow metrics, and a very good liquidity profile supported by large cash balances and an expectation for continued free cash flow generation. Moody's also expects that revenue and RPO growth supported by continued expansion into the Enterprise market will outgrow expenses, leading to EBITDA growth. The rating also incorporates governance considerations and Moody's expectation that SurveyMonkey's financial policy will not include share repurchases and dividend payments over at least the next few years. The upgrade of the PDR by two notches to B2-PD from Caa1-PD reflects an expected family recovery rate of 50% and Moody's belief that SurveyMonkey will maintain significant cushion on its maximum leverage financial maintenance covenant required by the credit agreement. The B2 ratings on the $75 million senior secured revolving credit facility expiring October 10, 2023 and $215 million senior secured term loan due October 10, 2025 reflect both the Probability of Default rating of B2-PD and a Loss Given Default (LGD) assessment of LGD3. The first lien facilities are guaranteed by certain SurveyMonkey subsidiaries and secured by liens on substantially all off the assets of the company and such subsidiaries. The SGL-1 Speculative Grade Liquidity rating reflects SurveyMonkey's very good liquidity profile, supported by $247 million of cash as of March 31, 2021, $72.5 million available under its $75 million revolver due October 2023, and Moody's expectation of at least $40 million over the next 12 months. The credit agreement includes an Excess Cash Flow sweep of 75% of cash flow (as defined) generated by only the domestic subsidiary when the leverage ratio is above 4x. The credit agreement permits stock compensation and deferred revenue addbacks to the definition of EBITDA and therefore, Moody's does not project that an excess cash flow sweep will be required in the near term. The credit agreement includes a maximum leverage ratio covenant of 5x for the life of the loan and Moody's expects the company will maintain a significant cushion of compliance. The stable rating outlook reflects Moody's expectations that revenue will grow at least 15% in 2021 and 2022 and that revenue or RPO will outgrow expenses, which includes stock-based compensation. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS The ratings could be upgraded if Moody's expects: 1) the company to achieve meaningfully positive EBITDA (includes Moody's standard adjustments, adding back the change in deferred revenue, and expensing capitalized software costs and stock compensation) on a sustainable basis, 2) SurveyMonkey's scale and scope to significantly increase, and 3) free cash flow to debt to be sustained at or above 20%. The ratings could be downgraded if Moody's expects: (1) revenue growth is less than anticipated or expenses continue to outpace revenue and RPO growth, (2) in the absence of improving profits, free cash flow to debt to be sustained below the mid-teens percentages or liquidity to meaningfully deteriorate, (3) the company's market position to deteriorate, (4) technological disruptions to negatively impact operating performance, or (4) more aggressive financial strategies, including share repurchases. SurveyMonkey Inc. is an online survey and software solutions company that became a public company in September 2018. Revenue for the last twelve months ended March 31, 2021 was $390 million. The company was founded in 1999. The principal methodology used in these ratings was Business and Consumer Service Industry published in October 2016. TEA OLIVE: Haybeach Special Buying Class Action Claim for $61.5K ---------------------------------------------------------------- Tea Olive I, LLC, filed with the U.S. Bankruptcy Court for the District of Minnesota a notice of its sale of all of its rights, titles, and interests in, to, and under any and all claims, demands, rights and causes of action that the Debtor had, now has, or may in the future against or with respect to a settlement of claims or judgment in that certain class action proceeding against Visa, Inc. MasterCard, Inc. and certain other defendants in the case captioned as In re: Payment Card Interchange Fee and Merchant Discount Antitrust Litig., Case No 05-1720 (E.D.N.Y.), to Haybeach Special Opportunities Fund, LP, for $61,500. The Court will hold a hearing on the Motion at 9:00 a.m. (CT) on June 8, 2021. The hearing will be held telephonically: Dial 1-888-684-8852; when prompted, enter Aceess Cose: 5988550; when prompted, enter Security Code: 0428. The Objection Deadline is June 3, 2021. In the beginning of 2020, the Debtor continued its rebranding efforts and expected the business to grow throughout the year. However, the COVID-19 pandemic unexpectedly changed all expectations for 2020. All of the Debtor's 25 stores were either closed entirely or, at a minimum, under strict capacity and operating hour restrictions due to the pandemic. Additionally, the pandemic itself altered the shopping behaviors of the Debtor's consumers, with some customers not feeling comfortable entering physical stores to shop. In this challenging environment, the Debtor commenced the case and immediately began its efforts to winddown its business and marshal its assets for liquidation and subsequent disbursement of the proceeds for the benefit of its estate, its creditors, and other parties in interest. Prior to the Filing Date, the Debtor held certain claims, demands, rights, and causes of action against the Defendants in the Class Action Case. These claims and rights stemmed from the Defendants' unlawful fixing of interchange fees and other conduct in violation of the Sherman Act (15 U.S.C. Section 1, et seq.). As part of the Class Action Case, the class plaintiffs -- including the Debtor -- and the Defendants entered into a certain Definitive Class Settlement Agreement, which was approved by the U.S. District Court on Nov. 27, 2012. The Debtor accordingly received rights to certain settlement proceeds based on its Claims. On Dec. 13, 2019, the U.S. District Court approved a proposed settlement fund of up to $5.54 billion, subject to an appeal filed Jan. 3, 2020. Payment of the Claims from the settlement fund, however, is speculative and may result in no distributions or payments. After the Filing Date and as the DIP, the Debtor began the process of marketing its assets as part of its initial restructuring and eventual wind-down efforts. As part of this process, the Debtor marketed and solicited interest in its Claims against the Defendants. In connection with these efforts, the Debtor solicited various offers for the Claims and received the highest offer from the Purchaser. The Debtor negotiated with the Purchaser regarding the potential sale of the Claims. Within those negotiations, the Debtor emphasized its need to obtain Court approval of any agreement to sell the Claims to the Purchaser. As a result of those extensive negotiations, the Debtor and the Purchaser entered into a certain Claim Sale Agreement. Under the Agreement, the Debtor agreed to sell the rights to its Claims to the Purchaser in exchange for $61,500. The Agreement provides for the sale free and clear of all liens, the Claims are speculative and may result in no distributions or payments or distributions or payments that are different in amount and kind from the purchase price. Based upon the Debtor's marketing and sale efforts, the Debtor believes in its sound business judgment that the Agreement represents its best opportunity to realize the maximum value of the Claims and is in the best interests of the estate and the creditors. There are currently two known liens, claims, interests, or encumbrances that may encumber the Claims. First, Second Avenue Capital Partners LLC holds a blanket lien on all assets of the Debtor. Second, Worldwide Distributors also holds a blanket lien on all assets of the Debtor. However, based on the liens and the nature of the Claims, it is unclear whether either lien actually encumbers the Claims. The Debtor requests that the order approving the sale of the Claims provide that such sale is free and clear of all liens, claims, and encumbrances in accordance with section 363(f) of the Bankruptcy Code, including those of Second Avenue Capital Partners LLC and Worldwide Distributors. The Debtor also requests that any order approving the relief requested be effective immediately, by providing that the 14-day stay is inapplicable. There is no just reason for delaying the effectiveness of the order. A copy of the Agreement 1 is available at https://tinyurl.com/cu5xm6b4 from PacerMonitor.com free of charge. About Tea Olive I, LLC Tea Olive I, LLC -- https://www.stockandfield.com/ -- is a Minnesota limited liability company formed in 2018 and headquartered in Eagan, Minn. It is a farm, home and outdoor retailer currently operating 25 stores across Illinois, Indiana, Ohio, Wisconsin and Michigan. Tea Olive I conducts business under the name Stock+Field. Tea Olive I filed a Chapter 11 petition (Bankr. D. Minn. Case No. 21-30037) on Jan. 10, 2021. The Hon. William J. Fisher is the case judge. The Debtor estimated $50 million to $100 million in assets and liabilities as of the bankruptcy filing. As of the petition date, the Debtor had $29,724,104 in secured debt under a credit agreement with Second Avenue Capital Partners, LLC, as the administrative agent and collateral agent. The Debtor also has $26,500,000 in trade debt. As of Jan. 8, 2021, the Debtor estimated it holds consolidated inventory valued at $45,692,831. The Debtor also estimated it holds $734,000 in accounts receivable and prepaid assets. The Debtor tapped Fredrikson & Byron, P.A. as its counsel and Steeplechase Advisors LLC as its investment banker. Donlin, Recano & Company, Inc. is the claims agent. The U.S. Trustee for Region 12 has appointed an Official Committee of Unsecured Creditors. Bassford Remele, P.A., is the Committee's counsel. TEA OLIVE: June 8 Hearing on $61.5K Sale of Class Action Claims --------------------------------------------------------------- Tea Olive I, LLC, filed with the U.S. Bankruptcy Court for the District of Minnesota a notice of its amended request to approve proposed sale of all of its rights, titles, and interests in, to, and under any and all claims, demands, rights and causes of action that the Debtor had, now has, or may in the future against or with respect to a settlement of claims or judgment in that certain class action proceeding against Visa, Inc. MasterCard, Inc. and certain other defendants in the case captioned as In re: Payment Card Interchange Fee and Merchant Discount Antitrust Litig., Case No 05-1720 (E.D.N.Y.), to Haybeach Special Opportunities Fund, LP for $61,500. The Court will hold a hearing on the Motion at 9:00 a.m. (CT) on June 8, 2021. The hearing will be held telephonically: Dial 1-888-684-8852; when prompted, enter Access Code: 5988550; when prompted, enter Security Code: 0428. The Objection Deadline is June 3, 2021. In the beginning of 2020, the Debtor continued its rebranding efforts and expected the business to grow throughout the year. However, the COVID-19 pandemic unexpectedly changed all expectations for 2020. All of the Debtor's 25 stores were either closed entirely or, at a minimum, under strict capacity and operating hour restrictions due to the pandemic. Additionally, the pandemic itself altered the shopping behaviors of the Debtor's consumers, with some customers not feeling comfortable entering physical stores to shop. In this challenging environment, the Debtor commenced the case and immediately began its efforts to wind-down its business and marshal its assets for liquidation and subsequent disbursement of the proceeds for the benefit of its estate, its creditors, and other parties in interest. Prior to the Filing Date, the Debtor held certain claims, demands, rights, and causes of action against the Defendants in the Class Action Case. These claims and rights stemmed from the Defendants' unlawful fixing of interchange fees and other conduct in violation of the Sherman Act (15 U.S.C. Section 1, et seq.). As part of the Class Action Case, the class plaintiffs -- including the Debtor -- and the Defendants entered into a certain Definitive Class Settlement Agreement, which was approved by the U.S. District Court on Nov. 27, 2012. The Debtor accordingly received rights to certain settlement proceeds based on its Claims. On Dec. 13, 2019, the U.S. District Court approved a proposed settlement fund of up to $5.54 billion, subject to an appeal filed Jan. 3, 2020. Payment of the Claims from the settlement fund, however, is speculative and may result in no distributions or payments. After the Filing Date and as the DIP, the Debtor began the process of marketing its assets as part of its initial restructuring and eventual wind-down efforts. As part of this process, the Debtor marketed and solicited interest in its Claims against the Defendants. In connection with these efforts, the Debtor solicited various offers for the Claims and received the highest offer from the Purchaser. The Debtor negotiated with the Purchaser regarding the potential sale of the Claims. Within those negotiations, the Debtor emphasized its need to obtain Court approval of any agreement to sell the Claims to the Purchaser. As a result of those extensive negotiations, the Debtor and the Purchaser entered into a certain Claim Sale Agreement. Under the Agreement, the Debtor agreed to sell the rights to its Claims to the Purchaser in exchange for $61,500. The Agreement provides for the sale free and clear of all liens, the Claims are speculative and may result in no distributions or payments or distributions or payments that are different in amount and kind from the purchase price. Based upon the Debtor's marketing and sale efforts, the Debtor believes in its sound business judgment that the Agreement represents its best opportunity to realize the maximum value of the Claims and is in the best interests of the estate and the creditors. There are currently two known liens, claims, interests, or encumbrances that may encumber the Claims. First, Second Avenue Capital Partners LLC holds a blanket lien on all assets of the Debtor. Second, Worldwide Distributors also holds a blanket lien on all assets of the Debtor. However, based on the liens and the nature of the Claims, it is unclear whether either lien actually encumbers the Claims. The Debtor requests that the order approving the sale of the Claims provides that such sale is free and clear of all liens, claims, and encumbrances in accordance with section 363(f) of the Bankruptcy Code, including those of Second Avenue Capital Partners LLC and Worldwide Distributors. The Debtor also requests that any order approving the relief requested be effective immediately, by providing that the 14-day stay is inapplicable. There is no just reason for delaying the effectiveness of the order. A copy of the Agreement is available at https://tinyurl.com/2xy9usp3 from PacerMonitor.com free of charge. About Tea Olive I, LLC Tea Olive I, LLC -- https://www.stockandfield.com/ -- is a Minnesota limited liability company formed in 2018 and headquartered in Eagan, Minn. It is a farm, home and outdoor retailer currently operating 25 stores across Illinois, Indiana, Ohio, Wisconsin and Michigan. Tea Olive I conducts business under the name Stock+Field. Tea Olive I filed a Chapter 11 petition (Bankr. D. Minn. Case No. 21-30037) on Jan. 10, 2021. The Hon. William J. Fisher is the case judge. The Debtor estimated $50 million to $100 million in assets and liabilities as of the bankruptcy filing. As of the petition date, the Debtor had $29,724,104 in secured debt under a credit agreement with Second Avenue Capital Partners, LLC, as the administrative agent and collateral agent. The Debtor also has $26,500,000 in trade debt. As of Jan. 8, 2021, the Debtor estimated it holds consolidated inventory valued at $45,692,831. The Debtor also estimated it holds $734,000 in accounts receivable and prepaid assets. The Debtor tapped Fredrikson & Byron, P.A. as its counsel and Steeplechase Advisors LLC as its investment banker. Donlin, Recano & Company, Inc. is the claims agent. The U.S. Trustee for Region 12 has appointed an Official Committee of Unsecured Creditors. Bassford Remele, P.A., is the Committee's counsel. TEAM HEALTH: Moody's Puts Caa2 CFR Under Review for Upgrade ----------------------------------------------------------- Moody's Investors Service placed Team Health Holdings, Inc.'s Caa2 Corporate Family Rating, Caa2-PD Probability of Default Rating, Caa1 senior secured term loan and revolving credit facility's ratings and Ca rating of unsecured notes on review for upgrade. The review follows Team Health's announcement that it has initiated negotiations with its lenders to extend the maturity of its revolving credit facility. The company's revolving credit facility expires on February 6, 2022 and it was fully utilized at the end of March 2021. The rating review will focus on the outcome of lender negotiations and the company's ability to refinance at favorable terms. If the company is able to extend the revolver maturity on favorable terms, ratings could be upgraded. On Review for Upgrade: Issuer: Team Health Holdings, Inc. Corporate Family Rating, placed on review for upgrade, currently Caa2 Probability of Default Rating, placed on review for upgrade, currently Caa2-PD Senior Secured Revolving Credit Facility expiring 2022, placed on review for upgrade, currently Caa1 (LGD3) Senior Secured Term Loan due 2024, placed on review for upgrade, currently Caa1 (LGD3) Senior Unsecured Notes due 2025, placed on review for upgrade, currently Ca (LGD6) Outlook Actions: Issuer: Team Health Holdings, Inc. Outlook changed to rating under review from negative RATINGS RATIONALE / FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS Team Health's Caa2 CFR reflects its very high leverage and challenging operating environment. The operating challenges include material declines in business volume as a result of the COVID-19 pandemic, reimbursement risk from one of the largest commercial insurer and the company's exposure to unfavorable shift in payor mix. Team Health's CFR is supported by its large scale and strong competitive position in the highly fragmented physician staffing industry. Moody's regards the coronavirus outbreak as a social risk under its ESG framework, given the substantial implications for public health and safety. In addition, as a provider of emergency medicine physician staffing, Team Health faces high social risk. The No Surprise Act, which was signed into law in December 2020, will take the patient out of the provider-payor dispute. The inability to bill out-of-network patients for amounts over in-network rates will impact those companies that have sizeable out-of-network revenues. The extent to which each company will get impacted will depend on the percentage of out-of-network patients they treat, specific billing and collections practices, as well as arbitration process (which is still a work-in-progress). The company's financial policies are expected to remain aggressive reflecting its ownership by private equity investor (Blackstone Group). The ratings could be downgraded if Moody's anticipates a rising risk of a default event or reduced expectations for recovery for creditors. The ratings could be upgraded if Team Health extends the maturity of its revolving credit facility. Additionally, improved clarity and positive outcome in relation to contract negotiations with UnitedHealth could also support a rating upgrade. The principal methodology used in these ratings was Business and Consumer Service Industry published in October 2016. Team Health is a provider of physician staffing and administrative services to hospitals and other healthcare providers in the U.S. The company is affiliated with more than 15,000 healthcare professionals who provide emergency medicine, hospital medicine, anesthesia, urgent care, pediatric staffing and management services. The company also provides a full range of healthcare management services to military treatment facilities. Net revenues are approximately $4.5 billion. TECT AEROSPACE: Sets Bidding Procedures for Assets in Kansas ------------------------------------------------------------ TECT Aerospace Group Holdings Inc. and affiliates ask the U.S. Bankruptcy Court for the District of Delaware to authorize the bidding procedures in connection with the auction sale of the assets related to their two Kansas manufacturing facilities and headquarters. A hearing on the Motion is set for June 7, 2021, at 10:00 a.m. (ET). The Objection Deadline is June 2, 2021, at 4:00 p.m. (ET). The Debtors filed these chapter 11 cases to maximize value for their stakeholders by pursuing sales of their assets under section 363 of the Bankruptcy Code. By the procedures described in the Motion, the Debtors will continue to market their Kansas assets and solicit bids therefor in order to maximize value for the estates. Over the past two years, the Debtors' business has been severely impacted by shifts in the airline industry's procurement decisions due to the COVID-19 pandemic and related travel restrictions, as well as production halts related to The Boeing Co.'s 737 MAX aircraft. As a result, the Debtors pursued strategic alternatives, eventually determining to file these chapter 11 cases to pursue sales of substantially all of their assets. The Motion seeks to establish a process for the sale of the Debtors' Assets to maximize their value for these estates. By separate motion, the Debtors have sought to establish a process for the sale of their Everett, Washington assets. By the Motion, the Debtors seek approval of procedures and deadlines pursuant to which they will market, solicit, and select the highest or otherwise best offer for the sale of the Assets. In connection with this process, the Debtors also request that the Court schedules an auction and hearing to consider approval of the Sale. As part of the Sale, the Debtors propose to assume and assign certain executory contracts and unexpired leases to the successful bidder; therefore, the Debtors also request approval of assumption and assignment procedures related thereto. They likewise seek approval of the form and manner of notice that they will provide of the Sale, the Auction, the Sale Hearing, and the proposed assumptions and assignments. Finally, the Debtors request that, at the Sale Hearing, the Court enters an order approving the Sale to the successful bidder as determined in accordance with the Bidding Procedures. The salient terms of