/raid1/www/Hosts/bankrupt/TCR_Public/210610.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Thursday, June 10, 2021, Vol. 25, No. 160
Headlines
AEROMEXICO: Asks for Extension of Plan Filing Deadline
AI AQUA MERGER: Moody's Assigns B3 CFR, Outlook Stable
ALL WHEEL DRIVE: Seeks to Employ Susan Hersh as Bankruptcy Counsel
AT HOME GROUP: Posts $56.3 Million Net Income in First Quarter
AYTU BIOPHARMA: Signs Deal With Cantor to Sell $30M Common Shares
BABCOCK & WILCOX: Board OKs Dividend on Series A Preferred Stock
BILL STARKS: Case Summary & 20 Largest Unsecured Creditors
BLACKSTONE MORTGAGE: Moody's Alters Outlook on Ba2 CFR to Stable
BOOZ ALLEN: Moody's Rates New $500MM Sr. Unsecured Notes 'Ba2'
BURLINGTON COAT: Moody's Alters Outlook on Ba2 CFR to Positive
CAFE SERVICE: July 8 Plan Confirmation Hearing Set
CBL & ASSOCIATES: Court Denies Preferred Equity Committee Bid
CE ELECTRICAL: Seeks to Hire Jacobs and Rozich as Special Counsel
CHICAGOAN LOGISTIC: Case Summary & 10 Unsecured Creditors
CINCINNATI TERRACE: Voluntary Chapter 11 Case Summary
CIRTRAN CORP: Incurs $327,555 Net Loss in First Quarter
CITIUS PHARMACEUTICALS: Set to Join Russell 2000 Index
CLEARPOINT CHEMICALS: Aug. 19 Plan Confirmation Hearing Set
CLEARPOINT NEURO: Four Proposals Approved at Annual Meeting
CONNECTIONS COMMUNITY: Court Okays $12.5 Million Asset Sale
CORONADO CAPITAL: Seeks Cash Collateral Access
COTY INC: Moody's Rates New $500MM First Lien Notes Due 2026 'B3'
CRESTWOOD EQUITY: Moody's Puts Ba3 CFR Under Review for Upgrade
CTI BIOPHARMA: All Seven Proposals Approved at Annual Meeting
CYPRUS MINES: Tort Advocate Will Represent Future Claimants
D4MC LLC: Voluntary Chapter 11 Case Summary
EVOKE PHARMA: US Patent for Gimoti Now Listed in FDA Publication
FILLIT INC: Gets Interim OK on Disclosure Statement
FTPO LLC: Seeks to Use First-Citizens Bank's Cash Collateral
FUELCELL ENERGY: Executive VP Jennifer Arasimowicz Resigns
GIRARDI & KEESE: Trustee Can Hire Counsel to Chase Wife's Holdings
GREAT CANADIAN: Moody's Assigns B3 CFR on Apollo Transaction
GTT COMMUNICATIONS: Deadline to File Financials Extended to June 17
GUARDION HEALTH: Closes Acquisition of Activ Nutritional
GUI-MER-FE: Taps Lube & Soto Law Offices as Legal Counsel
HERTZ CORP: Moody's Assigns 'B3' CFR & Rates First Lien Loans 'B2'
HIGHLAND CAPITAL: Court Sanctions Ex- CEO for Stay-Away Violation
HOPLITE INC: Taps Howard Grobstein as Financial Consultant
HOVNANIAN ENTERPRISES: Posts $488.7M Net Income in Second Quarter
HUMAN HOUSING: Seeks to Hire Goldberg Simpson as Legal Counsel
IN-SHAPE HOLDINGS: Seeks Case Dismissal After Assets Sold
INNOVATIVE SOFTWARE: Wins Conditional OK on Disclosure Statement
INSPIREMD INC: Cancels Registration of Series A, Series B Warrants
INTERJET AIRLINES: Says Third Bankruptcy Claim to Be Filed
JB POINDEXTER: Moody's Affirms B1 CFR & Alters Outlook to Stable
KATERRA INC: Files for Chapter 11 After Greensill Woes
KK FIT: Seeks Approval to Hire Stutz Arment as Accountant
L&L WINGS: Seeks Approval to Hire CFGI as Financial Advisor
LATAM AIRLINES: To Delay Plan, To Take Add'l $500M Funding
MAJESTIC HILLS: Gateway Engineers Says Disclosures Deficient
MAJESTIC HILLS: Morris Knowles Says Disclosures Insufficient
MAJESTIC HILLS: NVR & Township Say Liquidating Plan Unconfirmable
MALACHI PAVING: Taps Law Office of Marc Voisenat as Counsel
MALLINCKRODT PLC: Judges Panel Reject Merger of Price-Gouging Suits
MARRIOTT OWNERSHIP: Moody's Rates New $450MM Unsecured Notes 'B1'
MATREIYA TRANS: Has Until Sept. 13 to Confirm Plan
MATTHEWS INT'L: Moody's Alters Outlook on Ba3 CFR to Stable
MAUNESHA RIVER: May Use Cash Collateral Until August 23
MAX FINE FURNITURE: Seeks Approval to Hire Texas State Auctions
MICROSTRATEGY INC: Moody's Assigns 'B3' CFR, Outlook Stable
MTPC LLC: Seeks Approval to Hire McDermott as New Legal Counsel
MYOMO INC: Provides Update on CMS Discussions
NABORS INDUSTRIES: Three Proposals Approved at Annual Meeting
NAHAUL INC: Case Summary & 11 Unsecured Creditors
NATCHITOCHES MEDICAL: Taps Diment & Associates as Legal Counsel
NEOVASC INC: Receives First National Reimbursement in Europe
NEOVASC INC: Shareholders Re-Elect Six Directors
O.P. INVESTMENT: Wins Preliminary OK on Disclosure Statement
OCULAR THERAPEUTIX: Amends MidCap Agreement to Refinance Term Loan
OMNIQ CORP: Signs Deal for AI Based Cloud Software for PERCS
ONEJET INC:Chapter 7 Trustee Tries to Stop Founder's $10 Mil. Claim
OPTIMUMBANK HOLDINGS: Commences Exchange Offer for TruPS
ORBCOMM INC: Moody's Assigns B3 CFR on GI Partners Transaction
PAYA HOLDINGS III: Moody's Assigns 'B1' CFR, Outlook Stable
PETROTEQ ENERGY: Signs Debt Conversion Agreements With Lenders
PG&E CORPORATION: Gibson, Dunn 3rd Update on Trade Committee
PLATINUM GROUP: Liberty Metals Has 9.45% Stake as of June 3
PROOFPOINT INC: Moody's Assigns 'B3' CFR, Outlook Positive
PURDUE PHARMA: AGs Ask Court to Close Sackler's Liability Loophole
RANCHER'S LEGACY: Court Rejects Blue-Grace's Admin. Expense Claim
RAPID AMERICAN CORP: Asbestos Fund May Get $12.3M from Insurers
RIVOLI & RIVOLI: U.S. Trustee Opposes Disclosure Statement
ROCKET TRANSPORTATION: Disclosure Statement Gets Preliminary OK
ROCKET TRANSPORTATION: Unsecs. to Recover 9.6% of Allowed Claims
SAMSONITE INT'L: S&P Hikes Rating on EUR350MM Unsec. Notes to 'B'
SANUWAVE HEALTH: Alan Rubino Resigns as Director
SC SJ HOLDINGS: July 15 Plan Confirmation Hearing Set
SC SJ HOLDINGS: Secures Eagle Canyon Commitment Letter; Amends Plan
SEMINOLE HARD ROCK: Moody's Alters Outlook on B1 CFR to Stable
SIRIUS XM: Moody's Assigns New $1.5BB Unsecured Notes 'Ba3'
SKS CONSTRUCTION: Case Summary & 20 Largest Unsecured Creditors
SKY STEEL: Case Summary & 20 Largest Unsecured Creditors
SLIDEBELTS INC: Seeks to Employ Nord & Associates as Accountant
SPENGLER PLUMBING CO: Files for Chapter 11 Bankruptcy Protection
SPHERATURE INVESTMENTS: Seeks to Hire McDermott as New Counsel
STARWOOD PROPERTY: Moody's Alters Outlook on Ba2 CFR to Stable
STEPHENS FARMS: July 8 Pretrial Conference on Plan Confirmation
SUSGLOBAL ENERGY: Appoints Site Selection Expert to Directors Board
TD HOLDINGS: Incurs $5.9 Million Net Loss in 2020
TEEFOR2 INC: Court OKs Use of SBA Cash Collateral
TRANSOCEAN LTD: Signs Deal to Delay Delivery of Drillships
TRAXIUM LLC: Unsecureds to Split Pro Rata of $850K Creditor Fund
TWIN PINES: Seeks Cash Collateral Access Thru Sept. 30
US CONCRETE: Moody's Puts B1 CFR Under Review for Upgrade
WEATHERFORD INT'L: Receives First Buy Rating After Bankruptcy Exit
WITCHEY ENTERPRISES: Disclosure Statement Hearing Reset to July 15
WITCHEY ENTERPRISES: Taps Andrew Katsock as Bankruptcy Attorney
WOODBRIDGE HOSPITALITY: Taps Sacks Tierney as Bankruptcy Counsel
YIELD10 BIOSCIENCE: Registers 300K Shares Under 2018 Plan
ZUCA PROPERTIES: Case Summary & 7 Unsecured Creditors
[^] Recent Small-Dollar & Individual Chapter 11 Filings
*********
AEROMEXICO: Asks for Extension of Plan Filing Deadline
------------------------------------------------------
Cyntia Barrera Diaz of Bloomberg News reports that Aeromexico is
requesting an extension to the period to file a Chapter 11
reorganization plan, according to a motion filed before a N.Y.
bankruptcy court late on Tuesday, June 8, 2021.
The current period expires June 25, while the period to solicit
votes ends Aug. 24
Aeromexico is requesting the period be extended to Oct. 25 and the
period to solicit votes be extended to Dec. 22, 2020.
Aeromexico must meet several conditional thresholds related to the
debtor-in-possession financing, such as delivering valuation
materials. Delivering these materials requires progress in the
claims reconciliation and fleet negotiation processes.
About Grupo Aeromexico
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.
AI AQUA MERGER: Moody's Assigns B3 CFR, Outlook Stable
------------------------------------------------------
Moody's Investors Service assigned ratings to AI Aqua Merger Sub,
Inc. (New) (dba Culligan), including a B3 Corporate Family Rating
and a B3-PD Probability of Default Rating. Concurrently, Moody's
assigned a B3 rating to the company's proposed senior secured first
lien credit facility, consisting of a $225 million first lien
revolver due 2026, a $2,000 million first lien term loan due 2028,
and a $250 million first lien delayed draw term loan due 2028. The
outlook is stable.
Proceeds from the proposed $2,000 million first lien term loan,
along with new common and preferred equity contributions from BDT
Capital Partners (BDT) and rollover equity from existing
shareholders, will fund the $6.0 billion leverage buyout (LBO) of
Culligan, refinance existing debt, and pay fees and expenses. The
proposed $225 million first lien revolver and $250 million delay
draw term loan are expected to be undrawn at close. Moody's will
withdraw all the existing ratings of the predecessor AI Aqua Merger
Sub, Inc. including the B3 CFR upon the closing of the transaction
and the repayment of its existing debt obligations.
Assignments:
Issuer: AI Aqua Merger Sub, Inc. (New)
Corporate Family Rating, Assigned B3
Probability of Default Rating, Assigned B3-PD
Senior Secured 1st Lien Revolving Credit Facility, Assigned B3
(LGD3)
Senior Secured 1st Lien Term Loan, Assigned B3 (LGD3)
Senior Secured 1st Lien Delayed Draw Term Loan, Assigned B3
(LGD3)
Outlook Actions:
Issuer: AI Aqua Merger Sub, Inc. (New)
Outlook, Assigned Stable
RATINGS RATIONALE
Culligan's B3 CFR broadly reflects its high financial leverage with
debt/EBITDA at around 6.7x as of fiscal year-end December 31, 2020,
pro forma for the transaction and including credit for a full year
of earnings from acquisitions and related transaction expenses, and
synergies. The company has a relatively short history of operating
at its current scope with revenue more than tripling since 2016,
and its aggressive growth strategy through acquisitions pressures
free cash flow generation, and results in weak quality of earnings.
Moody's estimates debt/EBITDA leverage on a reported basis is in
excess of 8x. As the company grows in scale, a reduction in future
acquisition related costs relative to the earnings base should
support positive free cash flow on an annual basis and debt/EBITDA
leverage below 7.0x over the next 12-18 months without significant
pro forma adjustments.
Culligan's rating also reflects the company's strong market
position, segment diversification, and high level of recurring
revenue. During fiscal 2020, Culligan's good geographic
diversification helped mitigate coronavirus-related weakness
because strong performance in the Americas segment somewhat offset
lower earnings from EMEA operations. Moody's expects organic
revenue growth in the high-single-digits to low-teens range and
continued EBITDA margin expansion in fiscal 2021, supported by
continued economic recovery in the Americas and easing of
coronavirus-related restrictions in the EMEA and APAC regions.
Both the legacy Culligan and Quench businesses have strong market
positions in the residential and office drinking water markets,
respectively. Culligan's good liquidity reflects Moody's
expectations for modestly positive free cash flow on an annual
basis and the support provided by its undrawn $225 million
revolving credit facility. Governance factors primarily consider
the company's aggressive financial policies, including its high
financial leverage, and its aggressive growth through acquisition
strategy.
Social risk factors consider Culligan doesn't handle sensitive
customer data, and it is not highly reliant on specialized human
capital. Moody's believes the company's products and services have
favorable long-term demand because they are aligned with delivery
of an essential resource with lower environmental impact than other
sources such as single use plastics. Culligan's sourcing and
delivery of fluid water comprises a small share of its products and
services. Because Culligan's products and services primarily relate
to the filtration and handling of fluid water sourced from other
entities, the focus is on delivery of clean water through reusable
means.
The B3 rating assigned to the company's proposed first lien credit
facilities, same as the B3 CFR, reflects that the first lien
facilities represent the preponderance of the capital structure.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The stable outlook reflects Moody's expectation that the company
will continue to profitably grow its revenue scale, and will
generate positive free cash flow on an annual basis over the next
12-18 months. The stable outlook also reflects Moody's expectation
that the company will continue to execute its acquisition strategy
prudently with minimal disruption both operationally and to credit
metrics.
The ratings could be upgraded if the company sustainably achieves
strong organic revenue and EBITDA growth with a narrowing gap
between reported US GAAP and management-adjusted results
(particularly EBITDA). A ratings upgrade will also require
debt/EBITDA sustained below 5.5x, free cash flow to debt sustained
above 5%, Moody's expectations of financial strategies that support
credit metrics at those levels, and at least good liquidity.
The ratings could be downgraded if the company's operating results
weakened, or it fails to generate positive free cash flow on an
annual basis. Ratings could also be downgraded if debt/EBTIDA is
sustained above 7.0x, financial policies become more aggressive, or
if liquidity deteriorates for any reason.
The proposed first lien credit agreement contains provisions for
incremental debt capacity up to the sum of the greater of $378
million and 100% of pro forma trailing four quarter consolidated
EBITDA, plus unused capacity reallocated from the general debt
basket, plus unlimited amounts subject to closing date pro forma
first lien net leverage (if pari passu secured). Amounts up to the
greater of $378 million and 100% of trailing four quarter
consolidated EBITDA may be incurred with an earlier maturity date
than the initial term loan. 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 in connection with bona fide business purpose
and not for the primary purpose of evading the collateral and
guarantee requirement. The credit agreement permits the transfer of
assets to unrestricted subsidiaries, up to the carve-out
capacities, subject to "blocker" provisions preventing unrestricted
subsidiaries from owning title to intellectual property that is
material to the business of the company and its subsidiaries, taken
as a whole, other than in connection to the transfer of a license
entered into for legitimate business purpose or a bon fide joint
venture with an unaffiliated third party. The credit agreement is
expected to provide some limitations on up-tiering transactions,
including the requirement for affected lenders consent with respect
to modification of the pro rata sharing or payment waterfall
provisions, and subordination of the obligation or subordination of
the lien granted by the facilities. The above are proposed terms
and the final terms of the credit agreement may be materially
different.
Headquartered in Rosemont, Illinois, AI Aqua Merger Sub, Inc. (dba
Culligan) through its subsidiaries operates as a global producer
and distributor of consumer water products and services to
household, commercial drinking water, and commercial solutions
end-markets. Culligan's revenue for fiscal year end December 31,
2020 was over $1.3 billion.
The principal methodology used in these ratings was Business and
Consumer Service Industry published in October 2016.
ALL WHEEL DRIVE: Seeks to Employ Susan Hersh as Bankruptcy Counsel
------------------------------------------------------------------
All Wheel Drive Tuning, Inc. seeks approval from the U.S.
Bankruptcy Court for the Eastern District of Texas to hire Susan B.
Hersh, P.C. to serve as legal counsel in its Chapter 11 case.
The firm's services include assisting the Debtor in the preparation
and proposing of a plan of reorganization, responding to any
contested matters, and defending the Debtor in various matters
arising in its estate.
The firm's hourly rates are as follows:
Susan B. Hersh $325 per hour
Michael L. Geller $325 per hour
The Debtor paid $6,338.75 to the law firm for pre-bankruptcy
services rendered and expenses incurred, including the Chapter 11
filing fee, and $8,661.25 as a retainer.
Susan Hersh, Esq., disclosed in court filings that her firm is a
"disinterested persons" as the term is defined in Section 101(14)
of the Bankruptcy Code.
The law firm can be reached at:
Susan B. Hersh, Esq.
Susan B. Hersh, P.C.
12770 Coit Road, Suite 850
Dallas, TX 75251
Tel.: (972) 503-7070
Fax: (972) 503-7077
Email: susan@susanbhershpc.com
About All Wheel Drive Tuning
All Wheel Drive Tuning, Inc. owns and operates an automotive repair
and maintenance facility specializing in high performance Subaru
vehicles. The business suffered reduced demand and associated
revenue due to the economic downturn and depressed business
environment resulting from the COVID-19 pandemic.
All Wheel Drive Tuning sought protection under Chapter 11 (Bankr.
E.D. Tex. Case No. 21-40790) on May 27, 2021. At the time of the
filing, the Debtor had between $100,001 and $500,000 in assets and
between $500,001 and $1,000,000 in liabilities. Larry Keith
Fields, president, signed the petition. Judge Brenda T. Rhoades
oversees the case. Susan B. Hersh, P.C. is the Debtor's legal
counsel.
AT HOME GROUP: Posts $56.3 Million Net Income in First Quarter
--------------------------------------------------------------
At Home Group Inc. filed with the Securities and Exchange
Commission its Quarterly Report on Form 10-Q disclosing net income
of $56.32 million on $537.08 million of net sales for the 13 weeks
ended
May 1, 2021, compared to a net loss of $358.94 million on $189.85
million of net sales for the 13 weeks ended April 25, 2020.
As of May 1, 2021, the Company had $2.59 billion in total assets,
$2.04 billion in total liabilities, and $546.20 million in total
stockholders' equity.
As of May 1, 2021, At Home Group had $150.5 million of cash and
cash equivalents, no borrowings outstanding under the ABL Facility
revolving credit loans and $325.2 million in borrowing availability
under the Company's ABL Facility. At that date, there were $1.2
million in face amount of letters of credit that had been issued
under the ABL Facility. The agreement governing the ABL Facility
(the “ABL Credit Agreement”), as amended, currently provides
for aggregate revolving commitments of $425.0 million, with a
sublimit for the issuance of letters of credit of $50.0 million and
a sublimit for the issuance of swingline loans of $20.0 million.
The availability under the Company's ABL Facility is determined in
accordance with a borrowing base which can decline due to various
factors. Therefore, amounts under the Company's ABL Facility may
not be available when the Company needs them. On June 12, 2020, the
ABL Facility was amended to provide for a new tranche of term loans
in a principal amount of $35.0 million on a "first-in, last out"
basis.
At Home Group said, "Based on our growth plans, we believe that our
current cash position, net cash provided by operating activities,
borrowings under our ABL Facility and sale-leaseback transactions
will be adequate to finance our operations, planned capital
expenditures, working capital requirements and debt service
obligations over the next twelve months and for the foreseeable
future thereafter. However, if cash flows from operations and
borrowings under our ABL Facility are not sufficient or available
to meet our operating requirements, including as a result of
further restrictions on store operations in future periods, we
could be required to obtain additional financing in the near
future. We may not be able to obtain equity or additional debt
financing in the future when we need it or, if available, the terms
may not be satisfactory to us or could be dilutive to our
stockholders."
A full-text copy of the Form 10-Q is available for free at:
https://www.sec.gov/ix?doc=/Archives/edgar/data/1646228/000155837021007987/home-20210501x10q.htm
About At Home Group Inc.
At Home Group Inc. (NYSE: HOME) is a home decor retailer offering
more than 50,000 on-trend home products to fit any budget or style,
from furniture, mirrors, rugs, art and housewares to tabletop,
patio and seasonal decor. At Home is headquartered in Plano,
Texas, and currently operates 219 stores in 40 states.
At Home Group reported a net loss of $149.73 for the fiscal year
ended Jan. 30, 2021, compared to a net loss of $214.43 for the
fiscal year ended Jan. 25, 2020. As of Jan. 30, 2020, the Company
had $2.52 billion in total assets, $2.04 billion in total
liabilities, and $484.16 million in total stockholders' equity.
AYTU BIOPHARMA: Signs Deal With Cantor to Sell $30M Common Shares
-----------------------------------------------------------------
Aytu BioPharma, Inc. entered into a Controlled Equity Offering(SM)
Sales Agreement with Cantor Fitzgerald & Co., under which the
Company may issue and sell from time to time up to $30,000,000 of
its common stock through or to Cantor Fitzgerald, as sales agent or
principal.
Sales of the Company's common stock, if any, under the Sales
Agreement will be made at market prices by any method that is
deemed to be an "at the market offering" as defined in Rule
415(a)(4) under the Securities Act of 1933, as amended. Each time
the Company wishes to issue and sell common stock under the Sales
Agreement, it will notify the Sales Agent of the number of shares
to be issued, the dates on which such sales are anticipated to be
made and any minimum price below which sales may not be made. Once
the Company has so instructed the Sales Agent, unless the Sales
Agent declines to accept the terms of the notice, the Sales Agent
has agreed to use its commercially reasonable efforts consistent
with its normal trading and sales practices to sell such shares up
to the amount specified on such terms. The obligations of the
Sales Agent under the Sales Agreement to sell the Company's common
stock are subject to a number of conditions that the Company must
meet.
The offering of common stock pursuant to the Sales Agreement will
terminate upon the earlier of (1) the sale of all common stock
subject to the Sales Agreement and (2) termination of the Sales
Agreement as permitted therein. The Sales Agreement may be
terminated by the Company at any time upon ten days' notice. The
Sales Agent may terminate the Sales Agreement at any time upon ten
days' prior notice.
The Sales Agent is entitled to compensation from the Company at a
fixed commission rate equal to 3.0% of the gross sales price per
share of any common stock sold under the Sales Agreement.
About Aytu BioPharma
Englewood, Colorado-based Aytu BioPharma, Inc., formerly known as
Aytu BioScience, Inc. -- http://www.aytubio.com-- is a
commercial-stage specialty pharmaceutical company focused on
commercializing novel products that address significant patient
needs. The company currently markets a portfolio of prescription
products addressing large primary care and pediatric markets. The
primary care portfolio includes (i) Natesto, an FDA-approved nasal
formulation of testosterone for men with hypogonadism, (ii)
ZolpiMist, an FDA-approved oral spray prescription sleep aid, and
(iii) Tuzistra XR, an FDA-approved 12-hour codeine-based
antitussive syrup.
Aytu BioPharma reported a net loss of $13.62 million for the year
ended June 30, 2020, compared to a net loss of $27.13 million for
the year ended June 30, 2019. As of Dec. 31, 2020, the Company had
$166.74 million in total assets, $54.05 million in total
liabilities, and $112.69 million in total stockholders' equity.
BABCOCK & WILCOX: Board OKs Dividend on Series A Preferred Stock
----------------------------------------------------------------
The board of directors of Babcock & Wilcox Enterprises, Inc.
approved that the Company declare a dividend of $0.290625 per share
of its outstanding 7.75% Series A Cumulative Perpetual Preferred
Stock, with a record date for the dividend of June 18, 2021 and a
payment date of June 30, 2021. The Preferred Stock is listed on
the New York Stock Exchange under the symbol "BW PRA."
About Babcock & Wilcox
Headquartered in Akron, Ohio, Babcock & Wilcox Enterprises is a
growing, globally-focused renewable, environmental and thermal
technologies provider with decades of experience providing
diversified energy and emissions control solutions to a broad range
of industrial, electrical utility, municipal and other customers.
B&W's innovative products and services are organized into three
market-facing segments which changed in the third quarter of 2020
as part of the Company's strategic, market-focused organizational
and re-branding initiative to accelerate growth and provide
stakeholders improved visibility into its renewable and
environmental growth platforms.
Babcock & Wilcox reported net losses of $10.30 million in 2020,
$129.04 million in 2019, $724.86 million in 2018, $379.01 million
in 2017, and $115.08 million in 2016. As of March 31, 2021, the
Company had $582.36 million in total assets, $777.80 million in
total liabilities, and a total stockholders' deficit of $195.44
million.
BILL STARKS: Case Summary & 20 Largest Unsecured Creditors
----------------------------------------------------------
Debtor: Bill Starks Construction Co., Inc.
8013 US Highway 277
Abilene, TX 79601
Business Description: Bill Starks Construction Co., Inc. operates
in the utility system construction industry.
Chapter 11 Petition Date: June 9, 2021
Court: United States Bankruptcy Court
Northern District of Texas
Case No.: 21-10081
Debtor's Counsel: Weldon L. Moore, III, Esq.
SUSSMAN & MOORE, LLP
2911 Turtle Creek Blvd.
Ste. 1100
Dallas, TX 75219
Tel: 214-378-8270
Fax: 214-378-8290
E-mail: wmoore@csmlaw.net
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by William Starks, president.
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/GJBPOXI/Bill_Starks_Construction_Co_Inc__txnbke-21-10081__0001.0.pdf?mcid=tGE4TAMA
BLACKSTONE MORTGAGE: Moody's Alters Outlook on Ba2 CFR to Stable
----------------------------------------------------------------
Moody's Investors Service has affirmed the Ba2 corporate family and
long-term senior secured ratings of Blackstone Mortgage Trust, Inc.
(BXMT) and revised its outlook to stable from negative. The rating
action reflects BXMT's strong financial performance during the
coronavirus pandemic-induced downturn in the commercial real estate
sector, and Moody's expectations that asset quality, profitability
and leverage will remain stable over the next 12-18 months.
Affirmations:
Issuer: Blackstone Mortgage Trust, Inc.
LT Corporate Family Rating, Affirmed Ba2
Senior Secured Bank Credit Facility, Affirmed Ba2
Outlook Actions:
Issuer: Blackstone Mortgage Trust, Inc.
Outlook, Changed To Stable From Negative
RATINGS RATIONALE
Moody's has affirmed BXMT's Ba2 corporate family and long-term
senior secured ratings based on the company's strong asset quality,
stable profitability and moderate leverage, as well as the strength
of the company's competitive positioning in the CRE lending sector
resulting from its affiliation with The Blackstone Group L.P.
(Blackstone). BXMT also has a longer operating history than most
rated non-bank US CRE lenders that spans industry cycles. Credit
challenges include the company's CRE loan concentration inherent in
its business model and its high reliance on secured funding that
encumbers its earning assets and limits its access to the unsecured
debt markets.
BXMT's asset quality has performed well since the onset of the
pandemic. As of March 31, 2021, BXMT's ratio of problem loans to
gross loans was a relatively low 2.0%. Moody's attributes this
strong performance partly to BXMT's disciplined credit risk
management, underpinned by its strong underwriting and review
process. The company's loan portfolio is largely comprised of
first-lien mortgages, which is more conservative than most non-bank
peers; Blackstone pursues more junior CRE lending opportunities and
property investments through other managed funds. The average
loan-to-value (LTV) of the portfolio (at origination) is a
conservative 65% and has gradually decreased in the last five years
reflecting late-cycle underwriting conservatism. The portfolio is
reasonably granular given BXMT's leading scale among non-bank
peers. The company's capital strength and expertise allow it to
pursue larger and more complex transactions than smaller and less
established lenders, a competitive advantage that Moody's believes
enhances yields and asset quality.
BXMT's loan portfolio includes collateral in the major property
sectors, with office representing the company's highest
concentration at 57% of total loans as of March 31, 2021. BXMT does
not have significant exposure to hotel and retail properties, two
sectors among the hardest hit by the immediate economic fallout and
business disruptions of the pandemic. BXMT's exposure to the
volatile hotel sector was comparatively low at 13% as of March 31,
2021, and the company is able to leverage the strong institutional
knowledge and experience of Blackstone in this sector to invest
selectively, with strong sponsors, low average LTVs and strong cash
flow performance. BXMT's retail exposure was modest at 3% and BXMT
has no investments in retail malls, as of the same reporting date.
Additionally, construction loans accounted for a small portion of
BXMT's overall portfolio, limiting future funding commitments.
Notwithstanding BXMT's strong portfolio performance, credit risks
in sub-sectors including central business district office and
hotels remain elevated, which will potentially increase portfolio
and earnings volatility for the next several quarters.
Like other CRE lenders, BXMT's profitability declined in 2020
reflecting the impact of the Current Expected Credit Losses (CECL)
accounting implementation and the pandemic. The company reported a
first-quarter 2021 net income to average assets ratio of 1.9%, an
improvement over 0.8% in 2020 but still below its historical range
of 2.0-2.5%. Given BXMT's exclusive focus on lending, its
investment activities and revenue sources are generally less
diverse than non-bank peers; however, Moody's expect that the
company's earnings will be more stable than peers in a downturn
because of its focus on high quality, first-lien lending and
because it has not historically participated in conduit lending for
CMBS issuance, a cause of earnings volatility for some peers. In
addition, 98% of BXMT's portfolio is floating rate, with 65% of the
portfolio benefitting from active LIBOR floors as of March 31,
2021, which mitigates interest rate volatility.
BXMT maintains a strong capital cushion to absorb unexpected
deterioration in asset quality, with capital measures that are
comparable with non-bank peers. As of March 31, 2021, BXMT's
tangible common equity to tangible managed assets ratio was a
healthy 22.3%, and its reported debt-to-equity ratio (net of cash)
was 2.6x. Over the next 12-18 months, Moody's expects that BXMT's
capitalization and leverage will remain at the current levels,
which is an important consideration in BXMT's Ba2 ratings.
Moody's has revised BXMT's outlook to stable from negative based on
the resilience of the company's loan portfolio during the
coronavirus pandemic-induced CRE downturn, and Moody's expectations
that asset quality, profitability and leverage will remain stable
over the next 12-18 months.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
BXMT's ratings could be upgraded if the company: 1) reduces its
ratio of secured debt to total assets to 45%, increases
unencumbered assets and establishes unsecured revolving borrowing
capacity; 2) increases business diversification; and 3) continues
to demonstrate predictable earnings, profitability and asset
quality that compare favorably with peers.