the Bidding Procedures are: a. Bid Deadline: June 24, 2021, at 4:00 p.m. (ET). b. Deposit: 10% of the aggregate consideration c. Auction: In the event the Debtors receive more than one Qualified Bid before the Bid Deadline, the Debtors will conduct a virtual Auction beginning at 10:00 a.m. (ET) on June 28, 2021, or at such other time, place, and/or method as the Debtors, in consultation with the Consultation Parties, determine and provide notice of by filing a notice with the Court. d. Bid Increments: $100,000 e. Sale Hearing: July 9, 2021, (subject to the Court's calendar) f. Sale Objection Deadline: July 6, 2021, at 4:00 p.m. (ET) g. Credit Bidding: Parties holding claims against the Debtors secured by some or all of the Assets will be allowed to credit bid the amount of their secured claim for those Assets in which the party holds a perfected security interest, which will reduce the cash consideration offered for those Assets. The Debtors propose to provide notice of the Sale, Bidding Procedures, and Sale Hearing in accordance with the Noticing Procedures. Within two business days after the date of entry of the Bidding Procedures Order, or as soon as reasonably practicable thereafter, the Debtors will serve the Sale Notice upon the Sale Notice Parties. After the Bid Deadline, the Debtors, in consultation with the Consultation Parties, will determine which bids qualify as Qualified Bids and will notify Potential Bidders whether their bids are Qualified Bids by no later than June 25, 2021. In connection with any Sale, the Debtors may seek to assume and assign to a Successful Bidder one or more Contracts. The Assumption and Assignment Procedures are designed to, among other things, govern the Debtors' provision of Adequate Assurance Information and notice of Cure Costs to applicable Counterparties. Within two business days after the entry of the Bidding Procedures Order, the Debtors will file with the Court and serve on each Counterparty to a Contract that may be assumed in connection with the Sale the Assumption and Assignment Notice. The Cure Objection Deadline is June 24, 2021, at 4:00 p.m. (ET). The Adequate Assurance Objection Deadline is July 6, 2021 at 4:00 p.m. (ET). The Assets will be sold free and clear of any and all liens, claims, interests and other encumbrances, with any liens, claims, interests, and encumbrances attaching to the proceeds of the applicable sale. To implement the foregoing successfully, the Debtors request that the Court finds that notice of the Motion is adequate under Bankruptcy Rule 6004(a) under the circumstances, and waives the 14-day stay of an order authorizing the use, sale, or lease of property under Bankruptcy Rule 6004(h). A copy of the Bidding Procedures is available at https://tinyurl.com/6zer9p88 from PacerMonitor.com free of charge. About TECT Aerospace TECT Aerospace Group Holdings, Inc., and its affiliates manufacture high precision components and assemblies for the aerospace industry, specializing in complex structural and mechanical assemblies, and, machined components for a variety of aerospace applications. TECT produces assemblies and parts used in flight controls, fuselage/interior structures, doors, wings, landing gear, and cockpits. TECT operates manufacturing facilities in Everett, Washington, and Park City and Wellington, Kansas and their corporate headquarters is located in Wichita, Kansas. TECT currently employs approximately 400 individuals nationwide. TECT and its affiliates are privately held companies owned by Glass Holdings, LLC and related Glass-owned or Glass controlled entities. TECT Aerospace Group Holdings, Inc., and six affiliates sought Chapter 11 protection (Bankr. D. Del. Case No. 21-10670) on April 6, 2021. TECT Aerospace estimated assets of $50 million to $100 million and liabilities of $100 million to $500 million as of the bankruptcy filing. The Debtors tapped RICHARDS, LAYTON & FINGER, P.A., as counsel; WINTER HARBOR, LLC, as restructuring advisor; and IMPERIAL CAPITAL, LLC, as investment banker. KURTZMAN CARSON CONSULTANTS LLC is the claims agent. The Boeing Company, as DIP Agent, is represented by: Alan D. Smith, Esq. Perkins Coie LLP E-mail: ADSmith@perkinscoie.com - and - Kenneth J. Enos, Esq. Young Conaway Stargatt & Taylor, LLP E-mail: kenos@ycst.com THADEUS A. GADOMSKI JR: Selling Wells Asset for $505K to Rau & Dang ------------------------------------------------------------------- Thadeus A. Gadomski, Jr., and Marianne C. Gadomski ask the U.S. Bankruptcy Court for the District of Massachusetts to authorize their private sale of all their right, title, and interest in the real property with the improvements thereon located at 15 Central Avenue, in Wells, Maine, to Shane A. Rau and Quan A. Dang for $505,000. On a post-petition basis, by agreement dated May 20, 2021, the Debtors entered into a conditional Purchase and Sale Agreement for the sale of the Property to the Buyers of 19930 Gist Road, Los Gatos, California, for the sum of $505,000. On a pre-petition basis, the Property was a secondary residence of the Debtors. The sale of the Property proposed is to be free and clear of all liens, claims, interests, and encumbrances, with such liens, claims, interests, and encumbrances to attach to the proceeds in the order of their priority. The Property is being purchased by the Buyers "as is," with all faults and no adjustments for repairs or other items. The only adjustments to be made are usual adjustments for rent, taxes, municipal utilities, and the like. The holders of interests in the Property are, in order of priority, as follows: (i) Town of Wells, Maine (Real estate taxes) - $2,000 and (ii) PHH Mortgage (First Mortgage) - $169,905.21. The Property had been marketed using conventional methods via the listing of the Property with Linda Pratt, Century 21 North East, Kittery, Maine, licensed real estate brokers. Pursuant to the terms of the Agreement, compensation is to be paid to the broker on a percentage basis in the total amount of 5% of the sale price for the Property. Century 21 is to receive a commission, and Jonathan Safford, Better Homes & Gardens Real Estate/The Masiello Group of 1465 Post Road, Wells, Maine is to receive a commission as part of the transaction. The Debtors seek approval for the distribution of a portion of the proceeds at the time of sale. Specifically, they seek that the real estate taxes and the claims of PHH Mortgage, be paid at the time of closing, as well as all ordinary and usual closing adjustments and costs, such as recording fees and transfer taxes. The Debtors propose to pay, from sale proceeds at time of closing, a fee of 5% of the sales price to the brokers listed. To the extent that approval is required for this provision, the Debtors request such approval. The Debtors propose that all of the liens, interests, and encumbrances on the property attach to the proceed, and to be paid as provided for. The the Debtors request the Court to allow the sale to take place upon the terms and conditions set forth in the Purchase and Sale Agreement and subject to the terms and provisions of the motion. They also request that the Court approves the Notice of Intended Private Sale, to the extent required, for issuance. A copy of the Agreement is available at https://tinyurl.com/f2xv93vj from PacerMonitor.com free of charge. Thadeus A. Gadomski, Jr. and Marianne C. Gadomski sought Chapter 11 protection (Bankr. D. Mass. Case No. 20-11537) on July 21, 2020. The Debtors tapped Michael Feinman, Esq., as counsel. THADEUS A. GADOMSKI, JR.: June 15 Hearing on Sale of Wells Property ------------------------------------------------------------------- Thadeus A. Gadomski, Jr., and Marianne C. Gadomski filed with the U.S. Bankruptcy Court for the District of Massachusetts a notice of their private sale of all of their right, title, and interest in the real property with the improvements thereon located at 15 Central Avenue, in Wells, Maine, to Shane A. Rau and Quan A. Dang for $505,000, cash. The sale will take place on June 30, 2021. The Buyers have paid a deposit in the sum of 10,000. The terms of the proposed sale are more particularly described in the Motion to Approve Sale filed with the Court on May 20, 2021 and a written purchase and sale agreement dated May 20, 2021. The Motion to Approve Sale and the purchase and sale agreement are available at no charge upon request from the counsel for the Debtors. The will be sold free and clear of all liens, claims, and encumbrances. Any perfected, enforceable valid liens will attach to the proceeds of the sale. The Objection Deadline is June 14, 2021, at 4:30 p.m. Through the Notice, higher offers for the Property are hereby solicited. Any higher offer must be accompanied by a cash deposit of $10,000 made payable to the counsel for the Debtors. Higher offers must be on the same terms and conditions provided in the Purchase and Sale Agreement, other than the purchase price. A hearing on the Motion to Approve Sale, objections or higher offers is scheduled to take place on June 15, 2021 at 10:00 a.m. To appear telephonically, attendees shall, at the appointed time of hearing, dial (877) 336-1839 and enter access code 7925100. The deposit will be forfeited to the estate if the successful purchaser fails to complete the sale by the date ordered by the Court. If the sale is not completed by the Buyer approved by the Court, the Court, without further hearing, may approve the sale of the Property to the next highest bidder. Any questions concerning the intended sale will be addressed to the Debtors' counsel. The Purchasers: Shane A. Rau and Quan A. Dang 19930 Gist Road Los Gatos, CA 95033 Thadeus A. Gadomski, Jr. and Marianne C. Gadomski sought Chapter 11 protection (Bankr. D. Mass. Case No. 20-11537) on July 21, 2020. The Debtors tapped Michael Feinman, Esq., as counsel. TIANJIN JAHO: Case Summary & 3 Unsecured Creditors -------------------------------------------------- Debtor: Tianjin Jaho Investment, Inc. 9119 Windswept Grove Dr Houston, TX 77083-7405 Business Description: Tianjin Jaho Investment, Inc. is a Single Asset Real Estate debtor (as defined in 11 U.S.C. Section 101(51B)). Chapter 11 Petition Date: May 26, 2021 Court: United States Bankruptcy Court Western District of Washington Case No.: 21-11047 Judge: Hon. Christopher M. Alston Debtor's Counsel: Marc S. Stern, Esq. LAW OFFICE OF MARC S. STERN 1825 NW 65th St. Seattle, WA 98117-5532 Tel: (206) 448-7996 E-mail: marc@hutzbah.com Estimated Assets: $10 million to $50 million Estimated Liabilities: $10 million to $50 million The petition was signed by Charles Xi, president. A full-text copy of the petition is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/TEOXV6Y/Tianjin_Jaho_Investment_Inc__wawbke-21-11047__0001.0.pdf?mcid=tGE4TAMA List of Debtor's Three Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ 1. Kwang Keun Son Salary $75,000 3908 153rd Pl Se Reimbursement Mill Creek, WA 98012-7812 2. SYS Construction Construction $350,000 13300 Bothell Everett Overhead Hwy Ste 303 Mill Creek, WA 98012-531 3. Zhigiao He Salary $62,000 2300 Old Spanish Trl #2054 Reimbursement Houston, TX 77054-2142 TMX FINANCE: S&P Affirms 'B-' ICR on Steady Operating Performance ----------------------------------------------------------------- S&P Global Ratings affirmed its 'B-' issuer credit rating on TMX Finance LLC. The outlook remains stable. At the time, S&P affirmed its 'B-' issue rating on the company's senior secured notes due 2023. The recovery rating on the notes is '3' (50%), indicating S&P's expectation of a meaningful recovery in the event of default. The rating affirmation reflects the company's steady operating performance and leverage after a challenging year for the U.S. economy. The ratings also reflect ongoing exposure to state regulatory changes and concentrated ownership. TMX Finance reported gross debt to adjusted EBITDA of 2.6x and adjusted EBITDA interest coverage was 3.5x for the 12 months ended March 31, 2021, which improved from 3.4x and 2.9x, respectively, at the end of 2019. Although gross debt to adjusted EBITDA is below 3.0x, as the economy opens and government stimulus fades, S&P expects origination volume to grow, net revenue margin to normalize, and leverage to normalize back to its historical 3.0x-4.0x levels. The reduced leverage was driven by higher EBITDA and less debt, as the company opportunistically bought back debt over the past two years. Adjusted EBITDA grew to $216 million for the 12 months ended March 31, 2021, from $201 million in 2019. Adjusted EBITDA includes $58 million of operating lease adjustment. Also, since 2019, TMX has repurchased $67.3 million of its senior secured notes. Over the last year, TMX scaled back its origination volume to $753.2 million, versus $1.1 billion in 2019, largely in response to economic conditions brought on by the COVID-19 pandemic. In 2020, TMX's net charge-offs to average combined loans receivable declined to 27.9% from 35.5%, primarily owing to ongoing government stimulus that improved consumer debt payments. The rise in used car prices also helped reduce losses on repossessed vehicles. The increase in cash was offset by debt repurchases and distributions, including tax distributions, of $97.9 million to the company's sole member. S&P expects TMX to maintain sufficient liquidity as originations return to normal after the government stimulus ends. S&P said, "Notwithstanding the above, we remain cautious about TMX's exposure to ongoing state and federal regulations. In March 2021, the state of Illinois implemented an interest rate cap of 36% APR on consumer finance products. As a result, we expect TMX to gradually exit the Illinois market. As of year-end 2020, Illinois represented approximately 2.9% of the company's combined loans receivable balance, a level we view as modest. We also believe the Consumer Financial Protection Bureau could revisit its rules on high-cost, small dollar loans under the Biden administration." S&P's base-case forecast assumes: -- Net revenue to decrease by mid-single digits in 2021, driven by an increase in provision for loan losses; -- Gross debt to adjusted EBITDA of 3.0x-4.0x and adjusted EBITDA interest coverage of 2.5x-3.5x; and -- Sufficient maintenance of on-balance-sheet liquidity. S&P said, "The stable outlook over the next 12 months reflects our expectations of gross debt to adjusted EBITDA of 3.0x-4.0x, adjusted EBITDA coverage of 2.5x-3.5x, and net charge-offs (as a percent of average receivables) staying below 40%. The outlook also considers adequate covenant cushion. "We could lower the ratings if operational performance severely deteriorates so that adjusted EBITDA coverage approaches 1.0x, if regulations impedes the firm's growth strategy, if the company has difficulty refinancing its debt, or if TMX 's covenant cushion declines. "An upgrade is unlikely over the next 12 months. Over time, we could raise the rating if we expect leverage to sustain comfortably below 3.0x, adjusted EBITDA coverage above 3.0x, and net charge-offs remain below 35% on a sustained basis. An upgrade would also be contingent upon no regulations impeding the company's operational performance." TOP FLIGHT INVESTMENTS: Seeks to Hire Abbasi Law as Legal Counsel ----------------------------------------------------------------- Top Flight Investments, LLC, seeks approval from the U.S. Bankruptcy Code for the Central District of California to hire Abbasi Law Corporation as its legal counsel. The firm will render these services: a. represent the Debtor at its initial Debtor interview; b. represent the Debtor in its meeting of creditors pursuant to the Bankruptcy Code, or any continuance thereof; c. represent the Debtor at all hearings before the U.S. Bankruptcy Court involving the Debtor as Debtor-in-Possession and as recognized by the Debtor; d. prepare on behalf of the Debtor, as Debtor-in-Possession all necessary applications, motions, orders, and other legal papers; e. advise the Debtor, regarding matters of bankruptcy law, including the Debtor's rights and remedies with respect to the Debtor's assets and claims of its creditors; f. represent the Debtor with regard to all contested matters; g. represent the Debtor with regard to the preparation of a disclosure statement and the negotiation, preparation, and implementation of a plan of reorganization; h. analyze any secured, priority, or general unsecured claims that have been filed in the Debtor's bankruptcy case; i. negotiate with the Debtor's secured and unsecured creditors regarding the amount and payment of their claims; j. object to claims as may be appropriate; k. perform all other legal services for the Debtor as Debtor-in-Possession as may be necessary, other than adversary proceedings which would require a further written agreement; l. advise the Debtor with respect to its powers and duties as a Debtor-in-Possession in the continued operation of its business; m. provide counseling with respect to the general corporate, securities, real estate, litigation, environmental, state regulatory, and other legal matters which may arise during the pendency of the Chapter 11 case; and n. perform all other legal services that is desirable and necessary for the efficient and economic administration of the Chapter 11 case. The firm will be paid at these hourly rates: Attorneys $400 Paralegals $60 Law Clerks $25 Prior to the commencement of the Chapter 11 case, the firm received from the Debtor a retainer in the amount of $15,000, and $1,738 filing fee. Abbasi Law will also be reimbursed for reasonable out-of-pocket expenses incurred. Matthew Abbasi, a partner of Abbasi Law Corporation, assured the Court that the firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code and does not represent any interest adverse to the Debtor and its estates. Abbasi Law can be reached at: Matthew Abbasi, Esq. ABBASI LAW CORPORATION 6320 Canoga Ave., Suite 220 Woodland Hills, CA 91367 Tel: (310) 358-9341 Fax: (888) 709-5448 About Top Flight Investments Top Flight Investments, LLC, filed its voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. C.D. Cal. Case No. 21-10736) on April 26, 2021. At the time of filing, the Debtor estimated under $1 million in both assets and liabilities. Matthew Abbasi, Esq. at ABBASI LAW CORPORATION represents the Debtor as counsel. TORNANTE-MDP JOE: S&P Places 'B-' ICR on CreditWatch Positive ------------------------------------------------------------- S&P Global Ratings placed all its ratings on Tornante-MDP Joe Holding LLC (Topps), including its 'B-' issuer credit rating, on CreditWatch with positive implications. Tornante-MDP Joe Holding LLC (Topps) subsidiary Topps Co. Inc. announced plans to merge into special-purpose acquisition company (SPAC) Mudrick Capital Acquisition Corp. II (MUDS II) in a transaction valued at more than $1.1 billion. A substantial portion of owners, including Tornante, will roll over existing equity. S&P said, "The CreditWatch positive placement reflects the probability we would raise our 'B-' issuer credit rating on Topps one notch to 'B' because of favorable trends in its core markets, reduced S&P Global Ratings-adjusted debt to EBITDA, and our expectation that public ownership will lead to a more conservative financial policy. Demand has spiked for the company's sports and entertainment products, which consist of sports and entertainment-based trading cards and collectibles. This resulted in total revenue growth of 23% and adjusted debt to EBITDA of approximately 2x in 2020, well under our 4x upgrade threshold. Additionally, we believe that once the proposed SPAC transaction closes, Topps will likely adopt a more conservative financial policy regarding leverage. Previously, we assumed it would use leverage from time to time to return capital to shareholders given financial sponsor control. Following the transition to a public company, we believe Topps will likely maintain leverage below 4x to incorporate potential leveraging acquisitions and volatility over the economic cycle. In addition, Topps plans to refinance its $200 million senior secured term loan and $30 million revolver, both due in 2022. The significant reduction in leverage likely lowers near-term refinancing risk. "We believe current good demand trends in the company's sports and entertainment segment will continue through the second half of 2021 and that the company's confections segment, which was hampered by COVID-19 pandemic-related store closures in 2020, will likely recover this year. We understand that retailer inventory levels for Topps' trading cards and collectibles are currently low, and demand is outpacing the company's ability to fulfill orders. We believe the pandemic caused a surge in demand because consumers have spent more time at home, where trading cards and collectibles activities are more attractive entertainment options. In our updated base case, we expect total revenue to increase approximately 20%, driven by mid-20% sales growth in its sports and entertainment segment and 10% growth in its confections segment. We believe demand could moderate in late 2021 and 2022 due to the availability of other entertainment and leisure activity options as consumers feel more comfortable traveling and visiting out-of-home entertainment venues. As a result, we assume 2022 total revenue could increase in the low-single-digit percentages. We expect adjusted EBITDA margin in 2021 of approximately 17%-18% and for modest EBITDA margin compression in 2022 to 15%-16% if Topps' revenue growth declines and with modest negative operating leverage. While the company has made considerable progress in shifting its product mix toward its sports and entertainment segment and driving sales by using e-commerce, the segment has been volatile in the past. Furthermore, untested initiatives such as the proposed use of nonfungible tokens may result in margin volatility in the medium term if they do not produce the desired return. "Additionally, the proposed SPAC transaction would add approximately $41 million in incremental adjusted debt to S&P Global Ratings-adjusted leverage. We add $16 million to our adjusted debt calculation related to the tax receivable agreement that will be entered into upon consummation of merger. This agreement will require Topps to pay its previous shareholders 85% of realized tax savings. We also include $24.5 million in our debt calculation related to warrants that would be issued as part of the transaction, which we expect will be reported as a liability given recent U.S. Securities and Exchange Commission guidance for the treatment of equity warrants subject to tender offers that involve a more than 50% offer approval. Incorporating these adjustments and our base-case assumptions, we expect S&P Global Ratings-adjusted debt to EBITDA in the mid-2x area in 2021 and approximately 3x in fiscal 2022. "We believe with the proposed merger the company can refinance its capital structure when it matures in 2022. Topps plans to raise $571 million through the merger, including $250 million in proceeds from a private investment in a public entity (PIPE) transaction. The PIPE includes investments from Mudrick Capital, Gamco Investors, and Wells Capital Management. It is subject to customary closing conditions, which we expect in the second half of 2021. As a result of the substantial capital raise and recently reduced leverage, we believe Topps likely can refinance its $30 million revolving credit facility due in April 2022 and $200 million term loan, which matures in October 2022. "We plan to resolve the CreditWatch upon close of the proposed SPAC transaction. We intend to assess the impact of Topps' transition to a public company, review management's financial policies, and assess business risks and opportunities. We likely will raise our issuer credit rating one notch to 'B' due to recent trends in Topps' core markets, which have reduced S&P Global Ratings-adjusted debt to EBITDA well below our 4x upgrade threshold. We also believe the company is likely to adopt a lower leverage policy under new ownership, even if it pursues opportunistic leveraging acquisitions that could enable it to sustain leverage under 4x over the economic cycle. We believe the outlook will be stable. Upside to the rating will depend upon sustaining recent good business trends, margin improvement following the pandemic, and potential leveraging acquisitions." TOWN SPORTS: N.Y. Sports Club Bankruptcy Deal 'Destroyed' Stake --------------------------------------------------------------- Chris Dolmetsch and Katherine Doherty of Bloomberg News report that a lender to New York Sports Clubs sued the investment firms that took partial control of the gym chain through bankruptcy, claiming the Chapter 11 plan arranged by the new owners left the gym chain financially shaky and the lender's stake essentially worthless. Kennedy Lewis Investment Management said in court papers filed Tuesday, May 25, 2021, that its loan to Town Sports International LLC was unfairly converted into a minority stake by the new owners, and some of its holdings were frozen out entirely. What's more, the gym was re-launched without the financial backing that had been promised, according to Kennedy Lewis. About Town Sports International Town Sports International, LLC and its subsidiaries are owners and operators of fitness clubs in the United States, particularly in the Northeast and Mid-Atlantic regions. As of Dec. 31, 2019, the Company operated 186 fitness clubs under various brand names, collectively serving approximately 605,000 members. Town Sports owns and operates brands such as New York Sports Clubs, Boston Sports Clubs, Philadelphia Sports Clubs, Washington Sports Clubs, Lucille Roberts and Total Woman. Town Sports and several of its affiliates filed for bankruptcy protection (Bankr. D. Del. Lead Case No. 20-12168) on Sept. 14, 2020. The petitions were signed by Patrick Walsh, chief executive officer. The Debtors were estimated to have $500 million to $1 billion in consolidated assets and consolidated liabilities. The Hon. Christopher S. Sontchi presides over the cases. Young Conaway Stargatt & Taylor, LLP, and Kirkland & Ellis LLP have been tapped as bankruptcy counsel to the Debtors. Houlihan Lokey, Inc., serves as financial advisor and investment banker to the Debtors, and Epiq Corporate Restructuring LLC acts as claims and noticing agent to the Debtors. TPT GLOBAL: Posts $1.7 Million Net Loss in First Quarter -------------------------------------------------------- TPT Global Tech, Inc. filed with the Securities and Exchange Commission its Quarterly Report on Form 10-Q disclosing a net loss attributable to the company's shareholders of $1.71 million on $2.71 million of total revenues for the three months ended March 31, 2021, compared to a net loss attributable to the company's shareholders of $5.97 million on $3.08 million of total revenues for the three months ended March 31, 2020. As of March 31, 2021, the Company had $13.06 million in total assets, $37.93 million in total liabilities, $4.95 million in total mezzanine equity, and a total stockholders' deficit of $29.82 million. Cash flows generated from operating activities were not enough to support all working capital requirements for the three months ended March 31, 2021 and 2020. Financing activities described below have helped with working capital and other capital requirements. In addition, the Company reported increases and reductions in liabilities as uses of cash and deceases assets and increases in liabilities as sources of cash. For the three months ended March 31, 2021, the Company had a net increase in its assets and liabilities of $1,283,213 primarily from an increase in accounts payable from lag of payments for accounts payable for cash flow considerations and an increase in the balances from its operating lease liabilities. For the three months ended March 31, 2020, the Company had a net increase to its assets and liabilities of $739,018 for similar reasons. Cash flows from financing activities were $306,380 and $81,765 for the three months ended March 31, 2021 and 2020, respectively. For the three months ended March 31, 2021, these cash flows were generated primarily from proceeds from sale of Series D Preferred Stock of $153,744, proceeds from convertible notes, loans and advances of $1,068,674 offset by payment on convertible loans, advances and factoring agreements of $903,978. For the three months ended March 31, 2020, cash flows from financing activities primarily came from proceeds from convertible notes, loans and advances of $590,000 offset by payments on convertible loans, advances and factoring agreements of $328,392 and payments on convertible notes and amounts payable - related parties of $179,843. Cash flows used in investing activities were $144,481 and $131,351, respectively, for the three months ended March 31, 2021 and 2020. These cash flows were used for the purchase of equipment. The Company said these factors raise substantial doubt about the ability of the Company to continue as a going concern for a period of one year from the issuance of these financial statements. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. https://www.sec.gov/Archives/edgar/data/1661039/000165495421006188/tptw_10q.htm About TPT Global Tech TPT Global Tech Inc. (OTC:TPTW) based in San Diego, California, is is a technology-based company with divisions providing telecommunications, medical technology and product distribution, media content for domestic and international syndication as well as technology solutions. TPT Global Tech offers Software as a Service (SaaS), Technology Platform as a Service (PAAS), Cloud-based Unified Communication as a Service (UCaaS). It offers carrier-grade performance and support for businesses over its private IP MPLS fiber and wireless network in the United States. TPT's cloud-based UCaaS services allow businesses of any size to enjoy all the latest voice, data, media and collaboration features in today's global technology markets. TPT Global Tech also operates as a Master Distributor for Nationwide Mobile Virtual Network Operators (MVNO) and Independent Sales Organization (ISO) as a Master Distributor for Pre-Paid Cell phone services, Mobile phones Cell phone Accessories and Global Roaming Cell phones. TPT Global reported a net loss attributable to the Company's shareholders of $8.07 million for the year ended Dec. 31, 2020, compared to a net loss attributable to the company's shareholders of $14.03 million for the year ended Dec. 31, 2019. Draper, Utah-based Sadler, Gibb & Associates, LLC, the Company's auditor since 2016, issued a "going concern" qualification in its report dated April 15, 2021, citing that the Company has suffered recurring losses from operations and has insufficient cash flows from operations to support working capital requirements. These factors raise substantial doubt about the Company's ability to continue as a going concern. TRANSACT HOLDINGS: S&P Alters Outlook to Pos., Affirms 'CCC+' ICR ----------------------------------------------------------------- S&P Global Ratings affirmed all the ratings, including its 'CCC+' issuer credit rating on U.S.-based integrated payment and software solutions provider for post-secondary education institutions Transact Holdings Inc., and revised the outlook to positive from negative. S&P said, "At the same time, we are assigning our 'CCC+' issuer credit rating with a positive outlook to RCP Vega Inc., the parent company and audited entity. "The positive outlook reflects our expectation of higher revenue growth and steady margin improvement, driven primarily by the company's SmartPay and software businesses, despite leverage remaining high. We also anticipate free cash flow generation to improve and the reliance on the revolver in support of the company's liquidity needs to subside. "The positive outlook reflects our expectations for higher revenue growth and profitability leading to improved credit metrics and liquidity over the next year.This is supported by solid industry fundamentals and growing momentum in the company's business, such as campus reopenings and new client wins. We see a path to achieving improved credit measures such as leverage in the low-9x area and free cash flow to debt of about 2%-3% by fiscal year-end 2021 as the company has completed its separation steps (i.e., personnel and systems) from Blackboard Inc. Transact has proven its ability to not only retain but to grow its customer base through the pandemic because of the stickiness of its campus payment acceptance and management software. Nonetheless, we view the company's modest scale and limited track record of operating as a stand-alone entity with profitable performance as remaining risks. Offsetting these factors are supportive integrated payments and campus security industry fundamentals, a good market position, recurring revenue base, and low client concentration risk. "The positive outlook reflects our expectation of higher revenue growth and steady margin improvement, driven primarily by the company's SmartPay and software businesses, despite leverage remaining high. We also anticipate free cash flow generation to improve and the reliance on the revolver in support of the company's liquidity needs to subside." A higher rating would require: -- Continued revenue growth and EBITDA margin expansion steadily improving leverage toward 8x; and -- Sustained generation of positive free cash flows such that free cash flow to debt is in the low single digit percentage area. S&P said, "We could revise the outlook on Transact to stable if its profitability fails to improve or if the company experiences revenue declines and client churn, leading to negative annual free operating cash flow (FOCF) and further pressuring its liquidity." Inability to repay intrayear seasonal revolver draw would also be a sign of weakening liquidity. Such a scenario could indicate that the company's capital structure is unsustainable. TRIUMPH GROUP: S&P Raises First-Lien Note Rating to 'B' ------------------------------------------------------- S&P Global Ratings raised its issue-level rating on Triumph Group Inc.'s first-lien notes due 2024 to 'B' from 'B-'. At the same time, S&P revised its recovery rating on the notes to '1' from '2'. The '2' recovery rating indicates its expectation for very high (90%-100%; rounded estimate: 95%) recovery in a default scenario. All of our other ratings on the company are unaffected. Triumph Group recently announced that it has closed the sale of three of its aerostructures manufacturing sites for net proceeds of $155 million. As per the terms of the 2024 notes, it will use $120 million of the sale proceeds to redeem $113 million of the notes at a price of 106.656% of face value plus accrued interest. The reduction in the amount of principal outstanding will improve the recovery prospects for the lenders of the notes. The company also announced that it had raised $145.4 million of net proceeds from selling stock during its recently ended fiscal year 2021. It also paid down $63.5 million of its $300 million notes due June 2022 and is calling the remaining notes for redemption using cash on hand. S&P said, "Although calling the 2022 notes will eliminate a near-term maturity, the transaction will reduce the amount of cash Triumph has to fund what we expect will be a relatively large cash outflow of $175 million-$225 million in fiscal year 2022. We estimate the company will have about $390 million of cash pro forma for the pay down of the first lien notes due 2024 and the redemption of the 2022 notes." ISSUE RATINGS--RECOVERY ANALYSIS Key analytical factors Pro forma for the proposed transactions, Triumph's capital structure will comprise $700 million of first-lien notes ($587 million outstanding after paydown), a $75 million accounts receivable (AR) facility, $525 million of second-lien notes, and $500 million of unsecured notes. The AR facility is unrated. Other default assumptions include LIBOR rising to 2.5% and the AR facility is 100% drawn after letters of credit usage. S&P considers drawings on the AR facility to be priority claims. Simulated default assumptions -- Emergence EBITDA: $184 million -- Default year: 2022 -- EBITDA multiple: 5x Simplified waterfall -- Net enterprise value (after 5% administrative expenses and pension claims): $675 million -- Priority claims (AR): $49 million -- Collateral value available to first-lien debt: $627 million -- Estimated first-lien claim: $613 million --Recovery expectations: 90%-100% (rounded estimate: 95%) -- Collateral value available to second-lien debt: $14 million -- Estimated second-lien claim: $541 million --Recovery expectations: 0%-10% (rounded estimate: 0%) -- Total value available to unsecured claims: $0 -- Total unsecured claims: $1.05 billion --Recovery expectations: 0%-10% (rounded estimate: 0%) TTK RE ENTERPRISE: Arias Buying Atlantic City Property for $200K ---------------------------------------------------------------- TTK RE Enterprises, LLC, asks the U.S. Bankruptcy Court for the District of New Jersey to authorize the sale of the real estate located at 36 S. Bellevue Avenue, in Atlantic City, New Jersey, to Christina Arias for the sum of $199,900. A hearing on the Motion is set for June 22, 2021, at 11:00 a.m. The Debtor's business consists of acquiring and leasing residential real properties. It owns residential rental properties in southern New Jersey as of the Petition Date. Among the rental units it owned is the Property, a residential property. The CMA Summary Report dated March 31, 2021 set the value of the Property at $199,900. As of the Petition Date, the Debtor was indebted to Corevest American Finance Lender, LLC, in the amount of $2,144,457.12 as set forth in Proof of Claim No. 44 filed by Situs on Jan. 7, 2020. As of the Petition Date, the Situs Claim was secured by a mortgage against 18 of the Debtor's real properties as of the Petition Date, including the Property. The Situs mortgage against the Property dated April 25, 2018 was recorded on July 25, 2018 as Instrument No. 2018037889 in the amount of $2,159,000. The Situs Claim is also secured by the rents from the real properties against which Situs possesses a mortgage(s), including the Property. According to the Title Report, the Property is also subject to outstanding real estate taxes and municipal liens for outstanding water and sewer charges as of the date of closing on the sale of the Property as set forth in the Title Report. Although Debtor has sold a number of its properties which constitutes the collateral of Situs subsequent to the Petition Date, the Situs mortgage against the Property remains far in excess of the value of the Property. The Property has been listed for sale with Century 21 Alliance, 1333 New Road, Suite 1, Northfield, NJ, the Court-Approved realtor, and has been actively marketed by Century 21. As the result of the efforts of Century 21, the Debtor has entered into a Contract for Sale of the Property with the Purchaser for the sum of $199,900, subject to the approval of the Court, pursuant to their Contract for Sale. As such, the Debtor also seeks to have the 4% commission ($7,996) provided for in the listing agreement paid to Century 21 as the dual agency broker at the time of closing on the sale of the Property. The Purchaser has no relationship to Debtor, and the Debtor represents that the proposed sale of the Property is the result of an arms-length transaction and the sale price has been approved by Situs, the secured lender. The sale will be free and clear of Liens, which such Liens to attach to the proceeds of such sale pursuant to the terms of the Contract for Sale. Because the Debtor believes the $199,900 purchase price for the Property is the highest and best offer which the Debtor will receive for the Property and as such, it is in its best business judgment to proceed with the sale of the Property to the Purchaser for $199,900. Except for all transfer taxes associated with the sale or as otherwise provided for in the Contract for Sale, all costs relating to the sale and settlement of the Property, including all searches and title search fees, all survey fees, all title company settlement charges and title insurance costs, will be the obligation of the Purchaser at the time of closing. All property taxes, all public utility charges, rents and like charges, if any, relating to the Property will be pro-rated as of Closing. Settlement at Closing will be made on pro-ration of estimates of such taxes and charges with net balances payable by either Party at the time of closing. he Debtor submits that at the time of closing the proceeds of the sale of the Property should be paid as follows: a. Normal costs attendant with closing on the sale of the Property but not limited to, outstanding real estate taxes and municipal liens for outstanding water and sewer charges as of the date of closing on the sale of the Property; b. 4% of the Purchase Price ($7,996) to Century 21 as the dual agency broker in connection with the sale of the Property; and c. All remaining proceeds to Situs on account of the Situs Secured Claim. Finally, the Debtor requests that the stay of an order granting the Motion under Bankruptcy Rule 6004(h) be waived for cause because the Purchaser intends to close immediately upon the entry of an Order approving the sale of Property and the Debtor is concerned that the Purchaser will refuse to close if they cannot do so until 10 days after the entry of an Order approving the sale of the Property. A copy of the Contract is available at https://tinyurl.com/cudx86df from PacerMonitor.com free of charge. About TTK RE Enterprise TTK RE Enterprise LLC is a privately held company in Somers Point, New Jersey. The Company is the 100% owner of 48 real estate properties in New Jersey having a total current value of $9,265,000. TTK RE Enterprise sought Chapter 11 protection (Bankr. D.N.J. Case No. 19-30460) on Oct. 29, 2019 in Camden, New Jersey. In the petition signed by Emily K. Vu, president, the Debtor disclosed total assets of $9,269,950, and total liabilities of $6,432,457. Judge Jerrold N. Poslusny Jr. oversees the case. FLASTER GREENBERG PC - CHERRY HILL is the Debtor's counsel. U.S. SILICA: Unit Gets Imminent Danger Order at Texas Mine ---------------------------------------------------------- An operating subsidiary of U.S. Silica Holdings, Inc. on May 19, 2021, received an imminent danger order under Section 107(a) of the Federal Mine Safety and Health Act of 1977 issued by the federal Mine Safety and Health Administration at the Crane, Texas mine. The order was issued when a representative of MSHA allegedly observed a contractor truck driver out on the hood of a contractor haul truck attempting to clean the windshield without proper fall equipment. No individuals were injured as a result of the condition alleged in the order. The driver was safely removed and a citation was issued to the contractor's firm. The order was then terminated. The subsidiary is reviewing MSHA's order and may seek judicial review of its issuance. About U.S. Silica Headquartered in Katy, Texas, U.S. Silica Holdings, Inc. -- http://www.ussilica.com-- is a global performance materials company and a producer of commercial silica used in a wide range of industrial applications and in the oil and gas industry. In addition, through its subsidiary EP Minerals, LLC, the Company produces products derived from diatomaceous earth, perlite, engineered clays, and non-activated clays. U.S. Silica reported a net loss of $115.12 million in 2020, a net loss of $329.75 million in 2019, and a net loss of $220.82 million in 2018. As of March 31, 2021, the Company had $2.21 billion in total assets, $1.59 billion in total liabilities, and $618.27 million in total stockholders' equity. UNITED BANCSHARES: Late-Filed Form 10-K Shows $319K Loss for 2017 ----------------------------------------------------------------- United Bancshares, Inc. filed with the Securities and Exchange Commission its Annual Report on Form 10-K disclosing a net loss of $319,426 on $2.54 million of total interest income for the year ended Dec. 31, 2017, compared to net income of $24,537 on $2.59 million of total interest income for the year ended Dec. 31, 2016. As of Dec. 31, 2017, the Company had $59.01 million in total assets, $55.73 million in total liabilities, and $3.28 million in total shareholders' equity. Going Concern United Bancshares stated, "The Company's consolidated financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates continuity of operations, realization of assets, and liquidation of liabilities in the normal course of business. As reflected in its consolidated financial statements, the Company reported a net loss of approximately $319,000 for the year ended December 31, 2017 and net income of approximately $25,000 for the year ended December 31, 2016. Further, the Company has entered into Consent Orders with the FDIC and the Department that, among other provisions, require the Bank to increase its tier one leverage capital ratio to 8.00% and its total risk based capital ratio to 12.50%. As of December 31, 2017, the Bank's tier one leverage capital ratio was 5.51% and its total risk based capital ratio