BXMT's ratings could be downgraded if the company: 1) shrinks the
amount of its availability under secured borrowing facilities, its
primary liquidity source; 2) sustains an increase in leverage
(debt/total equity) above 3.5x given the current portfolio mix; 3)
experiences a material deterioration in asset quality; or 4)
experiences a material weakening of profitability.
The principal methodology used in these ratings was Finance
Companies Methodology published in November 2019.
BOOZ ALLEN: Moody's Rates New $500MM Sr. Unsecured Notes 'Ba2'
--------------------------------------------------------------
Moody's Investors Service assigned Baa3 ratings to amended tranches
of Booz Allen Hamilton Inc.'s ("BAH" or the "company") senior
secured credit facility and a Ba2 rating to the proposed offering
of $500 million of senior unsecured notes due 2029. All other
ratings for the company, including the Ba1 corporate family rating
and Ba1-PD probability of default rating, are unaffected. The
speculative grade liquidity rating of SGL-1 and the positive
ratings outlook are also unchanged.
Through the credit facility amendment, BAH will extend the maturity
of its $1.29 billion term loan A to July 2026 from July 2023. The
revolving credit line expiration date will similarly move to July
2026 and the commitment size will be enlarged to $1 billion from
$500 million. The existing November 2026 maturity of the facility's
$384 million term loan B will not change. The $500 million senior
unsecured note issuance will increase BAH's debt balance to $2.9
billion from $2.4 billion. Note proceeds will go toward funding the
pending $725 million acquisition of Liberty IT Solutions, that BAH
expects will close this month. The following rating actions were
taken:
Assignments:
Issuer: Bo8oz Allen Hamilton Inc.
Senior Secured 1st lien Term Loan A, Assigned Baa3 (LGD2)
Senior Secured 1st lien Revolving Credit Facility, Assigned Baa3
(LGD2)
Senior Unsecured Regular Bond/Debenture, Assigned Ba2 (LGD5)
RATINGS RATIONALE
The Ba1 CFR is supported by BAH's good scale, with almost $8
billion in annual revenue, its strong market position, solid credit
metrics and measured financial policies. Market share gains
followed BAH's effort to internally invest and expand technical
qualifications in recent years. The added capabilities well suit
the US defense modernization phase that will continue unfolding
across the next decade, supporting the company's growth outlook.
Good scale enables BAH to remain a leading defense services prime
within a rapidly consolidating US defense services sector. Beyond
being able to execute on larger contracts/tasks, scale gives
overhead capacity to innovate as technology evolves, and allows the
company to better attract and retain employees with specialized
skills.
The Ba1 is constrained by BAH's near-total reliance on the US
government for revenues. BAH derives 97% of its revenues from the
US government and is vulnerable to reduced government spending. The
revenue mix has been broadening but civilian agencies still only
comprise about 30% of the revenue base with defense/intelligence
comprising 70%. A dramatic shift in spending away from national
security would negatively impact BAH. Governance related risks
include BAH's ongoing Department of Justice and SEC investigations.
There could be financial or reputational harm as a result. The
inability to attract and retain qualified workers, particularly
those possessing top security clearances is a key social risk.
Consolidation among defense service contractors is changing the
competitive landscape and BAH will likely need to become more
acquisitive in order to maintain its competitive position. For
example, the acquisition of Liberty IT Solutions will be the
company's first in more than three years. That said, Moody's
expects the company's financial policies to remain balanced, with
debt/EBITDA generally maintained around 3.0x. Moody's expects
acquisitions will be in the $50 million to $300 million range, with
a pace of one to three annually.
The speculative grade liquidity rating of SGL-1 denotes very good
liquidity. BAH possesses high cash (around $1 billion) relative to
basic needs, a well sized backstop revolving credit facility, and
good headroom under financial maintenance covenants.
The positive rating outlook reflects BAH's continued demonstration
of moderate financial policies, while the company has
simultaneously exhibited strong organic revenue and backlog growth.
Improving EBITDA margin, to over 11%, also demonstrates increased
specialization across BAH's labor base.
The Baa3 rating of the secured bank credit facility, one notch
above the CFR considers its effective seniority versus unsecured
debt and non-debt claims that would compete for recovery in a
stress scenario. The Ba2 rating on the senior unsecured notes is
one notch below the CFR, reflecting the potential for significant
loss absorption for this creditor class in a default, given the
sizeable amount of secured and other priority claims.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Upward ratings momentum would depend on an expectation of leverage
generally remaining at or below 3x and free cash flow of $300
million or more, with a healthy backlog and cash maintained at $350
million or higher. Confidence that risk appetite will remain within
acceptable bounds for a prospectively higher rating will be a key
ratings factor.
Downward ratings pressure would mount with negative contract
developments, an unexpectedly negative outcome from the US
Department of Justice investigation, leverage exceeding 4x, and/or
a significantly diminished liquidity profile.
Booz Allen Hamilton Inc. is a publicly traded (NYSE: BAH) provider
of management and technology consulting and engineering services to
governments in the defense, intelligence and civil markets, global
corporations and not-for-profit organizations. Booz Allen Hamilton
is headquartered in McLean, Virginia, and reported revenues of
approximately $7.9 billion for twelve months ended March 31, 2021.
The principal methodology used in these ratings was Aerospace and
Defense Methodology published in July 2020.
BURLINGTON COAT: Moody's Alters Outlook on Ba2 CFR to Positive
--------------------------------------------------------------
Moody's Investors Service affirmed Burlington Coat Factory
Warehouse Corp's ratings including its corporate family rating at
Ba2, its probability of default rating at Ba2-PD and its senior
secured term loan at Ba1 and senior secured notes at Ba1. Its
speculative grade liquidity was upgraded to SGL-1 from SGL-2. The
outlook was changed to positive from negative.
The change in outlook to positive and the rating affirmations
reflect governance considerations including the company's
maintenance of a conservative financial strategy evidenced through
its plan to repay debt and suspension of share repurchases. The
company plans to repay its $300 million of senior secured notes
through its make-whole call with cash on hand. Moody's will
withdraw the rating on these senior secured notes upon repayment.
The change in outlook to positive also reflects that Moody's
expects the strong recovery in Burlington's operation performance
to be sustained for the remainder of 2021 supporting further
improvement in credit metrics. The upgrade to SGL-1 reflects
Burlington's sizable cash balances of $1.5 billion and the full
availability of its $600 million asset based revolving credit
facility.
Affirmations:
Issuer: Burlington Coat Factory Warehouse Corp
Corporate Family Rating, Affirmed Ba2
Probability of Default Rating, Affirmed Ba2-PD
Senior Secured Bank Credit Facility, Affirmed Ba1 to (LGD2) from
(LGD3)
Gtd Senior Secured Regular Bond/Debenture, Affirmed Ba1 to (LGD2)
from (LGD3)
Upgrades:
Issuer: Burlington Coat Factory Warehouse Corp
Speculative Grade Liquidity Rating, Upgraded to SGL-1 from SGL-2
Outlook Actions:
Issuer: Burlington Coat Factory Warehouse Corp
Outlook, Changed To Positive From Negative
RATINGS RATIONALE
Burlington Coat Factory Warehouse Corp's (Ba2 positive) rating
reflects its conservative financial strategy and very good
liquidity with cash at approximately $1.5 billion at the end of its
first quarter 2021. The company's execution in off-price retail, a
segment which has historically grown faster than other apparel
related sub-sectors and has performed relatively well during
economic downturns, supports its rating. The company has seen a
resurgence in sales in recent quarters as the off-price sector's
recovers from its weak operating performance in 2020 as Burlington
faced earnings pressure from the temporary store closures related
to COVID-19 and the suppression of consumer demand. Its improved
merchandising initiatives and real estate expansion through smaller
stores have supported sustainable improvement in operating margins
historically. Nonetheless, headwinds from increased wages and
freight costs will curtail margin expansion in 2021. The company
still has a relatively weaker competitive position, as it is still
significantly smaller with lower operating margins than its largest
peers -- TJX and Ross Stores.
The positive outlook reflects the expectation that operating
performance will continue to recover and that its new store growth
plans will be successful. Financial strategy is expected to remain
conservative with debt repayment remaining a priority.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Ratings could be upgraded if operating performance improves such
that debt/EBITDA is sustained below 3.75x and EBIT/interest expense
is sustained above 3.25x. A ratings upgrade will also require
maintaining very good liquidity as well as a conservative financial
strategy.
Ratings could be downgraded in the event Burlington's financial
strategy was to become more aggressive prior to a return to sales
and operating income growth or its liquidity profile weakens.
Quantitatively, ratings could be downgraded if debt/EBITDA was
sustained above 4.25x and EBIT/interest expense was sustained below
2.75x.
Headquartered in Florence, NJ, Burlington Stores operates a
national chain of off-price retail stores, operating 784 stores as
of May 1, 2021 primarily under the Burlington Stores name. LTM
revenues exceed $7.1 billion as of May 1, 2021.
The principal methodology used in these ratings was Retail Industry
published in May 2018.
CAFE SERVICE: July 8 Plan Confirmation Hearing Set
--------------------------------------------------
On May 25, 2021, Cafe Service Co, Inc. and eight of its affiliates
-- Yiorgos, LLC; Lefkara Taxi, LLC; Kefalonia Taxi, LLC; Robola,
Inc.; Tarifa, LLC; Crossways Cab, Corp.; Devox, Inc; and
Anesthitos, Inc. – filed a Revised Amended Plan of Reorganization
and a Revised Amended Disclosure Statement.
On June 3, 2021, Judge Elizabeth S. Stong approved the Disclosure
Statement and ordered that:
* July 8, 2021, at 10:30 a.m. is the telephonic hearing to
consider confirmation of the Plan.
* July 1, 2021, is fixed as the last day for filing and
serving written objections to confirmation of the Plan.
* July 1, 2021, at 4:00 p.m. is fixed as the last day to
submit all ballots voting in favor of or against the Plan.
* July 1, 2021 at 4:00 p.m. is fixed as the last day to file
objections to confirmation of the Plan.
* July 2, 2021 at 12:00 p.m. is fixed as the last day for
counsel for the Debtors to file a ballot tally and an affidavit
and/or brief in support of confirmation.
A copy of the order dated June 3, 2021, is available at
https://bit.ly/3pAV8D5 from PacerMonitor.com at no charge.
Debtors' Counsel:
Alla Kachan, Esq.
LAW OFFICES OF ALLA KACHAN, P.C.
3099 Coney Island Avenue, 3rd Floor
Brooklyn, NY 11235
Tel: (718) 513-3145
Fax: (347) 342-3156
E-mail: alla@kachanlaw.com
About Cafe Service Co.
Cafe Service Co. Inc., Yiorgos LLC, Lefkara Taxi LLC, Kefalonia
Taxi LLC, Robola Inc., Tarifa LLC, Crossways Cab Corp, Devox Inc.,
and Anesthitos Inc. are privately held companies that operate in
the taxi and limousine service industry.
Cafe Service and its affiliates sought protection under Chapter 11
of the Bankruptcy Code (Bankr. E.D.N.Y. Case Nos. 19-41690 to 19
41697) on March 22, 2019. At the time of the filing, these Debtors
disclosed their total assets and liabilities as follows:
Total Total
Assets Liabilities
------------ -----------
Cafe Service Co. Inc. $404,044 $1,414,692
Yiorgos, LLC $423,510 $1,574,256
Lefkara Taxi, LLC $401,076 $1,395,799
Kefalonia Taxi, LLC $405,600 $1,556,013
Anesthitos, Inc. $417,251 $1,431,245
The Debtors tapped the Law Offices of Alla Kachan, P.C., as their
legal counsel.
CBL & ASSOCIATES: Court Denies Preferred Equity Committee Bid
-------------------------------------------------------------
Jeremy Hill of Bloomberg News reports that U.S. Bankruptcy Judge
David R. Jones rejected a request to form an official committee of
preferred shareholders in the Chapter 11 case of mall owner CBL &
Associates Properties.
Some holders of preferred shares wanted to form an official group
and hire advisers, paid for by CBL, that would lobby for a better
payout under the co.’s bankruptcy plan.
"There is simply no basis on which to appoint an equity committee
of any type," Jones said in a hearing Tuesday, June 8, 2021.
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 four other 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). Another 172 entities sought
bankruptcy protection on November 2, 2020, and CBL/Regency I, LLC
on November 13. Laredo Outlet Shoppes, LLC filed its Chapter 11
petition on May 26, 2021. The cases are jointly administered with
CBL & Associates Properties' case as the lead case.
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.
CE ELECTRICAL: Seeks to Hire Jacobs and Rozich as Special Counsel
-----------------------------------------------------------------
CE Electrical Contractors, LLC seeks approval from the U.S.
Bankruptcy Court for the District of Connecticut to employ Jacobs
and Rozich, LLC as its special counsel.
The Debtor needs the firm's general construction advice during its
Chapter 11 case and legal assistance to collect certain
receivables.
For the collection of receivables, Jacobs and Rozich will get 25
percent of the amount collected. The firm will receive the
contingency fee whether it collected the amount through negotiation
or litigation.
Jacobs and Rozich will also receive a retainer in the amount of
$2,500 as security for the payment of its fees and expenses. The
firm's hourly rates are as follows:
Kenneth M. Rozich $300
Paralegal $125
As disclosed in court filings, Jacobs and Rozich is a
"disinterested person" within the meaning of Section 101(14) of the
Bankruptcy Code.
The firm can be reached through:
Kenneth M. Rozich, Esq.
Jacobs & Rozich, LLC
91 William St.
New Haven, CT 06511
Phone: +1 203-772-4134
About CE Electrical Contractors
CE Electrical Contractors, LLC filed a voluntary petition for
relief under Chapter 11 of the Bankruptcy Code (Bankr. D. Conn.
Case No. 21-20211) on March 5, 2021. Paul Calafiore, managing
member of CE Electrical Contractors, signed the petition. In the
petition, the Debtor disclosed total assets of $1,625,485 and total
liabilities of $8,648,831.
Judge James J. Tancredi oversees the case.
The Debtor tapped The Fox Law Corporation Inc. as lead bankruptcy
counsel, Boatman Law LLC as local bankruptcy counsel, and Jacobs
and Rozich LLC as special counsel. Lucove, Say & Co. is the
Debtor's accountant.
CHICAGOAN LOGISTIC: Case Summary & 10 Unsecured Creditors
---------------------------------------------------------
Debtor: Chicagoan Logistic Company
3612 N. Sacramento Ave
Chicago, IL 60618
Business Description: Chicagoan Logistic Company is in the general
freight trucking industry.
Chapter 11 Petition Date: June 5, 2021
Court: United States Bankruptcy Court
Northern District of Illinois
Case No.: 21-07154
Judge: Hon. Janet S. Baer
Debtor's Counsel: Laxmi P. Sarathy, Esq.
LAXMI P. SARATHY
PO Box 60741
Chicago, IL 60660
Tel: 312-674-7965
Fax: 312-873-4774
E-mail: lsarathylaw@gmail.com
Estimated Assets: $500,000 to $1 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Serkan Kaputluoglu, president.
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/34P3QJY/Chicagoan_Logistic_Company__ilnbke-21-07154__0001.0.pdf?mcid=tGE4TAMA
CINCINNATI TERRACE: Voluntary Chapter 11 Case Summary
-----------------------------------------------------
Debtor: Cincinnati Terrace Associates, LLC
4013 13th Ave
Brooklyn, NY 11218-3501
Business Description: Cincinnati Terrace Associates, LLC is a
Single Asset Real Estate debtor (as defined
in 11 U.S.C. Section 101(51B)).
Chapter 11 Petition Date: June 9, 2021
Court: United States Bankruptcy Court
Eastern District of New York
Case No.: 21-41548
Judge: Hon. Elizabeth S. Stong
Debtor's Counsel: Kevin J. Nash, Esq.
GOLDBERG WEPRIN FINKEL GOLDSTEIN LLP
1501 Broadway 22nd Floor
New York, NY 10036
Tel: (212) 221-5700
E-mail: knash@gwfglaw.com
Estimated Assets: $10 million to $50 million
Estimated Liabilities: $10 million to $50 million
The petition was signed by FIA Capital Partners by David
Goldwasser, manager and restructuring officer.
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/ULRAQNY/Cincinnati_Terrace_Associates__nyebke-21-41548__0001.0.pdf?mcid=tGE4TAMA
CIRTRAN CORP: Incurs $327,555 Net Loss in First Quarter
-------------------------------------------------------
CirTran Corporation filed with the Securities and Exchange
Commission its Quarterly Report on Form 10-Q disclosing a net loss
of $327,555 on $619,399 of net sales for the three months ended
March 31, 2021, compared to a net loss of $315,372 on $2,082 of net
sales for the three months ended March 31, 2020.
As of March 31, 2021, the Company had $1.45 million in total
assets, $42.47 million in total liabilities, and a total
stockholders' deficit of $41.02 million.
The Company had a working capital deficiency of $37,384,422 and
$37,109,751 as of March 31, 2021, and Dec. 31, 2020, respectively,
and a net loss from continuing operations of $289,714 and $277,111
during the three months ended March 31, 2021 and 2020,
respectively. As of March 31, 2021, and Dec. 31, 2020, the Company
had an accumulated deficit of $78,257,227 and $77,929,672,
respectively. The Company said tthese conditions raise substantial
doubt about its ability to continue as a going concern.
CirTran stated, "Our ability to continue as a going concern is
dependent upon our ability to successfully accomplish our business
plan described in the following paragraphs and eventually attain
profitable operations. The accompanying financial statements do
not include any adjustments that may be necessary if we are unable
to continue as a going concern."
"In the coming year, our foreseeable cash requirements will relate
to development of business operations and associated expenses. We
may experience a cash shortfall and be required to raise additional
capital."
"Historically, we have mostly relied upon shareholder loans and
advances to finance operations and growth. Management may raise
additional capital by retaining net earnings, if any, or through
future public or private offerings of our stock or loans from
private investors, although we cannot assure that we will be able
to obtain such financing. Our failure to do so could have a
material and adverse effect upon us and our shareholders."
A full-text copy of the Form 10-Q is available for free at:
https://www.sec.gov/Archives/edgar/data/813716/000149315221013673/form10-q.htm
About Cirtran Corp
West Valley City, Utah-based CirTran Corporation is an established
global company with a diversified expertise in manufacturing,
marketing, distribution and technology in a wide variety of
consumer products, including tobacco products, medical devices and
beverages.
Spokane, Washington-based Fruci & Associates II, PLLC, the
Company's auditor since 2020, issued a "going concern"
qualification in its report dated May 14, 2021, citing that the
Company has an accumulated deficit, net losses, and working capital
deficiencies. These factors raise substantial doubt about the
Company's ability to continue as a going concern.
CITIUS PHARMACEUTICALS: Set to Join Russell 2000 Index
------------------------------------------------------
Citius Pharmaceuticals, Inc. is set to be added to the Russell 2000
Index at the conclusion of the Russell US Indexes annual
reconstitution, effective at the opening of the U.S. equity markets
on June 28, 2021.
"Our inclusion in the Russell index is an important milestone for
Citius that reflects the continued progress we are making to
develop and commercialize first-in-class treatment options for
patients around the world. We welcome the enhanced visibility of
our diversified pipeline and long-term growth potential, and look
forward to sharing our future milestones with a broader investment
community," said Myron Holubiak, president and chief executive
officer of Citius.
FTSE Russell determines membership for its Russell indexes
primarily by objective, market-capitalization rankings and style
attributes. Membership in the small-cap Russell 2000 Index, which
remains in place for one year, is based on membership in the
broad-market Russell 3000Ò Index. Citius stock will also be
automatically added to the appropriate growth and value indexes.
Russell indexes are widely used by investment managers and
institutional investors for index funds and as benchmarks for
active investment strategies. Approximately $9 trillion in assets
are benchmarked against Russell’s US indexes. Russell indexes are
part of FTSE Russell, a leading global index provider.
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.
CLEARPOINT CHEMICALS: Aug. 19 Plan Confirmation Hearing Set
-----------------------------------------------------------
On May 10, 2021, debtor Clearpoint Chemicals, LLC filed with the
U.S. Bankruptcy Court for the Southern District of Alabama a First
Amended Disclosure Statement related to First Amended Plan of
Reorganization.
On June 3, 2021, Judge Jerry C. Oldshue, Jr. approved the
Disclosure Statement and ordered that:
* Aug. 19, 2021, at 9:30 a.m. in Courtroom 2, John A. Campbell
U.S. Courthouse, 113 St. Joseph Street, Mobile, AL 36602 is the
hearing on confirmation of the Plan.
* Aug. 5, 2021, at 5:00 p.m. is fixed as the last day for all
creditors and other parties in interest entitled to vote on the
Plan to transmit written notice of their acceptance or rejection of
the plan by transmitting a ballot.
* Aug. 5, 2021, is fixed as the last day to file any
objections to confirmation of the Plan.
* Aug. 17, 2021, is fixed as the last day for the Debtor to
file a summary of voting on the Plan.
A copy of the order dated June 3, 2021, is available at
https://bit.ly/3ioBQPD from PacerMonitor.com at no charge.
Counsel for the Debtor:
Lawrence B. Voit
Alexandra K. Garrett
Matthew C. Butler
SILVER, VOIT & GARRETT
Attorneys at Law, P.C.
4317-A Midmost Drive
Mobile AL 36609-5589
Telephone: 251-343-0800
About Clearpoint Chemicals
Clearpoint Chemicals, LLC, operates in the specialty chemical
services industry. It develops customer-specific chemical
solutions, provides in-house last mile logistics, and delivers
on-site application and management, and continued communication and
project assessment services.
Clearpoint Chemicals sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. S.D. Ala. Case No. 20-12274) on Sept. 29,
2020. At the time of the filing, the Debtor disclosed assets of
between $10 million and $50 million and liabilities of the same
range.
Judge Jerry C. Oldshue oversees the case.
The Debtor tapped Silver, Volt & Garrett as its bankruptcy counsel.
R. Tate Young, Esq., an attorney practicing in Houston, and Michael
W. Huddleston, Esq., of Munsch, Hardt, Kopf & Harr, P.C. serve as
the Debtor's special counsel.
CLEARPOINT NEURO: Four Proposals Approved at Annual Meeting
-----------------------------------------------------------
At the 2021 annual meeting of the stockholders of ClearPoint Neuro,
Inc., the Company's stockholders:
(1) elected Joseph M. Burnett, John R. Fletcher, Pascal E.R.
Girin, Kristine R. Johnson, Matthew B. Klein, and Timothy
T.
Richards as directors to serve until the 2022 annual meeting
of stockholders;
(2) ratified the appointment of Cherry Bekaert LLP as the
Company's independent registered public accounting firm for
the year ending Dec. 31, 2021;
(3) approved the Company's Employee Stock Purchase Plan; and
(4) approved, on an advisory basis, the compensation of the
Company's executive officers.
As previously disclosed, John N. Spencer, Jr. did not stand for
re-election at the Annual Meeting. Following the Annual Meeting
and as a result of Mr. Spencer's retirement, the Audit Committee of
the Board of Directors of the Company is comprised of Messrs.
Girin, Fletcher and Ms. Johnson, each of whom is an audit committee
financial expert within the meaning of SEC rules, with Mr. Girin
serving as the Chair.
About ClearPoint Neuro
ClearPoint Neuro formerly MRI Interventions, Inc. --
http://www.clearpointneuro.com-- is a medical device company that
develops and commercializes innovative platforms for performing
minimally invasive surgical procedures in the brain under direct,
intra-procedural magnetic resonance imaging, or MRI, guidance.
Applications of the Company's current product portfolio include
deep-brain stimulation, laser ablation, biopsy, neuro-aspiration,
and delivery of drugs, biologics, and gene therapy to the brain.
Clearpoint Neuro reported a net loss of $6.78 million for the year
ended Dec. 31, 2020, compared to a net loss of $5.54 million for
the year ended Dec. 31, 2019. As of March 31, 2021, the Company
had $74.26 million in total assets, $30.28 million in total
liabilities, and $43.98 million in total stockholders' equity.
CONNECTIONS COMMUNITY: Court Okays $12.5 Million Asset Sale
-----------------------------------------------------------
Law360 reports that a Delaware bankruptcy judge Tuesday, June 8,
2021, approved drug and mental health provider Connections
Community Support Programs Inc.'s $12. 5 million asset sale to its
stalking horse bidder, which the organization says will preserve
its programs.
At a virtual hearing, U.S. Bankruptcy Judge Mary Walrath approved
the sale after hearing that the provider had turned down a higher
offer for part of its programs because the higher bidder was
unwilling to take on an in-patient program with three dozen
residents. "Every single program and every single patient will be
transferred," company investment adviser J. Scott Victor said at
the hearing.
About Connections Community Support Programs
Connections Community Support Programs Inc. is a multifaceted
not-for-profit 501(c)(3) health and human services organization
operating and founded in Delaware with over 100 locations
throughout Delaware and more than 1,100 employees.
Since its founding in 1985, CCSP has grown from providing
assistance to older adults with lifelong histories of psychiatric
hospitalization to one of Delaware's largest nonprofit
organizations that touches the lives of approximately 10,000 of
Delaware's most vulnerable citizens and their families, dealing
with behavioral health and substance use disorders, housing
challenges, and developmental and intellectual disabilities. The
organization leases 408 properties (including 389 leased
facilities associated with housing and veterans' services) and owns
48 properties.
Connections Community Support Programs filed for Chapter 11
protection (Bankr. D. Del. Case No. 21-10723) on April 19, 2021.
The Debtor had estimated assets and debt of $50 million to $100
million as of the bankruptcy filing.
The Debtor tapped Chipman Brown Cicero & Cole, LLP, led by Mark L.
Desgrosseilliers, Esq., as legal counsel and SSG Advisors, LLC as
investment banker. Robert Katz, managing director at EisnerAmper
LLP, serves as the Debtor's chief restructuring officer. Omni
Agent Solutions is the claims and noticing agent and administrative
agent.
The U.S. Trustee for Region 3 appointed an official committee of
unsecured creditors on May 3, 2021. The committee is represented
by Polsinelli, PC.
On April 26, 2021, the U.S. Trustee for Region 3 appointed Eric M.
Huebscher as patient care ombudsman in this Chapter 11 case. The
ombudsman tapped Huebscher & Company as his consultant and advisor.
CORONADO CAPITAL: Seeks Cash Collateral Access
----------------------------------------------
Coronado Capital Investment, Inc. asks the U.S. Bankruptcy Court
for the Western District of Texas, El Paso Division, for authority
to use cash collateral and provide adequate protection.
CCI currently owns three properties in El Paso with units available
for rental. On the Petition Date, CCI was indebted to certain
secured creditors in connection with each property:
(a) 8919 Norton, El Paso, Texas 79901 with six units
available plus one residential property:
* SM VER Enterprises, LLC (First Lien on 8919 Norton,
El Paso, Texas 79901)
-- Claim of $210,523.40;
-- Promissory Note dated June 28, 2019;
-- Secured by a Deed of Trust dated recorded at
Document #20190051676, Real Property Records of El
Paso County;
-- Collateral is 8919 Norton, El Paso, Texas 79901;
and
-- Debtor's estimated FMV: $400,000.
* Aureliano Chaidez & Gloria Chaidez (Second Lien on
8919 Norton, El Paso, Texas 79901)
-- Claim of $64,759;
-- Second Lien Promissory Note dated June 28, 2019;
-- Secured pursuant to a Second Lien Deed of Trust
recorded at Document #20199005167, Real Property
Records of El Paso County;
-- Collateral is 8919 Norton, El Paso, Texas 79901;
and
-- Debtor's estimated FMV: $400,000.
(b) 701 S. Campbell, El Paso, Texas 79901 with 14 units
available:
* Zia Trust as Custodian for Bradle E. Jarman, IRA
(First Lien on 701 S. Campbell, El Paso, Texas 79901)
-- Claim of $259,122;
-- Promissory Note dated August 23, 2019;
-- Secured by a Deed of Trust recorded at Document
#(unknown), Real Property Records of El Paso
County;
-- Collateral is 701 S. Campbell, El Paso, Texas
79901; and
-- Debtor's estimated FMV: $410,000.
* Fernando Torres Macias & Bertha Lujan Macias (Second
Lien on 701 S. Campbell, El Paso, Texas 79901)
-- Claim of $52,242;
-- Promissory Note dated August 23, 2019;
-- Secured by a Second Lien Deed of Trust recorded at
Document #201990066903, Real Property Records of El
Paso County;
-- Collateral is 701 E. Campbell, El Paso, Texas
79901; and
-- Debtor's estimated FMV: $410,000.
(c) 9012 Matterhorn, El Paso, Texas 79904 with four units
available:
* Keith Murchison for Wesley Keith Murchison Revocable
Trust (First Lien on 9012 Matterhorn, El Paso, Texas
79904)
-- Claim of $213,106;
-- Promissory Note dated July 31, 2019;
-- Secured by a Deed of Trust recorded at Document
#(unknown), Real Property Records of El Paso
County;
-- Collateral is 9012 Matterhorn, El Paso, Texas
79904; and
-- Debtor's estimated FMV: $325,000.
* Frankie Marquez (Second Lien on 9012 Matterhorn, El
Paso, Texas 79904)
-- Claim of $75,000;
-- Warranty Deed with Vendor's Lien dated July 31,
2019, and recorded at Document #20190059389, Real
Property Records of El Paso County;
-- Secured by a Second Lien Deed of Trust, Security
Agreement, Assignment of Rents and Financing
Statement dated July 31, 2019 and recorded at
Document #(unknown), Real Property Records of El
Paso County;
-- Collateral is 9012 Matterhorn, El Paso, Texas
79904; and
-- Debtor's estimated FMV: $325,000.
As adequate protection for its use of the cash collateral, CCI
proposes to provide the creditors:
(a) First Lienholders: Principal, taxes, insurance, and
interest at 5.50% (based on are 20-year amortization
plus $100/month.
(b) Second Lienholders: Prepetition amount of principal and
interest. However, this adequate protection term does
not apply to the second lienholder for the Matterhorn
Property as it is disputed.
A copy of the motion and the Debtor's pro forma budget from June to
November 2021 is available for free at https://bit.ly/3v7BcIO from
PacerMonitor.com.
The Debtor projects total income of $6,050 and total expenses of
$5,681.50 for June 2021.
About Coronado Capital Investment
Coronado Capital Investment, Inc. is a Texas corporation formed in
El Paso since September 19, 1994. It is the owner operator of
multi-family residential real estate in El Paso, Texas renting
apartment units and other residential property.
The Debtor filed a voluntary petition for relief under Chapter 11
of the Bankruptcy Code (Bankr. W.D. Texas Case No. 21-30264) on
April 5, 2021, listing under $1 million in both assets and
liabilities. Doug Rutter, principal and sole shareholder, signed
the petition.
Judge H. Christopher Mott oversees the case.
Miranda & Maldonado, PC serves as the Debtor's legal counsel.
COTY INC: Moody's Rates New $500MM First Lien Notes Due 2026 'B3'
-----------------------------------------------------------------
Moody's Investors Service assigned a B3 rating to Coty Inc.'s
proposed EUR500 million senior secured first lien 5-year notes due
2026. Proceeds from the new offering will be used to repay a
portion of the company's term loan A due 2023. Coty has also
successfully extended $700 million of its revolving commitment to
April 2025. The remaining $2.05 billion revolving credit facility
had $678 million outstanding as of March 31, 2021, and expires in
2023. Moody's views the proposed issuance and revolver extension as
credit positive because it demonstrates continued progress with
extending the company's 2023 debt maturities. Refinancing the
remaining 2023 maturities is important to provide Coty with
additional time to continue to turnaround its operations.