was 10.11%. Assuming no change in average assets, the Bank's capital would need to decline by $857,000 to be less than adequately capitalized. The Bank's failure to comply with the terms of the Consent Orders could result in additional regulatory supervision and/or actions. The ability of the Bank to continue as a going concern is dependent on many factors, including achieving required capital levels, earnings and fully complying with the Consent Orders. The Consent Orders 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/944792/000109690621001248/usbi_10k.htm About United Bancshares United Bancshares, Inc. is a holding company for United Bank of Philadelphia (www.ubphila.com). UBS was incorporated under the laws of the Commonwealth of Pennsylvania on April 8, 1993. The Company became the bank holding company of the Bank, pursuant to the Bank Holding Company Act of 1956, as amended, on Oct. 14, 1994. US VIRGIN ISLANDS WAPA: Fitch Retains CCC Issuer Default Rating --------------------------------------------------------------- Fitch Ratings has maintained the following ratings for the U.S. Virgin Islands (USVI) Water and Power Authority (WAPA) on Rating Watch Negative: -- $91.49 million electric system revenue bonds 'CCC'; -- $86.40 million electric system subordinate revenue bonds 'CCC'; -- Issuer Default Rating (IDR) 'CCC'. ANALYTICAL CONCLUSION The Rating Watch reflects the ongoing prospects for additional governmental oversight of WAPA, which could adversely affect operating performance and increase the authority's vulnerability to default. The U.S. Virgin Islands legislature recently approved a bill granting the Virgin Islands Public Services Commission greater regulatory and operational oversight of the authority. Despite being vetoed by the governor, Fitch's concerns remain heightened by the scope of the legislative initiative, which includes the development of a debt consolidation and management plan, and the possibility that such a plan could increase the likelihood of a distressed debt exchange. Fitch expects to resolve the Rating Watch following resolution of the prospective oversight issues, as well as receipt of the fiscal year 2019 audit. The 'CCC' rating continues to reflect heightened default risk as a consequence of WAPA's exceptionally weak cash flow and liquidity. Based on unaudited information provided by the WAPA, the authority maintains modest amounts of cash on hand and borrowing capacity that is insufficient to service the full amount of scheduled maturities over the long term. External financing remains necessary to meet maturing bond anticipation notes that mature July 1, 2022 and to address the continued deferral of scheduled bank repayments, as well as other obligations. The availability of such financing remains questionable. Additionally, while operating cash flow appears to have stabilized in fiscal years 2020 and 2021, continued challenges related to the travel and tourism sector and the demand for electricity throughout the USVI, clouds WAPA's performance further. Fitch currently makes no distinction between the ratings on WAPA's senior lien obligations, subordinate lien obligations and its IDR as the relatively high probability of enterprise default does not support distinction among the ratings. However, given the disparate liens supporting WAPA's rated and unrated debt obligations, distinctions could be made in the event of selective payment default on specific classes of debt. SECURITY Electric system revenue bonds are secured by a pledge of net electric revenues and certain other funds established under the bond resolution. The electric system subordinated revenue bonds are secured by a pledge of net revenues that are subordinate to the pledge securing the electric system revenue bonds. Outstanding senior and subordinate lien bonds are also secured by fully debt service reserve funds. KEY RATING DRIVERS Revenue Defensibility: 'bbb'; Weak Service Area and Regulation Limit Revenue Defensibility The authority's revenue defensibility is constrained by the territory's weak demographics and demand characteristics, as well as limited rate flexibility. WAPA's rates for electric service are extremely high contributing to low affordability. The authority's rates are further regulated by the PSC. Operating Risk: 'bb'; High Operating Cost Burden Operating risk is very high due to an extremely high operating cost burden. Costs are driven largely by the challenges of serving a territory comprised of multiple islands including higher than normal costs for fuel, labor and excess capacity necessary to ensure reliability. Financial Profile: 'bb'; Significant Liquidity Concerns Weak liquidity and very high leverage contribute to WAPA's weak financial profile. At Feb. 28, 2021, 2020, the authority reported (unaudited) $5 million or 10 days of unrestricted cash on hand, no borrowing capacity under its working capital line of credit and $14 million of short-term overdraft balances. Asymmetric Additional Risk Considerations Asymmetric risks related to WAPA's management and governance, debt profile and the absence of audited information for fiscal years 2019 and 2020 have been factored in the current rating. ESG - Governance: WAPA has an ESG Relevance Score of '5' for Governance Structure due to the prospects for legislation that would create and additional oversight committee and increased political influence could pressure WAPA toward a debt restructuring that includes a distressed debt exchange. RATING SENSITIVITIES Factors that could, individually or collectively, lead to positive rating action/upgrade: -- A resolution to prospective legislation that does not heighten the risk of a restructuring of outstanding debt; -- Evidence of sustainable earnings and cash flow stability, as well as an ability to meet ongoing financial obligations; -- Improved liquidity in the form of both cash on hand and future borrowing capacity. Factors that could, individually or collectively, lead to negative rating action/downgrade: -- The inability to refinance, or negotiate a long-term resolution to address, WAPA's scheduled debt maturities; -- Any evidence that a restructuring of outstanding debt is probable, including the passage of enabling legislation. BEST/WORST CASE RATING SCENARIO International scale credit ratings of Sovereigns, Public Finance and Infrastructure issuers have a best-case rating upgrade scenario (defined as the 99th percentile of rating transitions, measured in a positive direction) of three notches over a three-year rating horizon; and a worst-case rating downgrade scenario (defined as the 99th percentile of rating transitions, measured in a negative direction) of three notches over three years. The complete span of best- and worst-case scenario credit ratings for all rating categories ranges from 'AAA' to 'D'. Best- and worst-case scenario credit ratings are based on historical performance. CREDIT PROFILE WAPA is an instrumentality created by the government of United States Virgin Islands and is the sole provider of electric and water service to the territory, which includes the separate islands of St. Thomas, St. Croix and St. John. The electric system generates, transmits and sells electric power and energy to currently more than 50,000 residential, commercial and large power customers, including the USVI government. ESG CONSIDERATIONS Virgin Islands Water & Power Authority (VI) has an ESG Relevance Score of '5' for Governance Structure due to legislative initiatives to impose greater regulatory and operational oversight of the authority, and the potential for the development of a debt consolidation and management plan that includes a distressed debt exchange, which have a negative impact on the credit profile, and are highly relevant to the rating, resulting in the Rating Watch Negative. Virgin Islands Water & Power Authority (VI) has an ESG Relevance Score of '4' for Exposure to Environmental Impacts due to the authority's exposure to extreme weather events, which has a negative impact on the credit profile, and is relevant to the ratings in conjunction with other factors. Virgin Islands Water & Power Authority (VI) has an ESG Relevance Score of '4' for Financial Transparency due to its inability to issue timely audited financial statements, which has a negative impact on the credit profile, and is relevant to the ratings in conjunction with other factors. Virgin Islands Water & Power Authority (VI) has an ESG Relevance Score of '4' for Group Structure due to the authority's relationship with the USVI government and historical challenges to collecting revenue on a timely basis. which has a negative impact on the credit profile, and is relevant to the ratings in conjunction with other factors. Unless otherwise disclosed in this section, the highest level of ESG credit relevance is a score of '3'. This means ESG issues are credit-neutral or have only a minimal credit impact on the entity, either due to their nature or the way in which they are being managed by the entity. UWM MORTGAGE 2021-1: Moody's Assigns (P)B3 Rating to Cl. B5 Notes ----------------------------------------------------------------- Moody's Investors Service has assigned provisional ratings to thirty-one classes of residential mortgage-backed securities issued by UWM Mortgage Trust 2021-1. The ratings range from (P)Aaa (sf) to (P)B3 (sf). UWM Mortgage Trust 2021-1 is a securitization of 508 first-lien agency eligible mortgage loans. All the loans in the pool are originated by United Wholesale Mortgage, LLC (UWM - Ba3 long-term corporate family and Ba3 senior unsecured bond ratings, with stable outlook) in accordance with the underwriting guidelines of Fannie Mae or Freddie Mac with additional credit overlays. The transaction is backed by 502 30-year, 2 29-year, 3 25-year and 1 24-year fixed rate mortgage loans, respectively, with an aggregate stated principal balance of $351,858,069. The average stated principal balance is $692,634 and the weighted average (WA) current mortgage rate is 3.00%. All of the loans are designated as Qualified Mortgages (QM) under the GSE temporary exemption under the Ability-to-Repay (ATR) rules. Cenlar FSB (Cenlar) will service all the mortgage loans in the pool. Servicing compensation is subject to a step-up incentive fee structure. UWM will be the servicing administrator and Nationstar Mortgage LLC (Nationstar - B2 long-term issuer rating, with positive outlook) will be the master servicer. UWM will be responsible for principal and interest advances as well as other servicing advances. The master servicer will be required to make principal and interest advances if UWM is unable to do so. A third-party review (TPR) firm verified the accuracy of the loan level information on all the mortgage loans in the collateral pool. The firm conducted credit, property valuation, data accuracy and compliance reviews. The TPR results indicate that there are no material compliance, credit, or data issues and no appraisal defects. Moody's analyzed the underlying mortgage loans using Moody's Individual Loan Analysis (MILAN) model. Moody's expected loss for this pool in a baseline scenario-mean is 0.28%, in a baseline scenario-median is 0.11%, and reaches 5.08% at a stress level consistent with Moody's Aaa ratings. Moody's also compared the collateral pool to other securitizations with agency eligible loans. Overall, this pool has average credit risk profile as compared to that of recent transactions. The securitization has a shifting interest structure with a five-year lockout period that benefits from a senior subordination floor and a subordinate floor. Moody's coded the cash flow to each of the certificate classes using Moody's proprietary cash flow tool. The complete rating actions are as follows: Issuer: UWM Mortgage Trust 2021-1 Cl. A-1, Assigned (P)Aaa (sf) Cl. A-2, Assigned (P)Aaa (sf) Cl. A-3, Assigned (P)Aaa (sf) Cl. A-4, Assigned (P)Aaa (sf) Cl. A-5, Assigned (P)Aaa (sf) Cl. A-6, Assigned (P)Aaa (sf) Cl. A-7, Assigned (P)Aaa (sf) Cl. A-8, Assigned (P)Aaa (sf) Cl. A-9, Assigned (P)Aaa (sf) Cl. A-9-X*, Assigned (P)Aaa (sf) Cl. A-9-A, Assigned (P)Aaa (sf) Cl. A-9-AI*, Assigned (P)Aaa (sf) Cl. A-9-B, Assigned (P)Aaa (sf) Cl. A-9-BI*, Assigned (P)Aaa (sf) Cl. A-10, Assigned (P)Aaa (sf) Cl. A-11, Assigned (P)Aaa (sf) Cl. A-12, Assigned (P)Aaa (sf) Cl. A-13, Assigned (P)Aaa (sf) Cl. A-14, Assigned (P)Aa1 (sf) Cl. A-15, Assigned (P)Aa1 (sf) Cl. A-16, Assigned (P)Aaa (sf) Cl. A-17, Assigned (P)Aaa (sf) Cl. A-X-2*, Assigned (P)Aa1 (sf) Cl. A-X-3*, Assigned (P)Aaa (sf) Cl. A-X-4*, Assigned (P)Aa1 (sf) Cl. B1, Assigned (P)Aa3 (sf) Cl. B2, Assigned (P)A3 (sf) Cl. B3, Assigned (P)Baa3 (sf) Cl. B4, Assigned (P)Ba3 (sf) Cl. B5, Assigned (P)B3 (sf) *Reflects Interest-Only Classes Rating Rationale Summary Credit Analysis and Rating Rationale Moody's expected loss for this pool in a baseline scenario is 0.28% at the mean, 0.11% at the median, and reaches 5.08% at a stress level consistent with Moody's Aaa ratings. The coronavirus pandemic has had a significant impact on economic activity. Although global economies have shown a remarkable degree of resilience to date and are returning to growth, the uneven effects on individual businesses, sectors and regions will continue throughout 2021 and will endure as a challenge to the world's economies well beyond the end of the year. While persistent virus fears remain the main risk for a recovery in demand, the economy will recover faster if vaccines and further fiscal and monetary policy responses bring forward a normalization of activity. As a result, there is a heightened degree of uncertainty around Moody's forecasts. Moody's analysis has considered the effect on the performance of consumer assets from a gradual and unbalanced recovery in U.S. economic activity. Moody's regard the coronavirus outbreak as a social risk under its ESG framework, given the substantial implications for public health and safety. Moody's increased its model-derived median expected losses by 10.0% (5.96% for the mean) and Moody's Aaa losses by 2.5% to reflect the likely performance deterioration resulting from a slowdown in US economic activity due to the coronavirus outbreak. These adjustments are lower than the 15% median expected loss and 5% Aaa loss adjustments Moody's made on pools from deals issued after the onset of the pandemic until February 2021. Moody's reduced adjustments reflect the fact that the loan pool in this deal does not contain any loans to borrowers who are not currently making payments. For newly originated loans, post-COVID underwriting takes into account the impact of the pandemic on a borrower's ability to repay the mortgage. For seasoned loans, as time passes, the likelihood that borrowers who have continued to make payments throughout the pandemic will now become non-cash flowing due to COVID-19 continues to decline. Moody's base its ratings on the certificates on the credit quality of the mortgage loans, the structural features of the transaction, Moody's assessments of the origination quality and servicing arrangement, the strength of the third party due diligence and the R&W framework of the transaction. Collateral description UWM Mortgage Trust 2021-1 is a securitization of 508 first-lien agency eligible mortgage loans. All the loans in the pool are originated by UWM in accordance with the underwriting guidelines of Fannie Mae or Freddie Mac with additional credit overlays. The transaction is backed by 502 30-year, 2 29-year, 3 25-year and 1 24-year fixed rate mortgage loans, respectively, with an aggregate stated principal balance of $351,858,069. The average stated principal balance is $692,634 and the weighted average (WA) current mortgage rate is 3.00%. Borrowers of the mortgage loans backing this transaction have strong credit profiles demonstrated by strong credit scores and low combined loan-to-value (CLTV) ratios. The weighted average primary borrower original FICO score and original CLTV ratio of the pool is 767 and 65.64%, respectively. The WA original debt-to-income (DTI) ratio is 36.00%. Approximately, 28.61% (by loan balance) of the borrowers in the pool have more than one mortgaged property. All of the loans are designated as Qualified Mortgages (QM) under the GSE temporary exemption under the Ability-to-Repay (ATR) rules. Approximately half of the mortgages (47.68% by loan balance) are backed by properties located in California. The next largest geographic concentration is New York (14.27% by loan balance), Washington (8.86% by loan balance), Colorado (8.34% by loan balance) and Utah (7.43% by loan balance). All other states each represent 4% or less by loan balance. Approximately 3.70% (by loan balance) of the pool is backed by properties that are 2-to-4 unit residential properties whereas loans backed by single family residential properties represent 68.04% (by loan balance) of the pool. Approximately 85.19% and 14.81% (by loan balance) of the loans were originated through the broker and the correspondent channels respectively. Irrespective of the origination channel, UWM underwrites all the loans it originates through its underwriting process. Nevertheless, the MILAN model adjusts the loan probability of default (PD) to account for different loan origination channels - retail (the least risk), broker (the most risk) and correspondent (intermediate risk) channels. Origination Quality and Underwriting Guidelines All the mortgage loans in this pool (including correspondent channel loans) were originated in accordance with the underwriting guidelines of Fannie Mae or Freddie Mac with additional credit overlays and approved for origination through Fannie Mae's Desktop Underwriter Program or Freddie Mac's Loan Prospector Program. Loan file reviews are conducted through a pre-funding and post-closing quality control (QC) process. Moody's consider UWM to be an adequate originator of GSE eligible loans following Moody's review of its underwriting guidelines, quality control processes, policies and procedures, and historical performance relative to its peers. As a result, Moody's did not make any adjustments to Moody's base case and Aaa stress loss assumptions. Servicing arrangement Cenlar (the servicer) will service all the mortgage loans in the transaction. UWM will serve as the servicing administrator and Nationstar will serve as the master servicer. The servicing administrator will be required to (i) make advances in respect of delinquent interest and principal on the mortgage loans and (ii) make certain servicing advances with respect to the preservation, restoration, repair and protection of a mortgaged property, including delinquent tax and insurance payments, unless the servicer determines that such amounts would not be recoverable. The master servicer will be obligated to fund any required monthly advance if the servicing administrator fails in its obligation to do so. Moody's consider the overall servicing arrangement for this pool as adequate given the ability and experience of Cenlar as a servicer and the presence of a master servicer, and as a result, Moody's did not make any adjustments to Moody's base case and Aaa stress loss assumptions. COVID-19 Impacted Borrowers As of the cut-off date, none of the borrowers under the mortgage loans have entered into a disaster related forbearance plan, including, but not limited to, in response to the COVID-19 outbreak. In the event a borrower requests or enters into a disaster related forbearance plan after the cut-off date but prior to the closing date, the sponsor will remove such mortgage loan from the mortgage pool and remit the related closing date substitution amount. In the event a borrower enters into a disaster related forbearance plan after the closing date, such mortgage loan will remain in the mortgage pool. While a mortgage loan is in a disaster related forbearance period, the servicer will continue to report the borrower's delinquency status based on the actual payments received while in forbearance, which will show the borrower as delinquent for any scheduled payments not made during the disaster related forbearance period. Servicing compensation in this transaction is based on a fee-for-service incentive structure. The servicer receives higher fees for labor-intensive activities that are associated with servicing delinquent loans, including loss mitigation, than they receive for servicing a performing loan, which is less labor intensive. The fee-for-service incentive structure includes an initial monthly base servicing fee of $40 for all performing loans and increases according to certain delinquent and incentive fee schedules. The fees in this transaction are similar to other transactions with fee-for-service structure which Moody's have rated. Third-party review (TPR) An independent third-party review firm, Wipro Opus Risk Solutions, LLC (Opus), was engaged to conduct due diligence for the credit, regulatory compliance, property valuation, and data accuracy on 100% of the loans in the pool. There were generally no material findings. The loans that had exceptions to the originators' underwriting guidelines had significant compensating factors that were documented. Moody's did not make any adjustments to Moody's credit enhancement for TPR scope and results. Representations and Warranties Framework UWM as the sponsor, makes the loan-level R&Ws for the mortgage loans. The R&Ws cover most of the categories that Moody's identified in Moody's methodology as credit neutral. Further, R&W breaches are evaluated by an independent third party using a set of objective criteria. The independent reviewer will perform detailed reviews to determine whether any R&Ws were breached when any loan becomes a severely delinquent mortgage loan, a delinquent modified mortgage loan, or is liquidated at a loss. These reviews are thorough in that the transaction documents set forth detailed tests for each R&W that the independent reviewer will perform. However, Moody's applied an adjustment to Moody's expected losses to account for the risk that UWM may be unable to repurchase defective loans in a stressed economic environment in which a substantial portion of the loans breach the R&Ws, given that it is a non-bank entity with a monoline business (mortgage origination and servicing) that is highly correlated with the economy. Transaction structure The securitization has a shifting interest structure that benefits from a senior subordination floor and a subordinate floor. Funds collected, including principal, are first used to make interest payments and then principal payments on a pro-rata basis up to the senior bonds principal