Coty's Caa1 CFR and stable rating outlook are not affected because
the company faces high execution risk to meaningfully and
sustainably improve earnings and operating cash flow, which in part
refocuses on its Consumer Beauty business product mix away from low
value sales. Stronger earnings performance is necessary to reduce
leverage and improve reinvestment capacity in the highly
competitive beauty industry. Leverage is also unaffected by the
refinancing.
New Assignments:
Issuer: Coty Inc.
Senior Secured Global Notes, Assigned B3 (LGD3)
$700 million Gtd Senior Secured First Lien Revolving
Credit Facility expiring April 2025, Assigned
B3 (LGD3)
RATINGS RATIONALE
Coty's Caa1 CFR reflects the company's gradual recovery from weak
revenue levels over the next few quarters driven by efforts to
contain the coronavirus and pressure on discretionary consumer
income, contributing to high debt to EBITDA financial leverage that
Moody's estimates at about 8.5x in December 2021. The rating also
reflects Moody's belief that the company will generate weak (but
improving) free cash flow over the next several quarters due to its
ongoing restructuring costs. Coty has been plagued by low demand
for its products due to weaker than expected sales and earnings
from its consumer beauty products (38% of sales) and from the
company's luxury beauty and fragrance products (62% of sales). Over
the next 3-6 months, demand will continue to be adversely impacted
by the lingering effects of the coronavirus as worldwide consumer
vaccination efforts remain uneven, as well as ongoing competitive
pressures. That said Moody's expects demand for the company's
products to improve over the next year as the number of vaccinated
consumers continues to increase, and as consumers slowly return to
their everyday activities.
Coty's concentration in fragrance and color cosmetics creates
exposure to discretionary consumer spending and requires continuous
product and brand investment to minimize revenue volatility as
these categories tend to be more fashion driven than other beauty
products. Coty will remain more concentrated than its primary
competitors in mature developed markets. This creates growth
challenges and investment needs to more fully build its global
distribution capabilities and brand presence. The ratings are
supported by the company's large scale, its portfolio of
well-recognized brands, and good product and geographic
diversification.
The SGL-4 Speculative Grade Liquidity Rating reflects Moody's view
that Coty's liquidity is weak. Coty's ongoing restructuring actions
will consume large amounts of cash and Moody's expects the company
to generate negative free cash flow in fiscal 2021 ending June
30th. Free cash flow should turn positive in fiscal 2022 but
required debt amortization remains significant at about $200
million annually. The company has a fully available $700 million
revolving credit facility expiring in 2025, and a $2.05 billion
revolver expiring in 2023. The 2023 revolver had $678 million
outstanding as of March 31, 2021. Both revolvers are subject to a
maximum total net leverage financial covenant with step downs. The
covenant's next step down to 5.0x is in March 2022. Moody's
projects that the company will have weak headroom under the total
net leverage covenant over the next 12 months.
ENVIRONMENTAL SOCIAL AND GOVERNANCE CONSIDERATIONS
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 regards the coronavirus outbreak
as a social risk under its ESG framework, given the substantial
implications for public health and safety.
Coty's ratings also reflect governance considerations related to
its financial policies and board independence. Moody's views Coty's
financial policies as aggressive given its appetite for debt
financed acquisitions. In addition, the company's board of
directors has limited independence given that four of the nine
board members are related to JAB, Coty's majority shareholder.
Social considerations impact Coty in several ways. First, Coty is a
"beauty" company. It sells products that appeal to customers almost
entirely due to "social" considerations. That is, such products
such as makeup and fragrance help individuals fit in to society and
comply with social mores and customs. Hence social factors are the
primary driver of Coty's sales, and hence the primary reason it
exists. To the extent such social customs and mores change, it
could have an impact -- positive or negative -- on the company's
sales and earnings. However, Moody's believes such risk is
manageable as such customs and mores change at a measured pace, and
as the company is able to adapt to changing "fashion" trends, and
hence offset such social changes. The company engages with social
media influencers, which is in line with demographic and societal
trends. While negative product reviews for the company have
historically been modest, Moody's recognizes that a high number of
adverse product reviews could negatively impact product demand.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The stable outlook reflects Moody's expectation that Coty will
continue to improve credit metrics over the next 12-to-18 months
through an ongoing recovery in earnings from the weakness
experienced during the coronavirus downturn. The stable outlook
also recognizes that the company is making meaningful progress in
extending its 2023 debt maturities.
Coty's ratings could be downgraded if Coty is unable to
successfully refinance its remaining debt due 2023 in a timely
manner. Ratings could also be downgraded if the company fails to
stabilize revenue and earnings or continues to generate weak or
negative free cash flow over the next 12-18 months. The inability
to further reduce financial leverage and improve liquidity, or the
pursuit of material debt funded acquisitions or shareholder returns
could also lead to a downgrade.
Coty's ratings could be upgraded if the company successfully
refinances its remaining debt due 2023 in a timely manner and
meaningfully reduces financial leverage. Coty would also need to
consistently generate renewed revenue and earnings growth such that
comfortably positive free cash flow is restored.
The principal methodology used in these ratings was Consumer
Packaged Goods Methodology published in February 2020.
Coty Inc., a public company headquartered in New York, NY, is one
of the leading manufacturers and marketers of fragrance, color
cosmetics, and skin and body care products. The company's products
are sold in over 150 countries. The company generates roughly $4.0
billion in annual revenues. Coty is 60% owned by a German based
investment firm, JAB Holding Company S.a.r.l. (JAB), with the rest
publicly traded.
CRESTWOOD EQUITY: Moody's Puts Ba3 CFR Under Review for Upgrade
---------------------------------------------------------------
Moody's Investors Service placed Crestwood Equity Partners LP's
(Crestwood) and Crestwood Midstream Partners LP's (Midstream)
ratings on review for upgrade following Crestwood's announcement
that it and its 50% joint venture partner, Consolidated Edison,
Inc., had sold their interests in Stagecoach Gas Services LLC, to a
subsidiary of Kinder Morgan, Inc. (NYSE: KMI) for $1.225 billion.
The ratings on review include Crestwood's Ba3 corporate family
rating, its Ba3-PD probability of default rating, and Midstream's
B1 senior unsecured notes rating. Crestwood's SGL-3 rating remains
unchanged. The outlook on both entities was changed to ratings
under review from stable.
On Review for Upgrade:
Issuer: Crestwood Equity Partners LP
Probability of Default Rating, Placed on Review for Upgrade,
currently Ba3-PD
Corporate Family Rating, Placed on Review for Upgrade, currently
Ba3
Pref. Stock Non-cumulative Preferred Stock, Placed on Review for
Upgrade, currently B2 (LGD6)
Issuer: Crestwood Midstream Partners LP
Senior Unsecured Notes, Placed on Review for Upgrade, currently B1
(LGD4)
Outlook Actions:
Issuer: Crestwood Equity Partners LP
Outlook, Changed To Rating Under Review From Stable
Issuer: Crestwood Midstream Partners LP
Outlook, Changed To Rating Under Review From Stable
RATINGS RATIONALE/ FACTORS THAT COULD LEAD TO AN UPGRADE OR
DOWNGRADE OF THE RATINGS
The transaction is expected to close in two stages, with all but
Twin Tier Pipeline, LLC (valued in the sale at $30 million)
conveying during the first closing. The transaction is subject to
Hart-Scott-Rodino approval and Crestwood expects the first stage to
close in the third quarter of 2021. Crestwood intends to use the
proceeds it receives from the sale to repay borrowings under its
revolving credit facility.
"The transaction provides Crestwood with the opportunity to
materially reduce leverage and reach its long-term leverage
target," noted Moody's VP - Senior Credit Officer John Thieroff.
Crestwood's and Midstream's ratings were placed on review for
upgrade based on the meaningful debt reduction the transaction will
provide, given the paydown of the company's revolver. On a
Moody's-adjusted basis, Crestwood's debt/EBITDA is likely to fall
to within the company's stated long-term leverage target of between
3.5x and 3.75x, a level consistent with a Ba2 CFR given Crestwood's
business mix. Moody's review will focus on Crestwood's financial
policy, particularly its intentions around returning capital to
shareholders, and its medium to long-term growth objectives.
Assuming the transaction closes and proceeds are deployed as
planned, Moody's determination that Crestwood's capital return
plans are credit neutral would likely lead to an upgrade.
Houston, Texas-based master limited partnership Crestwood, through
its subsidiaries develops, acquires, owns or controls, and operates
primarily fee-based assets and operations within the energy
midstream sector. Its primary operations are located in the Bakken
and Marcellus Shales and the Powder River and Permian Basins.
The principal methodology used in these ratings was Midstream
Energy published in December 2018.
CTI BIOPHARMA: All Seven Proposals Approved at Annual Meeting
-------------------------------------------------------------
At the 2021 Annual Meeting, CTI Biopharma Corp.'s stockholders:
(1) elected Adam R. Craig, Laurent Fischer, Michael A. Metzger,
David Parkinson, Matthew D. Perry, and Reed V. Tuckson as
directors;
(2) approved an amendment to the Certificate of Incorporation to
increase the number of authorized shares;
(3) approved an amendment to the Amended and Restated 2017
Equity
Incentive Plan to increase the number of authorized shares;
(4) approved an amendment to the 2007 Employee Stock Purchase
Plan to increase the number of authorized shares;
(5) ratified Ernst & Young LLP as Independent Registered Public
Accounting Firm;
(6) approved, on an advisory basis, the 2020 Named Executive
Officer Compensation; and
(7) approved an adjournment of the Meeting if necessary or
appropriate.
About CTI BioPharma
Headquartered in Seattle, Washington, CTI BioPharma Corp. is a
biopharmaceutical company focused on the acquisition, development
and commercialization of novel targeted therapies for blood-related
cancers that offer a unique benefit to patients and their
healthcare providers. The Company concentrates its efforts on
treatments that target blood-related cancers where there is an
unmet medical need. In particular, the Company is focused on
evaluating pacritinib, its sole product candidate currently in
active development, for the treatment of adult patients with
myelofibrosis. In addition, the Company has recently started
developing pacritinib for use in hospitalized patients with severe
COVID-19, in response to the COVID-19 pandemic.
CTI Biopharma reported a net loss of $52.45 million for the year
ended Dec. 31, 2020, compared to a net loss of $40.02 million for
the year ended Dec. 31, 2019. As of March 31, 2021, the Company
had $42.79 million in total assets, $16.14 million in total
liabilities, and $26.65 million in total stockholders' equity.
Seattle, Washington-based Ernst & Young LLP, the Company's auditor
since 2018, issued a "going concern" qualification in its report
dated March 17, 2021, citing that the Company has suffered losses
from operations and has stated that substantial doubt exists about
the Company's ability to continue as a going concern.
CYPRUS MINES: Tort Advocate Will Represent Future Claimants
-----------------------------------------------------------
Leslie A. Pappas of Bloomberg Law reports that a longtime tort
victims' advocate will represent future asbestos injury claimants
in Cyprus Mines Corp.'s bankruptcy, settling a dispute over who
would fill that role.
Attorney Roger Frankel "is best suited" for the position, Judge
Laurie Selber Silverstein of the U.S. Bankruptcy Court for the
District of Delaware said in a bench ruling Tuesday. She didn't
elaborate on the reasons for her selection.
Frankel, the founding partner of Frankel Wyron LLP, has served as
legal representative for future asbestos injury claimants in the
bankruptcy of W.R. Grace, and those with personal injury claims
related to defective Takata airbags.
About Cyprus Mines Corporation
Cyprus Mines Corporation is a Delaware corporation and a
wholly-owned subsidiary of Cyprus Amax Minerals Co., which is an
indirect subsidiary of Freeport-McMoRan Inc. It currently has
relatively limited business operations, which include the ownership
of various parcels of real property, certain royalty interests that
generate de minimis revenue (e.g., less than $1,500 in each of the
past two calendar years), and the ownership of an operating
subsidiary that conducts marketing activities.
Cyprus Mines is a predecessor in the interest of Imerys Talc
America, Inc. In June 1992, Cyprus Mines sold its talc-related
assets to RTZ America Inc. (later known as Rio Tinto America, Inc.)
through a two-step process. First, Cyprus Mines transferred its
talc-related assets and liabilities (subject to minor exceptions)
to Cyprus Talc Corporation, a newly formed subsidiary of Cyprus
Mines, according to an Agreement of Transfer and Assumption, dated
June 5, 1992.
Second, Cyprus Mines sold the stock of Cyprus Talc Corporation to
RTZ according to a Stock Purchase Agreement, also dated June 5,
1992 (as amended, the "1992 SPA"). The purchase price was
approximately $79.5 million. Cyprus Talc Corporation was later
renamed Imerys Talc America, Inc. Under the 1992 ATA, the entity
now named Imerys expressly and broadly assumed the talc liabilities
of Cyprus Mines and its former subsidiaries that were in the talc
business.
Cyprus Mines filed for Chapter 11 bankruptcy protection (Bankr. D.
Del. Case No. 21-10398) on February 11, 2021, listing between $10
million and $50 million in assets, and between $1 million and $10
million in liabilities.
The Honorable Laurie Selber Silverstein is the case judge.
The Debtor tapped Reed Smith LLP, led by Kurt F. Gwynne, Esq., as
bankruptcy counsel; Kasowitz Benson Torres, LLP as special
conflicts counsel; and Prime Clerk LLC as claims agent.
James L. Patton, Jr. was appointed as the future claimants'
representative in the Debtor's Chapter 11 case. The FCR tapped
Young Conaway Stargatt & Taylor, LLP as his bankruptcy counsel and
Gilbert, LLP as his special insurance counsel.
The U.S. Trustee for Regions 3 and 9 appointed an official
committee of tort claimants on March 4, 2021. The tort committee
is represented by Caplin & Drysdale, Chartered, and Campbell &
Levine, LLC. Province, LLC, and Axlor Consulting, LLC serve as the
tort committee's financial advisor and consultant, respectively.
D4MC LLC: Voluntary Chapter 11 Case Summary
-------------------------------------------
Debtor: D4MC, LLC
13901 Midway Road
Suite 102
Dallas, TX 75244
Chapter 11 Petition Date: June 9, 2021
Court: United States Bankruptcy Court
Northern District of Texas
Case No.: 21-41371
Judge: Hon. Edward L. Morris
Debtor's Counsel: Joyce Lindauer, Esq.
JOYCE W. LINDAUER ATTORNEY, PLLC
1412 Main Street, Suite 500
Dallas, TX 75202
Tel: (972) 503-4033
E-mail: joyce@joycelindauer.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $100,000 to $500,000
The petition was signed by Tim Barton, 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/DFT6T7A/D4MC_LLC__txnbke-21-41371__0001.0.pdf?mcid=tGE4TAMA
EVOKE PHARMA: US Patent for Gimoti Now Listed in FDA Publication
----------------------------------------------------------------
Evoke Pharma, Inc.'s US patent No. 11,020,361 for Gimoti
(metoclopramide) nasal spray is now listed in the U.S. Food and
Drug Administration (FDA) publication, "Approved Drug Products with
Therapeutic Equivalence Evaluations", commonly known as the "Orange
Book". The patent covers methods of use for nasal delivery of
metoclopramide for the treatment of gastroparesis.
Gimoti is the Company's nasal spray product for the relief of
symptoms in acute and recurrent diabetic gastroparesis. FDA
approved the New Drug Application for Gimoti in June 2020. As
previously announced on June 2, 2021, the United States Patent and
Trademark Office (USPTO) issued US patent No. 11,020,361 entitled
"Nasal Formulations of Metoclopramide" for Gimoti. This new patent
is now listed in FDA's Orange Book and carries a patent term to at
least 2029.
About Evoke Pharma
Headquartered in Solana Beach, California, Evoke --
http://www.evokepharma.com-- is a specialty pharmaceutical company
focused primarily on the development of drugs to treat GI disorders
and diseases. The Company is developing Gimoti, a nasal spray
formulation of metoclopramide, for the relief of symptoms
associated with acute and recurrent diabetic gastroparesis in adult
women.
Evoke Pharma reported a net loss of $13.15 million for the year
ended Dec. 31, 2020, compared to a net loss of $7.12 million for
the year ended Dec. 31, 2019. As of March 31, 2021, the Company
had $19.29 million in total assets, $11.48 million in total
liabilities, and $7.81 million in total stockholders' equity.
BDO USA, LLP, in San Diego, California, the Company's auditor since
2014, issued a "going concern" qualification in its report dated
March 11, 2021, citing that the Company has had recurring losses
and negative cash flows from operations since inception and expects
to continue to incur net losses for the foreseeable future. The
determination as to whether the Company can continue as a going
concern includes consideration of managements operating plan and
anticipated timing of future cash flows.
FILLIT INC: Gets Interim OK on Disclosure Statement
---------------------------------------------------
Judge Christine M. Gravelle approved, on an interim basis, the
Combined Disclosure Statement and Plan of Fillit, Inc.
Judge Gravelle has set the following timetable related to the
confirmation of the Plan:
* July 6, 2021, at 4 p.m. (ET), is the Combined Disclosure
Statement and Plan Objection Deadline;
* July 9, 2021, at 4 p.m. (ET), is the deadline to file
confirmation brief and supporting evidence, and to respond to
objections to the Combined Disclosure Statement and Plan; and
* July 14, 2021, at 2 p.m. (ET), is the combined hearing on the
approval of the Disclosure Statement and confirmation of the Plan.
A copy of the order is available for free at https://bit.ly/2RBkPH1
from PacerMonitor.com.
About Fillit, Inc.
Fillit, Inc., d/b/a Fillit Corp., is engaged in activities related
to real estate.
Fillit sought Chapter 11 protection (Bankr. D.N.J. Case No.
20-23140) on November 30, 2020. In the petition signed by James
Campo, president, the Debtor was estimated to have $10 million to
$50 million in assets and $1 million to $10 million in liabilities
as of the bankruptcy filing. The Honorable Christine M. Gravelle
is the case judge. Lowenstein Sandler, LLP, led by Kenneth A.
Rosen, is the Debtor's counsel.
FTPO LLC: Seeks to Use First-Citizens Bank's Cash Collateral
------------------------------------------------------------
FTPO, LLC asked the Bankruptcy Court to authorize the use of cash
collateral in which First-Citizens Bank & Trust Company holds a
first priority lien, for the continued operation of the Debtor's
business in the ordinary course.
In June 2015, the Debtor borrowed $539,750 from the Lender,
pursuant to the terms of a Future Advance Loan Agreement, evidenced
by a Promissory Note, as modified on September 23, 2015, and
extended on April 9, 2020, pursuant to a Business & Commercial Loan
Extension Agreement.
The amount currently due under the Note is approximately $590,000.
As security for the Debtor's obligations, the Debtor granted the
Lender a mortgage on the Debtor's real property in Fort Pierce,
Florida, and the improvements thereon, pursuant to the terms of a
mortgage dated June 30, 2015, as modified on September 23, 2015.
The Debtor also granted the Lender a security interest in the rents
from the property pursuant to the terms of an Assignment of Rents,
dated June 30, 2015.
The Debtor proposed to offer the Lender a first priority
post-petition lien on all of the Debtor's cash generated
post-petition, as adequate protection of the Lender's lien.
A copy of the motion is available for free at
https://bit.ly/3co3KY3 from PacerMonitor.com.
About FTPO, LLC
FTPO, LLC is a Single Asset Real Estate debtor, as defined in
Section 101(51B) of the Bankruptcy Code. The Debtor filed a
Chapter 11 petition (Bankr. S.D. Fla. Case No. 21-15445) on June 1,
2021.
On the Petition Date, the Debtor reported $686,408 in total assets
and $3,192,633 in total liabilities. The petition was signed by
Ajay K. Goyal, manager of HRAG, LLC.
Judge Erik P. Kimball presides over the case. FurrCohen P.A. is
the Debtor's counsel.
FUELCELL ENERGY: Executive VP Jennifer Arasimowicz Resigns
----------------------------------------------------------
Jennifer D. Arasimowicz, executive vice president, general counsel,
chief administrative officer and corporate secretary of FuelCell
Energy, Inc. has elected to resign effective June 25, 2021 to
pursue an opportunity with another company. Under Jennifer's
leadership, the Company has significantly expanded its legal
capabilities and compliance functions in a manner that will assist
in the Company's plans for future growth.
"Jennifer's leadership and expertise have been critical to FuelCell
Energy's transformation," said Jason Few, president, chief
executive officer and chief commercial officer at FuelCell Energy.
"I'd like to thank Jennifer for her dedication and contributions to
the Company and we wish her all the best in her future endeavors.
Jennifer will remain a close friend of FuelCell Energy."
"I have enjoyed my time at FuelCell Energy and my working
relationships with an outstanding group of colleagues. I
appreciate the opportunities I have had at the Company and wish the
Company much success," said Jennifer Arasimowicz.
Joshua Dolger has been appointed to the positions of interim
general counsel and corporate secretary, effective June 25, 2021,
while the Board of Directors considers both internal and external
candidates for Jennifer's replacement. Joshua recently joined
FuelCell Energy from Terex Corporation where he served as Assistant
General Counsel. "Josh's experience as a senior corporate attorney
will help to enable a smooth transition and I look forward to
working more closely with Josh," said Jason Few.
About FuelCell Energy
Headquartered in Danbury, Connecticut, FuelCell Energy, Inc. --
http://www.fuelcellenergy.com-- is a global developer of
environmentally responsible distributed baseload power solutions
through its proprietary fuel cell technology. The Company targets
large-scale power users with its megawatt-class installations
globally, and currently offer sub-megawatt solutions for smaller
power consumers in Europe. The Company develops turn-key
distributed power generation solutions and operate and provide
comprehensive service for the life of the power plant.
FuelCell Energy reported a net loss attributable to common
stockholders of $92.44 million for the year ended Oct. 31, 2020, a
net loss attributable to common stockholders of $100.24 million for
the year ended Oct. 31, 2019, and a net loss attributable to common
stockholders of $62.17 million for the year ended Oct. 31, 2018. As
of Jan. 31, 2021, the Company had $552.39 million in total assets,
$165.03 million in total liabilities, $59.85 million in redeemable
series B preferred stock, and $327.51 million in total
stockholders' equity.
GIRARDI & KEESE: Trustee Can Hire Counsel to Chase Wife's Holdings
------------------------------------------------------------------
Law360 reports that Girardi Keese's bankruptcy trustee can hire a
social media-savvy lawyer who has criticized the law firm founder's
estranged wife, reality television star Erika Girardi, to
investigate whether she has assets belonging to the defunct
practice, a California federal judge ruled from the bench Tuesday,
June 8, 2021.
During a hearing in his downtown Los Angeles courtroom, U.S.
Bankruptcy Judge Barry Russell said attorney Ronald Richards can
help Girardi Keese trustee Elissa Miller of SulmeyerKupetz PC
recover assets from Erika Girardi in exchange for contingency fees
of 35% to 45%, despite Mrs. Girardi's arguments that the deal is
rife with conflicts of interest.
About Girardi & Keese
Girardi and Keese or Girardi & Keese was a Los Angeles-based law
firm founded in 1965 by lawyers Thomas Girardi and Robert Keese. It
served clients in California in a variety of legal areas. It was
known for representing plaintiffs against major corporations.
An involuntary Chapter 7 petition (Bankr. C.D. Cal. Case No.
20-21022) was filed in December 2020 against GIRARDI KEESE by
alleged creditors Jill O'Callahan, Robert M. Keese, John Abassian,
Erika Saldana, Virginia Antonio, and Kimberly Archie.
The petitioners' attorneys:
Andrew Goodman
Goodman Law Offices, Apc
Tel: 818-802-5044
E-mail: agoodman@andyglaw.com
Elissa D. Miller, a member of the firm SulmeyerKupetz, has been
appointed as Chapter 7 trustee.
The Chapter 7 trustee can be reached at:
Elissa D. Miller
333 South Grand Ave., Suite 3400
Los Angeles, California 90071-1406
Telephone: (213) 626-2311
Facsimile: (213) 629-4520
E-mail: emiller@sulmeyerlaw.com
GREAT CANADIAN: Moody's Assigns B3 CFR on Apollo Transaction
------------------------------------------------------------
Moody's Investors Service assigned a B3 Corporate Family Rating and
B3-PD Probability of Default Rating to Great Canadian Gaming
Corporation (New). At the same time, Moody's assigned B2 senior
secured ratings to the company's proposed C$650 million first lien
term loan, C$250 million revolving credit facility and C$650
million secured notes, all due 2026 and issued in US dollar
equivalents. Moody's also assigned a Caa2 senior unsecured rating
to the proposed C$400 million (USD equivalent) notes due 2027. The
outlook is stable.
Proceeds from the issuances totaling C$1.7 billion, together with
cash equity of C$1.65 billion, will fund Apollo Global Management,
Inc.'s ("Apollo") acquisition of Great Canadian in a going private
transaction totaling about C$3.7 billion.
Assignments:
Issuer: Great Canadian Gaming Corporation (New)
Probability of Default Rating, Assigned B3-PD
Corporate Family Rating, Assigned B3
Gtd. Senior Secured First Lien Term Loan, Assigned B2
Gtd. Senior Secured First Lien Revolving Credit Facility, Assigned
B2
Senior Secured Regular Bond/Debenture, Assigned B2
Senior Unsecured Regular Bond/Debenture, Assigned Caa2
Outlook Actions:
Issuer: Great Canadian Gaming Corporation (New)
Outlook, Assigned Stable
RATINGS RATIONALE
Great Canadian (B3 CFR) is constrained by: (1) high leverage, with
Moody's adjusted debt to EBITDA remaining well above 10x in 2021
before declining to around 6x by year end 2022; (2) sustained
negative free cash flow through 2022 and execution risk around
pending capital deployment at the Ontario Gaming GTA Limited
Partnership (One Toronto Gaming, "OTG"); (3) financial policy risks
under private equity ownership; and (4) longer-term social risks
including demographic shifts away from traditional casino-style
gaming. The company benefits from: (1) wide geographic
diversification across 26 properties in four provinces, with
proximity to major metropolitan areas (Toronto and Vancouver); (2)
strong market positions, including the absence of competing
operators within Ontario bundles; (3) favorable provincial
regulatory frameworks given high barriers to entry and other
supportive measures, including a capital incentive program in
British Columbia and actions in both Ontario and British Columbia
to support operations following sustained closures due to COVID-19;
and (4) a stable pre-pandemic operating track record.
The stable outlook reflects Moody's expectation that Great Canadian
will maintain adequate liquidity as operations ramp up, with
leverage declining to around 6x by year end 2022.
Great Canadian has adequate liquidity. Pro-forma for the
transaction and on a fully consolidated basis, Moody's estimates
that sources total about C$900 million compared to uses of C$250
million over the next year. At transaction close, sources will
consist of $215 million in cash on hand, full availability under
the company's C$250 million revolver due 2026, about $400 million
of available credit under the OTG's non-recourse revolving and
capital expenditures credit facilities, and a sponsor-funded equity
commitment reserve equal to six months of interest (about $40
million). The equity commitment will remain funded and cover a
six-month period of interest payments until gross gaming revenue
reaches 65% or more of 2019 baseline revenues for a consecutive
four-quarter period. Uses include negative free cash flow of close
to $230 million, $6 million in mandatory debt amortizations and
Moody's estimate of about $12 million in debt repayments under the
50% excess cash flow sweep for the restricted group, which excludes
OTG. Additional upcoming debt maturities include OTG's non-recourse
revolving and capital expenditures credit facilities due March
2023, which Moody's expect to be fully drawn at around C$1.1
billion by year end 2022 (about $610 million outstanding as of
March 2021). The company has limited flexibility to generate
liquidity from asset sales.
The revolving credit facility is subject to a springing net first
lien leverage ratio when drawings exceed $87 million. While Moody's
do not expect the company to utilize the facility over the next
twelve months, it would remain in compliance given flexibility
under the credit agreement while operations are ramping back up.
Compliance with the springing covenant is not required until after
four full fiscal quarters following the close of the transaction,
or earlier, if restricted group revenues reach 85% or more of 2019
baseline levels in any corresponding quarter. During the period the
springing is exempt from being tested, Great Canadian will be
required to maintain minimum liquidity of at least C$150 million,
which includes unused capacity under the revolver and cash and cash
equivalents, excluding cage cash.
Great Canadian's secured first lien facilities are rated B2, one
notch above the B3 CFR, reflecting higher recovery in the capital
structure. The unsecured notes are rated two notches below the CFR
at Caa2, reflecting their junior position behind the secured debt,
which includes 50% of OTG's secured debt.
As proposed, the new credit facility is expected to provide
covenant flexibility that if utilized could negatively impact
creditors. Notable terms include the following: (1) incremental
debt capacity up to the sum of (x) the greater of C$312 million and
1x of LTM EBITDA, (y) plus unlimited secured amounts so long as net
first lien leverage ratio (excluding cage cash) does not exceed 4x.
Amounts up to the greater of C$312 million and 1x of LTM EBITDA may
be incurred with an earlier maturity date than the initial term
loans; (2) There are no express "blocker" provisions which prohibit
the transfer of specified assets to unrestricted subsidiaries; such
transfers are permitted subject to carve-out capacity and other
conditions; (3) Non-wholly owned subsidiaries are not required to
provide guarantees; dividends or transfers resulting in partial
ownership of subsidiary guarantors could jeopardize guarantees,
with no explicit protective provisions limiting such guarantee
releases; (4) 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.
Great Canadian remains highly exposed to social risks arising from
the direct impact of the COVID-19 outbreak on business operations
as well as the health and safety of patrons and employees, which
has led to prolonged casino closures and operations at reduced
capacity to comply with social distancing requirements. The company
also has exposure to social risks relating to demographic changes
and shifting consumer preferences as younger generations are less
likely to access traditional casino-style gaming (particularly more
profitable slot machines). Great Canadian has a strategy focused on
modernizing its properties and developing attractive food &
beverage and live entertainment to appeal to a broader customer
base and more casual gamers.
Potential changes in gaming regulation to address social issues
such as problem gambling and crime prevention represents additional
risks that could also impact profitability and set precedents for
new regulations across provinces. Data security and customer
privacy risks are also elevated and in the event of a breach, the
company could face higher operational costs to secure processes and
limit reputational damage. Risks around regulatory shifts and data
security are partially mitigated by well-established internal
controls and geographic diversification across Canada.
Governance considerations include risks associated with private
equity ownership under Apollo and the potential for financial
strategies and policies that favor shareholders, including high
financial leverage and debt-funded shareholder distributions.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The ratings could be upgraded if Great Canadian maintains Moody's
adjusted debt/EBITDA comfortably below 6x (well over 10x expected
during 2021) and EBIT/interest above 2x (0x expected in 2021) while
generating positive free cash flow and maintaining good liquidity.
The ratings could be downgraded if liquidity weakens or operational
performance is impacted by a slower than anticipated recovery, if
Moody's adjusted debt/EBITDA remains above 8x in 2022 (well over
10x expected during 2021) or if EBIT/interest declines to under 1x
(0x expected in 2021). The ratings could also be downgraded if
there is delay in refinancing the non-recourse facilities at the
GTA joint venture.