distribution amount, and then interest and principal payments on a sequential basis up to each subordinate bond principal distribution amount. As in all transactions with shifting interest structures, the senior bonds benefit from a cash flow waterfall that allocates all prepayments to the senior bonds for a specified period of time, and increasing amounts of prepayments to the subordinate bonds thereafter, but only if loan performance satisfies delinquency and loss tests. Realized losses are allocated reverse sequentially among the subordinate and senior support certificates and on a pro-rata basis among the super senior certificates. Tail risk & subordination floor The transaction cash flows follow a shifting interest structure that allows subordinated bonds to receive principal payments under certain defined scenarios. Because a shifting interest structure allows subordinated bonds to pay down over time as the loan pool shrinks, senior bonds are exposed to eroding credit enhancement over time and increased performance volatility, known as tail risk. To mitigate this risk, the transaction provides for a senior subordination floor of 0.60% which mitigates tail risk by protecting the senior bonds from eroding credit enhancement over time. Additionally, there is a subordination lock-out amount which is 0.50% of the closing pool balance. Moody's calculate the credit neutral floors for a given target rating as shown in Moody's principal methodology. The senior subordination floor and the subordinate floor of 0.60% and 0.50%, respectively, are consistent with the credit neutral floors for the assigned ratings. Factors that would lead to an upgrade or downgrade of the ratings: Down Levels of credit protection that are insufficient to protect investors against current expectations of loss could drive the ratings down. Losses could rise above Moody's original expectations as a result of a higher number of obligor defaults or deterioration in the value of the mortgaged property securing an obligor's promise of payment. Transaction performance also depends greatly on the US macro economy and housing market. Other reasons for worse-than-expected performance include poor servicing, error on the part of transaction parties, inadequate transaction governance and fraud. Up Levels of credit protection that are higher than necessary to protect investors against current expectations of loss could drive the ratings up. Losses could decline from Moody's original expectations as a result of a lower number of obligor defaults or appreciation in the value of the mortgaged property securing an obligor's promise of payment. Transaction performance also depends greatly on the US macro economy and housing market. Methodology The principal methodology used in rating all classes except interest-only classes was "Moody's Approach to Rating US RMBS Using the MILAN Framework" published in April 2020. VAL'S FOOD: July 7 Plan & Disclosure Hearing Set ------------------------------------------------ On May 20, 2021, Val's Food with a Twist, LLC, filed with the U.S. Bankruptcy Court for the Northern District of Texas an Amended Chapter 11 Plan of Reorganization combined with Disclosure Statement. On May 25, 2021, Judge Stacey G. C. Jernigan conditionally approved the Disclosure Statement and ordered that: * June 30, 2021, is fixed as the last day for filing written acceptances or rejections of the proposed Chapter 11 Plan. * June 30, 2021, is fixed as the last day for filing and serving written objections to final approval of the Disclosure Statement; or confirmation of the proposed Chapter 11 plan. * July 7, 2021, at 2:30 p.m., in the 1100 Commerce Street, 14th Floor, Dallas, Texas 75242 is the hearing to consider final approval of the Disclosure Statement (if a written objection has been timely filed) and to consider confirmation of the proposed Chapter 11 Plan. A full-text copy of the order dated May 25, 2021, is available at https://bit.ly/3yMWj6t from PacerMonitor.com at no charge. Attorneys for Debtor: QUILLING, SELANDER, LOWNDS, WINSLETT & MOSER, P.C. 2001 Bryan Street, Suite 1800 Dallas, Texas 75201 Tel: (214) 880-1805 Fax: (214) 871-2111 E-mail: John Paul Stanford About Val's Food with a Twist d/b/a dba Val's Cheesecake Val's Food with a Twist, LLC sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. N.D. Tex. Case No. 20-31965) on July 20, 2020. The case is assigned to Judge Stacey G. Jernigan. John Paul Stanford, Esq., at Quilling, Selander, Lownds, Winslett & Moser, P.C., is the Debtor's counsel. VERICAST CORP: S&P Downgrades ICR to 'CCC', Outlook Negative ------------------------------------------------------------ S&P Global Ratings lowered its issuer credit rating and issue-level ratings on Vericast Corp. to 'CCC' from 'CCC+'. The negative outlook reflects the risk that the company will be unable to refinance its 8.375% senior secured notes at par ahead of the May 2022 springing debt maturities for its ABL revolver and term loan, which could lead to a liquidity event or distressed exchange. The company's ABL revolver and term loan mature in May 2022 due to the springing debt maturities in its credit agreements. Vericast's ABL revolver ($116 million outstanding as of April 3, 2021) and senior secured term loan ($1.4 billion outstanding) are subject to springing maturities under their respective credit agreements. Specifically, if the company does not retire its 8.375% senior secured notes due August 2022 ($800 million outstanding) by May 16, 2022, the ABL revolver and term loan will become due on that date. S&P said, "We do not believe the company will organically generate sufficient cash to service its 8.375% notes, thus it will be materially dependent on its access to the capital markets to refinance this obligation and avoid a default under its credit agreements. Given its recent difficulty in accessing the capital markets to refinance its capital structure at favorable rates, we believe there is an elevated likelihood of a payment default or distressed exchange over the next 12 months." The negative outlook reflects the risk that Vericast will be unable to refinance its 8.375% senior secured notes at par ahead of the May 2022 springing debt maturities for its ABL revolver and term loan, potentially leading to a liquidity event or distressed exchange. S&P said, "We could lower our issuer credit rating on Vericast if we anticipate a payment default or distressed debt restructuring in the next six months. "We could raise our rating on Vericast if it refinances its 8.375% notes at par and we view a payment default or distressed exchange as unlikely over the next 12 months." VERITAS FARMS: Incurs $1.2 Million Net Loss in First Quarter ------------------------------------------------------------ Veritas Farms, Inc. filed with the Securities and Exchange Commission its Quarterly Report on Form 10-Q disclosing a net loss of $1.15 million on $888,261 of sales for the three months ended March 31, 2021, compared to a net loss of $2.33 million on $1.15 million of sales for the three months ended March 31, 2020. As of March 31, 2021, the Company had $11.37 million in total assets, $4.74 million in total liabilities, and $6.63 million in total stockholders' equity. Net cash used in operating activities was $913,352 for the three months ended March 31, 2021, as compared to $1,046,222 for the three months ended March 31, 2020. The decrease is largely attributable to the reduction of net losses and reductions in prepaid expenses, accounts payable and stock based compensation. Net cash used in investing activities was $0 for the three months ended March 31, 2021 as compared to net cash used of $77,423 for the three months ended March 31, 2020, reflecting reduced capital expenditures in 2021. Net cash provided by financing activities was $897,640 for the three months ended March 31, 2021 as compared to $184,645 for the three months ended March 31, 2020. The 2021 number reflects the net proceeds of $803,994 from the PPP loan received in March, net proceeds of $86,895 from initial closings under a private placement, while the 2020 amount reflects the net proceeds from of a $200,000 convertible loan received in March 2020. "Our primary sources of capital to develop and implement our business plan and expand our operations have been the proceeds from private offerings of our equity securities, capital contributions made by members prior to completion of the September 2017 acquisition of 271 Lake Davis Holdings, LLC by the Company and loans from shareholders," Veritas said. The accompanying financial statements have been prepared in conformity with accounting principles generally accepted in the United States, which contemplate continuation of the Company as a going concern. However, the Company has sustained substantial losses from operations since its inception. As of and for the period ended March 31, 2021, the Company had an accumulated deficit of ($27,821,806) and a net loss of ($1,154,659). These factors, among others, raise substantial doubt about the ability of the Company to continue as a going concern. Continuation as a going concern is dependent on the ability to raise additional capital and financing, though there is no assurance of success. "The Company believes that it will require additional financing to fund its growth and achieve profitability. The Company anticipates that such financing, will be generated from subsequent public or private offerings of its equity and/or debt securities. While we believe additional financing will be available to us as needed, there can be no assurance that equity financing will be available on commercially reasonable terms or otherwise, when needed. Moreover, any such additional financing may dilute the interests of existing shareholders. The absence of additional financing, when needed, could substantially harm the Company, its business, results of operations and financial condition," Veritas said. A full-text copy of the Form 10-Q is available for free at: https://www.sec.gov/Archives/edgar/data/1669400/000121390021028867/f10q0321_veritasfarms.htm About Veritas Fort Lauderdale, Florida-based Veritas Farms, Inc. -- www.TheVeritasFarms.com -- is a vertically-integrated agribusiness focused on producing, marketing, and distributing superior quality, whole plant, full spectrum hemp oils and extracts containing naturally occurring phytocannabinoids. Veritas Farms owns and operates a 140 acre farm in Pueblo, Colorado, capable of producing over 200,000 proprietary full spectrum hemp plants containing naturally occurring phytocannabinoids which can potentially yield a minimum annual harvest of 250,000 to 300,000 pounds of outdoor-grown industrial hemp. Veritas Farms reported a net loss of $7.59 million for the year ended Dec. 31, 2020, compared to a net loss of $11.15 million for the year ended Dec. 31, 2019. As of Dec. 31, 2020, the Company had $12.41 million in total assets, $4.76 million in total liabilities, and $7.65 million in total stockholders' equity. Hackensack, New Jersey-based Prager Metis CPA's LLC, the Company's auditor since 2018, issued a "going concern" qualification in its report dated April 15, 2021, citing that the Company has sustained substantial losses from operations since its inception. As of and for the year ended Dec. 31, 2020, the Company had an accumulated deficit of $26,667,147, and a net loss of $7,592,539. These factors, among others, raise substantial doubt about the ability of the Company to continue as a going concern. VIP PHARMACY: Wins Cash Collateral Access Thru July 31 ------------------------------------------------------ The U.S. Bankruptcy Court for the Eastern District of Pennsylvania has approved the Second Interim Stipulation that VIP Pharmacy Inc. entered into with Woori America Bank, authorizing VIP Pharmacy's use of cash collateral on an interim basis through July 31, 2021. The parties agree that prior to the Petition Date, Woori America Bank extended a commercial loan in the original principal amount of $1.1 million to the Debtor, KBS Pharmacy, Inc., Shri Santram Corporation, and Big Oak Pharmacy Inc, as co-borrowers, which is evidenced by a Promissory Note dated July 19, 2016. The outstanding principal amount due to the Bank under the Pre-Petition Loan as of April 12, 2021, was $623,023, and the Debtor is obligated to pay the Bank certain other amounts under the terms of the Pre-Petition Loan, including interest, attorneys' fees, collection costs, late charges, and other charges of the Bank. The Bank consents to the Debtor's use of Cash Collateral to pay ordinary and customary business expenses of the Debtor as more fully set forth in the budget. As adequate protection for the Debtor's use of Cash Collateral, the Bank is granted a first lien upon and security interest in all of the Debtor's now existing and hereafter acquired assets of the same nature and extent as the Pre-Petition Collateral. Any Cash Collateral that is used by the Debtor and not secured by the Pre-Petition Collateral or the Post-Petition Collateral will constitute a cost and expense of administration in the Chapter 11 case and will have a superpriority status pursuant to Bankruptcy Code section 364(c)(1) and thus will be paid ahead of all other costs and expenses of administration. During the term of the Stipulation, the Debtor will pay to the Bank adequate protection payments on the Pre-Petition Loan in an amount equal to the regular monthly principal and interest payment amount(s) no later than the first day of every month in immediately available funds. The Debtor will also pay all insurance premiums necessary to maintain adequate insurance coverage on all of the Debtor's assets and will pay all taxes as and when due. These events constitute Events of Default: a. The Debtor fails to keep, observe or perform any of its agreements or undertakings in the Order including, but not limited to, all reporting provisions contained in the Order; b. The Debtor furnishes or makes any material false, inaccurate or incomplete representation, warranty, certificate, report or summary in or under this Stipulation; c. The Debtor suffers the appointment of a trustee; or d. The Debtor's Chapter 11 case is converted to a case under Chapter 7 of the Bankruptcy Code. A further hearing on the matter is scheduled for July 28, 2021 at 11 a.m. A copy of the order is available for free at https://tinyurl.com/t38z53hm from PacerMonitor.com. About VIP Pharmacy, Inc. VIP Pharmacy Inc. is a privately held company in the health care business. It sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. E.D. Pa. Case No. 1-10428) on February 23, 2021. In the petition signed by Kaushal Patel, president, the Debtor disclosed up to $500,000 in assets and up to $10 million in liabilities. Judge Eric L. Frank oversees the case. Paul Winterhalter, Esq., at OFFIT KURMAN, P.A. is the Debtor's counsel. Woori America Bank, as Lender, is represented by Charles N. Shurr, Jr., Esq. at KOZLOFF STOUDT. VIRGINIA TRUE: Suit v. Cipollones Stays in Bankruptcy Court ----------------------------------------------------------- Senior District Judge Frederic Block of the United States District Court for the Eastern District of New York denied the requests of Anthony and Domenick Cipollone to withdraw the bankruptcy court reference to their adversary proceeding against Virginia True Corporation and conduct all further proceedings, including those related to their motion to dismiss. The District Judge also denied their alternative request that the District Court abstain from hearing the adversary case and allow it to be decided in the Virginia state courts. The Cipollones are former shareholders and directors of Virginia True, an insolvent real estate development corporation. The Cipollones invested $5,000,000 in Virginia True in exchange for a 32% equity interest, two seats on the company's board and the right to convert their ownership interest to a secured debt within 18 months of their investment. In 2018, the Cipollones concluded that they would not recover their investment and attempted to exercise their option to convert their equity to secured debt. To this end, they filed suit against Virginia True in Virginia state court and obtained a promissory note for $5,000,000 plus interest, which was secured by a first priority lien on the Property. Virginia True made no payments on the note, which matured in April 2019. Instead, it declared bankruptcy, and the Cipollones submitted proofs of claim, asserting that the $5,000,000 debt owed them should take priority in the distribution of Virginia True's assets. In response, Virginia True instituted an adversary proceeding against the Cipollones in the bankruptcy court, in which Diatomite Corporation of America. Diatomite argues that, under Virginia and federal law, (1) it may avoid its obligation to pay the Cipollones' secured debt, since that debt was created by a fraudulent transfer; (2) the Cipollones' secured debt must be reverted to an equity interest in the company; (3) that interest must be subordinated to the interest of outside creditors, including Diatomite; and (4) the Cipollones' lien on the Property must be voided and the documents securing it returned to Virginia True's estate. It further argues that the Virginia Stock Corporation Act entitles it to damages from the Cipollones. The Cipollones have moved to dismiss Virginia True's complaint and seek a jury trial on any counts that survive dismissal. Diatomite is Virginia True's largest external creditor and the Property's original owner. Virginia True owes about $7,000,000 to Diatomite. The adversary case is, Virginia True Corporation. v. Anthony Cipollone and Domenick Cipollone, No. 1-19-01118-nhl (Bankr. E.D.N.Y. Sept. 4, 2019). A copy of the Court's Memorandum and Order is available at https://bit.ly/3yEHdA1 from Leagle.com. The Cipollones are represented by: Stephen Zoltan Starr STARR & STARR, PLLC 260 Madison Ave 17th Floor New York, NY 10016 Tel: (212) 867-8165 Fax: (212) 867-8139 E-mail: stephenstarr@starrandstarr.com Counsel to the Debtor: Douglas J. Pick, Esq. Eric C. Zabicki, Esq. PICK & ZABICKI LLP 369 Lexington Avenue, 12th Floor New York, NYork 10017 Tel: (212) 695-6000 About Virginia True Corp Virginia True Corporation, a New York-based golf resort owner and developer, sought protection under Chapter 11 of the Bankruptcy Code (Bankr. E.D.N.Y. Case No. 19-42769) on May 3, 2019. At the time of the filing, the Debtor disclosed assets of between $10 million and $50 million and liabilities of the same range. Judge Nancy Hershey Lord oversees the case. Pick & Zabicki LLP is the Debtor's legal counsel. VISTA CHARTER MIDDLE SCHOOL: S&P Puts 'BB+' LT Rating on Watch Neg. ------------------------------------------------------------------- S&P Global Ratings placed its 'BB+' long-term rating on the California Municipal Finance Authority's series 2014 (tax exempt) charter school lease bonds, issued for Vista Charter Middle School, on CreditWatch with negative implications. As of June 30, 2020, there is $6.4 million debt outstanding. "The CreditWatch placement reflects the lack of timely information of satisfactory quality to maintain our rating in accordance with our applicable criteria and policies," said S&P Global Ratings credit analyst Peter Murphy. Specifically, S&O has not received the fall 2020 demand data, including enrollment, waiting list, and student-retention figures, and interim fiscal 2021 financial information. It has requested this data on multiple occasions. S&P said, "The withdrawal of the rating could follow if we do not receive fall 2020 demand data and fiscal 2021 interim financial reports within 30 days. We consider the enrollment information and financial statements necessary to maintain and assess our rating on this issuer. Accordingly, the rating is now at risk of being withdrawn, preceded by any change to the rating we consider appropriate given available information. However, if the issuer provides us with 2020 demand data requested within 30 days, we will conduct a full review and take a rating action within 90 days of the CreditWatch placement." W&T OFFSHORE: S&P Affirms 'CCC+' ICR on Asset Sale, Outlook Neg. ---------------------------------------------------------------- S&P Global Ratings affirmed the 'CCC+' issuer credit rating on Houston-based W&T Offshore Inc. S&P said, "We view the transaction as neutral for credit quality. The asset sale supports liquidity at W&T, as it will raise cash on hand about $130 million after fees, debt repayment, and other expenses, it also significantly lowers reserves and production at the parent. As of Dec 31, 2020, the Mobile Bay assets were about 55% of W&T's total proved reserves and 37% of production. The assets will support the first-lien term loan at the SPV, with no cash flow going to the parent company until certain conditions are fulfilled. Nevertheless, we expect W&T's liquidity to remain adequate over the next 12 months, supported by low capital spending requirements, cash on hand, and availability under its RBL. We also expect that W&T could use some of the cash to pursue acquisitions as it seeks to increase production and reserves in the Gulf of Mexico. "Consolidated financial measures have improved modestly. We look at W&T on a consolidated basis, including the SPV, given W&T's 100% ownership. On a consolidated basis, we expect funds from operations (FFO) to debt to average around 16% and debt/EBITDA about 4.5x. Nevertheless, in our view, debt leverage remains somewhat elevated given W&T's limited scale and focus on the hurricane-prone Gulf of Mexico region. We expect this to improve over time as required amortization on the term loan, supported by expected positive free cash flow, reduces outstanding term loan debt over the seven-year life of the loan." The rating on the second-lien senior secured notes due 2023 is on CreditWatch with negative implications. S&P said, "As mentioned above, the asset sale removed about 55% of proved reserves from the collateral pool supporting the second-lien notes, the SPV now has a first lien on those assets. Given the significant reduction in collateral and expected negative impact to our recovery estimate available to support the non-SPV debt, we have placed the senior secured ratings on CreditWatch with negative implications given the possibility of a reduction in recovery and resulting rating. We plan to reassess recovery when we receive an updated PV-10 reserve valuation and incorporate our recovery assumptions--including $50 per barrel West Texas Intermediate (WTI) crude oil and $2.50 per thousand cubic feet Henry Hub natural gas--as well as including any potential impact from a reduction in the RBL's borrowing base." S&P said, "The negative outlook reflects our view that the high yield on the company's second-lien notes, currently around 16%, could make a transaction we would consider distressed; that is, less than the original promise, an attractive way to address the 2023 maturity of those notes over the coming 12 months, especially if yields weaken further. We also note financial measures remain elevated, in our view, given W&T's small scale of operations and limited geographic diversification. "We could lower our rating if we believed that W&T would pursue a below par debt repurchase or restructuring that we would view as distressed. This could occur if market conditions, driven by weak crude oil and natural gas prices, causing cash flows to weaken and capital markets to become more restrictive. "We could revise the outlook to stable if debt/EBITDA trended comfortably below 5x and FFO/debt above 12% for a sustained period, providing an adequate cushion to price volatility, while the company maintained adequate liquidity. Additionally, we would need to believe a distressed debt transaction was not attractive and capital markets would be receptive to a refinancing of the second-lien notes due 2023. Both conditions likely occur with a sustained improvement in crude oil and natural gas prices, along with strengthening capital markets." WARDMAN HOTEL: Trustee Selling Art Van's Bellwood Property for $2M ------------------------------------------------------------------ Alfred T. Giuliano, Chapter 7 trustee to the estate of Art Van Furniture, LLC, an affiliate of Wardman Park Hotel, L.L.C., asks the U.S. Bankruptcy Court for the District of Delaware to authorize the private sale of the real property located at 1620 N. Tuckahoe Street, in Bellwood, Pennsylvania, to BHN Associates or its designee for $2 million, subject to higher and better offers. A hearing on the Motion is set for June 21, 2021, at 10:00 a.m. (ET). The Objection Deadline is June 3, 2021, at 4:00 p.m. (ET). The Trustee believes the Sale is in the best interest of the Debtors' estates, their creditors, their customers, and all parties in interest to complete the Sale under the terms of the PSA. The key terms of the PSA are: a. Buyer: BHN Associates or its designee b. Seller: Alfred T. Giuliano, chapter 7 trustee to the estate of Art Van Furniture, LLC c. Purchase Price: $2 million d. Purchased Assets: The Property located at 1620 N. Tuckahoe Street, Bellwood, Pennsylvania 16617 e. Deposit: The Buyer will deposit with the Title Company: (a) within two business days of the mutual execution and delivery of the Agreement, the sum of $200,000 in immediately available, good funds, which will be held by the Title Company in a segregated account and retained or disbursed solely in accordance with the terms and provisions of the Agreement and the Buyer's timely delivery of which will be an express condition precedent to the Seller's obligations under the Agreement. f. Breakup Fee: There is no break-up fee or expense reimbursement g. Outside Closing Date: The Closing will be held on or before the date which is the later of (i) 45 days following the Diligence Date and (ii) 10 business days after the Approval Order has been issued and entered by the Court. h. Sale is an "as is" transaction. The Sale is intended to be a private sale, however, the Trustee reserves all rights to accept higher and better offers for the Property up until the objection deadline on the Motion. The Trustee is seeking authorization to sell the Property free and clear of all liens, claims, and encumbrances to maximize value. The Trustee submits that the proposed private sale to the Buyer in accordance with the PSA is appropriate in light of the facts and circumstances of these chapter 7 cases. Specifically, a long and complicated sale process with bid procedures and an auction is unlikely to net the estates a significant appreciable benefit through a substantially increased sale price in light of the costs and expenses for running a competitive bid and sale process, and the Trustee has already marketed the Property through his retained real estate broker, Newmark, and the $2 million purchase price represents the highest and best offer at this time. If the Trustee receives a competing bid for the Property on or before the objection deadline on the Motion, the Trustee proposes to utilize the following bid procedures: a. The Trustee will notify each potential bidder via email of its selection as an interested bidder for the Property and will notify the bidders of the current highest and best bid for the Property; b. The Trustee will notify each potential bidder via email of the deadline to submit a final highest and best sealed bid for the Property; c. For the final bid for each interested bidder, it must submit, via email a single, sealed bid to the Trustee which will be deemed such interested bidder's final bid, along with a 10% deposit to the Trustee within 24 hours of submitting the Final Bid; d. Any Final Bid for the Property must be at least $2.1 million; e. The Trustee may, in his sole discretion, establish a separate auction process of his choosing and associated procedure for such auction process, which may include, but is not limited to, a sealed bid auction, live or video auction, or on-line auction; and f. In the event a party other than BHN Associates is deemed the winning bidder with respect to the Property, such party will be required to purchase the Property under the same terms and conditions as set forth in the PSA. Finally, the Trustee is requesting a waiver of the 14-day stay requirement under Bankruptcy Rule 6004(h). A copy of the PSA is available at https://tinyurl.com/wyu5z7fk from PacerMonitor.com free of charge. About Wardman Hotel Owner Wardman Hotel Owner, L.L.C., owns Marriott Wardman Park Hotel, a convention hotel located at 2600 Woodley Road NW, in the Woodley Park neighborhood of Washington, D.C. Wardman Hotel Owner, L.L.C., filed a Chapter 11 bankruptcy petition (Bankr. D. Del. Case No. 21-10023) on Jan. 11, 2021. In the petition signed by James D. Decker, manager, the Debtor estimated $100 million to $500 million in assets and liabilities. The Hon. John T. Dorsey is the case judge. PACHULSKI STANG ZIEHL & JONES LLP, led by Laura Davis Jones, is the Debtor's counsel. WASTEQUIP LLC: S&P Affirms 'B' ICR on Anticipated Demand Recovery ----------------------------------------------------------------- S&P Global Ratings affirmed their 'B' issuer credit rating on U.S.-based waste and recycling equipment manufacturer Wastequip LLC, its 'B' issue-level rating on its first-lien senior secured credit facility, and its 'CCC+' issue-level rating on its second-lien term loan due 2026. S&P's '3' recovery rating on the first-lien facility remains unchanged, indicating its expectation for meaningful (50%-70%; rounded estimate: 50%) recovery in the event of a default. S&P's '6' recovery rating on the second-lien loan also remains unchanged, indicating its expectation for negligible (0%-10%; rounded estimate: 0%) recovery in the event of a default. S&P said, "We anticipate the company's end markets will begin to recover from the pandemic-induced recession in fiscal year 2021 and into fiscal year 2022; however, there are still some risks to our forecast. We expect the conditions in Wastequip's end markets to rebound steadily over the next 12 months as the business environment begins to improve. Early signs of the recovery are evidenced by the 100% increase in the company's bookings in March 2021. We believe that significant pent-up demand from 2020 will be released this year, primarily in the second half of 2021 and into 2022. We also believe Wastequip will continue to benefit from statewide reopenings, as municipalities increase their spending, and from incremental demand in states with elevated pandemic restrictions, such as California. In addition, we view the company as better positioned to benefit from the recessionary rebound than smaller waste equipment manufacturers due to its large market share. We also view its revenue mix, given that it derives about 70% of its revenue from product replacement and aftermarket parts sales, and stable long-term relationships with its large national customers as credit positive. Therefore, we anticipate Wastequip's volumes will increase in the second half of 2021 and, along with contributions from a potential acquisition at a deleveraging multiple, cause its credit metrics to improve. "Wastequip's ability to improve its leverage and generate positive FOCF depends on the timely and effectively pass through of its rising raw material costs to its customers. Steel and resin account for a significant percentage of the company's material costs. Given that steel prices have nearly tripled while resin prices rose by 36% over the last 12 months, Wastequip's ability to pass through price increases to its customers will be an important factor in our EBITDA growth forecast. We believe the company has some ability to pass through increases in its steel prices through contracted provisions, primarily with its larger customers. For its remaining sales, we believe Wastequip can leverage its scale to maintain some price leadership for its input costs. The company is also exposed to rising resin costs which may be passed on to customers. Therefore, we believe Wastequip may face weaker order volumes and margin compression due to its rising product pricing. "Wastequip's private-equity ownership and financial policy decisions continue to weigh on its credit quality. The company's debt to EBITDA was high as of the end of 2020 at 9.2x, which is well above our previous expectations. Wastequip completed a $60 million debt-financed dividend to its sponsor and a $60 million acquisition in February 2020, which was shortly before the onset of the pandemic. This, coupled with the sharp and sudden pandemic-related decline in its volumes, led to the rise in its leverage burden in 2020. We expect the company to remain acquisitive as it focuses on bolstering its regional steel-related manufacturing and innovation capabilities. "The negative outlook on Wastequip reflects the potential that we will lower our rating over the next 12 months if a weaker-than-expected recovery in its end markets, operating inefficiencies, or an inability to pass along rising input costs prevents it from deleveraging or generating positive FOCF." S&P could lower its ratings on Wastequip if: -- Continued material weakness in the U.S. waste collection and disposal market causes the company's sales volumes and margins to decline further such that its adjusted debt to EBITDA exceeds 6.5x with limited foreseeable near-term improvement. S&P estimates that this could occur if Wastequip's sales volumes remain flat over the next 12 months; or -- The company pursues debt-funded acquisitions or dividends that materially weaken its credit metrics on a sustained basis; or -- Operating inefficiencies cause its FOCF generation to remain negative over the next 12 months. S&P said, "We could revise our outlook on Wastequip to stable if its operating prospects continue to improve and its adjusted debt to EBITDA declines below 6.5x on a sustained basis. Under this scenario, we would also expect the company and its financial sponsor to maintain financial policies that would enable it to sustain these improved credit measures." WAXELENE INC: Court Extends Plan Exclusivity Thru July 29 --------------------------------------------------------- At the behest of Debtor Waxelene, Inc., Judge Christopher B. Latham of the U.S. Bankruptcy Court for the Southern District of California extended the period in which the Debtor may file a chapter 11 plan through and including July 29, 2021. According to the Declaration of Todd Cooper, the president of the Debtor Waxelene, Inc., the Debtor is working on the resolution of the largest claim held by Trusper. Trusper filed its proof of claim on February 17, 2021. Since that time, the Debtor and Trusper have exchanged information regarding their respective positions regarding the basis of the claim and continue to do so toward consensus. The Debtor has been negotiating diligently with its creditors to settle claims and has had great success in resolving and reducing claims. The Debtor is also working to determine the legal basis for the claim of its largest unsecured creditor and to reach a consensus with that creditor. With the granted extensions, the Debtor will be able to complete its negotiation and obtain consensus for its Plan. A copy of the Debtor's Motion to extend is available at https://bit.ly/3uo2oTq from PacerMonitor.com. A copy of the Court's Extension Order is available at https://bit.ly/3hYQ75j from PacerMonitor.com. About Waxelene Inc. Waxelene, Inc. sought protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Cal. Case No. 20-05878) on December 1, 2020, listing under $1 million in both assets and liabilities. Judge Christopher B. Latham oversees the case. The Law Office of Judith A. Descalso serves as the Debtor's bankruptcy counsel. WB BRIDGE HOTEL: Wants Plan Exclusivity Extended Thru August 18 --------------------------------------------------------------- WB Bridge Hotel LLC and 159 Broadway Member LLCrequest the U.S. Bankruptcy Court for the Southern District of New York to extend the exclusive periods during which the Debtors may file a Chapter 11 plan and solicit votes on a proposed plan through and including August 18, 2021, and October 19, 2021, respectively. This is the Debtors' first request for an extension of the Exclusivity Periods. Before the filing of the Debtors' chapter 11 cases, the Debtor acquired the real property located at 159 Broadway, Brooklyn, New York with the expectation of turning what was a vacant lot into a 26-story hotel with new condominiums and retail space. The development project was meant to exploit its location in the Williamsburg neighborhood of Brooklyn, with the hotel being right next door to the landmarked Williamsburg Savings Bank and across the street from the famous Peter Luger Steakhouse. With 15% of the construction completed, the Debtors exhausted their funding and sought new capital or refinancing for the development project. But with the onset of the COVID-19 pandemic in the spring of 2020, the Debtors were unable to locate new capital or otherwise refinance its senior and mezzanine indebtedness. When the mezzanine lender scheduled a UCC sale of 159 Broadway Member LLC's membership interests in WB Bridge Hotel LLC, the Debtors were constrained to commence these chapter 11 cases. The Debtors continue to believe the Property is a viable project with significant upside potential and have spent their time since filing determining the best way in the current economic climate to carve out a pathway towards reorganization. And since the Petition Date, the Debtors have been exploring multiple avenues toward reorganization, including, among other possibilities, the potential infusion of new capital through a joint venture partner and refinancing of the Debtors' existing financial obligations. Should the Debtors be unable to find new capital or find refinancing, the Debtors have also been exploring the possibility of a sale for the Property. The Debtors may retain additional professionals, such as an investment banker and a real estate broker, to assist the Debtors in their conducting an organized process to undertake a search for new capital or a potential buyer. Depending on the results and timing of the Debtors' efforts to find new capital, the Debtors may run a search for new capital concurrently with a sale process. The Debtors' secured lenders have been apprised of the Debtors' efforts to date. An objective analysis of the relevant factors establishes that the Debtors are doing everything they should do as chapter 11 debtors to advance these chapter 11 cases. Still, finding a new partner for a development project will take more time. The Debtors submit that sufficient cause supports extending the Exclusivity Periods as provided here and support a finding of "cause" to extend the Exclusivity Periods for 120 days. By doing so, the Debtors and their stakeholders may realize the benefits of the progress made to date and avoid the risks of competing plan proposals. Extending the Exclusivity Periods will benefit the Debtors' estates, their creditors, and all other key parties in interest. A copy of the Debtors' Motion to extend is available at https://bit.ly/3oT2zVD from PacerMonitor.com. About WB Bridge Hotel WB Bridge Hotel LLC and 159 Broadway Member LLC are the owners of a hotel and residential tower project in Brooklyn's hip Williamsburg neighborhood. The project covers a planned 26-story tower at 159 Broadway in Brooklyn, N.Y., that includes apartments and a 235-room hotel across the street from the legendary Peter Luger Steakhouse. The Debtors are affiliated with Hollywood, Fla.-based GC Realty Advisors LLC. They are also affiliated with 85 Flatbush RHO Mezz LLC, the owner of the Tillary Hotel Brooklyn, located at 85 Flatbush Extension, Brooklyn, N.Y. WB Bridge Hotel and 159 Broadway Member sought Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 20-23288) on December 21, 2020. The Debtors were each estimated to have $10 million to $50 million in assets and liabilities. Judge Robert D. Drain oversees the cases. Robinson Brog Leinwand Greene Genovese & Gluck PC is the Debtors' legal counsel. The U.S. Trustee for Region 2 appointed an official committee of unsecured creditors in the Debtors' Chapter 11 cases. The committee tapped SilvermanAcampora, LLP as its legal counsel. WENDY'S CO: S&P Raises ICR to 'B+' on Improved Performance ---------------------------------------------------------- S&P Global Ratings raised its issuer credit rating on U.S.-based quick-service restaurant operator The Wendy's Co. to 'B+' from 'B'. The outlook is stable. S&P said, "We also raised issue-level rating on the company's unsecured debentures to 'B-' from 'CCC+'. The '6' recovery rating indicates our expectation for negligible recovery (0%-10%; rounded estimate: 0%) in the event of a default or bankruptcy." The stable outlook reflects the company's solid market position in the competitive burger QSR sector and stable franchisee model (95% of the store base), notwithstanding a highly leveraged debt profile. Wendy's demonstrated solid performance through the 2020 pandemic period given its highly franchised operating model. The upgrade reflects our view of improved creditworthiness based on resilient operating performance and favorable operating prospects that offsets the higher leverage level compared to other non-franchisor retail and restaurant peers. S&P's view also considers the capital structure's laddered maturity schedule (laddered maturities between 2022 and 2028) and the relatively low projected EBITDA and cash flow volatility, which comes from franchising a significant amount of restaurant operations and the company's asset-lite business model. Wendy's free cash flow generation benefits from the good underlying economics of Wendy's franchisor operating model which boasts low capital expenditures and high, stable EBITDA margins. Risks associated with the operations, including labor and food cost inflation, are carried primarily by franchisees who operate about 95% of Wendy's locations. Wendy's has a well-established brand with close to 7,000 restaurants globally, a geographically well-diversified footprint in the U.S., and has been effective at managing through various end-market conditions, most recently the pandemic period. As a result of this track record and consistent growth expectations we are revising our comparable rating analysis modifier to positive from neutral. Wendy's brand is well positioned in a highly competitive segment and poised for modest growth in the medium term. Wendy's leading market position in the intensely competitive and fragmented QSR industry reflects its established brand image. This solid brand perception with consumers has helped the company maintain good average unit volumes (AUV) of around $1.7 million and supports prospects for continued growth. Development agreements continue to be signed in other countries (which comes with risks of brand awareness and customer taste) but also reflects the company's successful execution and franchisee appetite to operate Wendy's locations internationally. S&P expects measured growth of restaurants in the low-single-digit percentage area on an annual basis with increasing international exposure. Wendy's posted strong first-quarter results including 13% global same restaurant sales growth, partially lapping the pandemic-affected period last year. S&P said, "We expect growth to moderate but to remain good in the mid-to-high-single digits this year. We believe that abating pandemic concerns, a supportive economic backdrop, and company specific programs will support the growth." S&P said, "We expect that Wendy's will focus on expanding its delivery businesses and continued investments in its technology systems, particularly its mobile app, with a focus on restaurant efficiency and faster delivery. The company should continue to benefit from menu changes and product promotions which have been successful through the year and building on its good track record of innovation. The company has an ongoing objective to bolster breakfast sales with a target of 10% of the total sales by the end of 2022 and we will monitor its traction. We believe a return to more normal commuting patterns post pandemic should be supportive of QSR breakfast sales and Wendy's effort to raise awareness of its breakfast offerings should gain traction over time." The company's large debt load is manageable considering expected operating performance consistency. Wendy's carries a significant debt-load--meaningfully greater than $2 billion--most of which is in the form of long-term securitization debt. The rated corporate debt consists of unsecured notes and makes up a small minority of the total debt burden at less than $100 million. S&P said, "We expect Wendy's to continue pursuing an aggressive financial policy and to sustain a highly leveraged financial risk profile consistent with its historic approach via the securitization markets. While we expect adjusted leverage to remain elevated for the next few years , we think additional credit protection measures (including free operating cash flow [FOCF] generation and interest coverage) are important when considering the company's credit risk. We also think the company's above-average adjusted