Great Canadian Gaming Corporation, headquartered in Ontario, is a
gaming and entertainment operator with 26 properties located in
British Columbia, Ontario, Nova Scotia, and New Brunswick,
including over 19,000 slot machines, over 700 table games, 65
dining amenities and over 500 hotel rooms. Upon closure of the
transaction, Great Canadian will be majority owned by Apollo Global
Management.
The principal methodology used in these ratings was Gaming
Methodology published in October 2020.
GTT COMMUNICATIONS: Deadline to File Financials Extended to June 17
-------------------------------------------------------------------
GTT Communications, Inc. received a notice on behalf of the New
Term Loan Facility Required Lenders consenting to an extension of
the deadlines under the Priming Facility Credit Agreement to
deliver the Company's audited consolidated financial statements for
the fiscal year ended Dec. 31, 2020 and unaudited consolidated
financial statements for the fiscal quarter ended March 31, 2021 to
June 17, 2021.
GTT previously entered into that certain Priming Facility Credit
Agreement, among the Company, GTT Communications B.V., the lenders
party thereto and Delaware Trust Company, as administrative agent.
The Priming Facility Credit Agreement provides for a priming term
loan facility consisting of initial and delayed draw term loans in
a principal amount of up to $275,000,000 (the "New Term Loan
Facility"). On March 29, 2021, the Company, GTT B.V., the PTL
Lenders party thereto and the PTL Agent entered into that certain
Second Amendment to Priming Facility Credit Agreement. The Second
PTL Amendment, among other things, extended the deadline to deliver
the Company's audited consolidated financial statements under the
Priming Facility Credit Agreement for the fiscal year ended Dec.
31, 2020 to April 15, 2021 and provided that PTL Lenders holding a
majority of the loans and commitments under the New Term Loan
Facility may further extend such deadline by notice to the Company.
On April 12, 2021, the Company received a notice on behalf of PTL
Lenders constituting New Term Loan Facility Required Lenders
consenting to an extension of the deadline to deliver the Company's
audited consolidated financial statements under the Priming
Facility Credit Agreement for the fiscal year ended Dec. 31, 2020
to April 22, 2021. On April 20, 2021, the Company received a
notice on behalf of PTL Lenders constituting New Term Loan Facility
Required Lenders consenting to an extension of such deadline to May
3, 2021. On April 30, 2021, the Company received a notice on
behalf of PTL Lenders constituting New Term Loan Facility Required
Lenders consenting to a further extension of such deadline to May
10, 2021.
As previously disclosed, on May 10, 2021, the Company, GTT B.V.,
the PTL Lenders party thereto constituting New Term Loan Facility
Required Lenders and the PTL Agent entered into that certain Third
Amendment to Priming Facility Credit Agreement. The Third PTL
Amendment, among other things, extended the deadlines under the
Priming Facility Credit Agreement to deliver (i) the Company's
audited consolidated financial statements for the fiscal year ended
Dec. 31, 2020 to May 17, 2021 and (ii) the Company's unaudited
consolidated financial statements for the fiscal quarter ended
March 31, 2021 to May 17, 2021. On May 17, 2021, the Company, GTT
B.V., the PTL Lenders party thereto constituting New Term Loan
Facility Required Lenders and the PTL Agent entered into that
certain Fourth Amendment to Priming Facility Credit Agreement. The
Fourth PTL Amendment, among other things, further extended the
deadlines under the Priming Facility Credit Agreement to deliver
the Company's audited consolidated financial statements for the
fiscal year ended Dec. 31, 2020 and unaudited consolidated
financial statements for the fiscal quarter ended March 31, 2021 to
June 3, 2021 and provided that PTL Lenders constituting New Term
Loan Facility Required Lenders may further extend each of these
deadlines by notice to the Company.
Extension of Second Notes Forbearance Agreement
As previously disclosed, on Dec. 28, 2020, the Company and the
guarantors under that certain Indenture, dated as of Dec. 22, 2016,
by and between the Company, as successor by merger to GTT Escrow
Corporation, and Wilmington Trust, National Association, as
Trustee, entered into that certain Noteholder Forbearance Agreement
with certain beneficial owners (or nominees, investment managers,
advisors or subadvisors for the beneficial owners) of a majority of
the outstanding aggregate principal amount of the Company's
outstanding 7.875% Senior Notes due 2024. Pursuant to the Second
Notes Forbearance Agreement, the Forbearing Noteholders agreed to,
among other provisions, forbear from exercising any and all rights
and remedies under the Indenture, the Notes and applicable law,
including not directing the Trustee to take any such action, with
respect to defaults and events of default that have occurred, or
that may occur as a result of, (i) the Company's failure to timely
file its Quarterly Reports on Form 10-Q for the quarters ended June
30, 2020 and Sept. 30, 2020 and (ii) the occurrence and continuance
of the "Lender Specified Defaults" as defined in the applicable
forbearance agreement with respect to the Credit Agreement, in each
case until the earlier of (a) 5:00 p.m., New York City time, on
March 31, 2021 and (b) the receipt of notice from Forbearing
Noteholders regarding their intent to terminate the Second Notes
Forbearance Agreement upon the occurrence of certain specified
forbearance defaults. The Second Notes Forbearance Agreement may
be amended with the consent of Forbearing Noteholders holding more
than 66.7% of the aggregate principal amount of the Notes held by
all Forbearing Noteholders, provided that at least two of such
consenting Forbearing Noteholders are unaffiliated.
As previously disclosed, on March 29, 2021, the Company and the
Guarantors entered into that certain First Amendment to Noteholder
Forbearance Agreement with Forbearing Noteholders constituting
Requisite Forbearing Noteholders. The Second Notes Forbearance
Agreement Amendment No. 1, among other things, (i) provided that in
addition to the matters originally subject to forbearance in the
Second Notes Forbearance Agreement, the Forbearing Noteholders will
forbear from exercising any and all rights and remedies under the
Indenture, the Notes and applicable law, including not directing
the Trustee to take any such action, with respect to defaults and
events of default that have occurred, or that may occur as a result
of, the Company's failure to timely file its Annual Report on Form
10-K for the fiscal year ended Dec. 31, 2020 and (ii) amended the
scheduled expiration time under the Second Notes Forbearance
Agreement to 5:00 p.m., New York City time, on April 15, 2021. On
April 12, 2021, the Company received a notice on behalf of
Forbearing Noteholders constituting Requisite Forbearing
Noteholders consenting to an extension of the scheduled expiration
time under the Second Notes Forbearance Agreement to 5:00 p.m., New
York City time, on April 22, 2021. On April 19, 2021, the Company
received a notice on behalf of Forbearing Noteholders constituting
Requisite Forbearing Noteholders consenting to an extension of the
scheduled expiration time under the Second Notes Forbearance
Agreement to 5:00 p.m., New York City time, on May 3, 2021. On
April 28, 2021, the Company received a notice on behalf of
Forbearing Noteholders constituting Requisite Forbearing
Noteholders consenting to an extension of the scheduled expiration
time under the Second Notes Forbearance Agreement to 5:00 p.m., New
York City time, on May 10, 2021. On May 10, 2021, the Company and
the Guarantors entered into that certain Second Amendment to
Noteholder Forbearance Agreement with Forbearing Noteholders
constituting Requisite Forbearing Noteholders. The Second Notes
Forbearance Agreement Amendment No. 2, among other things, amended
the scheduled expiration time under the Second Notes Forbearance
Agreement to 5:00 p.m., New York City time, on May 17, 2021. On
May 17, 2021, the Company and the Guarantors entered into that
certain Third Amendment to Noteholder Forbearance Agreement with
Forbearing Noteholders constituting Requisite Forbearing
Noteholders. The Second Notes Forbearance Agreement Amendment No.
3, among other things, (i) provided that in addition to the matters
subject to forbearance in the Second Notes Forbearance Agreement as
previously amended, the Forbearing Noteholders will forbear from
exercising any and all rights and remedies under the Indenture, the
Notes and applicable law, including not directing the Trustee to
take any such action, with respect to defaults and events of
default that have occurred, or that may occur as a result of, the
Company's failure to timely file its Quarterly Report on Form 10-Q
for the quarter ended March 31, 2021 and (ii) amended the scheduled
expiration time under the Second Notes Forbearance Agreement to
5:00 p.m., New York City time, on the Prior Expiration Date.
On May 28, 2021, the Company received a notice on behalf of the
Requisite Forbearing Noteholders consenting to an extension of the
scheduled expiration time under the Second Notes Forbearance
Agreement to 5:00 p.m., New York City time, on the New Expiration
Date.
Amendment to Fourth Credit Facilities
Forbearance Agreement
As previously disclosed, on May 10, 2021, the Company, GTT B.V. and
the other credit parties party thereto entered into that certain
Fourth Lender Forbearance Agreement and Amendment No. 5 to Credit
Agreement with (1) lenders holding (a) a majority of the
outstanding loans and revolving commitments and (b) a majority of
the revolving commitments under that certain Credit Agreement,
dated as of May 31, 2018, by and among the Company and GTT B.V., as
borrowers, KeyBank National Association, as administrative agent
and letter of credit issuer, and the lenders and other financial
institutions party thereto from time to time, (2) certain hedge
providers to the Company and (3) the Agent. Pursuant to the Fourth
Credit Facilities Forbearance Agreement, the Consenting Lenders
agreed to, among other things, forbear from exercising any and all
rights and remedies under the Loan Documents (as defined in the
Credit Agreement), any secured hedge agreement with the Secured
Hedge Providers and applicable law, including not directing the
Agent to take any such action, with respect to certain defaults and
events of default under the Credit Agreement and certain events of
default under any Secured Hedge Agreement (as applicable) that have
occurred, or that may occur as a result of, (i) the Company's
failure to timely file the Q2 Form 10-Q, the Q3 Form 10-Q, the 2020
Form 10-K and the Q1 2021 Form 10-Q, and related compliance
certificates, (ii) any amendment, supplement, modification,
restatement and/or withdrawal or public statement of non-reliance
on (A) any audit opinion related to historical consolidated
financial statements or (B) historical consolidated financial
statements and (iii) the occurrence and continuance of the
"Noteholder Specified Defaults" as defined in the Second Notes
Forbearance Agreement, in each case until the earlier of (a) 5:00
p.m., New York City time, on May 17, 2021 and (b) the receipt of
notice regarding intent to terminate the Fourth Credit Facilities
Forbearance Agreement from Consenting Lenders upon the occurrence
of any of the specified forbearance defaults as further described
under the heading "Third Credit Facilities Forbearance Agreement"
in the Company's Current Report on Form 8-K filed with the
Securities and Exchange Commission on March 30, 2021. The Fourth
Credit Facilities Forbearance Agreement may be amended with the
consent of (i) Required Lenders and (ii) Required Revolving Lenders
(except that the extension of the forbearance period with respect
to any of the Secured Hedge Providers requires the consent of such
Secured Hedge Provider). On May 14, 2021 and May 16, 2021, the
Company received notices on behalf of Lenders constituting Required
Revolving Lenders and Required Lenders, respectively, consenting to
an extension of the scheduled expiration time under the Fourth
Credit Facilities Forbearance Agreement to 5:00 p.m., New York City
time, on the Prior Expiration Date.
On June 2, 2021, the Company, GTT B.V. and the other credit parties
party thereto entered into that certain First Amendment to Fourth
Lender Forbearance Agreement with Lenders constituting Required
Lenders and Required Revolving Lenders. The Fourth Lender
Forbearance Agreement Amendment No. 1, among other things, (i)
amends the scheduled expiration time under the Fourth Lender
Forbearance Agreement to 5:00 p.m., New York City time, on the New
Expiration Date, (ii) adds a forbearance default for the completion
of the pending infrastructure sale transaction announced by the
Company on Oct. 16, 2020 earlier than 20 business days after the
last condition set forth in that certain Sale and Purchase
Agreement, dated as of Oct. 16, 2020, among the Company, its
subsidiaries GTT Holdings Limited, Global Telecom and Technology
Holdings Ireland Limited, Hibernia NGS Limited and GTT Americas,
LLC (collectively, and Cube Telecom Europe Bidco Limited, as
amended by the Project Apollo - KPMG VDD Reports Deadline Extension
Letter dated as of Feb. 15, 2021, is satisfied or waived without
prior consent of Consenting Lenders constituting Required Lenders
and Required Revolving Lenders and (iii) amends certain consent
rights of, and certain notice delivery requirements to, the Agent,
certain Lenders and the advisors to the Consenting Lenders. The
Company paid fees and expenses of certain advisors to the
Consenting Lenders and the Agent in connection with the entry into
the Fourth Lender Forbearance Agreement Amendment No. 1.
As reported by the Company in its prior filings with the SEC, the
Company has been unable to file on a timely basis the Q2 Form 10-Q,
the Q3 Form 10-Q, the 2020 Form 10-K and the Q1 2021 Form 10-Q. In
addition, as further described in the Company's Current Report on
Form 8-K filed on Dec. 22, 2020, in connection with the Company's
previously disclosed review of certain accounting issues, the
Company's board of directors concluded that the Company's
previously issued consolidated financial statements for the years
ended
Dec. 31, 2019, 2018 and 2017, each of the quarters during the years
ended Dec. 31, 2019 and 2018 and the quarter ended March 31, 2020
and certain related disclosures should no longer be relied upon.
The Company is preparing restated financial statements relating to
the Non-Reliance Periods, which Restated Financial Statements will
be needed to produce the Q2 Form 10-Q, the Q3 Form 10-Q, the 2020
Form 10-K and the Q1 2021 Form 10-Q.
The Company does not expect to be able to file the Q2 Form 10-Q,
the Q3 Form 10-Q, the 2020 Form 10-K or the Q1 2021 Form 10-Q by
the New Expiration Date, and the Company is unable to predict a
specific filing date for the Q2 Form 10-Q, the Q3 Form 10-Q, the
2020 Form 10-K or the Q1 2021 Form 10-Q at this time. The Company
intends to work diligently to file the Restated Financial
Statements, the Q2 Form 10-Q, the Q3 Form 10-Q, the 2020 Form 10-K
and the Q1 2021 Form 10-Q as soon as possible.
About GTT
Headquartered in McLean, Virginia, GTT Communications, Inc. --
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.
GUARDION HEALTH: Closes Acquisition of Activ Nutritional
--------------------------------------------------------
Guardion Health Sciences, Inc. announced the closing of the first
acquisition in its strategy to more widely compete in the clinical
nutrition market. The Company closed on the recently announced
Equity Purchase Agreement with Adare Pharmaceuticals, Inc. to
acquire all of the equity of Activ Nutritional, LLC for a cash
payment of $26 million, subject to certain adjustments. Activ
Nutritional, LLC, is a subsidiary of Adare Pharmaceuticals, Inc.
and manufacturer of the Viactiv line of chewable mineral
supplements for bone health and other applications.
Currently marketed through many of the nation's largest retailers,
including, among others, Walmart (retail and online), Target, CVS
and Amazon, the Viactiv product lines are expected to become
Guardion's most prominent product lines, as well as to provide
access to significant opportunities in the short-term for growth
and expansion.
Bret Scholtes, Guardion's president and chief executive officer,
commented, "Management is focusing on the future of Guardion. The
conclusion of this acquisition is the first in what we hope will be
multiple value-added transactions to transform Guardion into a
market leader in clinically supported nutrition. This acquisition
satisfies a number of our current requirements as we continue to
reconfigure our role in the clinical nutrition marketplace. Activ
Nutritional has an established brand and presence from which we can
significantly expand our capabilities in terms of marketing,
product lines and new distribution channels. Activ Nutritional
will also provide a significant boost to our current operating
revenues and contribute substantially to our efforts to achieve
operational profitability. This transaction expands our reach
beyond ocular health, which has long been our primary focus, and
allows us to more easily explore the possibility of participating
in the wider world of clinical nutrition to compete in a more
substantial and impactful way. It also positions us to more
adeptly identify additional opportunities to expand our presence in
the market, whether through improved commercialization of our
current products and product pipeline or through other acquisitions
and other strategic transactions."
Corporate Finance Associates acted as the exclusive investment
banker and strategic financial advisor to Guardion. CFA's advisory
team was led by Daniel E. Sirvent, managing director and Global
Head of Healthcare Investment Banking, and Joseph P. Sands, Global
Head of Consumer/Retail Investment Banking. CFA is one of the
largest and most experienced middle market investment banking firms
in the nation. Additional information about Corporate Finance
Associates may be found on their website at www.cfaw.com.
Stout provided transaction and valuation advisory services,
including due diligence analysis and other technical support.
Sheppard, Mullin, Richter & Hampton LLP is serving as Guardion's
legal advisor.
About Guardion Health Sciences
Headquartered in San Diego, California, Guardion --
http://www.guardionhealth.com-- is a specialty health sciences
company that develops clinically supported nutrition, medical foods
and medical devices, with a focus in the ocular health marketplace.
Located in San Diego, California, the Company combines targeted
nutrition with innovative, evidence-based diagnostic technology.
Guardion Health reported a net loss of $8.57 million for the year
ended Dec. 31, 2020, compared to a net loss of $10.88 million for
the year ended Dec. 31, 2019. As of March 31, 2021, the Company
had $44.70 million in total assets, $1.21 million in total
liabilities, and $43.49 million in total stockholders' equity.
GUI-MER-FE: Taps Lube & Soto Law Offices as Legal Counsel
---------------------------------------------------------
GUI-MER-FE, Inc. seeks approval from the U.S. Bankruptcy Court for
the District of Puerto Rico to hire Lube & Soto Law Offices, PSC to
serve as legal counsel in its Chapter 11 case.
The firm's hourly rates are as follows:
Madeline Soto Pacheco, Esq. $250 per hour
Teresa M. Lube Capo, Esq. $250 per hour
Paralegals $85 per hour
The Debtor paid $5,000 to the law firm as a retainer and $1,738 as
the Chapter 11 filing fee.
Madeline Soto Pacheco, Esq., and. Teresa Lube Capo, Esq., disclosed
in court filings that their firm is a "disinterested persons" as
the term is defined in Section 101(14) of the Bankruptcy Code.
The law firm can be reached at:
Madeline Soto Pacheco, Esq.
Teresa M. Lube Capo, Esq.
Lube & Soto Law Offices, PSC
1130 F.D. Roosevelt Avenue
San Juan, PR 00920-2906
Tel: 787.841.1704
Email: madelinesotopacheco@yahoo.com
About GUI-MER-FE
GUI-MER-FE, Inc. sought Chapter 11 protection (Bankr. D. P.R. Case
No. 21-01659) on May 27, 2021. At the time of the filing, Debtor
disclosed total assets of between $100,000 and $500,000 and total
liabilities of between $1 million and $10 million. Mercedes Garcia
Reyes, president, signed the petition. Lube & Soto Law Offices,
PSC is the Debtor's legal counsel.
HERTZ CORP: Moody's Assigns 'B3' CFR & Rates First Lien Loans 'B2'
------------------------------------------------------------------
Moody's Investors Service assigned The Hertz Corporation the
following ratings: Corporate Family Rating -- B3; $1.3 billion
senior secured term loan B -- B2; $245 million senior secured term
loan C -- B2; $1.26 billion senior secured revolving credit
facility -- B2; and, Speculative Grade Liquidity rating -- SGL-3.
The outlook is stable.
The ratings are assigned in anticipation that Hertz's Plan of
Reorganization will be confirmed and that the company will emerge
from bankruptcy over the very near term. The ratings will be
withdrawn if the plan is not confirmed or if emergence does not
occur.
RATINGS RATIONALE
The ratings reflect: (1) the operating efficiencies and cost
reductions Hertz achieved while operating in bankruptcy; (2) a
capital structure and liquidity profile that will enable the
company to fund its rental fleet through the
fleet-expansion/fleet-reduction cycle characteristic of the car
rental industry; and (3) the outlook for healthy demand, pricing
and used vehicle prices into 2022.
Despite these positive factors, Hertz will exit bankruptcy with a
highly-leveraged capital structure, with pro forma debt/EBITDA of
5.0x for the twelve months ending June 2021, declining to
approximately 4.5x by year end 2021. Hertz's capital structure upon
emergence will consist of approximately $1.5 billion in first lien
corporate debt, and $7 billion in ABS conduit facilities. Notably,
the advance rates on the ABS are lower than that of the
pre-pandemic structure, and that will result in a lower amount of
debt per vehicle.
Also, Hertz lost overall market share as domestic competitors have
been able to add corporate business in both the on-airport and the
off-airport sectors.
Nonetheless, fundamentals for the car rental business improved
during late 2020 and into 2021 at a rate better than Moody's
expected. The rating agency expects healthy daily rental rates,
improving air travel, and robust used car prices will continue
through 2021.
Hertz will benefit from these favorable market conditions, as the
company has significantly reduced its operating costs from programs
initiated prior to the covid pandemic and that were continued
through 2021. The bankruptcy process also facilitated the company's
ability to abrogate uneconomic contracts. This should support some
improvement in Hertz's post-emergence results.
Hertz's liquidity, reflected by the Speculative Grade Liquidity
Rating of SGL-3, will be adequate to fund its fleet requirements
based on an undrawn $1.2 billion revolving credit facility and a $3
billion ABS conduit facility. Over the intermediate term, financial
covenants in the term loan and revolving credit facilities require
Hertz to maintain minimum liquidity levels (varying over time
between $500 million and $400 million) that are achievable.
The B2 ratings for the term loan and revolving credit facilities,
one notch higher than the CFR, reflect their first-lien security
position in substantially all of the assets of Hertz and its
guarantor subsidiaries. However, these facilities amount to $2.8
billion, and they represent a substantial portion of Hertz's
non-ABS liabilities. As a result, there is limited capacity to
increase secured debt without adding unsecured liabilities as doing
so could pressure the secured debt rating down to the same level as
the CFR.
As proposed, the new credit facilities are expected to provide
covenant flexibility that if utilized could negatively impact
creditors. Notable terms include the following: Incremental
capacity up to the greater of $635m and 100% of adjusted EBITDA,
plus unlimited amounts subject to pro forma first lien net leverage
ratio = 3.00x; amounts up to the greater of $635m and 100% of
adjusted EBITDA may be incurred with an earlier maturity than the
initial 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 the
disposition of Core Intellectual Property ("Hertz," "Dollar," and
"Thrifty" branding) by restricted subsidiaries, other than (i) in
connection with any license, sublicense or other grant of rights
associated with any Core Intellectual Property in the ordinary
course of business or in connection with any franchise, JV or
similar arrangement, or (ii) lapse or abandonment of IP not
practicable to maintain. Non-wholly-owned subsidiaries are not
required to provide guarantees; dividends or transfers resulting in
partial ownership of subsidiary guarantors could jeopardize
guarantees, with no explicit protective provisions limiting such
guarantee release. There are no express protective provisions
prohibiting an up-tiering transaction.
The stable outlook reflects Moody's expectation that Hertz will
maintain a sustainable competitive position and an adequate
liquidity profile despite the potential for long-term volatility in
car rental demand and used car pricing.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The ratings could be upgraded if Hertz is able to reduce year end
debt to EBITA to be sustainably below 4x. An upgrade would also be
based on Moody's expectation of continuous improved in operating
disciplines already achieved, as evidenced by US utilization rates
of approximately 75% and EBITDA/interest sustained above 4x, as
well as a liquidity position that comfortably covers seasonal fleet
expansion requirements.
The ratings could be downgraded if Moody's expects an erosion in
the operating or liquidity position, which could reflected by
year-end debt/EBITDA above 5x or EBITDA/interest nearing 3x, or
weakening liquidity that leads to limitations on ability to fund
the significant seasonal capex. An increase in the non-ABS,
first-lien secured debt without additional first loss claims could
pressure the B2 senior secured rating to being downgraded to the
same level as the CFR which is currently B3.
Hertz's principal environmental exposure arises from its storage of
petroleum products such as gasoline, diesel fuel and motor and
waste oils. Moody's expect Hertz will remain in compliance with all
related requirements. Hertz also maintains adequate relationships
with its employees, regulatory bodies and the communities in which
it operates. The key governance risk is Hertz's financial strategy
which employs a considerable amount to debt to fund the maintenance
and the annual expansion its vehicle fleet. This heavy reliance on
debt increases the company's vulnerability to operational stress
and to factors that could limit its access to needed funding.
The following rating actions were taken:
Assignments:
Issuer: Hertz Corporation (The)
Corporate Family Rating, Assigned B3
Probability of Default Rating, Assigned B3-PD
Speculative Grade Liquidity Rating, Assigned SGL-3
Senior Secured Term Loan B, Assigned B2 (LGD3)
Senior Secured Term Loan C, Assigned B2 (LGD3)
Senior Secured Revolving Credit Facility, Assigned B2 (LGD3)
The Hertz Corporation, headquartered in Estero, Florida, is the
third largest car rental company in the US, with annual revenues of
approximately $6 billion.
The principal methodology used in these ratings was Equipment and
Transportation Rental Industry published in April 2017.
HIGHLAND CAPITAL: Court Sanctions Ex- CEO for Stay-Away Violation
-----------------------------------------------------------------
Daniel Gill of Bloomberg Law reports that Highland Capital
Management LP won a $450,000 award against its former CEO James
Dondero for violating a court order to stay away from the bankrupt
investment company's affairs.
Highland's Chapter 11 case, pending for almost two years, has been
marked by the company's falling out and heated battle with Dondero
over issues regarding management and bankruptcy proceedings.
The case had become "very much like a nasty divorce," Judge Stacey
G. C. Jernigan of the U.S. Bankruptcy Court for the Northern
District of Texas said in an order Monday, June 7, 2021.
About Highland Capital Management
Highland Capital Management, LP was founded by James Dondero and
Mark Okada in Dallas in 1993. Highland Capital is the world's
largest non-bank buyer of leveraged loans in 2007. It also manages
collateralized loan obligations. In March 2007, it raised $1
billion to buy distressed loans. Collateralized loan obligations
are created by bundling together loans and repackaging them into
new securities.
Highland Capital Management sought Chapter 11 protection (Bank. D.
Del. Case No. 19-12239) on Oct. 16, 2019. On Dec. 4, 2019, the case
was transferred to the U.S. Bankruptcy Court for the Northern
District of Texas and was assigned a new case number (Bank. N.D.
Texas Case No. 19-34054). Judge Stacey G. Jernigan is the case
judge.
At the time of the filing, Highland had between $100 million and
$500 million in both assets and liabilities.
The Debtor tapped Pachulski Stang Ziehl & Jones LLP as bankruptcy
counsel, Foley & Lardner LLP as special Texas counsel, and Teneo
Capital, LLC as litigation advisor. Kurtzman Carson Consultants,
LLC is the claims and noticing agent.
The U.S. Trustee for Region 6 appointed a committee of unsecured
creditors on Oct. 29, 2019. The committee tapped Sidley Austin LLP
and Young Conaway Stargatt & Taylor LLP as bankruptcy counsel, and
FTI Consulting, Inc. as financial advisor.
HOPLITE INC: Taps Howard Grobstein as Financial Consultant
----------------------------------------------------------
Hoplite, Inc. and Hoplite Entertainment, Inc. seek approval from
the U.S. Bankruptcy Court for the Central District of California to
hire Howard Grobstein, a certified public accountant practicing in
California, as financial consultant.
Mr. Grobstein will provide services in connection with the Debtors'
Chapter 11 cases, which include:
(a) guiding the actions of the Debtors with regard to the
requirements of the bankruptcy court, Bankruptcy Code, Federal
Rules of Bankruptcy Procedure and the Office of the United States
Trustee as they pertain to the Debtors;
(b) exercising the rights of the Debtors with regard to
certain claims, rights, and remedies of their bankruptcy estates
and the rights, claims, and interests of creditors;
(c) conducting negotiations and assisting in the preparation
of documents necessary for the successful sale of the Debtors'
property and adjustment of any claims;
(d) deciding the positions of the Debtors in any proceeding or
hearing in the bankruptcy court involving their estate;
(e) preparing or assisting in the preparation of reports,
applications, pleadings and orders including, but not limited to,
pleadings with respect to the Debtor's use, sale or lease of
property outside the ordinary course of business; and
(f) other financial consulting services.
Mr. Grobstein and his firm will be paid at these rates:
Partners $325 - $525 per hour
Managers & Directors $225 - $375 per hour
Staff & Senior Accountants $85 - $295 per hour
Para-Professionals $85 - $135 per hour
As disclosed in court filings, Howard Grobstein is a "disinterested
person" as the term is defined in Section 101(14) of the Bankruptcy
Code.
Mr. Grobstein can be reached at:
Howard Grobstein
Grobstein Teeple LLP
6300 Canoga Avenue, Suite 1500W
Woodland Hills, CA 91367
Phone: 818.532.1020
About Hoplite Inc. and Hoplite
Entertainment Inc.
Hoplite Entertainment Inc., a performing arts company in Los
Angeles, sought protection under Chapter 11 of the Bankruptcy Code
(Bankr. C.D. Calif. Case No. 21-12546) on March 30, 2021. On April
1, 2021, Hoplite Inc., a Los Angeles-based affiliate of Hoplite
Entertainment, filed a Chapter 11 petition (Bankr. C.D. Calif. Case
No. 21-12663). Judge Ernest M. Robles oversees the cases.
At the time of the filing, Hoplite Entertainment disclosed total
assets of up to $50,000 and liabilities of up to $10 million while
Hoplite Inc. disclosed total assets of up to $50,000 and
liabilities of up to $50 million.
The Debtors tapped the Law Offices of Richard T. Baum as legal
counsel. Sierra Constellation Partners and Howard Grobstein of
Grobstein Teeple, LLP serve as the Debtors' investment banker and
financial consultant, respectively.
HOVNANIAN ENTERPRISES: Posts $488.7M Net Income in Second Quarter
-----------------------------------------------------------------
Hovnanian Enterprises, Inc. filed with the Securities and Exchange
Commission its Quarterly Report on Form 10-Q disclosing net income
of $488.68 million on $703.16 million of total revenues for the
three months ended April 30, 2021, compared to net income of $4.08
million on $538.35 million of total revenues for the three months
ended April 30, 2020.
For the six months ended April 30, 2021, the Company reported net
income of $507.64 million on $1.28 billion of total revenues
compared to a net loss of $5.07 million on $1.03 billion of total
revenues for the same period in 2020.
As of April 30, 2021, the Company had $2.34 billion in total
assets, $2.27 billion in total liabilities, and $72.71 million in
total equity.
Hovanian said, "Our operations consist primarily of residential
housing development and sales in the Northeast (New Jersey and
Pennsylvania), the Mid-Atlantic (Delaware, Maryland, Virginia,
Washington D.C. and West Virginia), the Midwest (Illinois and
Ohio), the Southeast (Florida, Georgia and South Carolina), the
Southwest (Arizona and Texas) and the West (California). In
addition, we provide certain financial services to our homebuilding
customers."
"We have historically funded our homebuilding and financial
services operations with cash flows from operating activities,
borrowings under our credit facilities, the issuance of new debt
and equity securities and other financing activities. Due to
covenant restrictions in our debt instruments, we are currently
limited in the amount of debt we can incur that does not qualify as
refinancing indebtedness, even if market conditions, including
then-current market available interest rates (in recent years, we
have not been able to access the traditional capital and bank
lending markets at competitive interest rates due to our highly
leveraged capital structure), would otherwise be favorable, which
could also impact our ability to grow our business."