EBITDA margins (as compared to rated restaurant peers) and operations are important considerations." The stable ratings outlook reflects S&P's expectation that Wendy's will experience consistent performance and FOCF generation over the coming year, supporting leverage in the mid 6x range. S&P could lower the ratings if: -- Operating performance deteriorates and S&P expects leverage will be more elevated at around 7x or higher. -- This could occur if Wendy's operating initiatives do not gain traction and the company raises incremental debt. -- If, for instance, nominal debt levels grew to about $2.8 billion and the EBITDA base was not expected to grow, we could lower the ratings. S&P could raise the rating if Wendy's: -- Significantly grows its footprint, especially internationally, and executes strategies to expand AUV resulting in more significant size and scale that could lead S&P to favorably reassess its view of the business risk profile; or -- The company maintains a less aggressive financial policy, with leverage in the 5x area. WILLIAM CARTER: Moody's Affirms Ba1 CFR, Outlook Remains Stable --------------------------------------------------------------- Moody's Investors Service upgraded The William Carter Company's (Carter's) speculative grade liquidity rating to SGL-1 from SGL-2. Concurrently, Moody's affirmed all of the company's ratings, including the Ba1 corporate family rating, Ba1-PD probability of default rating and Ba2 senior unsecured notes ratings. The outlook remains stable. The upgrade of the speculative grade liquidity rating to SGL-1 from SGL-2 reflects the improvement in Carter's liquidity, including its over $1 billion cash balance, access to the undrawn $750 million revolving credit facility and Moody's expectations for solid positive free cash flow, good covenant cushion and a lack of near-term debt maturities. The affirmation of the CFR, PDR and unsecured notes ratings reflects Carter's strong earnings recovery following the coronavirus-driven disruption in consumer spending. Moody's took the following rating actions for The William Carter Company: Corporate family rating, affirmed Ba1 Probability of default rating, affirmed Ba1-PD Senior unsecured regular bond/debenture due 2025, affirmed Ba2 to (LGD4) from (LGD5) Senior unsecured regular bond/debenture due 2027, affirmed Ba2 to (LGD4) from (LGD5) Speculative grade liquidity rating, upgraded to SGL-1 from SGL-2 Outlook, remains stable RATINGS RATIONALE Carter's Ba1 CFR reflects the company's well-recognized brands, diversified distribution channels and leading share in the US young children's apparel category. The replenishment nature of Carter's competitively priced baby and toddler offering results in resilient performance during recessionary periods and limited fashion risk compared to other apparel companies. These strengths have enabled a solid earnings recovery coming out of the coronavirus disruption, and significant deleveraging despite the doubling of funded debt relative to pre-pandemic levels. Moody's expects Carter's to maintain very good liquidity over the next 12-18 months and strong credit metrics relative to similarly-rated apparel peers. Moody's-adjusted debt/EBITDA was 2.5x and EBITA/interest expense was 5.0x as of April 3, 2021. The rating also incorporates governance considerations, including the company's balanced financial strategies. Nevertheless, Carter's ratings are constrained by the lack of commitment to maintaining financial strategies supportive of an investment grade capital structure. While the company has maintained balanced financial policies, given its periodic capital structure reviews, there is a risk that it may choose to increase debt to finance acquisitions or share repurchases. The rating also considers Carter's narrow product focus primarily in infant and toddler apparel, customer concentration, geographic focus mainly in the US, and small scale compared to investment-grade apparel companies. As an apparel designer and retailer, the company also needs to make ongoing investments in its brands and infrastructure, as well as in social and environmental drivers including responsible sourcing, product and supply sustainability, privacy and data protection. The stable rating outlook reflects Moody's expectations that Carter's will maintain its market share and solid profit margins, while operating with balanced financial policies and very good liquidity. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS The ratings could be upgraded if the company demonstrates a commitment to maintaining an investment grade profile, including credit metrics stronger than the quantitative upgrade triggers. An upgrade would also require sustained market share and operating performance in key segments, lease-adjusted debt/EBITDA maintained below 3 times, EBITA/interest expense above 5.5 times and EBITA margins in the mid-teens. The ratings could be downgraded if financial policies become more aggressive or liquidity erodes. Quantitatively, the ratings could be downgraded if debt/EBITDA is sustained above 3.75 times. Headquartered in Atlanta, Georgia, The William Carter Company ("Carter's") owns the "Carter's", "OshKosh B'gosh" and "Skip Hop" brands, which are distributed through company-operated stores, e-commerce operations, as well as national chains, department stores, specialty retailers and e-commerce platforms domestically and internationally. Revenues for the twelve months ended April 3, 2021 were approximately $3.2 billion. The company's parent entity Carters, Inc. is publicly traded. The principal methodology used in these ratings was Apparel Methodology published in October 2019. WOODFORD EXPRESS: Moody's Hikes CFR to B3, Outlook Stable --------------------------------------------------------- Moody's Investors Service upgraded Woodford Express, LLC's (WEX) Corporate Family Rating to B3 from Caa1, Probability of Default Rating to B3-PD from Caa1-PD and senior secured bank credit facility rating to B3 from Caa1. The outlook was changed to stable from negative. "The upgrade of Woodford's ratings reflects the emergence of its largest customer from bankruptcy with reduced financial burden, and our expectation for increasing volumes on the company's system driving higher EBITDA, and continuing positive free cash flow," said Arvinder Saluja, Moody's Vice President. Upgrades: Issuer: Woodford Express, LLC Probability of Default Rating, Upgraded to B3-PD from Caa1-PD Corporate Family Rating, Upgraded to B3 from Caa1 Senior Secured Term Loan, Upgraded to B3 (LGD4) from Caa1 (LGD4) Outlook Actions: Issuer: Woodford Express, LLC Outlook, Changed To Stable From Negative RATINGS RATIONALE WEX's B3 CFR reflects its modest scale in a single basin. WEX also has a highly concentrated customer base and relies on acreage dedications and long term, fixed fee contracts. WEX derives 70% of its volumes from Gulfport Energy Corporation (Gulfport, B2 stable), which filed for Chapter 11 bankruptcy protection in November 2020 and emerged in May 2021. Nonetheless, the upgrade of WEX's CFR to B3 recognizes the company's success in navigating the challenging commodity price and volume environment of 2020. Moody's expects higher volumes and increased EBITDA to drive lower leverage through 2022, especially after Gulfport's emergence from bankruptcy. Gulfport's has been able to significantly reduce debt and achieve financial flexibility as a result of the Chapter 11 bankruptcy process. Although Gulfport renegotiated certain contracts with many of its other midstream counterparties, its contracts for its SCOOP production with WEX were not meaningfully impacted. A gradual uptick in activity in the SCOOP by Gulfport and WEX's other customers will improve WEX's EBITDA and support deleveraging in 2021-22. Moody's expects that WEX will continue to generate positive free cash flow supporting liquidity and modest reduction of debt. WEX has flexibility around capital expenditures and significantly reduced its spending in the second half of 2020. Moody's expects capital expenditures to remain limited with modest growth as more wells are connected to the system. WEX has no near term debt maturities. Moody's expects that WEX will maintain good liquidity through 2022. As of March 31, 2021, the company had $47 million of cash and an undrawn $25 million revolver due 2023. In addition to revolver availability, Moody's expects that WEX will maintain its cash balance and that its operations will generate cash flow to support liquidity. There is an excess cash flow sweep mechanism under the credit facility that requires repayment of debt with excess cash flow as long as the consolidated net leverage ratio is above 3.0x. Moody's expects WEX will comply with its credit facility financial covenant at least through 2021 - a minimum debt service coverage ratio of 1.10x. The $316 term loan facility due 2025 is rated B3. The $25 million revolver due 2023 (unrated) has a super priority claim on WEX's assets, but given its small size relative to the term loan, the term loan is rated at the same level as the CFR. The stable outlook reflects Moody's expectation that WEX will be able to increase volumes and EBITDA enough to support lower leverage and adequate liquidity over the next 12-18 months. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS Factors that could lead to an upgrade include increased scale, durable growth of volumes and EBITDA leading to leverage (debt to EBITDA) remaining below 4x, reduced customer concentration, and improved commodity price environment that supports SCOOP development. Factors that could lead to a downgrade include leverage above 6x, weakening liquidity, or an interest coverage ratio below 2x. Woodford Express, LLC is the owner of a natural gas gathering and processing system located in the core SCOOP play of Southern Oklahoma. The operating assets currently consist of 450 MMcf/d of cryogenic gas processing capacity, 200 miles of rich gas gathering pipeline, total field compression capacity of 250 MMcf/d, and blending capacity of 50 MMcf/d. The principal methodology used in these ratings was Midstream Energy published in December 2018. WORK CAT: Wins Cash Collateral Access Thru June 17 -------------------------------------------------- The U.S. Bankruptcy Court for the Middle District of Florida, Tampa Division, has authorized Work Cat Florida, LLC to use cash collateral on an interim basis through June 17, 2021. The Debtor is authorized to use the cash collateral of Vetting, LLC and NowAccount Network Corporation, and pay the expenses and costs of administration incurred by the Debtor as set forth in and in accordance with the Budget. The Debtor is allowed a variance in respect of any line item(s) set forth in the Budget to enable the Debtor to make payments in excess of any such line item(s) during a particular period in the Budget, provided that the excess payments in the aggregate will not exceed 10% of the total budgeted expenses for the same period in the Budget. In the event that an expense arises which is not within any of the approved line items in the Budget, or the Debtor anticipates that any line item will need to be exceeded by more than the Allowed Variance, then the Debtor will request approval from the Creditors in writing, and the Creditors will have five business days from the date of such request within which to provide consent or object. In the event that the Creditors do not consent, then the Debtor will file a motion with the Court seeking amendment of the Budget and approval of the additional expense, which relief may be sought on an emergency basis. As adequate protection for the Debtor's use of Cash Collateral, the Creditors are granted, effective as of the Petition Date, a replacement lien on and in all assets of the Debtor that are acquired or generated after the Petition Date, but solely to the same extent and priority, and of the same kind and nature, as the Cash Collateral securing the pre-petition obligations to the Creditors under the Loan Documents. Any and all replacement liens granted to the Creditors under the Order will be deemed valid, binding, enforceable and perfected upon entry of the Court Order. The Creditors will not be required to file any UCC-1 financing statement or any similar document or take any other action (including possession of any of the collateral) in order to validate the perfection of the their liens. If the Creditors will, in their discretion, choose to file any such UCC-1 financing statements or other document, or take any other action to validate the perfection of any part of its replacement liens, the Debtor is directed to execute any documents or instruments as the Creditors will reasonably request, and all such documents and instruments will be deemed to have been filed or recorded at the time and on the date of entry of the Order. A final hearing on the matter is scheduled for June 17 at 2 p.m. A copy of the order and the Debtor's one-month budget from May 18, 2021 to June 19, 2021, is available for free at https://tinyurl.com/janu2377 from PacerMonitor.com. The Debtor projects total collections of $910,119 and total outflow of $843,289 for the period. About Work Cat Florida LLC Work Cat Florida LLC, f/k/a Work Cat Trans Gulf, LLC, has been in business since August 2020 as a short sea shipping operation that provides trans-Gulf of Mexico container and roll on/roll off freight transportation services utilizing its own proprietary vessel design known as the "Work Cat." Specifically, the Work Cat is a modern 400 foot catamaran capable of transporting 300 truckload equivalent shipments between the ports of Tampa, Florida and Brownsville, Texas. The Debtor filed a Chapter 11 petition (Bankr. M.D. Fla. Case No. 21-02588) on May 18, 2021, listing $696,377 in total assets and $6,940,094 in total liabilities. The petition was signed by Chris Raley, CEO. GENOVESE JOBLOVE & BATTISTA, P.A., is the Debtor's counsel. WYNDHAM HOTELS: Moody's Affirms Ba1 CFR & Alters Outlook to Stable ------------------------------------------------------------------ Moody's Investors Service affirmed the ratings of Wyndham Hotels & Resorts including its corporate family rating of Ba1, probability of default rating at Ba1-PD, senior secured bank credit facility at Ba1 and senior unsecured rating at Ba2. The company's Speculative Grade Liquidity rating of SGL-2 remains unchanged. At the same time, Moody's revised the outlook to stable from negative. "The outlook revision to stable reflects Moody's expectation that Wyndham Hotels' earnings will benefit from the surge in domestic leisure travel this summer and enable the company to return its debt/EBITDA to below its downgrade factor of 4.0x over the next eighteen months," stated Pete Trombetta, Moody's lodging analyst. Several factors will help Wyndham Hotels continue to capitalize on the recovery in leisure travel that began in March: its reliance on the leisure traveler for about 70% of its bookings, limited exposure to corporate business travel and group business, and its strong presence in drive-to and suburban and small metro areas -- which have outperformed other locations in 2020, a trend that is expected to continue in 2021. Moody's forecasts that Wyndham Hotels' debt/EBITDA will remain high in 2021 but further earnings improvement in 2022 will result in debt/EBITDA approaching 4.0x at the end of 2022 at the latest (all metrics include Moody's standard adjustments). Affirmations: Issuer: Wyndham Hotels & Resorts Probability of Default Rating, Affirmed Ba1-PD Corporate Family Rating, Affirmed Ba1 GTD Senior Secured Bank Credit Facility, Affirmed Ba1 (LGD3) Senior Unsecured Regular Bond/Debenture, Affirmed Ba2 (LGD6 from LGD5) Outlook Actions: Issuer: Wyndham Hotels & Resorts Outlook, Changed To Stable From Negative RATINGS RATIONALE Wyndham Hotels' credit profile benefits from its scale as one of the largest hotel companies in the world with about 8,900 hotels and 797,000 rooms across 20 different brands. The company also benefits from its franchise based business model which generates stable and recurring earnings relative to companies that own a greater proportion of its hotels, and its good liquidity. Despite the material impact to industry trends in 2020 related to travel restrictions associated with COVID-19, Wyndham Hotels' revenue declined about 37% from 2019, which is modest compared to revenue declines for peers that have a greater exposure to the upscale lodging segments and business travel. Wyndham Hotels' credit profile is constrained by the length of time it will take its earnings to return to 2019 levels and risks around a pause in the recovery expected in 2021 related to virus variants or anything that causes travel restrictions to be put back in place. Other credit risks include its historically high leverage relative to other Ba1 rated business and consumer services companies and Moody's expectation that its debt/EBITDA will remain above its 4.0x downgrade factor for the next year before improving to close to 4.0x at the end of 2022. Wyndham also has modest brand concentration as two of the company's 20 brands -- the Super 8 and Days Inn brands -- historically accounted for about 40% of its total hotel rooms. Wyndham Hotels has good liquidity with about $530 million of cash at March 31, 2021 and $735 million available under its $750 million committed revolver due May 2023. Moody's notes that on April 15, 2021 the company used about $500 million of its cash to redeem its 5.375% senior unsecured notes due 2026. Besides the revolver in 2023, the company has no material debt maturities until 2025 when its term loan is due. The company will generate sufficient cash over the next 12 months to cover its debt service and capital requirement needs as well as continuing to pay a dividend to shareholders (the company paid a $15 million dividend in the first quarter of 2021). The company is subject to a first lien leverage covenant (as defined) of 5.0x, which beginning in the second quarter of 2021 will be tested using a form of annualized EBITDA in the second, third and potentially fourth quarters of 2021. Moody's expects the company will maintain adequate cushion with this covenant. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS A ratings upgrade would require the adoption of financial policies and a capital structure indicative of an investment grade company. Quantitatively, an upgrade would require debt/EBITDA of below 3.0x and EBITA/interest expense of above 6.0x. Ratings could be downgraded if the recovery were to stall for any reason leading to weakened liquidity or debt/EBITDA remaining above 4.0x and EBITA/interest expense sustained below 4.0x. Wyndham Hotels & Resorts is one of the largest hotel companies in the world with about 797,000 rooms across 20 different brands. The company generated net revenues of $950 million in 2020 (net of reimbursements). The principal methodology used in these ratings was Business and Consumer Service Industry published in October 2016. XPERI HOLDING: Moody's Rates $810MM First Lien Term Loan 'Ba3' -------------------------------------------------------------- Moody's Investors Service assigned a Ba3 rating to Xperi Holding Corporation's $810 million first lien term loan due May 2028. Xperi's existing ratings, including the Ba3 Corporate Family Rating, Ba3-PD Probability of Default Rating, and SGL-1 Speculative Grade Liquidity rating, are unaffected. The existing Ba3 debt instrument rating on the $1,050 million first lien term loan due June 1, 2025 will be withdrawn at close. The outlook remains stable. The rating assignment is in response to Xperi amending the terms of its existing term loan credit agreement, which extends the maturity date to May 2028 from June 2025 and prepays $50 million of outstanding principal to bring the commitment of the term loan to $810 million. The proposed amendment will also lower interest rates to L+300 from L+400 and reduce the level of mandatory debt repayment obligations due each year by the quarterly amortization requirement and excess cash flow ("ECF") sweep. Xperi's amended quarterly amortization requirement will decline to 1% per annum ($8.1 million) from 5% per annum ($52.5 million). Additionally, starting December 31, 2022, the ECF sweep requirement will be set to 50%, with step downs to 25% if the First Lien Net Leverage Ratio is 1.75x and 0% if below 1.75x. Xperi's previous ECF sweep was set to 75%, with step downs to 50% if the First Lien Net Leverage Ratio .8x, 25% if 0.3x, and 0% if below 0.3x. Moody's views the amended credit agreement terms and partial repayment as credit positive, and projects that Xperi will improve annual liquidity by approximately $55 million per year on a pro forma basis (excluding ECF requirements). However, the ratings could be negatively impacted should the company adopt a more aggressive financial policy in response to the improved cash generation. Assignments: Issuer: Xperi Holding Corporation Gtd Senior Secured 1st Lien Term Loan, Assigned Ba3 (LGD3) RATINGS RATIONALE The Ba3 CFR reflects Xperi's revenue scale, with over $1.1 billion of pro forma revenue for the twelve months ending March 31, 2021, its diversified and broad portfolio of products and intellectual property, which should limit the company's overall revenue volatility over time, and moderate pro forma financial leverage of approximately 3.5x (pro forma for the proposed $810 million term loan and excluding one-time revenue derived from the Comcast litigation). The rating also reflects the consistent free cash flow ("FCF") generation driven by the high profit margin intellectual property ("IP") licensing businesses of Legacy Xperi and Tivo and the modest capital intensity. Moody's expects Xperi will follow a conservative financial policy such that FCF to debt (Moody's adjusted) will approach high-teens percent over the next 12-18 months. In addition, the rating is constrained by the expected spin-off of the Product segment into a separate, publicly traded entity. Moody's estimates the Product segment contributes roughly 60% of Xperi's current pro forma revenue (excluding large, one-time revenue gains from litigation) with EBITDA margins in the mid-30 percent range (excluding unallocated corporate expenses). The proposed spinoff is expected to occur in 2022 but remains subject to change. Moody's expects the company will continue to voluntarily reduce its debt balance such that the remaining debt obligation is right-sized to the stand alone IP segment (which currently generates approximately 90% of Xperi's pro forma EBITDA). The rating is supported by governance considerations. Moody's expects that Xperi will follow a conservative financial policy, limiting leverage and refraining from debt funded shareholder returns. Xperi has voluntarily repaid $240 million of the first lien term loan since the June 2020 merger. The stable outlook reflects Moody's expectation for Xperi to generate a minimum FCF-to-debt (Moody's adjusted) in the high-teens percent level over the next 12-18 months. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATING The ratings could be upgraded if: -- The merger integration is successful, with revenues growing at least in the low single digits percent and Xperi is able to sustain the majority of the $50 million cost synergies in a normalized operating environment -- Sustained billings growth in the rest of Xperi's IP licensing business is achieved -- FCF-to-debt (Moody's adjusted) is sustained above the mid-teens percent level -- Xperi maintains a conservative financial policy The ratings could be downgraded if: -- Xperi experiences material operational disruption with the merger integration and/or the Product segment spin-off -- FCF to debt (Moody's adjusted) declines to the upper-single digits percent level The SGL-1 rating reflects Xperi's very good liquidity, which is supported by consistent cash flow generation and a large cash balance. Moody's expects that Xperi will generate annual FCF (Moody's adjusted) of at least $150 million. The Term Loan is not governed by any financial maintenance covenants. Although Xperi has no plans to obtain a revolving credit facility, Moody's believes that Xperi will maintain a cash balance of at least $125 million, which should provide Xperi with very good liquidity given Xperi's consistent and sizable FCF generation. The Ba3 rating on the Term Loan, which is the same as the Ba3 CFR, reflects the collateral, comprised of a first priority lien on the company's assets, and the minimal amount of unsecured liabilities in the capital structure. Xperi Holding Corporation, based in San Jose, California, through the Legacy Xperi develops and licenses technologies and intellectual property used in semiconductor chip manufacturing and image processing for consumer electronic as well as audio technology, which it licenses to manufacturers of consumer electronics, including home theater systems and car audio systems. Through TiVo, the company offers intellectual property and software related to content discovery, digital video recording, video-on-demand, and multi-screen functionality. TiVo also offers metadata and advertising services. The principal methodology used in this rating was Software Industry published in August 2018. YI LLC: Moody's Affirms B3 CFR & Alters Outlook to Stable --------------------------------------------------------- Moody's Investors Service revised YI, LLC d/b/a Young Innovations ("Young") outlook to stable from negative. The company's B3 Corporate Family Rating, B3-PD Probability of Default Rating, B2 senior secured first lien bank credit facilities ratings were affirmed. The change of outlook to stable reflects Moody's expectation that Young will be able to successfully navigate through ongoing challenges related to COVID-19. Following the cancellation of most dental visits in March and April 2020 associated with COVID related lock-downs, patient volumes have returned, with some markets showing a return to pre-COVID levels. As a result, revenues and EBITDA have stabilized, as evidenced by third and fourth quarter revenues which showed year over year growth. Moody's expects adjusted debt/EBITDA to decline towards 7x in the next 12-18 months. Young has demonstrated an ability to manage its cost structure and cash flow in a challenging environment, resulting in sustained liquidity. The affirmation of the B3 CFR reflects Moody's view that Young has a very good liquidity profile, with total liquidity (cash and undrawn credit facilities) of $73 million as of March 31, 2021. Young has maintained good free cash flows as the company's maintenance capital expenditures are modest at less than $10 million. The company maintains a solid market position across its portfolio of consumable dental products, and Moody's expects Young will maintain market share as procedure volumes continue to recover. Affirmations: Issuer: YI, LLC Corporate Family Rating, Affirmed B3 Probability of Default Rating, Affirmed B3-PD Senior Secured First Lien Bank Credit Facility, Affirmed B2 (LGD3) Outlook Actions: Issuer: YI, LLC Outlook, Changed To Stable From Negative RATINGS RATIONALE Young's B3 Corporate Family Rating reflects the company's very high financial leverage, modest size and narrow product focus within the dental consumables segment. Moody's estimate that the company's annual revenue for fiscal 2021 will be over $200 million. Debt/EBITDA was approximately 8 times as of March 31, 2021. The company's credit profile is supported by a stable end market and a high level of recurring revenue with about 90% of sales derived from consumable products. The company's products are generally used for routine dental care, such as regular cleaning exams, and are somewhat less susceptible to an economic downturn. The company has very good liquidity with cash and undrawn revolving credit capacity of $73 million as of March 31, 2021. Medical device companies face moderate social risk. However, they regularly encounter elevated elements of social risk, including responsible production as well as other social and demographic trends. Risks associated with responsible production include compliance with regulatory requirements for safety of medical devices as well as adverse reputational risks arising from recalls, safety issues or product liability litigation. Medical device companies will generally benefit from demographic trends, such as the aging of the populations in developed countries. Dental companies have somewhat less pressure from payors as a lower level of costs is paid by commercial and government payors. Moody's believe the near-term risks to pricing are manageable, but rising pressures may evolve over a longer period. With respect to governance, Moody's expect Young's financial policies to remain aggressive due to its ownership by private equity investor The Jordan Group L.P. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS Ratings could be upgraded if the company increases its scale with further diversity in its product offering. Quantitatively, ratings could be upgraded if debt/EBITDA is sustained below 5.5 times while maintaining good liquidity. Ratings could be downgraded if the company's liquidity materially weakens, or if sales or margins erode or free cash flow is negative. Quantitatively, ratings could be downgraded if Moody's expects debt/EBITDA to be sustained above 7.5 times for an extended period. YI, LLC, d/b/a Young Innovations develops, manufactures and markets consumable supplies and equipment used for dental care. The company's product offerings include disposable and metal prophylaxis (prophy) angles, prophy cups and brushes, dental micro-applicators, moisture control products, infection control products, dental hand pieces, endodontic systems, orthodontic brushes, flavored examination gloves, children's tooth brushes and children's toothpastes. The company is owned by The Jordan Company, L.P - a private equity firm. YI, LLC's fiscal 2020 revenue is about $195 million. The principal methodology used in these ratings was Medical Product and Device Industry published in June 2017. YIELD10 BIOSCIENCE: All Four Proposals Passed at Annual Meeting --------------------------------------------------------------- Yield10 Bioscience, Inc. held its 2021 annual meeting of its stockholders on May 24, 2021, at which the stockholders: (a) reelected Anthony J. Sinskey, Sc.D. and Richard W. Hamilton Ph.D. as Class III directors of the Company to hold office until the annual meeting of stockholders in 2024 and until their successors are elected and qualified, subject to their earlier death, resignation or removal; (b) approved an amendment to the Company's Amended and Restated 2018 Stock Option and Incentive Plan to add 300,000 shares of common stock for issuance under the Plan; (c) approved, on an advisory basis, the compensation of the named executive officers of the Company; and (d) ratified the selection of RSM US LLP as the Company's independent registered public accounting firm for the fiscal year ending Dec. 31, 2021. About Yield10 Yield10 Bioscience, Inc. -- http://www.yield10bio.com-- is an agricultural bioscience company that uses its "Trait Factory" and the Camelina oilseed "Fast Field Testing" system to develop high value seed traits for the agriculture and food industries. Yield10 is headquartered in Woburn, Massachusetts and has an Oilseed Center of Excellence in Saskatoon, Saskatchewan, Canada. Yield10 Bioscience reported a net loss of $10.21 million for the year ended Dec. 31, 2020, compared to a net loss of $12.95 million for the year ended Dec. 31, 2019. As of March 31, 2021, the Company had $27.57 million in total assets, $4.47 million in total liabilities, and $23.09 million in total stockholders' equity. YOAKUM INDEPENDENT SCHOOL: S&P Lowers GO Debt Rating to 'BB' ------------------------------------------------------------ S&P Global Ratings lowered its underlying rating to 'BB' from 'BB+' on Yoakum Independent School District, Texas' existing general obligation (GO) debt. The outlook is stable. "The lowered rating reflects three consecutive years of the district's receiving a going concern auditor's opinion and negative cash and reserve positions in the general fund from fiscal 2018 through fiscal 2020, and our expectation that cash and reserves could remain negative until fiscal 2022. We view as the district's governance risk as elevated based on management's inability to strategically develop and execute a cohesive plan to restore its finances to a positive level," said S&P Global Ratings credit analyst Joyce Jung. "The stability and improvement of the rating rely on multiple factors, including stable local and state revenues, the timing of federal stimulus funds, management's ability to operate on thin operating margins, and the district's property wealthy district status and the recapture payment." S&P said, "Despite the district's negative general fund reserves and cash position, we believe it has sufficient resources to meet its operations and debt service for the next two years. We could raise the rating if the district's cash stabilizes and budgetary performance trends positively. Should the district's cash continue to deteriorate, we could lower the rating, potentially by multiple notches." YOUFIT HEALTH CLUBS: Asks Court to Dismiss Bankruptcy Case ---------------------------------------------------------- Alex Wolf of Bloomberg Law reports that YouFit Health Clubs LLC asked a judge to dismiss its bankruptcy case, saying it lacks the funds needed to get a creditor repayment plan approved after selling the business to a group of secured lenders. The gym chain’s former estate would provide more benefit to creditors by ending the bankruptcy instead of remaining in Chapter 11 proceedings, the company told the U.S. Bankruptcy Court for the District of Delaware in a filing Thursday. About YouFit Health Clubs YouFit Health Clubs, LLC, and its affiliates -- https://www.youfit.com/ -- own and operate 85 fitness clubs in the states of Alabama, Arizona, Florida, Georgia, Louisiana, Maryland, Pennsylvania, Rhode Island, Texas, and Virginia. On Nov. 9, 2020, YouFit Health Clubs and its affiliates sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 20-12841). YouFit was estimated to have $50 million to $100 million in assets and $100 million to $500 million in liabilities as of the filing. The Honorable Mary F. Walrath is the case judge. The Debtors tapped Greenberg Traurig LLP as its bankruptcy counsel, FocalPoint Securities LLC as an investment banker, Red Banyan Group LLC as a communications consultant, and Hilco Real Estate LLC as a real estate advisor. Donlin Recano & Company Inc. is the claims agent. On November 18, 2020, the U.S. Trustee for Region 3 appointed a committee to represent unsecured creditors in the Debtors' Chapter 11 cases. The committee tapped Berger Singerman LLP and Pachulski Stang Ziehl & Jones LLP as its legal counsel, and Dundon Advisers LLC as its financial advisor. ZIG ZAG DOUGH: Case Summary & 12 Unsecured Creditors ---------------------------------------------------- Debtor: Zig Zag Dough, LLC dba Mellow Mushroom 3455 Bluebonnet Circle Fort Worth, TX 76109 Business Description: Zig Zag Dough, LLC operates a chain of pizza restaurants. Chapter 11 Petition Date: May 28, 2021 Court: United States Bankruptcy Court Eastern District of Texas Case No.: 21-40798 Debtor's Counsel: Christopher J. Moser, Esq. QUILLING, SELANDER, LOWNDS, WINSLETT & MOSER, P.C. 2001 Bryan Street, Suite 1800 Dallas, TX 75201 Tel: (214) 871-2100 E-mail: cmoser@qslwm.com Estimated Assets: $500,000 to $1 million Estimated Liabilities: $1 million to $10 million The petition was signed by Kimberly Slawson, the managing member. A copy of the Debtor's list of 12 unsecured creditors is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/ICZACTQ/Zig_Zag_Dough_LLC__txebke-21-40798__0002.0.pdf?mcid=tGE4TAMA A full-text copy of the petition is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/IGNZAOI/Zig_Zag_Dough_LLC__txebke-21-40798__0001.0.pdf?mcid=tGE4TAMA ZIG ZAG DOUGH: Seeks Cash Collateral Access ------------------------------------------- Zig Zag Dough, LLC asks the U.S. Bankruptcy Court for the Eastern District of Texas, Sherman Division, for authority to use cash collateral in accordance with the proposed budget and provide adequate protection. The Debtor has an immediate need to use cash collateral, including cash proceeds, to pay its employees and other operating expenses. The U.S. Small Business Association asserts a security interest in the Debtor's cash collateral by virtue of a Security Agreement corresponding to the COVID-19 Economic Injury Disaster Loan, executed in June 2020 -- in which the Debtor pledged all assets, including all accounts, account receivables and inventory -- and secured by a recorded UCC financing statement on June 2, 2020. The Debtor requests interim authorization to use cash collateral as set forth in the Budget until a final cash collateral order can be entered. The Budget includes a list of business expenses that are reasonable and necessary and that must be paid until such time as a final hearing on the Motion can be held. The Debtor has also budgeted a carve out for administrative expenses of $1,500 each month. These business expenses are reasonable and necessary and must be paid until such time as the Debtor can reach confirmation. The Debtor proposes to adequately protect the interest of the SBA in any prepetition collateral by granting the SBA replacement liens in estate property. The Debtor proposes to grant the Replacement Liens upon all property and assets of the estate in which the SBA held a validly perfected and nonavoidable lien or right of setoff as of the Petition Date. The Debtor does not propose to grant any liens in avoidance actions under Chapter 5 of the Bankruptcy Code or the proceeds thereof. A copy of the motion is available at https://bit.ly/3c0hfNG from PacerMonitor.com. About Zig Zag Dough, LLC Zig Zag Dough, LLC owns and operates a Mellow Mushroom franchise pizzeria and bar located at 3455 Blue Bonnet Cir., Fort Worth, Texas 76109. The store serves dine-in and takeout food and alcohol. The Debtor sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. E.D. Tex. Case No. 21-40798) on May 28, 2021. In the petition signed by Kimberly Slawson, managing member, the Debtor disclosed up to $1 million in assets and up to $10 million in liabilities. Quilling, Selander, Lownds, Winslett & Moser, P.C. is the Debtor's counsel. [^] BOND PRICING: For the Week from May 24 to 28, 2021 ------------------------------------------------------ Company Ticker Coupon Bid Price Maturity ------- ------ ------ --------- -------- Acorda Therapeutics Inc ACOR 1.750 97.750 6/15/2021 American Airlines 2012-2 Class C Pass Through Trust AAL 4.700 100.000 6/3/2021 BPZ Resources Inc BPZR 6.500 3.017 3/1/2049 Basic Energy Services Inc BASX 10.750 18.516 10/15/2023 Basic Energy Services Inc BASX 10.750 18.516 10/15/2023 Boyd Gaming Corp BYD 4.750 101.973 12/1/2027 Boyd Gaming Corp BYD 4.750 101.837 12/1/2027 Briggs & Stratton Corp BGG 6.875 8.367 12/15/2020 Buffalo Thunder Development Authority BUFLO 11.000 50.000 12/9/2022 Burlington Coat Factory Warehouse Corp BURL 6.250 107.268 4/15/2025 Chinos Holdings Inc CNOHLD 7.000 0.332 N/A Chinos Holdings Inc CNOHLD 7.000 0.332 N/A Coca-Cola Co/The KO 2.875 108.608 10/27/2025 Cox Communications Inc COXENT 3.250 104.214 12/15/2022 Cox Communications Inc COXENT 3.250 104.257 12/15/2022 Dean Foods Co DF 6.500 2.000 3/15/2023 Dean Foods Co DF 6.500 1.100 3/15/2023 ESH Hospitality Inc STAY 4.625 106.037 10/1/2027 Energy Conversion Devices ENER 3.000 7.875 6/15/2013 Energy Future Competitive Holdings Co LLC TXU 0.931 0.072 1/30/2037 Equinix Inc EQIX 5.375 107.025 5/15/2027 Exela Intermediate LLC / Exela Finance Inc EXLINT 10.000 33.887 7/15/2023 Exela Intermediate LLC / Exela Finance Inc EXLINT 10.000 33.640 7/15/2023 Fleetwood Enterprises Inc FLTW 14.000 3.557 12/15/2011 GNC Holdings Inc GNC 1.500 1.250 8/15/2020 GTT Communications Inc GTT 7.875 9.286 12/31/2024 GTT Communications Inc GTT 7.875 8.020 12/31/2024 Goodman Networks Inc GOODNT 8.000 39.365 5/11/2022 Hornbeck Offshore Services HOSS 5.000 0.586 3/1/2021 Liberty Media Corp LMCA 2.250 48.628 9/30/2046 MAI Holdings Inc MAIHLD 9.500 15.895 6/1/2023 MAI Holdings Inc MAIHLD 9.500 15.895 6/1/2023 MAI Holdings Inc MAIHLD 9.500 15.895 6/1/2023 MBIA Insurance Corp MBI 11.444 16.000 1/15/2033 MBIA Insurance Corp MBI 11.444 16.089 1/15/2033 MF Global Holdings Ltd MF 9.000 15.625 6/20/2038 MF Global Holdings Ltd MF 6.750 15.625 8/8/2016 Mashantucket Western Pequot Tribe MASHTU 7.350 32.000 7/1/2026 NFP Corp NFP 7.000 108.632 5/15/2025 NGPL PipeCo LLC NGPLCO 4.375 103.369 8/15/2022 Navajo Transitional Energy Co LLC NVJOTE 9.000 65.000 10/24/2024 Nine Energy Service Inc NINE 8.750 41.562 11/1/2023 Nine Energy Service Inc NINE 8.750 42.078 11/1/2023 Nine Energy Service Inc NINE 8.750 41.347 11/1/2023 OMX Timber Finance Investments II LLC OMX 5.540 0.877 1/29/2020 Pricoa Global Funding I PRU 2.200 99.846 6/3/2021 Pricoa Global Funding I PRU 2.200 100.006 6/3/2021 Renco Metals Inc RENCO 11.500 24.875 7/1/2003 Revlon Consumer Products Corp REV 6.250 37.114 8/1/2024 Rolta LLC RLTAIN 10.750 1.669 5/16/2018 Sears Holdings Corp SHLD 8.000 1.200 12/15/2019 Sears Holdings Corp SHLD 6.625 2.496 10/15/2018 Sears Holdings Corp SHLD 6.625 2.496 10/15/2018 Sears Roebuck Acceptance Corp SHLD 7.500 0.520 10/15/2027 Sears Roebuck Acceptance Corp SHLD 7.000 0.596 6/1/2032 Sears Roebuck Acceptance Corp SHLD 6.500 0.726 12/1/2028 Sempra Texas Holdings Corp TXU 5.550 13.500 11/15/2014 SunPower Corp SPWR 0.875 99.600 6/1/2021 TJX Cos Inc/The TJX 3.750 111.570 4/15/2027 TerraVia Holdings Inc TVIA 5.000 4.644 10/1/2019 Transworld Systems Inc TSIACQ 9.500 31.875 8/15/2021 Voyager Aviation Holdings LLC / Voyager Finance Co VAHLLC 9.000 65.000 8/15/2021 Voyager Aviation Holdings LLC / Voyager Finance Co VAHLLC 9.000 54.000 8/15/2021 ********* Monday's edition of the TCR delivers a list of indicative prices for bond issues that reportedly trade well below par. Prices are obtained by TCR editors from a variety of outside sources during the prior week we think are reliable. Those sources may not, however, be complete or accurate. The Monday Bond Pricing table is compiled on the Friday prior to publication. Prices reported are not intended to reflect actual trades. Prices for actual trades are probably different. Our objective is to share information, not make markets in publicly traded securities. Nothing in the TCR constitutes an offer or solicitation to buy or sell any security of any kind. It is likely that some entity affiliated with a TCR editor holds some position in the issuers public debt and equity securities about which we report. Each Tuesday edition of the TCR contains a list of companies with insolvent balance sheets whose shares trade higher than $3 per share in public markets. At first glance, this list may look like the definitive compilation of stocks that are ideal to sell short. Don't be fooled. Assets, for example, reported at historical cost net of depreciation may understate the true value of a firm's assets. A company may establish reserves on its balance sheet for liabilities that may never materialize. The prices at which equity securities trade in public market are determined by more than a balance sheet solvency test. On Thursdays, the TCR delivers a list of recently filed Chapter 11 cases involving less than $1,000,000 in assets and liabilities delivered to nation's bankruptcy courts. The list includes links to freely downloadable images of these small-dollar petitions in Acrobat PDF format. Each Friday's edition of the TCR includes a review about a book of interest to troubled company professionals. All titles are available at your local bookstore or through Amazon.com. Go to http://www.bankrupt.com/books/to order any title today. Monthly Operating Reports are summarized in every Saturday edition of the TCR. The Sunday TCR delivers securitization rating news from the week then-ending. TCR subscribers have free access to our on-line news archive. Point your Web browser to http://TCRresources.bankrupt.com/and use the e-mail address to which your TCR is delivered to login. ********* S U B S C R I P T I O N I N F O R M A T I O N Troubled Company Reporter is a daily newsletter co-published by Bankruptcy Creditors Service, Inc., Fairless Hills, Pennsylvania, USA, and Beard Group, Inc., Washington, D.C., USA. Jhonas Dampog, Marites Claro, Joy Agravante, Rousel Elaine Tumanda, Valerie Udtuhan, Howard C. Tolentino, Carmel Paderog, Meriam Fernandez, Joel Anthony G. Lopez, Cecil R. Villacampa, Sheryl Joy P. Olano, Psyche A. Castillon, Ivy B. Magdadaro, Carlo Fernandez, Christopher G. Patalinghug, and Peter A. Chapman, Editors. Copyright 2021. All rights reserved. ISSN: 1520-9474. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. The TCR subscription rate is $975 for 6 months delivered via e-mail. Additional e-mail subscriptions for members of the same firm for the term of the initial subscription or balance thereof are $25 each. For subscription information, contact Peter A. Chapman at 215-945-7000. *** End of Transmission ***