A full-text copy of the Form 10-Q is available for free at:
https://www.sec.gov/ix?doc=/Archives/edgar/data/357294/000143774921014176/hov20210430_10q.htm
About Hovnanian Enterprises
Hovnanian Enterprises, Inc., founded in 1959 by Kevork S. Hovnanian
and headquartered in Matawan, New Jersey, designs, constructs,
markets, and sells single-family detached homes, attached townhomes
and condominiums, urban infill, and active lifestyle homes in
planned residential developments. The Company is a homebuilder
with operations in Arizona, California, Delaware, Florida, Georgia,
Illinois, Maryland, New Jersey, Ohio, Pennsylvania, South Carolina,
Texas, Virginia, Washington, D.C. and West Virginia. The
Company's
homes are marketed and sold under the trade names K. Hovnanian
Homes, Brighton Homes.
Hovnanian Enterprises reported net income of $50.93 million for the
year ended Oct. 31, 2020, compared to a net loss of $42.12 million
for the year ended Oct. 31, 2019. As of Oct. 31, 2020, the Company
had $1.82 billion in total assets, $2.26 billion in total
liabilities, and a total deficit of $436.09 million.
* * *
As reported by the TCR on Feb. 10, 2020, S&P Global Ratings raised
its issuer credit rating on U.S.-based homebuilder Hovnanian
Enterprises Inc. to 'CCC+' from 'SD' because it believes the
company has completed exchange offers that it viewed as
distressed.
In November 2019, Moody's Investors Service downgraded Hovnanian
Enterprises' Corporate Family Rating to Caa2 from Caa1. The rating
action was prompted by a series of refinancing transactions
completed and contemplated by Hovnanian that Moody's deems to be
distressed exchanges.
HUMAN HOUSING: Seeks to Hire Goldberg Simpson as Legal Counsel
--------------------------------------------------------------
Human Housing Henrietta Hyatt, LLC seeks approval from the U.S.
Bankruptcy Court for the Western District of Kentucky to employ
Goldberg Simpson, LLC to serve as legal counsel in its Chapter 11
case.
The firm's services include:
a. advising the Debtor regarding its obligations under the
Bankruptcy Code;
b. filing pleadings and taking those actions necessary to
administer the Debtor's estate, including the filing of adversary
proceedings and claims objections; and
c. other legal services necessary to formulate and obtain
confirmation of the Debtor's Chapter 11 plan.
Mark Sandlin, Esq., the firm's attorney who will be handling the
case, will be paid at the rate of $175 per hour.
Goldberg Simpson will receive reimbursement for out-of-pocket
expenses incurred.
Mr. Sandlin 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.
Goldberg Simpson may be reached at:
Mark J. Sandlin, Esq.
Goldberg Simpson, LLC
9301 Dayflower Street
Louisville, KY 40059
Phone: (502) 585-8562
Fax: (502) 581-1344
Email: msandlin@goldbergsimpson.com
About Human Housing Henrietta Hyatt
Human Housing Henrietta Hyatt, LLC sought protection for relief
under Chapter 11 of the Bankruptcy Code (Bankr. W.D. Ky. Case No.
21-31099) on May 17, 2021, listing 500,001 to $1 million in both
assets and liabilities. Judge Charles R Merrill presides over the
case. Mark J. Sandlin, Esq., at Goldberg Simpson, LLC, serves as
the Debtor's legal counsel.
IN-SHAPE HOLDINGS: Seeks Case Dismissal After Assets Sold
---------------------------------------------------------
Alex Wolf of Bloomberg Law reports that In-Shape Holdings LLC asked
a judge to dismiss its Chapter 11 case, saying it doesn't have
sufficient funds to get a bankruptcy plan approved despite selling
its chain of California fitness centers.
In-Shape eliminated $45.3 million in secured debt when it sold the
business in February to former CEO Paul Rothbard, Aquiline Capital
Partners LLC, and other lenders. But the purchase price "is a far
cry" from the $65 million In-Shape owed before bankruptcy, the
company said in a court filing Monday.
The company received $250,000 in cash from the sale to cover
administrative expenses, and now has no other assets available.
About In-Shape
In-Shape is a regional health club operator. Before the outbreak of
COVID-19, In-Shape operated 65 clubs with over 470,000 members. Its
clubs offer premium amenities and member-focused community club
experiences at tiered pricing levels in secondary markets around
California. Visit https://www.inshape.com/ for more information.
In 2012, Fremont Group purchased 78% of the Company from the
Rothbards and their co-investors.
Fremont Group remains the majority equity owner of ISHC.
In-Shape Holdings, LLC, and two affiliates, including In-Shape
Health Clubs, LLC, sought Chapter 11 protection (Bankr. D. Del.
Case No. 20-13130) on Dec. 16, 2020.
In-Shape Holdings was estimated to have $50 million to $100 million
in assets and $100 million to $500 million in liabilities as of the
bankruptcy filing.
The Hon. Laurie Selber Silverstein oversees the cases.
The Debtors tapped KELLER BENVENUTTI KIM LLP as bankruptcy counsel;
TROUTMAN PEPPER HAMILTON SANDERS LLP as local bankruptcy
co-counsel; and CHILMARK PARTNERS, LLC as investment banker. B.
RILEY FINANCIAL, INC., is the real estate advisor. Stretto is the
claims agent.
INNOVATIVE SOFTWARE: Wins Conditional OK on Disclosure Statement
----------------------------------------------------------------
Judge Scott M. Grossman conditionally approved the Disclosure
Statement of Innovative Software Solution, Inc.
Judge Grossman has set:
* June 22, 2021 as the deadline for filing objections to claims;
* June 29, 2021 as the deadline for filing ballots to accept or
reject the Plan; and
* June 30, 2021 as the last day for filing objections to Plan
confirmation and the final approval of the Disclosure Statement.
The Disclosure Statement and Plan confirmation hearing (in person)
is set for July 6, 2021 at 1:30 p.m. at the U.S. Courthouse, 299
East Broward Boulevard, Courtroom 308, Ft. Lauderdale, Florida.
Parties may also attend by video conference.
A copy of the order is available for free at https://bit.ly/3ioaVTT
from PacerMonitor.com.
About Innovative Software
Innovative Software Solution, Inc. filed a voluntary petition for
relief under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Fla.
Case No. 21-10538) on Jan. 20, 2021. Natalie Frazier, president,
signed the petition.
Judge Scott M. Grossman oversees the case.
Van Horn Law Group, PA, serves as the Debtor's legal counsel.
INSPIREMD INC: Cancels Registration of Series A, Series B Warrants
------------------------------------------------------------------
InspireMD, Inc. has voluntarily withdrawn its Series A Warrants
(exercisable for one share of Common Stock) and Series B Warrants
(exercisable for one share of Common Stock) from listing and
registration on NYSE American, as disclosed in a Form 25 filed with
the Securities and Exchange Commission.
About InspireMD Inc.
Headquartered in Tel Aviv, Israel, InspireMD --
http://www.inspiremd.com-- is a medical device company focusing on
the development and commercialization of its proprietary MicroNet
stent platform technology for the treatment of complex vascular and
coronary disease. A stent is an expandable "scaffold-like" device,
usually constructed of a metallic material, that is inserted into
an artery to expand the inside passage and improve blood flow. Its
MicroNet, a micron mesh sleeve, is wrapped over a stent to provide
embolic protection in stenting procedures.
InspireMD reported a net loss of $10.54 million for the year ended
Dec. 31, 2020, compared to a net loss of $10.04 million for the
year ended Dec. 31, 2019. As of March 31, 2021, the Company had
$48.63 million in total assets, $4.68 million in total liabilities,
and $43.95 million in total equity.
INTERJET AIRLINES: Says Third Bankruptcy Claim to Be Filed
----------------------------------------------------------
Andrea Navarro of Bloomberg News reports that Mexican airline
Interjet has learned from media that a third bankruptcy procedure
known as concurso mercantil will be filed by a third party, the
carrier said in a statement.
The airline is working with lawyers to fully understand the claims.
According to the airline, concurso hasn't officially started, and
management is working to restructure the company to resume flights
as soon as possible.
Interjet has its own procedure planned and previously said it knew
of a second claim. The judge will integrate all claims into a
single concurso mercantil, a spokesperson said.
About Interjet
Interjet is an international airline based in Mexico City carrying
almost 14 million passengers annually within Mexico and between
Mexico, the United States, Canada, Central, and South America. In
all, it provides air service to 54 destinations in 10 countries
offering its passengers greater connections and travel options
through agreements with major airlines such as Alitalia, All Nippon
Airways (ANA), American Airlines, British Airways, Emirates, Air
Canada, LATAM Group, EVA Air, Iberia, Lufthansa, Hainan
Airlines,Hahn Air, Qatar Airlines and Japan Airlines.
As reported in the Troubled Company Reporter-Latin America on Sep.
3, 2019, Interjet Airlines re-iterated the airline is not in
"technical bankruptcy" as erroneously reported by a financial news
agency.
Interjet Airlines is in a dispute with Mexico's Tax Administration
Service (SAT), related to alleged taxes owed by the airline. An
attempt by SAT to seize control of the airline's bank accounts in
an effort to collect the alleged taxes was denied by the courts and
the airline is in negotiation with the tax authorities to determine
what back taxes are actually due.
JB POINDEXTER: Moody's Affirms B1 CFR & Alters Outlook to Stable
----------------------------------------------------------------
Moody's Investors Service affirmed the ratings of J.B. Poindexter &
Co., Inc., including the corporate family rating at B1, the
Probability of Default Rating at B1-PD and the senior unsecured
rating at B2. The outlook was changed to stable from negative.
The change in outlook of J.B. Poindexter's ratings reflects the
recovery in its end markets and a strong orderbook for medium-duty
trucks and step-vans in its Morgan and Morgan Olson divisions which
will support higher earnings resulting in debt/EBITDA to be
maintained in the low 4x range through 2022. The outlook change
also assumes that J.B. Poindexter will be able to address the
upcoming maturity of its ABL revolving credit facility (February
2022).
The following rating actions were taken:
Affirmations:
Issuer: J.B. Poindexter & Co., Inc.
Corporate Family Rating, Affirmed at B1
Probability of Default Rating, Affirmed at B1-PD
Senior Unsecured Regular Bond/Debenture, Affirmed at B2 (LGD4)
Outlook Actions:
Issuer: J.B. Poindexter & Co., Inc.
Outlook, Changed To Stable from Negative
RATINGS RATIONALE
J.B. Poindexter's ratings reflect the company's strong market
position in its main business lines, a national footprint and
long-standing relationships with its key blue chip customers. After
a difficult 2020, where revenue declined by nearly 18%, Moody's
expects the company's top-line to rebound by at least 10% driven by
recovery in its end markets. Morgan, the company's largest
division, is expected to see a rebound driven by a sizable backlog
as its customers are expected to ramp up fleet investment purchases
in 2021. Morgan Olson is expected to build on its strong
performance due to continued demand for its step-van vehicles used
by last-mile delivery companies.
The ratings also reflect the company's moderate scale, exposure to
cyclical end markets, large customer concentrations and volatility
around annual fleet truck orders. J.B. Poindexter is expected to
face headwinds in the form of supply constraints related to
medium-duty chassis in both its largest divisions, labor shortages
and inflation and rising material costs. These constraints will
result in some of the orders being pushed into 2022 and margin
pressure.
Although J.B. Poindexter is expected to recover some of these costs
through price increases, it will take some time before the company
is back to historical levels of profitability. Moody's expects
EBITA margins to modestly recover to 5.2% in 2021 (from 4.2% in
2019) before improving to around 7% in 2022.
J.B. Poindexter is expected to maintain a good liquidity profile
primarily supported by $385 million in cash as of March 2021
(following the $200 million debt raise in late 2020) and full
availability of its $100 million asset-based lending facility due
February 2022. Free cash flow is expected to be modestly positive
in 2021 at approximately $10 million as recovery in the business is
offset by working capital investments to support growth and other
start up costs. J.B. Poindexter's ABL has a springing minimum fixed
charge coverage of 1x that is tested if less than 10% of the
commitment is available. Moody's does not expect that the covenant
will trigger due to the company's ample cash balance.
Although J.B. Poindexter has a sizable cash balance, Moody's views
that a significant portion of it is earmarked for growth
initiatives, particularly for future acquisitions. Excess cash can
also be used to fund other longer term initiatives, such as
developing truck bodies for zero emission commercial vehicles.
The stable outlook reflects Moody's expectations that J.B.
Poindexter will improve its key credit metrics driven by continued
strong demand in its end markets while maintaining a good liquidity
profile. It also incorporates Moody's expectation that the company
will address its ABL revolver maturity in a timely manner.
As a niche supplier, Moody's views environmental risk, specifically
carbon transition risk which is high for the broader sector, to be
manageable for J.B. Poindexter given its product focus primarily on
truck bodies.
In terms of corporate governance, Moody's views the full equity
ownership by CEO John Poindexter to be a risk. Mr. Poindexter has
been instrumental in developing the company's businesses and
customer relationships over many decades, and thus, a high level of
key man risk exists.
As well, uncertainty over any succession transition remains.
Further, sole ownership creates relative uncertainty regarding
company financial policy. J.B. Poindexter has been acquisitive at
times to expand its businesses and geographic reach, and Moody's
expects this approach to continue in the near term. The company,
though, operates on a decentralized basis with individual division
presidents, which helps diversify certain decision-making at the
operating level. J.B. Poindexter itself is a collection of
individual businesses.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The ratings could be downgraded if Moody's expects that debt/EBITDA
leverage will be sustained above 4.5x, EBITA/interest expense below
2x or if liquidity deteriorates through a material reduction in
cash or expectations of cash flow that is weaker than expected from
expansionary capital spending or higher than anticipated warranty
outlays. An adoption of more aggressive financial policies,
including owner distributions, could pressure the ratings.
An upgrade of the ratings is unlikely in the near-term. Over time,
the ratings could be upgraded should J.B. Poindexter maintain
debt/EBITDA below 3x and EBITA/interest above 3x on a sustained
basis through cyclical periods in its end markets. J.B. Poindexter
would also need to maintain a good liquidity profile and
consistently address its debt maturities well in advance of due
dates.
The principal methodology used in these ratings was Automotive
Suppliers published in May 2021.
J.B. Poindexter & Co., Inc. manufactures commercial truck bodies
for medium-duty trucks, pickup truck caps and tonneau covers, truck
bodies for walk-in step vans, service utility trucks, commercial
vehicle shelving and storage systems, funeral coaches and
limousines, and provides contract manufacturing services for
precision metal parts and machining and casting services.
Headquartered in Houston, Texas, the privately held company
generated approximately $1.4 billion in revenue for the twelve
month period ending March 31, 2021.
KATERRA INC: Files for Chapter 11 After Greensill Woes
------------------------------------------------------
Despite an investment of over $2 billion from Japan-based
SoftBank's Vision Fund, Katerra Inc. has sought bankruptcy
protection in the U.S., citing ongoing losses, an investigation
into certain accounting regularities at its Renovations business,
and the collapse of UK-based financial services firm Greensill
Group.
Co-founded in 2015 by Michael Marks, Jim Davidson, and Fritz Wolff,
Katerra is an innovative and eco-conscious construction company
that develops, manufactures, and markets products and services in
the commercial and residential construction spaces.
Marc Liebman, Chief Transformation Officer of Katerra Inc.
(Cayman), explained in a bankruptcy court filing that over its six
years in operation, Katerra has raised close to $3 billion in
equity investments but was unable to generate a profit.
Katerra's manufacturing network specializes in "productized
design," whereby Katerra manufactures building components as
repeatable modules. In furtherance of productized design, in 2019,
Katerra launched "K3," a building platform focused on the
construction and assembly of high-quality apartment buildings
through the use of modular building components that are assembled
onsite. Katerra also has pioneered the use of new building
technologies, such as cross-laminated timber.
In pursuit of a fully integrated business model, Katerra acquired
several general contractor businesses specializing in commercial,
residential and multi-family projects in the West, Northeast,
Mid-Atlantic and South East regions.
Although Katerra won numerous projects, rapidly expanded its
national footprint, and completed a series of successful capital
raises, it was unable to generate a profit. Over time, Katerra
experienced losses on contracted projects that experienced
significant cost overruns, resulting in massive, ongoing losses,
especially when Katerra had to honor the maximum price guarantees
and discounts it had provided to certain legacy customers. In
hindsight, those discounts were value destructive.
In May 2020, Katerra commenced a sixth round of financing with one
of its existing investors, SVF Abode (Cayman) Limited, to raise
additional capital -- on top of close to $3 billion previously
raised -- to fund its operations. Pursuant to the terms of the
Series F financing, SVF Abode provided Katerra with an initial $100
million in funding and agreed to fund another $100 million
approximately 45 days later. In addition, SVF Abode exchanged its
49% ownership stake in non-Debtor Katerra Middle East Inc. for
another $150 million in Series F shares.
At the end of May 2020, Katerra identified potential improper
revenue recognition practices related to its Katerra Renovations,
LLC business. Within days, an independent committee of the Board
of Directors of Katerra Cayman was formed to oversee an
investigation into these potential accounting irregularities, and
Katerra elected to freeze its equity raises while that
investigation was ongoing. As a result of this investigation, SVF
Abode elected to exercise its contractual right to withhold the
additional $100 million of financing on the 45-day timeline.
During the investigation, and in part due to the freeze on raising
capital, Katerra continued to face worsening liquidity that
threatened its operations. Katerra experienced financial and
technical setbacks on some of its legacy construction projects due
to re-work issues related to earlier-completed work. The
Company's exposure to expensive long-term, third-party commitments
in real estate, IT, and software further restrained cash flow.
Finally, the Greensill Receivables Facility was already fully
drawn, and the debt level thereunder, combined with Katerra's
inability to comply with the covenant criteria since early 2020,
made it difficult to obtain bonding for new project starts,
impeding Katerra's ability to secure new business.
In July 2020, Katerra appointed new management to address its
constrained liquidity, which was preventing investment in new
growth areas and timely vendor payments, straining those
relationships and placing projects at risk. Further, due to
COVID-19, Katerra, along with the rest of the global construction
industry, experienced unprecedented economic disruption, including
project delays, shutdowns, and cancellations. Despite its best
efforts, Katerra was unable to reduce its heavy operating-cost
structure and high cash burn to optimize its business.
Given these difficulties, Katerra engaged restructuring advisors
and investment bankers in August and September 2020 to evaluate its
restructuring alternatives, including raising additional capital.
Also in September 2020, Katerra appointed two independent directors
with extensive restructuring experience to the Board of Directors
of Katerra Cayman. Around this time, Katerra also voluntarily
contacted the SEC to inform the SEC of the findings of the
Independent Committee investigation.
After several months of exploring options to restructure its
business and balance sheet (including negotiating a prospective
transaction with a consortium of new and existing investors that
ultimately did not materialize), in late November 2020, Katerra
reached a non-binding term sheet with the only investor willing to
engage in an out-of-court restructuring, SVF Abode, and other key
stakeholders, agreeing to a series of transactions that resulted in
the financial recapitalization and restructuring of Katerra's
material obligations, whereby, among other things:
* SVF Abode agreed to invest $200 million in new money in
exchange for approximately 75% of Katerra's post-closing equity;
* Certain of Katerra's contract counterparties agreed to global
amendments to their project contracts to amend and extend project
timelines and completion dates in exchange for granting releases of
certain claims regarding active projects;
* Greensill Limited extinguished approximately $440 million owed
by Katerra under the Greensill Receivables Facility in exchange for
approximately 5% of the post-equity closing in Katerra, which
equity was immediately transferred by Greensill to an affiliate of
SoftBank Vision Fund II in connection with a transaction in which
SVF II invested $440 million in Greensill's parent company; and
* 5% of the post-closing equity was reserved for certain
existing equity holders and 15% of the post-closing equity was
reserved in a share pool for an equity incentive plan and related
grants.
The transaction was implemented, allowing Katerra to avoid a
near-term Chapter 11 filing, and it was expected to provide Katerra
with sufficient liquidity to address its immediate ongoing
obligations and continue operating in the ordinary course of
business pursuant to a new business plan.
While negotiating the December 2020 transaction, Katerra was also
negotiating the final terms of the PIF Sale, which was expected to
generate approximately $147 million of additional capital, $47
million of which was expected to go directly to Katerra Cayman.
The PIF Sale was not expected to close until early 2021.
In March 2021, Greensill filed multiple insolvency proceedings in
the United Kingdom, Australia, and in the United States. Certain
of Katerra's important bond providers demanded exorbitant cash
collateral to facilitate construction and certain of Katerra's
contract counterparties stopped doing business with Katerra,
speculating that Katerra was still burdened with the Greensill
Receivables Facility and would be implicated in the Greensill
proceedings. In addition, the PIF Sale did not close and Katerra
Cayman needed to use $23 million of its own liquidity to address
covenant compliance concerns under the Samba Credit Facility.
Katerra was thus unable to bond certain contract projects,
exacerbating its existing operational issues because, without
appropriate bonding, it was unable to provide the security of
payment and performance of its obligations under certain projects.
All of which created massive liquidity constraints and, in some
instances, a halt to existing construction projects.
After providing Katerra with over $2 billion in equity funding to
support ongoing operations and the direct repayment to Greensill of
$440 million to facilitate the 2020 recapitalization, SoftBank
Vision Fund I explained to Katerra that it could not responsibly
continue to support Katerra with go-forward equity in May 2021.
Immediately thereafter, on May 17, 2021, three members of Katerra's
senior management team resigned, further straining Katerra's
already tenuous position.
In response, Katerra's board of directors formed a special
committee comprised of its two independent directors. The Special
Committee called upon the same legal and financial advisors to once
again start exploring strategic alternatives. Unfortunately,
Katerra's liquidity continued to rapidly deteriorate and, by the
end of May 2021, the Company found itself facing an overdrawn cash
position unless it received an immediate capital infusion. Katerra
immediately shut down several unprofitable and unmarketable active
projects to preserve liquidity and implemented a substantial
reduction in force (approximately 730 employees). Katerra
continues to work on certain projects to preserve value so that
certain business lines may be sold.
Notwithstanding that SVF (together with its affiliates) has
invested over $2 billion into Katerra and is unlikely to receive a
distribution in the Chapter 11 cases, SB Investment Advisers (UK)
Limited, an affiliate of SVF, has agreed to provide $35 million of
postpetition financing as a sign of continuing support to
facilitate a marketing process for the Debtors' remaining assets
and an orderly wind-down of the Debtors' business for the benefit
of the Debtors' estates. Time is clearly of the essence, and
Katerra intends to move expeditiously to maximize value for the
benefit of all stakeholders.
Over $1 Billion in Debt
As of the Petition Date, the Debtors and certain of their
non-debtor subsidiaries have an aggregate principal amount of
approximately $1.29 billion to $1.55 billion in estimated
obligations, consisting primarily of (i) prepetition funded debt of
certain of the Debtors' foreign non-Debtor subsidiaries, (ii)
surety bond obligations, (iii) letters of credit, and (iv)
corporate guarantees.
The aggregate outstanding amount of each debt obligation is as
follows:
Funded Debt Principal Amount (in USD)
----------- -------------------------
Prepetition Foreign Funded Debt $72.4 million
Prepetition Samba Credit Facility $16.7 million
Prepetition SIDF Term Loan $16.3 million
Prepetition YES Bank Facility $39.5 million
Bonding and Letters of Credit $699.1 million
Surety Bond Obligations $676.7 million
Letters of Credit $22.3 million
Corporate Guarantees $514.8 million
to $779.2 million
-----------------
Total Debt Obligations $1.29 billion
to $1.55 billion
Sale of Assets
To provide Katerra with liquidity to commence a smooth landing into
the Chapter 11 cases, SB Investment Advisers (UK) Limited agreed to
provide a $35 million senior secured superpriority DIP Promissory
Note. The purpose of the DIP Promissory Note is to provide Katerra
with enough liquidity to run an in-court marketing process with the
goal of consummating one or more sales of Katerra's assets and an
orderly wind-down of the Company.
Given its position as equity holder in Katerra, its familiarity
with Katerra's business and assets, and Katerra's impending
liquidity shortfall, SB Investment Advisers (UK) Limited was best
positioned to provide the DIP Promissory Note to facilitate
Katerra's soft landing into Chapter 11.
Because time is of the essence to minimize costs while preserving
the value of key assets, the Debtors propose the following case
timeline:
* On or before 5 days after the Petition Date, the Debtors shall
file a Bidding Procedures Motion;
* On or before 45 days after the Petition Date, the Court shall
enter an order approving the bid procedures;
* On or before 60 days after the Petition Date, the Court shall
enter one or more sale orders;
* On or before 60 days after the Petition Date, the Debtors
shall file a Plan and Disclosure Statement;
* On or before 90 days after the Petition Date, the Court shall
enter an order approving the Disclosure Statement;
* On or before 120 days after the Petition Date, the Court shall
enter an order confirming the Plan; and
* On or before 135 days after the Petition Date, the effective
date of the Plan shall occur.
During the Chapter 11 process, the Debtors are focused on marketing
Katerra's key assets and operations, including: (a) the CLT
Facility, equipment, and land; (b) the Tracy Factory equipment; (c)
Katerra Saudi Arabia; (d) operations in India; and (e) the K3
building platform. As of the Petition Date, the Debtors have
entered into term sheet commitments to sell the following
businesses, subject to Court approval, LAS and Renovations. The
Debtors expect to have final terms sheets to sell non-Debtors MGA
and Equilibrium in the near future.
The Debtors believe that a Chapter 11 process provides the best
avenue for the Company to maximize value for stakeholders by
continuing to market the assets of the business and effectuating an
orderly wind-down of operations.
About Katerra Inc.
Based in Menlo Park, California, Katerra is a Japanese-funded,
American technology-driven offsite construction company. It was
founded in 2015 by Michael Marks, former CEO of Flextronics and
former Tesla interim CEO, along with Fritz Wolff, the executive
chairman of The Wolff Co.
Katerra offers technology-driven design, manufacturing, and
assembly solution for bathroom pods, door and window, furniture,
and modular utility systems.
Katerra Inc. and its affiliates sought Chapter 11 protection
(Bankr. S.D. Tex. Lead Case No. 21-31861) on June 6, 2021. In its
petition, Katerra estimated liabilities of between $1 billion and
$10 billion and estimated assets of between $500 million and $1
billion.
The Debtors tapped Kirkland & Ellis LLP as counsel; Jackson Walker
LLP as co-bankruptcy counsel; Houlihan Lokey Capital, Inc., as
investment banker; and Alvarez & Marsal North America, LLC, as
financial and restructuring advisor. Prime Clerk LLC is the claims
and noticing agent.
KK FIT: Seeks Approval to Hire Stutz Arment as Accountant
---------------------------------------------------------
KK Fit, Inc. and its affiliates seek approval from the U.S.
Bankruptcy Court for the Middle District of Pennsylvania to hire
Stutz Arment, LLP as their accountant.
The firm's services include the preparation of tax returns and
assistance with bankruptcy matters. All services will be charged
at the rate of $250 per hour.
As disclosed in court filings, Stutz Arment does not represent
interests adverse to the Debtors or to their estate.
The firm can be reached through:
Ken Stutz, CPA
Stutz Arment LLP
24C E Roseville Rd.
Lancaster, PA 17601
Phone: +1 717-945-7272
About KK Fit Inc.
KK Fit, Inc., formerly known as Gold's Gym, and its affiliates
filed Chapter 11 petitions (Bankr. M.D. Pa. Lead Case No. 21-01035)
on May 7, 2021. KK Fit President Kurt Krieger signed the
petitions. At the time of the filing, KK Fit had total assets of
between $100,000 and $500,000, and total liabilities of between $1
million and $10 million.
Judge Henry W. Van Eck oversees the cases.
Cunningham, Chernicoff & Warshawsky, P.C. and Stutz Arment, LLP
serve as the Debtors' legal counsel and accountant, respectively.
L&L WINGS: Seeks Approval to Hire CFGI as Financial Advisor
-----------------------------------------------------------
L&L Wings, Inc. seeks approval from the U.S. Bankruptcy Court for
the Southern District of New York to employ CFGI as its financial
advisor.
The firm's services include:
a. identifying and facilitating the Debtor's restructuring
options, assisting the Debtor in exploring strategic alternatives
and assisting the Debtor in navigating a bankruptcy process;
b. assisting the Debtor in the preparation of short-term and
long-term projections, including balance sheet, profit and loss,
and cashflows;
c. assisting the Debtor in the preparation of
financial-related disclosures required by the bankruptcy court;
d. instituting procedures to ensure the safekeeping and
security of the Debtor's assets;
e. assisting the Debtor in resolving vendor issues;
f. assisting the Debtor with information and analyses
requested by the unsecured creditors' committee or required
pursuant to its cash collateral arrangements;
g. assisting the Debtor in the preparation of financial
statements;
h. preparing financial statements and other reports required
by the court or the United States Trustee Guidelines;
i. administering the accounting and financial advisory
services;
j. assisting the Debtor in its daily administrative and
operational duties;
k. preparing and validating updated and rolling 13-week cash
flow projections; and
l. other general consulting services.
The firm will be paid as follows;
Partner $580 per hour
Director//Managing Director $435 per hour
Senior Manager $340 per hour
Manager $275 per hour
Consultant $205 per hour
Joseph Baum, a partner at CFGI, disclosed in a court filing that
his firm is a "disinterested person" as that term is defined by
Section 101(14) of the Bankruptcy Code.
The firm can be reached through:
Joseph Baum
CFGI
340 Madison Avenue, 3rd Floor
New York, NY 10173
Phone: (646) 360-2850
Email: jbaum@cfgi.com
About L&L Wings
L&L Wings, Inc. is a New York-based retailer of beachwear and beach
sundry items. It operates 26 stores throughout North Carolina,
South Carolina, Florida, Texas, and California.
L&L Wings sought protection under Chapter 11 of the Bankruptcy Code
(Bankr. S.D.N.Y. Case No. 21-10795) on April 24, 2021. In the
petition signed by Ariel Levy, president, the Debtor disclosed up
to $50 million in assets and up to $100 million in liabilities.
Judge Shelley C. Chapman oversees the case.
The Debtor tapped Davidoff Hutcher & Citron LLP as legal counsel,
WebsterRogers LLP as accountant, and CFGI as financial advisor.
On May 7, 2021, the U.S. Trustee for Region 2 appointed an official
committee of unsecured creditors. Otterbourg P.C. and Thompson
Hine, LLP serve as the committee's bankruptcy counsel and special
counsel, respectively.
LATAM AIRLINES: To Delay Plan, To Take Add'l $500M Funding
----------------------------------------------------------
Reuters reports that LATAM Airlines Group, the region's largest
carrier, said on Wednesday that it had sought to extend until
September the deadline to present its restructuring plan as part of
the bankruptcy protection process initiated in 2020.
A judge had previously ordered the company deliver its
restructuring plan by the end of June, and the company has said it
hopes to wrap up the process in 2021.
"The extension request is a common alternative contemplated within
the process and does not modify the intention of the LATAM group to
exit Chapter 11 by the end of this year," the firm said in a
statement.
Latam also told Chilean securities regulators it has requested a
second disbursement for $500 million under the DIP Credit Agreement
(Debtor-In-Possession). The airline said the additional funds were
necessary given "the extension of the health and mobility
restrictions imposed by the authorities in the different countries
in that the Company operates, as well as the analysis of the
Company's liquidity projection".
The company also received a $1.15 billion debtor-in-possession loan
in October last year.
Earlier on Wednesday Latam said it expects to ramp up its June
operations to 36% of their pre-coronavirus pandemic levels,
bolstered by the quickening pace of vaccination in some countries
in the region.
"All markets show projections higher than those of the previous
month," the company said in the statement.
LATAM, headquartered in Santiago, also operates in Brazil, Chile,
Colombia, Ecuador and Peru, as well as international operations
throughout Latin America, Europe, the United States and the
Caribbean.
About LATAM Airlines Group
LATAM Airlines Group S.A. -- http://www.latam.com/-- is a
pan-Latin American airline holding company involved in the
transportation of passengers and cargo and operates as one unified
business enterprise. It is the largest passenger airline in South
America.
Before the onset of the COVID-19 pandemic, LATAM offered passenger
transport services to 145 different destinations in 26 countries,
including domestic flights in Argentina, Brazil, Chile, Colombia,
Ecuador and Peru, and international services within Latin America
as well as to Europe, the United States, the Caribbean, Oceania,
Asia and Africa.
LATAM and its 28 affiliates sought Chapter 11 protection (Bankr.
S.D.N.Y. Lead Case No. 20-11254) on May 25, 2020. Affiliates in
Chile, Peru, Colombia, Ecuador and the United States are part of
the Chapter 11 filing.
The Debtors disclosed $21,087,806,000 in total assets and
$17,958,629,000 in total liabilities as of Dec. 31, 2019.
The Hon. James L. Garrity, Jr., is the case judge.
The Debtors tapped Cleary Gottlieb Steen & Hamilton LLP as
bankruptcy counsel, FTI Consulting as restructuring advisor, Lee
Brock Camargo Advogados as local Brazilian litigation counsel, and
Togut, Segal & Segal LLP and Claro & Cia in Chile as special
counsel. The Boston Consulting Group, Inc. and The Boston
Consulting Group UK LLP serve as the Debtors' strategic advisors.
Prime Clerk LLC is the claims agent.
The official committee of unsecured creditors formed in the case
tapped Dechert LLP as its bankruptcy counsel, Klestadt Winters
Jureller Southard & Stevens, LLP as conflicts counsel, UBS
Securities LLC as investment banker, and Conway MacKenzie, LLC, as
financial advisor. Ferro Castro Neves Daltro & Gomide Advogados, is
the committee's Brazilian counsel.
The Ad Hoc Group of LATAM Bondholders tapped White & Case LLP as
counsel.
Glenn Agre Bergman & Fuentes, LLP, led by managing partner Andrew
Glenn and partner Shai Schmidt, has been retained as counsel to the
Ad Hoc Committee of Shareholders.
MAJESTIC HILLS: Gateway Engineers Says Disclosures Deficient
------------------------------------------------------------
The Gateway Engineers, Inc., objects to approval of the Disclosure
Statement to Accompany Amended Chapter 11 Liquidating Plan filed by
Majestic Hills, LLC.
Gateway claims that the Disclosure Statement, in its current form,
does not provide adequate information to allow Gateway to make an
informed decision about the Plan. The deficiencies compel Gateway
to file this Objection. The deficiencies must be corrected by the
Debtor by filing an amended Plan and Disclosure Statement before
Gateway will accept the Plan and Disclosure Statement.
Gateway objects to the Disclosure Statement (and Plan) in its
current form to the extent that the Disclosure Statement (and Plan)
fails to include a non-severability clause related to any provision
of the Plan that provides for the Release of the Released Parties.
Gateway objects to the Disclosure Statement (and Plan) to the
extent that the Disclosure Statement (and Plan) is ambiguous as to
when Gateway's contribution to Plan Funding would be due under the
Plan.
Gateway asserts that without certainty about the date when
Gateway's contribution to the Plan Funding would be due under the
Plan, Gateway does not have adequate information to make an
informed judgment about the Plan.
Specifically, Gateway's agreement to participate in the Plan was
conditioned upon Gateway's contribution to the Plan Funding not
becoming due until the issuance of an order approving the Plan and
granting the release of the Released Parties. Sufficient time must
pass for this order to became final and unappealable before Gateway
is obligated to pay its contribution to the Plan Funding.
A full-text copy of Gateway's objection dated June 3, 2021, is
available at https://bit.ly/3ggQK80 from PacerMonitor.com at no
charge.
Counsel for The Gateway Engineers, Inc.:
THOMAS H. AYOOB III & ASSOCIATES, LLC
Thomas H. Ayoob, III, Esquire
Pa. I.D. 63571
Matthew Junker, Esquire
Pa. I.D. 312356
710 Fifth Avenue, Suite 2000
Pittsburgh, PA 15219
Telephone: (412) 208-3000
Facsimile: (412) 208-3001
About Majestic Hills
Majestic Hills, LLC, a privately held company that owns certain
property in Pennsylvania, filed a Chapter 11 petition (Bankr. W.D.
Pa. Case No. 20-21595) on May 21, 2020. At the time of filing, the
Debtor was estimated to have $1 million to $10 million in assets
and liabilities. The Hon. Gregory L. Taddonio oversees the case.
The Debtor's counsel is Donald R. Calaiaro of CALAIRO VALENCIK.
MAJESTIC HILLS: Morris Knowles Says Disclosures Insufficient
------------------------------------------------------------
Morris Knowles & Associates files this Response to the Disclosure
Statement of debtor Majestic Hills, LLC and Joins in the Official
Committee of Unsecured Creditors' Response to Disclosure Statement
to Accompany Amended Chapter 11 Liquidation Plan.
Morris Knowles does not object to the Amended Plan and Disclosure
Statement overall. However, as a creditor, Morris Knowles contends
that the Amended Plan and Disclosure Statement need additional
information and/or clarification on certain issues, which is the
basis for this Response.
Morris Knowles is ultimately interested in the global resolution of
all claims and actions against it, including all of the adversary
proceedings in state and federal courts. In exchange for this
contribution, these contributing parties have been assured they
will receive a full, general release of all claims against them by
all parties in all pending actions in state and federal court
arising out of or relating to the earth movement issues at the
Majestic Hills development that is the subject of this bankruptcy
proceeding and the adversary proceedings.
Specifically, Morris Knowles' Response primarily relates to a need
for further information and/or clarification on certain aspects of
Section I, Paragraph 9 in the Disclosure Statement; Article 9 of
the Amended Plan; and any other sections of the Disclosure
Statement or Plan pertaining to:
* the specific prerequisites that must be met before any
contributions are made to the Amended Plan by Morris Knowles and
other contributing parties;
* a clearly defined trigger for the timing of the contribution
payments by Morris Knowles and other contributing parties;
* an exact time frame when the contribution payments should be
made by Morris Knowles and other contributing parties; and
* the explanation of specific procedures as to what happens to
any contributions that have been paid or are obligated to be paid
by Morris Knowles and other contributing parties if the Amended
Plan is not approved or confirmed.
Morris Knowles respectfully requests that: (i) the changes,
additions and clarifications be incorporated into the Disclosure
Statement; and (ii) the Plan be amended to be consistent with the
additions, clarifications and/or amendments to the Disclosure
Statement. By doing so, the Disclosure Statement, as amended, will
provide creditors adequate information of a kind, and in sufficient
detail, as far as is reasonably practicable in light of the nature
and history of the Debtor that would enable a hypothetical
reasonable investor to make an informed judgment about the Amended
Plan.
A full-text copy of Morris Knowles' objection dated June 3, 2021,
is available at https://bit.ly/3zeX34A from PacerMonitor.com at no
charge.
Counsel for Morris Knowles & Associates:
HOUSTON HARBAUGH, P.C.
Samuel H. Simon
Pa. I.D. No. 85503
ssimon@hh-law.com
Catherine S. Loeffler
Pa. I.D. No. 311667
loefflercs@hh-law.com
Three Gateway Center, 22nd Floor
401 Liberty Avenue
Pittsburgh, PA 15222
Tel: (412) 281-5060
About Majestic Hills
Majestic Hills, LLC, a privately held company that owns certain
property in Pennsylvania, filed a Chapter 11 petition (Bankr. W.D.
Pa. Case No. 20-21595) on May 21, 2020. At the time of filing, the
Debtor was estimated to have $1 million to $10 million in assets
and liabilities. The Hon. Gregory L. Taddonio oversees the case.
The Debtor's counsel is Donald R. Calaiaro of CALAIRO VALENCIK.
MAJESTIC HILLS: NVR & Township Say Liquidating Plan Unconfirmable
-----------------------------------------------------------------
NVR, Inc., d/b/a Ryan Homes and North Strabane Township object to
approval of the Disclosure Statement to Accompany Amended Chapter
11 Liquidating Plan filed by Majestic Hills, LLC. In support of the
Objection, NVR and the Township state as follows:
* The Plan described in the Disclosure Statement cannot be
confirmed. The Plan relies on plainly unlawful Non-Debtor Releases
and contains an Exculpation Clause that exceed the Court's
jurisdiction and authority.
* The is no provision in the Plan for payment to all or
substantially all of the class or classes affected by the Non
Debtor Releases and/or the Exculpation Clause. Accordingly, the
Non-Debtor Releases and the Exculpation Clause are improper and
cannot be authorized by this Court. As such, the Plan is
unconfirmable on its face and the Disclosure Statement should not
be approved.
* The Disclosure Statement is lacking in important
information, especially relating to the potential liability of the
Non-Debtors who will be granted releases if the Plan is confirmed.
The Disclosure Statement provides no analysis or any information
regarding the Non-Debtors' potential exposure, why such
contributions are reasonable in relation to their potential
liability, or why the amounts each of them are contributing is
substantial.
* The Disclosure Statement does not contain any information
about the remediation work to be completed by the Debtor, including
the scope of the work, an estimation of what the work will cost,
and in the event the "Plan Funding" runs out before the Debtor
completes the work, how the work will be completed and by whom.
This lack of information makes it impossible to adequately evaluate
the proposed Plan.
A full-text copy of NVR and Township's objection dated June 3,
2021, is available at https://bit.ly/3csLDR3 from PacerMonitor.com
at no charge.
Counsel for NVR and North Strabane Township:
Kathleen A. Gallagher
PA #37950
kag@glawfirm.com
Russell D. Giancola
PA #200058
rdg@glawfirm.com
Gallagher Giancola LLC
436 Seventh Avenue, 31st Floor
Pittsburgh, PA 15219
412.717.1900 (Phone)
412.717.1901 (Fax)
About Majestic Hills
Majestic Hills, LLC, a privately held company that owns certain
property in Pennsylvania, filed a Chapter 11 petition (Bankr. W.D.
Pa. Case No. 20-21595) on May 21, 2020. At the time of filing, the
Debtor was estimated to have $1 million to $10 million in assets
and liabilities. The Hon. Gregory L. Taddonio oversees the case.
The Debtor's counsel is Donald R. Calaiaro of CALAIRO VALENCIK.
MALACHI PAVING: Taps Law Office of Marc Voisenat as Counsel
-----------------------------------------------------------
Malachi Paving & Grading Inc. seeks approval from the U.S.
Bankruptcy Court for the Northern District of California to employ
the Law Office of Marc Voisenat to serve as legal counsel in its
Chapter 11 case.
Marc Voisenat will be paid at the hourly rate of $450 and will
receive a retainer in the amount of $7,500. The firm will also
receive reimbursement for out-of-pocket expenses incurred.
As disclosed in court filings, Marc Voisenat is a "disinterested
person" as the term is defined in Section 101(14) of the Bankruptcy
Code.
Marc Voisenat can be reached at:
Marc Voisenat, Esq.
Law Office of Marc Voisenat
1330 Broadway Suite 734
Oakland, CA 94612
Tel: (510) 272-9710
Email: voisenat@gmail.com
About Malachi Paving & Grading
Malachi Paving & Grading Inc. sought protection for relief under
Chapter 11 of the Bankruptcy Code (Bankr. N.D. Calif. Case No.
21-40721) on May 26, 2021, disclosing total assets of up to
$50,000 and total liabilities of up to $500,000. Judge Roger L.
Efremsky presides over the case. The Debtor is represented by the
Law Offices Of Marc Voisenat.
MALLINCKRODT PLC: Judges Panel Reject Merger of Price-Gouging Suits
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Mike Leonard of Bloomberg Law reports that a panel of judges
rejected a bid to centralize price-gouging litigation over
Mallinckrodt PLC's infantile spasm drug Acthar in a single court,
saying the cases involve too many variables, including
Mallinckrodt's bankruptcy, although "consolidation of some kind is
appropriate."
The Judicial Panel on Multidistrict Litigation turned down requests
by different parties—including Acthar buyers and Cigna Corp. unit
Express Scripts, a leading drug distributor targeted by some of the
lawsuits—to transfer all the cases to federal courts in Chicago
or New Jersey.
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.
MARRIOTT OWNERSHIP: Moody's Rates New $450MM Unsecured Notes 'B1'
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Moody's Investors Service assigned a B1 rating to Marriott
Ownership Resorts, Inc.'s ("a subsidiary of Marriott Vacations
Worldwide Corporation, combined with other subsidiaries as
"Marriott Vacations") planned $450 million senior unsecured note
offering. The company's other ratings are unchanged, including its
Ba3 corporate family rating, Ba3-PD probability of default rating,
Ba1 senior secured rating, Ba1 senior secured bank facility rating
and existing B1 senior unsecured rating. The outlook remains
negative.
Proceeds from the planned $450 million senior unsecured 8-year note
issuance will be used to redeem a portion of its 6.5% senior
unsecured notes due 2026 and to pay transaction expenses and fees.
The transaction is credit positive as it pushes out maturities by
three years and results in interest savings. Despite the positive
attributes of the transaction, Marriott Vacations' ratings and
negative outlook are unchanged. The negative outlook continues to
reflect Moody's expectation that Marriott Vacations' earnings will
continued to be pressured causing debt/EBITDA to remain above its
downgrade factor of 5.25x over the next 12 months.
Assignments:
Issuer: Marriott Ownership Resorts, Inc.
Gtd Senior Unsecured Regular Bond/Debenture, Assigned B1 (LGD5)
RATINGS RATIONALE
Marriott Vacations' credit profile benefits from its strong brand
presence in the upscale segment of the timeshare industry, its
geographic diversity, and the portion of its earnings derived from
recurring and fee based sources such as resort management and
exchange, rentals, and consumer finance. The company also benefits
from its position as the third largest vacation ownership company
in terms of revenues and number of owners (following Hilton Grand
Vacations Borrower LLC (Ba3 stable) acquisition of Diamond Resorts
International, Inc. (Caa1 on review for upgrade)), and second
largest timeshare exchange network in terms of members -- trailing
only Travel + Leisure Co. (formerly Wyndham Destinations; Ba3
negative). In the near term Marriott Vacations' credit profile will
be dominated by the length of time that the timeshare industry
continues to be highly disrupted and the resulting impact on the
company's earnings profile and metrics. The normal ongoing credit
risks include its exposure to the general risks associated with its
focus on the timeshare industry and its high leverage -- Moody's
estimate debt/EBITDA will exceed 5.0x through 2022 (Moody's metrics
include Moody's standard adjustments and 100% of securitized
debt).
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATING
The outlook could be revised to stable if occupancy trends continue
to improve leading to increasing new timeshare sales and enabling
the company to maintain debt/EBITDA below 5.25x. Ratings could be
upgraded if the company is able to maintain leverage below 4.75x
with EBITA/interest expense around 4.5x. Ratings could be
downgraded if the company's liquidity weakened in any way or if the
recovery is delayed beyond Moody's base assumptions and indications
are that the company cannot de-lever to below 5.25x.
Marriott Ownership Resorts, Inc., a subsidiary of Marriott
Vacations Worldwide Corporation, is one of the largest vacation
ownership and timeshare exchange companies. The company develops,
markets, sells and/or manages vacation ownership properties under
brands including the Marriott Vacation Club, Westin Vacation Club,
Sheraton Vacation Club, Grand Residences by Marriott, Hyatt
Residence Club, and The Ritz-Carlton Residences brand. Marriott
Vacations has a portfolio of nearly 120 properties and has the
second largest timeshare exchange business with access to nearly
3,200 resorts. Revenues in 2020 were about $2.9 billion.
The principal methodology used in this rating was Business and
Consumer Service Industry published in October 2016.
MATREIYA TRANS: Has Until Sept. 13 to Confirm Plan
--------------------------------------------------
Judge Jil Mazer-Marino has entered an order within which the time
for debtor Matreiya Trans, Corp. to confirm a Chapter 11 Small
Business Disclosure Statement together with a Chapter 11 Small
Business Chapter 11 Plan shall be extended though and including
September 13, 2021.
A copy of the order dated June 3, 2021, is available at
https://bit.ly/3pDaEOO from PacerMonitor.com at no charge.
Attorney for the Debtor:
ALLA KACHAN, ESQ.
3099 Coney Island Ave, 3rd Floor
Brooklyn, NY 11235
Tel: (718) 513-3145
Fax: (347) 342-315
E-mail: alla@kachanlaw.com
About Matreiya Trans Corp.
Matreiya Trans Corp. is a taxi medallion corporation located at 105
East 34th Street, Suite 174, New York. Matreiya Trans Corp. sought
Chapter 11 protection (Bankr. E.D.N.Y. Case No. 19-47711) on Dec.
26, 2019. Matreiya disclosed $157,164 in assets and $330,000 in
liabilities as of the bankruptcy filing. The petition was signed
by Michael L. Simon, president. The LAW OFFICES OF ALLA KACHAN,
P.C., serves as bankruptcy counsel to the Debtor.
MATTHEWS INT'L: Moody's Alters Outlook on Ba3 CFR to Stable
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Moody's Investors Service affirmed Matthews International
Corporation's Ba3 corporate family rating and Ba3-PD Probability of
Default Rating. Moody's also affirmed Matthew's B2 senior unsecured
instrument rating. The outlook was revised to stable from negative.
The speculative grade liquidity rating remains at SGL-2.
The affirmation is based on continued deleveraging of the company's
balance sheet and expectations that leverage will be in the 4.0x
area over the next few years. The outlook was changed to stable
from negative based on Moody's expectation that business conditions
for the company's largest segments Memorialization and SGK Brand
Solutions have improved since the trough of the pandemic, which is
a social consideration under Moody's ESG framework. Moody's expects
secular pressure to continue for the brand solutions segment in the
long term, however low single digit growth in consolidated revenue
is achievable based on an improving economy and a stable
memorialization and industrial solutions business.
Affirmations:
Issuer: Matthews International Corporation
Corporate Family Rating, Affirmed Ba3
Probability of Default Rating, Affirmed Ba3-PD
Senior Unsecured Regular Bond/Debenture, Affirmed B2 (LGD5)
Outlook Actions:
Issuer: Matthews International Corporation
Outlook, Changed To Stable From Negative
RATINGS RATIONALE
Matthews' Ba3 rating reflects the company's leading position in two
unrelated markets, deleveraging over the past few quarters and its
consistent free cash flow generation, balanced by ongoing organic
revenue pressures in the SGK brand management segment, thin EBITA
margins and an acquisitive growth strategy. Matthews retains market
leading positions in the mature memorialization and brand solutions
industries. The SGK brand management segment has been facing
headwinds as customers decreased spending on marketing and as
retail stores remained closed during the pandemic and organic
growth remains pressured, but the segment also has exposure to
growth industries such as electric cars via its cylinder and
rotogravure business. Despite these secular pressures Matthews
remains as one of the largest consumer branding and packaging
services companies. The company also benefits from its market
position in the memorialization market with exposure to the
cremation market. The Memorialization segment benefitted from
increased sales of funeral products as a result of the pandemic.
The Industrial Solutions segment, which accounts for a relatively
smaller proportion of overall revenue, is expected to have strong
growth prospects via sales to warehousing.
Matthews has been focused on deleveraging with a publicly announced
net leverage target of 3.0x (company's calculation) and has paid
down a significant amount of debt over the past twelve months.
Total debt declined by approximately $180 million during the twelve
months ended March 2021. However, Moody's expects that once the
leverage target is reached Matthews may focus on stock buy-backs as
a use of cash. Over the long run Moody's also expects the company
to continue acquiring and consolidating in order to stabilize
overall revenue and balance any declines in organic revenue and
since the markets that it operates in are fragmented in nature.
The stable outlook reflects the expectation that revenue will grow
in the low single-digit percentage range over the next 12 months,
aided by stabilization in demand from retail customers as stores
reopen and marketing spend recovers from the pandemic.
Memorialization is a stable segment with demand for funeral
products increasing as a result of the pandemic. Moody's expects
normalization of demand for products across the memorialization
segment including products for cemeteries, funerals and cremation
equipment over the next twelve to eighteen months. The stable
outlook is also supported by the extension of the revolver maturity
to March 2025, which eliminates the risk of near-term maturities.
Free cash flow to debt is expected to remain solid and in the
mid-teen area over the next 12 to 18 months. Although working
capital is expected to be a contributor to cash flow this year and
flat beyond this year, Moody's expects Matthews to generate cash
over the projection period assuming no acquisitions or stock
buy-backs.
The SGL-2 Speculative Grade Liquidity rating reflects Moody's
expectation that Matthews will maintain good liquidity over the
next 12 months, characterized by good free cash flow generation and
availability under its revolver and securitization facility. As of
March 31, 2021, internal sources of cash consisted of $47 million
of cash on hand and Moody's expects approximately $150 million of
free cash flow (after dividends) in FY 2021. External liquidity is
supported by a $750 million senior secured revolver (unrated) that
had $367 million of borrowings outstanding as of March 31, 2021 and
that matures in March 2025. While utilization is relatively high
compared to effective availability, the revolver is used mainly for
discretionary purposes (acquisitions and repurchases). The
remaining availability also provides good cushion to offset
unforeseen disruptions. The revolver is subject to a maximum Total
Leverage Ratio, a maximum Senior Leverage Ratio, and a minimum
Interest Coverage Ratio (as defined in the facility agreement.)
Moody's does not expect the company to have any covenant compliance
issues over the next 12 months.
The B2 rating on the senior unsecured notes reflects both the
probability of default of the company, reflected in the Ba3-PD
Probability of Default Rating, and a loss given default assessment
of LGD5, reflecting their relative position in the debt capital
structure. The notes are effectively subordinated to all of the
company's secured debt, which includes the $750 million revolving
credit facility (unrated) and the securitization facility.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Although unlikely in the near term, the ratings could be upgraded
if the company demonstrates consistent organic revenue growth and a
strong track record of debt repayment such that Moody's expect debt
to EBITDA will be sustained below 3.75x, and free cash flow to debt
will be above 15% (all metrics Moody's adjusted). In addition,
increasing scale in all the business segments would indicate a
stronger market position in the sectors that the business segments
operate in and would create upward rating momentum.
The ratings could be downgraded if the company is unable to
stabilize and improve operating performance whether the cause is
competitive pressure, or integration challenges. Declining revenue
and lower profitability would also likely imply that leverage will
increase and that would create downward pressure on the ratings.
Ratings could also be downgraded if the company adopts more
aggressive financial policies, there is a deterioration of
liquidity or free cash flow, or debt to EBITDA is expected to be
sustained above 4.75x.
Matthews is a designer, manufacturer and marketer of
memorialization products, brand solutions and industrial automation
solutions based in Pittsburgh, PA. The company operates in three
segments: SGK Brand Solutions, which provides brand management and
packaging solutions mainly for consumer and retail customers;
Memorialization, which provides bronze and granite memorials and
other memorialization products, caskets, and cremation and
incineration equipment and Industrial Solutions segment, which
manufactures marking and coding equipment and consumables,
industrial automation products and order fulfillment systems for
customers across sector. Annual revenue is about $1.5 billion. The
company is publicly traded (NASDAQ: MATW.)
The principal methodology used in these ratings was Business and
Consumer Service Industry published in October 2016.
MAUNESHA RIVER: May Use Cash Collateral Until August 23
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Judge Catherine J. Furay authorized Maunesha River Dairy, LLC to
use cash collateral, on an interim basis, for the conduct of its
business, pursuant to the budget until the end of the 13-week
period at 12 a.m. on August 23, 2021.
The 13-week budget provided for $1,199,543 in total operating
expenses:
The 13-week budget provided for $1,199,543 in total operating
expenses, allocated on a weekly basis, as follows:
$118,355 for the week beginning May 24, 2021;
$74,286 for the week beginning June 1, 2021;
$38,006 for the week beginning June 7, 2021;
$138,905 for the week beginning June 14, 2021;
$135,945 for the week beginning June 21, 2021;
$57,626 for the week beginning June 28, 2021;
$90,481 for the week beginning July 5, 2021;
$105,360 for the week beginning July 12, 2021;
$90,481 for the week beginning July 19, 2021;
$107,799 for the week beginning July 26, 2021;
$83,105 for the week beginning August 2, 2021;
$8,521 for the week beginning August 9, 2021; and
$150,671 for the week beginning August 16, 2021.
BMO Harris Bank, N.A. (BMO); Farmers & Merchants Union Bank (FMUB);
and Agri-Max Financial Services, LP (Agri-Max) consent to the
payment of the Debtor's professional fees from the cash
collateral.
As adequate protection:
a. the Debtor shall make interest-only payments of:
* $20,257 monthly to BMO;
* $18,661 for June and increase to $19,283 in July and
August (per diem interest is $622) to FMUB; and
* $1,462 to the SBA.
b. the Debtor shall continue to make contractual payments of:
* $2,855 monthly to Agri-Max for its purchase-money
security interest in the milking parlor equipment and
accessories;
* $2,672 monthly to CNH Industrial Capital America, LLC
(CNH) for its purchase- money security interests in 280
Magnum Tractor and CASE IH 330 34 Foot Turbo; and
* $5,086 monthly to AgDirect (related to the Mower and
Harvester) and of $2,213 monthly to CNH (related to the
Husky Spreaders) for their purchase-money security
interests in five pieces of equipment titled in the name
of insider Dennis Ballweg, but used exclusively by and
paid exclusively by the Debtor.
The Court ruled that for each 4-week period set forth in the budget
(on a cumulative basis), beginning May 31 and ending June 27, 2021,
the Debtor's actual ending cash balance for the period will not be
less than 85% of the ending cash balance as set forth in the
budget, with a permitted 15% variance in the aggregate.
The Court further ruled the Debtor shall open two DIP accounts with
BMO within three business days of the entry of the interim order to
be used as (i) the Debtor's general operational account and (ii) an
escrow account (Herd Account) in which all cull cow proceeds shall
be deposited.
The funds in the Herd Account shall be used exclusively for the
purchase of replacement livestock, in accordance with the budget,
provided that the Debtor provides BMO with the number of head,
price per head and type of livestock prior to purchase. BMO shall
have a replacement lien in the livestock, and in any acquired
post-petition to the same extent as its pre-petition lien.
A copy of the order is available for free at https://bit.ly/3gaQffG
from PacerMonitor.com.
About Maunesha River Dairy, LLC
Maunesha River Dairy, LLC sought protection under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. W.D. Wis. Case. No. 21-11157) on May
27, 2021. In the petition signed by Dennis E. Ballweg, the member,
the Debtor disclosed up to $10 million in both assets and
liabilities.
Judge Catherine J. Furay oversees the case.
Jane F. Zimmerman, Esq., at Murphy Desmond S.C. is the Debtor's
counsel.
MAX FINE FURNITURE: Seeks Approval to Hire Texas State Auctions
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Max Fine Furniture & Appliances, Inc. seeks approval from the U.S.
Bankruptcy Court for the Southern District of Texas to hire Texas
State Auctions to conduct an auction of its assets.
The Debtor owns and uses a pallet racking system at its warehouse
in Weslaco, Texas, part of which the Debtor no longer needs and
wishes to sell.
As compensation, Texas State Auctions will receive 12.5 percent of
the gross sales upon consummation of the sale.
As disclosed in court filings, Texas State Auctions and its
employees are "disinterested persons" as that phrase is defined in
Section 101(14) of the Bankruptcy Code.
The firm can be reached through:
Joe Bond
Texas State Auctions
5882 N. Val Verde Road
Donna, TX 728537
Phone: (956) 328-9109
About Max Fine Furniture & Appliances
Weslaco, Texas-based Max Fine Furniture & Appliances, Inc. --
https://www.maxfinefurniture.com/ -- sells a wide selection of
bedroom, living room, dining room, leather, home office, kids
furniture and brand name mattresses. It carries several brands,
including Ashley, Restonic Mattresses and Best Chair.
Max Fine Furniture & Appliances sought Chapter 11 protection
(Bankr. S.D. Texas Case No. 20-70114) on March 17, 2020. In the
petition signed by Maximo Saenz, president, the Debtor disclosed
$6,283,658 in assets and $4,261,778 in liabilities. Judge Eduardo
V. Rodriguez oversees the case. Pulman, Cappuccio & Pullen, LLP is
the Debtor's legal counsel.
MICROSTRATEGY INC: Moody's Assigns 'B3' CFR, Outlook Stable
-----------------------------------------------------------
Moody's Investors Service assigned to MicroStrategy Incorporated a
B3 Corporate Family Rating, a B3-PD probability of Default Rating
and SGL-2 Speculative Grade Liquidity Rating. Concurrently, Moody's
assigned a Ba3 rating to the company's proposed $400 million senior
secured notes. The outlook is stable.
Proceeds from the proposed secured notes issuance will be used to
finance MicroStrategy's purchase of the digital asset Bitcoin,
which the company uses as its primary treasury asset. The ratings
largely reflect the cash flow generation of the core software
business and MicroStrategy's aggressive financial policies of
raising debt in order to fund the purchase of risky, unregulated
digital assets. Moody's also notes that the elevated financial
leverage is the result of debt financing to purchase Bitcoin
assets, which are significant relative to the company's asset
base.
Assignments:
Issuer: MicroStrategy Incorporated
Corporate Family Rating, Assigned B3
Probability of Default Rating, Assigned B3-PD
Speculative Grade Liquidity Rating, Assigned SGL-2
Senior Secured Regular Bond/Debenture, Assigned Ba3 (LGD1)
Outlook Actions:
Issuer: MicroStrategy Incorporated
Outlook, Assigned Stable
RATINGS RATIONALE
The B3 CFR reflects MicroStrategy's very high financial leverage,
small scale relative to competing data analytics software providers
and expectations for modest organic growth in the low single digit
percent range. MicroStrategy, which generated revenues of about
$492 million in the LTM period ended March 31, 2021, will have
Moody's adjusted gross leverage well in excess of 20x (Moody's
treats stock-based compensation as an expense) pro forma for the
proposed transaction. Though leverage is extraordinarily high, the
company has a very low cost of borrowing with $650 million and
$1.05 billion of convertible notes outstanding bearing interest
rates of .75% and 0%, respectively. The low interest expense
enables strong interest coverage as well as free cash flow
generation. Moody's expects MicroStrategy's free cash flow will
approximate 4-5% of total gross debt over the next 12-18 months,
driven by low single digit organic growth and modestly improving
margins as the company resumes growth following declines related to
disruptions from the COVID-19 pandemic in 2020.
MicroStrategy also maintains substantial treasury reserves in the
form of alternative assets (currently Bitcoin) which, while
considered volatile, could potentially provide an alternate
liquidity source in a distressed situation. Moody's note however
that all of the company's existing digital assets are held at an
entity outside of the secured notes' collateral package.
Additionally, should the value of the treasury assets fall
significantly there is potential for refinancing risk related to
the outstanding convertible bonds. If the bonds could not be
settled with equity or refinanced at similar rates, Moody's expects
free cash flow generation would be substantially weakened.
MicroStrategy's core software products are well regarded by
industry analysts and deployed across many large enterprises
throughout North America, Europe and APAC. The company generates
its revenues across a highly diverse set of end-markets with
moderate concentration in the banking sector which accounts for
about 17% of revenues. MicroStrategy's business intelligence
products employ an open architecture and can integrate with both
complementary and competing offerings like Excel, Power BI, and
Tableau, enabling enterprise grade analytics to be performed across
a myriad of different customer deployment preferences.
MicroStrategy's revenues are largely recurring in nature, with
about 66% derived from product support and subscription contracts
with strong gross retention rates of about 95%. The company is
currently in the early stage of a transition toward a SaaS or
cloud-based business model and subscription contracts will
gradually increase as a proportion of recurring revenue (currently
about 7% of revenues in the LTM period ended March 31, 2021). The
transition to SaaS is expected to provide a modest economic benefit
to MicroStrategy over the next few years.
Governance risks are a consideration in the ratings as
MicroStrategy is a publicly held company with two classes of common
stock (class A receives 1 vote per share and class B receives 10
votes per share). The company's founder and CEO, Michael Saylor
owns the majority of the class B stock giving him control of the
company with 72% of voting power as of 2020. Mr. Saylor could
transfer control of the business, prevent a change of control or
limit the ability of other stockholders to influence corporate
matters. Further, the company has engaged in aggressive financial
policies by raising debt in order to fund the purchase of volatile,
unregulated digital assets. Changes in the value of MicroStrategy's
digital assets could adversely affect its treasury holdings and
liquidity. There is potential for the company to further increase
financial leverage over time as it continues its strategy of
purchasing digital assets. While the company does not currently pay
a dividend, returns to shareholders are possible through the
company's share repurchase authorization (total plan authorization
of $800 million, of which $209.1 million remains available for
repurchases as of March 31, 2021), subject to the limitations on
such repurchases set forth in the senior secured notes.
The stable outlook reflects Moody's expectation that MicroStrategy
will grow revenues and EBITDA organically in the low single digit
percent range and generate stable free cash flow approximating 4-5%
of gross debt over the next 12-18 months.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
MicroStrategy's ratings could be downgraded if Moody's expects free
cash flow to debt will be sustained below the low single digit
percent range or if the company were to raise additional debt such
that interest coverage levels were materially reduced.
MicroStrategy's ratings could be upgraded if the company were to
adopt more conservative financial policies and grow revenues and
EBITDA organically such that leverage were materially reduced and
free cash flow to debt was expected to be sustained around 7-8%.
MicroStrategy's SGL-2 Speculative Grade Liquidity Rating is
supported by expectations for healthy free cash flow generation of
at least $80 million in 2021 and $50 million of balance sheet cash
expected following the close of the transaction. Alternate
liquidity could be provided by the sale of stock or MicroStrategy's
digital assets though their value is expected to be volatile over
time. The company does not maintain a revolving line of credit.
The Ba3 rating on MicroStrategy's senior secured notes reflects the
company's B3-PD probability of default rating, their senior secured
nature and position in the capital structure relative to the
outstanding $650 million and $1.05 billion convertible notes due in
2025 and 2027, respectively. The senior secured notes are expected
to have a maturity of 7 years with springing maturity 91 days
inside the existing 2025 and 2027 convertible notes maturities if
MicroStrategy does not have liquidity in a specified amount at such
a time.
MicroStrategy (NASDAQ: MSTR) is an independent provider of business
intelligence software deployed on premise, in the cloud or via
mobile applications. The company, headquartered in Tyson's Corner,
Virginia generated revenues of approximately $481 million in the
year ended December 31, 2020.
The principal methodology used in these ratings was Software
Industry published in August 2018.
MTPC LLC: Seeks Approval to Hire McDermott as New Legal Counsel
---------------------------------------------------------------
MTPC, LLC and its affiliates seek approval from the U.S. Bankruptcy
Court for the Middle District of Tennessee to hire McDermott Will &
Emery, LLP as their new bankruptcy counsel.
The firm's services include:
a. giving advice to the Debtors regarding their powers and
duties in the continued operation of their business, including the
negotiation and finalization of any financing agreements;
b. assisting in the identification of assets and liabilities
of the Debtors' estate;
c. assisting the Debtors in formulating a plan of
reorganization or liquidation and taking the necessary legal steps
to confirm such plan;
d. preparing legal documents;
e. appearing in court;
f. analyzing claims and competing property interests, and
negotiating with creditors and parties-in-interest;
g. advising the Debtors in connection with any potential sale
of their assets; and
h. other legal services necessary to administer the Debtors'
bankruptcy cases.
The firm has agreed to provide a discount on the rates charged by
the primary attorneys who will be handling the Debtors' cases. The
discounted hourly rates are as follows:
Marcus A. Helt $915 per hour
Jack G. Haake $655 per hour
Shelby Taylor Perry $619 per hour
Cathy Miller Greer $342 per hour
McDermott will also provide a discount of approximately 25 percent
from the rates charged by other professionals at the firm who may
provide bankruptcy-related services. The current hourly rates
charged by these professionals are as follows:
Partners $1,050 - $2,200 per hour
Associates $645 - $1,065 per hour
Non-Lawyer Professionals $75 - $1,200 per hour
As disclosed in court filings, McDermott is a "disinterested
person" within the meaning of Bankruptcy Code Section 101(14).
In accordance with Appendix B-Guidelines for reviewing fee
applications filed by attorneys in larger Chapter 11 cases,
McDermott disclosed that:
-- the firm has agreed to a discount of approximately 25
percent from its customary hourly rates;
-- none of the professionals included in the engagement vary
their rate based on the geographic location of the bankruptcy
cases;
-- the firm has not represented the Debtors in the 12 months
prior to their Chapter 11 filing; and
-- the approved prospective budget is included in the
"cash-collateral" and debtor-in-possession financing motions and
related orders.
The firm can be reached through:
Marcus A. Helt, Esq.
Jack G. Haake, Esq.
McDermott Will & Emery LLP
2501 North Harwood Street, Suite 1900
Dallas, TX 75201
Tel: (214) 210-2801
Fax: (972) 528-5765
Email: mhelt@mwe.com
jhaake@mwe.com
About MTPC LLC
MTPC LLC is a proton-therapy cancer-treatment center that serves a
multi-state area of the Southeastern United States and began
operations in 2018. It is a freestanding center with three active
treatment rooms including one fixed beam and two gantries. MTPC is
located in a 43,500-square-foot building adjacent to the campus of
the Williamson Medical Center, in Franklin, Tenn.
MTPC's affiliate, The Proton Therapy Center, LLC, is a Tennessee
limited liability company that was organized in 2010. It is a
freestanding center with three active treatment rooms including one
fixed beam and two gantries. Proton Therapy Center is located in
an 88,000-square-foot building on the campus of the Provision Case
CARES Cancer Center at Dowell Springs, in Knoxville, Tenn., a
comprehensive healthcare campus focusing on cancer treatment,
patient care, research, and education.
PCPT Hamlin, another affiliate of MTPC, is a Florida limited
liability company that was organized in 2018. It includes an
approximately 36,700-square-foot building in the 900-acre Hamlin
planned development in the "Town Center" of the 23,000-acre
"Horizon West" planning area of West Orange County.
MTPC and its affiliates sought Chapter 11 protection (Bankr. M.D.
Tenn. Lead Case No. 20-05438) on Dec. 15, 2020.
As of Aug. 31, 2020, MTPC's unaudited financial statements
reflected total assets of approximately $105.6 million and total
liabilities of approximately $131.2 million. Proton Therapy
Center's unaudited financial statements reflected total assets of
approximately $93.4 million and total liabilities of approximately
$130.2 million. Meanwhile, PCPT Hamlin's unaudited financial
statements reflected total assets of approximately $139.2 million
and total liabilities of approximately $138.5 million.
The Hon. Randal S. Mashburn is the case judge.
The Debtors tapped McDermott Will & Emery LLP as lead bankruptcy
counsel, Waller Lansden Dortch & Davis LLP as co-counsel with
McDermott, Trinity River Advisors LLC as restructuring advisor, and
CRS Capstone Partners LLC as financial advisor. Stretto is the
claims agent.
The U.S. Trustee for Region 8 appointed an official committee of
unsecured creditors on Jan. 8, 2021. The committee is represented
by Sills Cummis & Gross P.C. and Manier & Herod, P.C.
MYOMO INC: Provides Update on CMS Discussions
---------------------------------------------
Myomo, Inc. provided an update regarding its application for a
Healthcare Common Procedure Coding System ("HCPCS") Level II code
change and benefit category redetermination for HCPCS codes L8701
and L8702 submitted in January 2021.
The Centers for Medicare & Medicaid Services (CMS) proposed several
changes to the benefit category determination process in its
proposed rule CMS-1738-P, "Medicare Program; Durable Medical
Equipment, Prosthetics, Orthotics and Supplies ("DMEPOS") Policy
Issues and Level II of the Healthcare Common Procedure Coding
System (HCPCS)" (85 Fed. Reg. 70358, November 4, 2020). With the
change in CMS leadership and continued COVID mitigation planning,
finalization of the Proposed Rule has been delayed. As a result,
Myomo withdrew its HCPCS code change application and intends to
meet with CMS to continue discussions for finalizing the
appropriate Medicare benefit category, coverage and fee
publications for HCPCS codes L8701 and L8702. The Company intends
to continue with its current business strategy of serving patients
with certain Medicare Advantage, commercial and government health
insurance plans.
Paul R. Gudonis, chief executive officer of Myomo commented, "Since
a new CMS Administrator was only recently confirmed, we decided
that it was in the Company's best interest to withdraw our
application until the Proposed Rule is finalized. We intend to
resubmit our coding application at that time. Due to recent
actions by the new Administration, over 800,000 more Americans now
have access to health insurance and we are pleased to see this
broader access. We look forward to working with new CMS leadership
and staff to enable more individuals with dysfunctional arms to
gain access to a MyoPro brace to restore their arm and hand
function and reduce their overall cost of care."
About Myomo
Headquartered in Cambridge, Massachusetts, Myomo, Inc.
--http://www.myomo.com-- is a wearable medical robotics company
that offers expanded mobility for those suffering from
neurologicaldisorders and upper limb paralysis. Myomo develops and
markets the MyoPro product line. MyoPro is a powered upper limb
orthosis designed to support the arm and restore function to the
weakened or paralyzed arms of patients suffering from CVA stroke,
brachial plexus injury, traumatic brain or spinal cord injury, ALS
or other neuromuscular disease or injury.
Myomo reported a net loss of $11.56 million for the year ended Dec.
31, 2020, compared to a net loss of $10.71 million for the year
ended Dec. 31, 2019. As of March 31, 2021, the Company had $20.92
million in total assets, $4.86 million in total liabilities, and
$16.07 million in total stockholders' equity.
NABORS INDUSTRIES: Three Proposals Approved at Annual Meeting
-------------------------------------------------------------
The annual general meeting of shareholders of Nabors Industries
Ltd. was held on June 1, 2021, at which the shareholders:
(1) elected Tanya S. Beder, Anthony R. Chase, James R. Crane,
John P. Kotts, Michael C. Linn, Anthony G. Petrello, and
John Yearwood as directors.
(2) approved the appointment of PricewaterhouseCoopers LLP as
the Company's independent auditor and authorized the Audit
Committee to set the Independent Auditor's remuneration;
and
(3) approved the Amended and Restated Nabors Industries Ltd.
2016
Stock Plan.
The shareholders did not approve, on an advisory basis, the
compensation of the Company's named executive officers.
About Nabors
Nabors (NYSE: NBR) owns and operates land-based drilling rig fleets
and provides offshore platform rigs in the United States and
several international markets. Nabors also provides directional
drilling services, tubular services, performance software, and
innovative technologies for its own rig fleet and those of third
parties. Leveraging advanced drilling automation capabilities,
Nabors highly skilled workforce continues to set new standards for
operational excellence and transform the industry.
Nabors reported a net loss attributable to common shareholders of
$820.25 million for the year ended Dec. 31, 2020, compared to a net
loss attributable to common shareholders of $720.13 million for the
year ended Dec. 31, 2019. As of Dec. 31, 2020, the Company had
$5.50 billion in total assets, $3.80 billion in total liabilities,
$442.84 million in redeemable noncontrolling interest in
subsidiary, and $1.25 billion in total equity.
* * *
As reported by the TCR on Dec. 14, 2020, S&P Global Ratings raised
its issuer credit rating on U.S.-based onshore drilling contractor
Nabors Industries Ltd. to 'CCC+' from 'SD', reflecting its
assessment of the company's credit risk following the debt
exchange.
Also in December 2020, Fitch Ratings downgraded the Issuer Default
Rating (IDR) for Nabors Industries, Ltd. and Nabors Industries,
Inc. (collectively, Nabors) to 'RD' from 'C' upon the completion of
the company's exchange of senior unsecured notes for new senior
unsecured priority guaranteed notes. Fitch has deemed the exchange
as a distressed debt exchange (DDE) under its criteria.
NAHAUL INC: Case Summary & 11 Unsecured Creditors
-------------------------------------------------
Debtor: Nahaul, Inc.
1900 Polaris Parkway Suite 450-049
Columbus, OH 43240
Business Description: Nahaul, Inc. is a privately held
company in the general freight trucking
industry.
Chapter 11 Petition Date: June 5, 2021
Court: United States Bankruptcy Court
Northern District of Illinois
Case No.: 21-07152
Judge: Hon. Carol A. Doyle
Debtor's Counsel: Laxmi P. Sarathy, Esq.
LAXMI P. SARATHY
PO Box 60741
Chicago, IL 60660
Tel: 312-674-7965
Fax: 312-873-4774
E-mail: lsarathylaw@gmail.com
Estimated Assets: $100,000 to $500,000
Estimated Liabilities: $1 million to $10 million
The petition was signed by Serkan B. Kaputluoglu, president.
A full-text copy of the petition containing, among other items, a
list of the Debtor's 11 unsecured creditors is available for free
at PacerMonitor.com at:
https://www.pacermonitor.com/view/227HPXA/NAHAUL_INC__ilnbke-21-07152__0001.0.pdf?mcid=tGE4TAMA
NATCHITOCHES MEDICAL: Taps Diment & Associates as Legal Counsel
---------------------------------------------------------------
Natchitoches Medical Specialists, LLC, received approval from the
U.S. Bankruptcy Court for the Western District of Louisiana to hire
Diment & Associates, LLC to serve as legal counsel in its Chapter
11 case.
The firm's services include legal advice regarding the Debtor's
business, the management of its property and other matters related
to its bankruptcy case.
The firm's hourly rates are as follows:
Partners $325 per hour
Associates $225 per hour
Paraprofessionals $95 per hour
The Debtor made a deposit in the amount of $35,000, of which $1,717
was used to pay the filing fees.
Morley Diment, Esq., at Diment & Associates, disclosed in a court
filing that the firm does not represent interests adverse to the
Debtor.
Diment & Associates can be reached through:
Morley C. Diment, Esq.
Diment & Associates, LLC
2644 South Sherwood Forest Blvd., Suite 108
Baton Rouge, LA 70816
Phone: (225) 424-2588
Fax: (225) 424-2599
Email: MCD@DimentFirm.com
About Natchitoches Medical Specialists
Natchitoches Medical Specialists, LLC, a Natchitoches, La.-based
company that operates in the healthcare industry, sought protection
under Chapter 11 of the Bankruptcy Code (Bankr. W.D. La. Case No.
21-80137) on April 11, 2021. At the time of the filing, the Debtor
disclosed total assets of $8,009,156 and total liabilities of
$286,300. Judge Stephen D. Wheelis oversees the case. Diment &
Associates, LLC is the Debtor's legal counsel.
NEOVASC INC: Receives First National Reimbursement in Europe
------------------------------------------------------------
Neovasc Inc. announced that the Neovasc Reducer system has been
granted national reimbursement in England as a result of being
included in the High-Cost Tariff Excluded Devices (HCTED) national
catalogue.
The National Health Service England (NHS England) has a nationwide
purchase and supply system for specific categories of high-cost
tariff-excluded medical devices used in specialized services
designed to support the accelerated adoption of effective new
technologies. These are devices NHS England has agreed should be
paid for separately from the national tariff for a medical
procedure. Hospital providers can now order the Reducer and bill
the cost of the device directly to NHS England.
Prof. Jonathan Hill, MD, Consultant Interventional Cardiologist at
Royal Brompton & Harefield NHS Foundation Trust, London, U.K.,
commented, "The clinical data on Reducer therapy, much of it
developed in the UK, continues to demonstrate efficacy and
excellent safety. Inclusion in the HCTED catalogue is an important
step for Reducer therapy and will help new centers to begin
utilizing the device. This is good news for the many patients
suffering from refractory angina in the UK."
"Expanding reimbursement for Reducer to enable broader market
access has been a cornerstone of the value creation strategy at
Neovasc. We are pleased with the NHS decision that follows the
positive American Medical Association decision to establish a new
Category III CPT code to report the transcatheter implantation of a
coronary sinus reduction device," stated Fred Colen, president and
chief executive officer of Neovasc. "We are honored that the NHS
has assessed the Reducer as an effective new therapy for patients.
The NHS is recognized as a leading authority on health and care
excellence. Their decision will help accelerate the adoption of
Reducer therapy in the UK and will benefit patients."
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.
NEOVASC INC: Shareholders Re-Elect Six Directors
------------------------------------------------
Neovasc Inc. held its Annual General Meeting of Shareholders in
Vancouver, B.C., at which the shareholders of the Company
re-elected board members Steven Rubin, Paul Geyer, Doug Janzen,
Norman Radow, Alexei Marko, and Fred Colen to serve in office until
the next annual meeting or until their successors are duly elected
or appointed.
At the Meeting, the Shareholders also approved the unallocated
options under the Company's stock option plan (90.49% of votes cast
in favour) and re-appointed Grant Thornton LLP, Chartered
Accountants as auditors of the Company.
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.
O.P. INVESTMENT: Wins Preliminary OK on Disclosure Statement
------------------------------------------------------------
Judge Thomas J. Tucker granted preliminary approval of the
Disclosure Statement of O.P. Investment Group, LLC.
Judge Tucker set July 8, 2021, as (i) the voting deadline on the
Debtor's Chapter 11 Plan, as well as (ii) the deadline to file
objections to final approval of the Disclosure Statement and
objections to confirmation of the First Amended Plan.
The combined hearing to consider final approval of the Disclosure
Statement and confirmation of the Plan is set for July 14, 2021, at
1 p.m., by telephone.
No later than July 12, 2021, the Debtor must file a signed ballot
summary indicating the ballot count, with a copy of all ballots
attached.
A copy of the order is available for free at https://bit.ly/2RygJze
from PacerMonitor.com.
About O.P. Investment Group
O.P. Investment Group, LLC owns a commercial strip mall located at
35252-35240 23 Mile Road, New Baltimore, Michigan 48047. O.P.
Investment Group filed its Chapter 11 petition (Bankr. E.D. Mich.
Case No. 21-40722) on January 28, 2021. The petition was signed by
Bassam Kallabat, member. In its petition, the Debtor estimated its
assets and liabilities at $1 million to $10 million.
Judge Thomas J. Tucker oversees the case.
The Debtor is represented by Daniel J. Weiner, Esq., at Schafer and
Weiner, PLLC.
OCULAR THERAPEUTIX: Amends MidCap Agreement to Refinance Term Loan
------------------------------------------------------------------
Ocular Therapeutix, Inc. entered into a Fourth Amended and Restated
Credit and Security Agreement with MidCap Financial Trust, as
administrative agent, and the lenders party thereto, which amends
and restates that certain Third Amended and Restated Credit and
Security Agreement, dated Dec. 21, 2018, by and among the Company,
the Administrative Agent, and the lenders party thereto, as amended
by that certain First Amendment to Third Amended and Restated
Credit and Security Agreement, dated Feb. 21, 2019, and that
certain Second Amendment to Third Amended and Restated Credit and
Security Agreement, dated Aug. 2, 2019, to refinance the Company's
existing secured term loan facility.
Under the Agreement, the term loans outstanding under the Prior
Agreement, in the aggregate principal amount of approximately
$20,833,333.35, were rolled over and converted into a new term loan
under the Credit Facility as of the Closing Date. The Agreement
also established an additional term loan under the Credit Facility
in the principal amount of approximately $4,166,666.65 as of the
Closing Date. Under the Agreement, the aggregate principal amount
of the Term Loans available under the Credit Facility is $25.0
million, the entirety of which was drawn at closing.
The Agreement extends the term of the Credit Facility until Nov.
30, 2025, provided that the term is automatically extended until
April 1, 2026, if the Administrative Agent receives evidence
reasonably satisfactory to it, by Nov. 15, 2025, that the entire
principal amount of the $37.5 million of unsecured senior
subordinated convertible notes that the Company issued in March
2019 has been converted into equity interests of the Company and
that such indebtedness is otherwise indefeasibly satisfied in full.
The Agreement requires the Company to make interest-only payments
on the Term Loans on a monthly basis until May 1, 2024. The
Agreement requires that thereafter, in addition to the monthly
interest payments, the Company make principal payments on the Term
Loans in accordance with the amortization schedules set forth in
the Agreement. Remaining unpaid principal and accrued interest
outstanding on the Maturity Date is due on the Maturity Date.
Amounts borrowed under the Credit Facility incur interest at a
LIBOR-based rate, subject to a minimum 1.00% floor, plus 6.75%.
The Company may prepay funds drawn under the Credit Facility at any
time, in accordance with the terms of the Agreement, subject to
prepayment fees of (i) 3.00% of outstanding principal prepaid, for
funds prepaid on or prior to the one-year anniversary of the
Closing Date; (ii) 2.00% of outstanding principal prepaid, for
funds prepaid after the one-year anniversary but on or prior to the
two-year anniversary of the Closing Date; and (iii) 1.00% of
outstanding principal prepaid, for funds prepaid after the two-year
anniversary but on or prior to the three-year anniversary of the
Closing Date. No prepayment fees are required for funds prepaid
thereafter. The Company is also obligated to pay a partial exit
fee of 3.50% of outstanding principal prepaid. Further, the
Company has agreed to pay an exit fee equal to 3.50% of the Total
Credit Facility Amount, less any partial exit fees paid, at the
Maturity Date.
Pursuant to and as further described in the Agreement, the Company
granted the Lenders a first-priority security interest in all
assets of the Company, including its intellectual property, subject
to certain agreed-upon exceptions. The Agreement includes a
negative covenant restricting the Company from making payments to
the holders of the 2026 Convertible Notes except in connection with
a proposed conversion to equity and with respect to certain
permitted expenses. The Agreement also includes customary
affirmative and negative covenants including limitations on
dispositions, mergers or acquisitions; incurring indebtedness,
liens or encumbrances; paying dividends or making distributions;
making certain investments; and engaging in certain other business
transactions. The Company's obligations under the Credit Facility
are subject to acceleration upon the occurrence of specified events
of default, including a material adverse change in the Company's
business, operations or financial or other condition or a breach or
default in the Company's obligations under the 2026 Convertible
Notes. At the election of the Administrative Agent, the Agreement
provides that, following the occurrence and during the continuance
of an event of default as defined in the Agreement, the Term Loans
may bear an interest rate that is 4.00% above the rate that is
otherwise applicable.
About Ocular Therapeutix
Headquartered in Bedford, MA, Ocular Therapeutix, Inc.
--http://www.ocutx.com-- is a biopharmaceutical company focused on
the formulation, development, and commercialization of innovative
therapies for diseases and conditions of the eye using its
proprietary bioresorbable hydrogel-based formulation technology.
Ocular Therapeutix's first commercial drug product, DEXTENZA, is
FDA-approved for the treatment of ocular inflammation and pain
following ophthalmic surgery.
Ocular Therapeutix reported a net loss and comprehensive loss of
$155.64 million for the year ended Dec. 31, 2020, compared to a net
loss and comprehensive loss of $86.37 million for the year ended
Dec. 31, 2019. As of March 31, 2021, the Company had $243.04
million in total assets, $159.63 million in total liabilities, and
$83.41 million in total stockholders' equity.
OMNIQ CORP: Signs Deal for AI Based Cloud Software for PERCS
------------------------------------------------------------
OmniQ Corp announced a Phase 1 Software as a Service Agreement with
a multi-billion dollar top ranked medical center (Medical Center),
to deploy its PERCS (Permitting, Enforcement, Revenue and
Collection) Cloud-hosted Software for campus parking management.
On an annual basis, the Medical Center generates more than $5
billion in revenue, seeing more than 5 million patients, with more
than 50,000 employees and runs a campus on more than 100 acres of
land. The agreement calls for an initial two-year term of services
with one year renewal options.
In addition, the Medical Center has entered into a Gold Service
Level Agreement (SLA) with omniQ to provide 24/7/365 support
coverage. The agreement provides terms for remote, onsite,
upgrade, warranty, maintenance and hardware replacement throughout
the term.
Omniq's CEO, Shai Lustgarten stated, "The momentum continues,
following our recent announcement regarding our AI based PERCS
project at the Georgia State University we are honored to enter
into an agreement with this top ranked Medical Center to provide
our AI based PERCS software and to streamline campus parking
management, and provide for around the clock support. It is hard
to overstate how gratifying it is to have omniQ technology
solutions selected by an organization that is at the forefront of
modern medicine."
OmniQ PERCS will be deployed to aggregate data between various
campus staff management systems. The PERCS cloud will manage the
campus parking program. Data imported from the campus HR (Workday)
system and (LSI and Lenel) Badging Systems will create parker
accounts within PERCS cloud. The parking management staff will
define parking rules for the campus staff and manage the overall
parking program via PERCS cloud. Access to various parking areas
for individual users will be downloaded to the existing Parking,
Access and Revenue Control System (PARCS) in place. In addition,
visitor lots can be enforced for permit violations with the omniQ
VISION Mobile LPR vehicle on site.
About omniQ Corp.
Headquartered in Salt Lake City, Utah, omniQ Corp. (OTCQB: OMQS) --
http://www.omniq.com-- provides computerized and machine vision
image processing solutions that use patented and proprietary AI
technology to deliver data collection, real time surveillance and
monitoring for supply chain management, homeland security, public
safety, traffic & parking management and access control
applications. The technology and services provided by the Company
help clients move people, assets and data safely and securely
through airports, warehouses, schools, national borders, and many
other applications and environments.
Omniq Corp. reported a net loss attributable to common stockholders
of $11.31 million for the year ended Dec. 31, 2020, compared to a
net loss attributable to common stockholders of $5.31 million for
the year ended Dec. 31, 2019. As of March 31, 2021, the Company
had $38.21 million in total assets, $45.55 million in total
liabilities, and a total stockholders' deficit of $7.34 million.
Salt Lake City, Utah-based Haynie & Company, the Company's auditor
since 2019, issued a "going concern" qualification in its report
dated March 31, 2021, citing that the Company has a deficit in
stockholders' equity, and has sustained recurring losses from
operations. This raises substantial doubt about the Company's
ability to continue as a going concern.
ONEJET INC:Chapter 7 Trustee Tries to Stop Founder's $10 Mil. Claim
-------------------------------------------------------------------
Law360 reports that an investment company owned by the family that
ran the now-defunct OneJet Inc. into bankruptcy shouldn't get to
make a claim for $10 million it allegedly "loaned" the struggling
airline, the Chapter 7 trustee overseeing the case said in an
adversary complaint. Trustee Rosemary Crawford told the U. S.
Bankruptcy Court in Pittsburgh that lender PrimAir Venture Partners
was actually a conduit for cash transfers to and from
Maguire/Maguire Inc. , through which founding family members
Patrick Maguire, Matthew Maguire and Jean Rieke kept the struggling
OneJet afloat and allegedly repaid themselves with new investors'
funds. The Maguires controlled the amount and timing of. . .
About OneJet Inc.
OneJet Inc. was a virtual airline that specialized in scheduled
point-to-point flights operated by small business jets and regional
aircraft. Flights were operated utilizing a public charter
arrangement.
OneJet was forced into involuntary Chapter 7 bankruptcy (Bankr.
W.D. Pa. Case No. 18-24070) by several investors in October 2018,
two months after it stopped flying. It later reported it had no
assets and $43 million in liabilities.
The Chapter 7 Trustee:
Rosemary C. Crawford
Crawford McDonald, LLC. P.O. Box 355
Allison Park, PA 15101
The Chapter 7 Trustee's counsel:
Kirk B. Burkley
Bernstein-Burkley, P.C.
Tel: 412-456-8108
E-mail: kburkley@bernsteinlaw.com
- and -
Rosemary C. Crawford
Crawford Mcdonald, Llc.
Tel: 724-443-4757
E-mail: crawfordmcdonald@aol.com
OPTIMUMBANK HOLDINGS: Commences Exchange Offer for TruPS
--------------------------------------------------------
OptimumBank Holdings, Inc. has commenced a private offer to
exchange its outstanding Trust Preferred Securities, upon the terms
and subject to the conditions set forth in the confidential
offering memorandum dated June 7, 2021 and related letter of
transmittal.
The Exchange Offer will expire immediately after 11:59 p.m.,
Eastern Time, on July 8, 2021, unless extended.
Under the Exchange Offer, the Company will issue shares of its
common stock, par value $0.01 per share, for Trust Preferred
Securities. The number of shares of Common Stock that will be
exchanged for each Trust Preferred Security will be determined by
dividing (i) the outstanding balance of each Trust Preferred
Security as of the Expiration Date by (ii) the applicable price of
the Common Stock as of the Expiration Date. The Exchange Offer
Price will be equal to the lesser of (i) $3.00 per share or (ii)
the closing market price of the Common Stock on the Expiration
Date. As of June 4, 2021, the closing market price of the Common
Stock was $3.95 per share, which would have resulted in an Exchange
Offer Price of $3.00 per share.
The maximum aggregate number of shares of Common Stock that will be
issued by the Company in the Exchange Offer will not exceed 700,000
shares. Additionally, the maximum aggregate value of the Trust
Preferred Securities that may be exchanged will not exceed
$2,100,000 (calculated on the basis of the outstanding balance of
such Trust Preferred Securities as of the Expiration Date). In the
event that the number of Trust Preferred Securities that are
validly tendered exceeds these limits, then the number of Trust
Preferred Securities that may be accepted for exchange from each
holder of the Trust Preferred Securities will be reduced on a pro
rata basis.
The Company will issue shares of Common Stock to the Holders of the
Trust Preferred Securities who properly tender and do not validly
withdraw their Trust Preferred Securities promptly after the
Expiration Date. Holders who tender and do not withdraw their
Trust Preferred Securities in the Exchange Offer will not be
entitled to any interest on such Trust Preferred Securities.
About OptimumBank
OptimumBank Holdings, Inc. is a Florida corporation formed in 2004
as a bank holding company for OptimumBank. The Company's only
business is the ownership and operation of the Bank. The Bank is a
Florida state chartered bank established in 2000, with deposits
insured by the Federal Deposit Insurance Corporation. The Bank
offers a variety of community banking services to individual and
corporate customers through its three banking offices located in
Broward County, Florida.
OptimumBank reported a net loss of $782,000 for the year ended Dec.
31, 2020, compared to a net loss of $1.10 million for the year
ended Dec. 31, 2019. As of Dec. 31, 2020, the Company had $235.11
million in total assets, $217.28 million in total liabilities, and
$17.83 million in total stockholders' equity.
ORBCOMM INC: Moody's Assigns B3 CFR on GI Partners Transaction
--------------------------------------------------------------
Moody's Investors Service assigned ratings to ORBCOMM Inc. (New),
consisting of a B3 corporate family rating, B3-PD probability of
default rating, and B3 ratings to the company's proposed senior
secured revolving credit facility and senior secured first lien
term loan. The outlook is stable.
On April 8, 2021, ORBCOMM announced that it had agreed to be
acquired by GI Partners (sponsor), a US-based investor in data
infrastructure businesses, for about $1.1 billion, including net
debt. Net proceeds from a new $360 million senior secured first
lien term loan and about $800 million of common equity contributed
by the sponsor, will be used to purchase the company and to pay
fees and expenses. A new $50 million senior secured revolving
credit facility is not expected to be drawn at close.
Assignments:
Issuer: ORBCOMM Inc. (New)
Corporate Family Rating, Assigned B3
Probability of Default Rating, Assigned B3-PD
Senior Secured First Lien Term Loan, Assigned B3 (LGD3)
Senior Secured First Lien Revolving Credit Facility, Assigned B3
(LGD3)
Outlook Actions:
Issuer: ORBCOMM Inc. (New)
Outlook, Assigned Stable
RATINGS RATIONALE
ORBCOMM's B3 CFR is constrained by: (1) elevated pro forma leverage
(adjusted Debt/EBITDA of 6.6x for LTM Q1/2021), together with
Moody's expectation that the metric will be sustained around 6x in
the next 12 to 18 months; (2) small scale (revenue of less than
$300 million) as a provider of industrial Internet of Things (IoT)
solutions that allow assets to be tracked, monitored, and
controlled remotely; (3) competitive risks as some larger rated
peers add new satellite capacity in order to pursue opportunities
in its target markets; and (4) ownership by private equity, which
could lead to leveraging transactions, including dividends and
acquisitions. The rating benefits from: (1) good and defensible
market positions as its offerings are embedded in customers'
processes and are complimented with competitive pricing; (2)
positive organic growth prospects, especially as there are lots of
remote and mobile assets globally that have not been penetrated
with connectivity; (3) good diversification across geographies,
industries and customers; and (4) very good liquidity, including
positive free cash flow generation.
The new credit facilities are rated at the same level as the CFR
because they make up the total debt capital.
As proposed, the new secured credit facilities (revolver and term
loan) are expected to provide covenant flexibility that if utilized
could negatively impact creditors. Notable terms include the
following: (1) incremental debt capacity not to exceed the sum of
(A) an amount equal to (i) the greater of $65.7 million and 100% of
pro forma consolidated EBITDA for the recent four quarters; plus
(B) an unlimited amount as would not result in the Consolidated
First Lien Net Leverage Ratio exceeding 5.50x (for pari passu first
lien debt). Amounts up to the greater of $65.7 million and 100% of
consolidated EBITDA may be incurred with an earlier maturity date
and a shorter life to maturity than the initial term loans; (2)
there no express "blocker" provisions which prohibit the transfer
of specified assets to unrestricted subsidiaries, such transfers
are permitted subject to carve-out capacity and other conditions;
(3) only wholly-owned subsidiaries are required to provide
guarantees, raising the risk of potential guarantee releases if
they cease to be wholly-owned, with no explicit protective
provisions limiting such guarantee releases; and (4) there are no
express protective provisions prohibiting an up-tiering
transaction. The proposed terms and the final terms of the credit
agreement may be materially different.
ORBCOMM has moderate social risk. Given its collection, storage,
transmission, use and disclosure of user data and personal
information, a cyber breach could cause legal, regulatory or
reputation issues and increased operational costs.
ORBCOMM has high governance risk. As a sponsor-owned company when
the going private transaction closes, its financial policies will
favor its owner.
ORBCOMM has very good liquidity over the next 12 months. Sources
approximate $85 million while the company will have $3.6 million of
term loan amortization in the next four quarters. Liquidity is
supported by $10 million of cash when the acquisition closes,
Moody's expected free cash flow of around $25 million through the
next four quarters and full availability under its new $50 million
revolving credit facility due in 2026. The revolver will be subject
to a springing first lien net leverage covenant when utilization
hits a certain threshold and cushion is expected to exceed 30% over
the next 12 months if applicable. ORBCOMM has limited flexibility
to generate liquidity from asset sales.
The outlook is stable because Moody's expects good operating
performance and maintenance of at least good liquidity while modest
EBITDA growth should allow leverage to be sustained around 6x in
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 profitably enhances
its scale or if it sustains leverage below 5x (pro forma 6.6x) and
FCF/Debt above 5% (pro forma 8%).
The ratings could be downgraded if liquidity becomes weak, or if
leverage is sustained above 6.5x (pro forma 6.6x) and FCF/Debt
below 0% (pro forma 8%).
The principal methodology used in these ratings was Business and
Consumer Service Industry published in October 2016.
ORBCOMM, headquartered in Rochelle Park, New Jersey, is a global
provider of industrial Internet of Things and Machine-to-Machine
communication solutions to transportation, heavy equipment,
maritime, and government customers that allow them to track,
monitor, and control their assets remotely. For the twelve months
ended March 31, 2021, the company generated revenue of $246 million
and had more than 2.2 million subscribers.
PAYA HOLDINGS III: Moody's Assigns 'B1' CFR, Outlook Stable
-----------------------------------------------------------
Moody's Investors Service assigned a B1 Corporate Family Rating,
B1-PD Probability of Default Rating and SGL-1 Speculative Grade
Liquidity rating to Paya Holdings III, LLC. The company's proposed
senior secured credit facilities were assigned a rating of B1. The
rating outlook is stable.
"Paya's business stability is above average for the merchant
acquiring sector, as evidenced by the steady performance in 2020"
said Peter Krukovsky, Moody's Senior Analyst. "The company follows
a prudent capital structure strategy, with moderate leverage and
solid cash liquidity reinforced by the recent equity offering.
However, over time potential incremental debt issuance for
acquisitions may result in intermittent re-leveraging."
The following rating actions were taken:
Assignments:
Issuer: Paya Holdings III, LLC
Corporate Family Rating, Assigned B1
Probability of Default Rating, Assigned B1-PD
Speculative Grade Liquidity Rating, Assigned SGL-1
Senior Secured Bank Credit Facility, Assigned B1 (LGD3)
Outlook Actions:
Issuer: Paya Holdings III, LLC
Outlook, Assigned Stable
RATINGS RATIONALE
Paya's small business scale in the highly competitive merchant
acquiring sector is counterbalanced by its differentiated positions
in defensive niche market verticals, high contribution of
integrated payments including B2B accounts receivable automation
solutions, high proportion of card not present revenues, and
relatively low customer attrition rates. These factors result in
relatively high stability of business profile, as evidenced by the
company's stable revenue generation in 2020 when many merchant
acquirers experienced revenue pressures. Paya's business prospects
benefit from positive secular trends that accelerated in the
pandemic, including cash displacement by electronic payments and
increasing penetration of integrated payments in B2B payment
flows.
Moody's projects Paya's revenues to grow in the mid-to-high teens
in 2021 including the effect of the recent acquisitions, driven by
strength in the integrated business lines that Moody's estimates
accounted for 64% of revenues in 2020. The non-integrated business
is also projected to grow solidly with support from key customer
wins and a constructive macro payments environment. While the
non-integrated business may be pressured over time, its high
quality merchant portfolio supported steady performance in 2020 and
will support its growth prospects in the near term. With solid
EBITDA margins in the mid-20%s, Moody's projects EBITDA growth in
2021 to drive a decline in total leverage from 4.3x at closing to
about 3.5x by the end of 2022.
Following the March 2021 equity offering, Paya has the benefit of
strong cash liquidity of $129 million pro forma for the debt
refinancing and the Paragon acquisition. However, Moody's expects
the company to utilize the cash for acquisitions over time. Paya
intends to operate at a moderate level of total leverage with a
long-term target level of about 3x, but Moody's expects the company
to achieve this target through EBITDA growth and does not expect
debt prepayment. Acquisition activity may cause incremental
borrowing and result in intermittent re-leveraging over time.
Paya's strong liquidity (SGL-1) reflects its unrestricted cash
balance of $129 million and Moody's forecast of free cash flow of
over $26 million in 2021. Liquidity is also supported by a new $45
million revolving credit facility that will mature 5 years after
closing.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The stable outlook reflects Moody's expectation of solid revenue
growth and steady profitability resulting in Moody's adjusted total
leverage declining to about 4x by the end of 2021. The ratings
could be upgraded if Paya increases its business scale,
demonstrates sustained EBITDA and free cash flow growth, and
reduces total leverage below 3.5x. The ratings could be downgraded
if Paya's EBITDA declines or free cash flow generation is
pressured, or if total leverage is sustained above 4.5x.
The new credit facility is expected to contain covenant flexibility
for transactions that could adversely affect creditors, including
incremental facility capacity, the ability to release a guarantee
when a subsidiary is not wholly owned, and lack of "blocker"
restrictions on collateral leakage through transfer to unrestricted
subsidiaries.
With net revenues of $206 million in 2020, Paya is an integrated
payment solutions provider to mid-size merchants in the United
States.
The principal methodology used in these ratings was Business and
Consumer Service Industry published in October 2016.
PETROTEQ ENERGY: Signs Debt Conversion Agreements With Lenders
--------------------------------------------------------------
Petroteq Energy Inc. has executed debt conversion agreements with
two arm's length lenders wherein the lenders will accept an
aggregate of 1,388,897 common shares of the Company at a deemed
price of US$0.139 per share in satisfaction of US$193,057,
representing certain principal and accrued and unpaid interest up
to and including June 1, 2021, under previously issued convertible
debentures.
The Company (with the lenders' consent) determined to satisfy the
foregoing indebtedness with common shares in order to
preserve the Company's cash for use on its extraction
technology in Asphalt Ridge, Utah, and for working capital.
The foregoing transactions are subject to all necessary approvals,
including from the TSX Venture Exchange. The foregoing securities
will be issued in reliance on exemptions from the registration
requirements of the United States Securities Act of 1933, as
amended, and applicable state securities laws, and will be issued
as "restricted securities" (as defined in Rule 144 under the U.S.
Securities Act). In addition, the shares issuable will be subject
to a Canadian four-month hold period.
The Company has also closed the equity financing of 2,666,665
common shares at US$0.06 per share for gross proceeds of US$130,000
previously announced on April 9, 2021.
About Petroteq Energy Inc.
Petroteq -- www.Petroteq.energy -- is a clean technology company
focused on the development, implementation and licensing of a
patented, environmentally safe and sustainable technology for the
extraction and reclamation of heavy oil and bitumen from oil sands
and mineable oil deposits. Petroteq is currently focused on
developing its oil sands resources at Asphalt Ridge and upgrading
production capacity at its heavy oil extraction facility located
near Vernal, Utah.
Petroteq reported a net loss and comprehensive loss of $12.38
million for the year ended Aug. 30, 2020, compared to a net loss
and comprehensive loss of $15.78 million for the year ended Aug.
31, 2019.
Vancouver, British Columbia, Canada-based Hay & Watson, the
Company's auditor since 2012, issued a "going concern"
qualification in its report daed Dec. 15, 2020, citing that the
Company has had recurring losses from operations and has a net
capital deficiency, which raises substantial doubt about its
ability to continue as a going concern.
PG&E CORPORATION: Gibson, Dunn 3rd Update on Trade Committee
------------------------------------------------------------
Pursuant to Rule 2019 of the Federal Rules of Bankruptcy Procedure,
the law firm of Gibson, Dunn & Crutcher LLP submitted a third
amended verified statement to provide an updated list of members of
the Ad Hoc Trade Committee and their claims in the Chapter 11 cases
PG&E Corporation and Pacific Gas and Electric Company.
On or around October 4, 2019, the Ad Hoc Trade Committee engaged
Gibson, Dunn & Crutcher LLP to represent it in connection with the
Debtors' restructuring. On October 16, 2019, the Ad Hoc Trade
Committee filed the Verified Statement of Ad Hoc Committee of
Holders of Trade Claims Pursuant to Bankruptcy Rule 2019.
On December 10, 2019, the Ad Hoc Trade Committee filed the First
Amended Verified Statement of Ad Hoc Committee of Holders of Trade
Claims Pursuant to Bankruptcy Rule 2019. On September 21, 2020, the
Ad Hoc Trade Committee filed the Second Amended Verified Statement
of Ad Hoc Committee of Holders of Trade Claims Pursuant to
Bankruptcy Rule 2019. This 2019 Statement amends and replaces the
Second Amended 2019 Statement.
As of June 8, 2021, members of the Ad Hoc Trade Committee and
their disclosable economic interests are:
Whitebox Advisors LLC
3033 Excelsior Blvd.
Minneapolis, MN 55416
* Trade Claims: $155,554,946.57
* Mechanics' Lien Claims: $21,167,627.90
Citigroup Financial Products, Inc.
Citigroup Global Markets Inc.
390 Greenwich St., 6th Floor
New York, New York 10013
* Trade Claims: $135,988,082.30
* Mechanics' Lien Claims: $18,041,655.93
Counsel reserves the right to amend or supplement this 2019
Statement.
Counsel for the Ad Hoc Committee of Holders of Trade Claims can be
reached at:
GIBSON, DUNN & CRUTCHER LLP
David M. Feldman, Esq.
Matthew K. Kelsey, Esq.
200 Park Avenue
New York, NY 10166-0193
Telephone: 212.351.4000
Facsimile: 212.351.4035
E-mail: dfeldman@gibsondunn.com
mkelsey@gibsondunn.com
GIBSON, DUNN & CRUTCHER LLP
Michael S. Neumeister, Esq.
Michelle Choi, Esq.
333 South Grand Avenue
Los Angeles, CA 90071-3197
Telephone: 213.229.7000
Facsimile: 213.229.7520
E-mail: mneumeister@gibsondunn.com
mchoi@gibsondunn.com
- and -
GIBSON, DUNN & CRUTCHER LLP
Matthew D. Mcgill, Esq.
1050 Connecticut Avenue, N.W.
Washington, DC 20036-5306
Telephone: 202.955.8500
Facsimile: 202.467.0539
E-mail: mmcgill@gibsondunn.com
A copy of the Rule 2019 filing is available at
https://bit.ly/3gk6Ai1 at no extra charge.
About PG&E Corporation
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.
PLATINUM GROUP: Liberty Metals Has 9.45% Stake as of June 3
-----------------------------------------------------------
In an amended Schedule 13D filed with the Securities and Exchange
Commission, Liberty Metals & Mining Holdings, LLC disclosed that as
of June 3, 2021, it beneficially owns 7,000,000 shares of common
stock of Platinum Group Metals Ltd., which represents 9.45 percent
based on the 74,036,413 current issued and outstanding Common
Shares.
On June 3, 2021, LMMH sold 157,438 Common Shares of the Issuer at a
price of US$3.97 per Common Share in the public market for gross
proceeds of US$625,028.86.
On, June 3, 2021, LMIH disposed of 157,438 shares. Following the
sale on June 3, 2021 and subsequent day's sale, LMMH currently
holds 7,000,000 Common Shares representing 9.45% of the 74,036,413
current issued and outstanding Common Shares as disclosed on the
Issuer's latest financial statements.
A full-text copy of the regulatory filing is available for free
at:
https://www.sec.gov/Archives/edgar/data/1095052/000119312521184318/d160748dsc13da.htm
About Platinum Group Metals
Headquartered in British Columbia, Canada, Platinum Group Metals
Ltd. -- http://www.platinumgroupmetals.net-- is a platinum and
palladium focused exploration, development and operating company
conducting work primarily on mineral properties it has staked or
acquired by way of option agreements or applications in the
Republic of South Africa and in Canada. The Company's sole
material mineral property is the Waterberg Project. The Company
continues to evaluate exploration opportunities both on currently
owned properties and on new prospects.
Platinum Group reported a net loss of US$7.13 million for the year
ended Aug. 31, 2020, compared to a net loss of US$16.77 million for
the year ended Aug. 31, 2019. As of Feb. 28, 2021, the Company had
US$50.77 million in total assets, US$31.93 million in total
liabilities, and US$18.85 million in total shareholders' equity.
PricewaterhouseCoopers LLP, in Vancouver, Canada, the Company's
auditor since 2007, issued a "going concern" qualification in its
report dated Nov. 25, 2020, citing that the Company has suffered
recurring losses from operations and has a net capital deficiency,
negative working capital and has significant amounts of debt
payable without any current source of operating income which raise
substantial doubt about its ability to continue as a going concern.
PROOFPOINT INC: Moody's Assigns 'B3' CFR, Outlook Positive
----------------------------------------------------------
Moody's Investors Service assigned a B3 Corporate Family Rating to
Proofpoint, Inc. and a B2 rating on the company's first lien debt
facilities. The first lien debt, along with an unrated second lien
term loan and new equity, is being used by private equity firm
Thoma Bravo to acquire Proofpoint. The outlook is positive.
RATINGS RATIONALE
The B3 CFR reflects Proofpoint's very high leverage at close of the
acquisition, offset to some degree by the company's strong growth
profile and leading market position in the email security software
industry and substantial amount of initial equity. Debt to
cash-based-EBITDA is over 12x based on December 2020 results pro
forma for the acquisition.. If Proofpoint does not make any
acquisitions leverage could trend towards 7x over the next 18
months based on revenue growth and margin improvements.
Proofpoint is one of the leading providers of email security and
related software solutions. The company has grown at double digit
rates over the past five years driven by the strength of its
product offerings. Although there is moderate risk associated with
the take private plans, Moody's expects that Proofpoint will
continue to grow annually at 10% or greater for the next several
years driven by constantly evolving security threats and the
efficacy of the company's products. Moody's anticipates that growth
will be fueled by new email security customers and the selling of
additional related products to existing customers. The expansion of
solutions includes areas such as targeted attack protection,
security awareness training, archiving, analytics and data loss
prevention. Proofpoint has good market positions in these
categories although most sales will only be to existing email
security customers. Moody's also expects Proofpoint will continue
to make acquisitions to supplement the company's technology
portfolio.
The positive outlook reflects the likelihood of double digit
revenue growth, EBITDA margin expansion and the potential for cash
EBITDA based leverage to drop to 7x over the next 18 months.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The ratings for Proofpoint could be upgraded if revenues continue
to grow at strong double digit rates, cash based leverage is
sustained below 7.5x and free cash flow (adjusted for pre-funded
RSU payments) to debt is sustained above 5%. The ratings could be
downgraded if Proofpoint's performance deteriorates, cash based
leverage is sustained above 9x or free cash flow (adjusted for
pre-funded RSU payments) is negative on other than a temporary
basis.
Proofpoint's liquidity is very good as highlighted by the cash
balances of approximately $550 million expected at close, an
undrawn $250 million revolver, and expectations of positive free
cash flow before restricted stock unit ("RSU") payments. The
company will have an obligation for substantial deferred RSU
payments at closing which are scheduled to be paid over the next
six years. The large cash balance at closing will effectively
pre-fund a significant portion, but not all of the payments.
Proofpoint's environmental risks are low and in line with other
software peers. Social risks are low to moderate, in line with the
software sector, mainly stemming from social issues linked to data
security, diversity in the workplace and access to highly skilled
workers. Cyber security risks are moderate at Proofpoint and arise
from breaches on installed customer software as well as internal
Proofpoint systems.
Proofpoint will be privately held by private equity firm Thoma
Bravo and will not have an independent board of directors.
Financial policies are expected to be aggressive as highlighted by
the high leverage at closing and significant restructuring plans.
The amount of equity being utilized to acquire Proofpoint is
exceptionally large however, and suggests a commitment to the
business as well as a stronger loan to value than other private
equity owned companies.
Assignments:
Issuer: Proofpoint, Inc.
Corporate Family Rating, Assigned B3
Probability of Default Rating, Assigned B3-PD
Senior Secured 1st Lien Term Loan, Assigned B2 (LGD3)
Senior Secured Multi-Currency Revolving Credit Facility, Assigned
B2 (LGD3)
Outlook Actions:
Issuer: Proofpoint, Inc.
Outlook, Assigned Positive
The first lien debt is rated B2, one notch above the CFR reflecting
its priority in the capital structure above the second lien debt
and other liabilities. The proposed secured debt facilities has
flexibility that could be detrimental to lenders, including a
provision for incremental first lien secured facilities up to the
greater of $462 million or 1x company defined EBITDA (with
additional non disclosed baskets) and provisions for additional
debt subject to certain leverage and interest coverage tests. Asset
sale proceeds are required to pay down debt based on a leverage
based test with 18 month reinvestment provisions but subject to
leverage based tests and certain other baskets. Amounts not
required to be reinvested or repay debt may in certain cases be
distributed to shareholders.
The principal methodology used in these ratings was Software
Industry published in August 2018.
Proofpoint is a leading provider of email and related security
software. At close of the acquisition, the company will be owned by
private equity firm Thoma Bravo. Proofpoint had revenues of $1.05
billion in 2020.
PURDUE PHARMA: AGs Ask Court to Close Sackler's Liability Loophole
------------------------------------------------------------------
Law360 reports that a bipartisan pair of attorneys general on
Tuesday urged lawmakers to close a Bankruptcy Code loophole that
could help members of the Sackler family avoid civil liability for
their role in the opioid crisis through Purdue Pharma LP's
bankruptcy case.
In testimony before the House Committee on Oversight and Reform,
Massachusetts Attorney General Maura Healey, a Democrat, and Idaho
Attorney General Lawrence Wasden, a Republican, called on lawmakers
to pass the Sackler Act, which would prevent individuals from
obtaining liability releases for themselves without personally
seeking bankruptcy protection.
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.
RANCHER'S LEGACY: Court Rejects Blue-Grace's Admin. Expense Claim
-----------------------------------------------------------------
Chief Bankruptcy Judge Michael E. Ridgway in Minnesota denied the
motion for payment of administrative expense claim filed by Blue
Grace Logistics, LLC against Rancher's Legacy Meat Co.
The Court held that the funds Blue-Grace seeks for payment in its
claim "have already been settled in the ordinary course of
business, and equity demands denial of the motion in accordance
with the fundamental tenets of the Bankruptcy Code."
For nearly 17 months, Rancher's case was pending without a
confirmed plan, with a litany of acrimonious issues, adversary
proceedings, and appeals along the way. On February 16, 2021, the
Official Committee of Unsecured Creditors, Rancher's and the
creditor whose claim constitutes approximately 71% of the general
unsecured claims pool filed an expedited motion to approve a global
settlement agreement. The expedited hearing for approval of the
settlement agreement was scheduled for February 25, 2021. Three
days before the hearing, on February 22, attorneys for Blue-Grace
filed notices of appearance, a motion for administrative expense
and a limited objection to the global settlement agreement.
Blue-Grace's limited objection was the only objection raised to the
global settlement agreement. Blue-Grace argued the settlement
agreement would leave Rancher's administratively insolvent and
unable to pay Blue-Grace's newly filed administrative expense
claim, which Blue-Grace concluded would have priority over all
unsecured claims. Blue-Grace's administrative expense claim was
based on transactions that occurred approximately eight months
prior, in June 2020.
Rancher's and Blue-Grace established a business relationship well
before Rancher's filed its chapter 11 bankruptcy case. Blue-Grace
is a third-party shipping and logistics company that arranges for
shipment of its clients' products. Rancher's began working with
Blue-Grace in April 2018. The relationship between the two entities
continued post-petition, with Blue-Grace continuing to arrange
shipping services for Rancher's products. From the September 20,
2019 petition date through July 30, 2020, the entities continued
their operations, with Blue-Grace arranging for Rancher's shipping
needs and Rancher's consistently and timely paying Blue-Grace's
invoices.
In June 2020, one of the shipments went wrong. Blue-Grace arranged
for one of its many contract carriers to haul a load of Rancher's
product, and the carrier failed to timely deliver the product. The
buyer rejected the product, resulting in damages to the estate of
$126,800. Following this incident, Rancher's unsuccessfully
attempted to work with Blue-Grace to resolve the issue. Meanwhile,
the parties conducted their business as usual, with Blue-Grace
arranging shipping services and billing Rancher's for those
services. Blue-Grace invoiced Rancher's for post-petition services
provided between July 31, 2020, and September 4, 2020, in the
amount of $97,952. Rancher's opted to offset those invoiced amount
against the $126,800 in damages it had sustained as a result of
Blue-Grace's contract carrier's late delivery.
Blue-Grace attempted to resolve the damages issue with its contract
carrier, but, to date, has been unsuccessful. On August 27, 2020,
Blue-Grace sent a letter to Rancher's in which it purported to
assign to Rancher's its claim and rights against the contract
carrier. In response, Rancher's rejected the assignment and sent a
letter on October 6, 2020, in which it explained its setoff action.
There is nothing on the record to indicate that either party took
any further action on the matter until more than four months later,
when Blue-Grace filed its notices of appearance, administrative
expense claim, and limited objection to the global settlement
agreement.
At the February 25, 2021 hearing on the global settlement
agreement, the Court granted expedited relief and approved the
agreement, but also ordered that other than two specific payments,
no distributions would be completed under the agreement until the
resolution of the Blue-Grace administrative expense claim.
According to Judge Ridgway, despite the interesting legal issues
raised by Blue-Grace's argument that its claim is properly brought
under 11 U.S.C. section 503(b)(1)(A), the unique facts on the
record in this case show that the Court need not reach or engage
with these inquiries. Instead, the facts indicate that the proper
inquiry is not whether Blue-Grace has an appropriately supported
administrative expense claim under section 503(b)(1)(A), but rather
whether Rancher's, as debtor-in-possession, properly engaged in a
common law setoff.
"Setoffs occur regularly in the ordinary course of business, and
debtors-in-possession are permitted to engage in actions that are
in the ordinary course of business without court approval. That is
precisely what occurred here; Rancher's opted to use its common law
right to set off the amounts in Blue-Grace's invoice against the
amount of damages Rancher's sustained as a result of Blue-Grace's
shipping contractor's late delivery. Rancher's setoff action was
conducted in the ordinary course of business and remained the
status quo for many months before Blue-Grace suddenly attempted to
challenge it on the eve of approval of a global settlement
agreement. Contrary to Blue-Grace's arguments, even if the
purported contract on the record is valid, enforceable, and
non-executory, the document's own terms make it inapplicable to
Rancher's setoff action. Further, based on the specific facts of
this case, and in conformity with the underlying principles of the
Bankruptcy Code, equity demands denial of Blue-Grace's
administrative expense claim,” Judge Ridgway concluded.
Judge Ridgway further ruled that the $97,952.00 held in reserve
pursuant to the Court order approving the Global Settlement shall
be distributed in accordance with the remainder of that Order and
the agreement.
A copy of the Court's June 3, 2021 Memorandum Decision and Order is
available at:
https://www.leagle.com/decision/inbco20210604534
About Rancher's Legacy Meat
Rancher's Legacy Meat Co. -- https://rancherslegacy.com/ -- owns
and operates an animal slaughtering and processing facility in
Vadnais Heights, Minnesota. Rancher's Legacy Meat was built to
produce fresh and frozen ground meat in patty and bulk
configurations.
Rancher's Legacy sought Chapter 11 protection (Bankr. D. Minn. Case
No. 19-32928) on Sept. 20, 2019. In the petition signed by Arlyn
J. Lomen, president, the Debtor listed total assets of $13,291,000
and total liabilities of $26,897,956 as of the Petition Date. Judge
Michael E Ridgway is assigned the case. FOLEY & MANSFIELD
P.L.L.P., represents the Debtor.
The U.S. Trustee for Region 12 on Sept. 27, 2019, appointed five
creditors to serve on the official committee of unsecured creditors
in the Chapter 11 case.
RAPID AMERICAN CORP: Asbestos Fund May Get $12.3M from Insurers
---------------------------------------------------------------
Rapid-American Corp. filed a Chapter 11 Plan of Liquidation and
related Disclosure Statement on June 4, 2021. The Plan provides
for the resolution of all existing Asbestos Personal Injury Claims.
On the Petition Date, the Debtor estimated having 275,000 Asbestos
PI Claims outstanding against it. The Debtor and the Asbestos
Claimants Committee are the Proponents of the Plan.
Under the Plan, only (i) Class 3A holders of Asbestos PI Defense
Claims, (ii) Class 3B holders of General Unsecured Claims and (iii)
Class 4 holders of Asbestos PI Claims are Impaired and are entitled
to vote on the Plan. The holders of Secured Claims and Priority
Claims are unimpaired by the Plan.
a. Class 3A Asbestos PI Defense Claims
Class 3A Asbestos PI Defense Claims include the unpaid costs of the
defense of Asbestos PI Claims in the tort system before the
Petition Date. The Debtor estimates those Claims total
approximately $150,000. Historically the Debtor's Asbestos PI
Defense Claims have been paid from the Debtor's Escrow Account.
If the Plan is approved, on the Effective Date the Debtor will pay
Asbestos PI Defense Claims 10% of each Claim up to a total of
$15,000 for all such Claims from proceeds in the Debtor's Escrow
Account.
b. Class 3B General Unsecured Claims
The California Franchise Tax Board filed a General Unsecured Claim
for approximately $41 million asserting that the Debtor owed taxes,
penalties, interest, and fees for tax years 1979-1988. The
Debtor's General Funds are the primary asset the Debtor has
available to pay Allowed General Unsecured Claims. The General
Funds currently total approximately $19,600.
All Allowed General Unsecured Claims in Class 3B will be paid a pro
rata share of the Debtor's General Funds available on the Effective
Date. The Debtor believes that the California Franchise Tax Board
is the only claimant in this Class.
c. Class 4 Asbestos PI Claims
Asbestos PI Claims in Class 4 will be transferred to and assigned
to the Asbestos Claims Liquidation Trust. These claims generally
are based on allegations of personal injury and wrongful death
resulting (in whole or in part) from the alleged conduct or
products of The Philip Carey Manufacturing Company as that company
existed prior to June 1, 1967, which liabilities the Debtor assumed
through various corporate transactions.
* Asbestos Claims Liquidation Trust
The Plan contemplates the establishment of a trust under Section
105(a) of the Bankruptcy Code that will resolve all Asbestos PI
Claims. The Asbestos Claims Liquidation Trust will be funded with
amounts remaining in the Debtor's Escrow Account at the Effective
Date of the Plan. That account included payments received for the
Debtor's claims in liquidation proceedings involving The Home
Insurance Company and Midlands Insurance Company.
The Asbestos Claims Liquidation Trust will also be funded with the
proceeds of settlement agreements with the Debtor's remaining
solvent upper level excess insurers -- The Travelers Insurance
Company (Travelers) and National Union Fire Insurance Company of
Pittsburgh, Pennsylvania.
The settlement agreement with Travelers will yield proceeds of $7.8
million, while the settlement agreement with National Union will
yield proceeds of $4.5 million. Both settlements are being
submitted for approval by the Bankruptcy Court as part of the
confirmation of the Plan. If approved, proceeds from the
settlements will be paid to the Asbestos Claims Liquidation Trust.
The Asbestos Claims Liquidation Trust will not be responsible for,
and shall provide no recovery on account of, any "Demand" as such
term is defined in Section 524(g)(5) of the Bankruptcy Code.
The Asbestos Claims Liquidation Trust Assets are limited and thus
will be managed by the Asbestos Claims Liquidation Trustee to
ensure that funds are available to pay all current asbestos
claimants whose claims are approved for payment by the Asbestos
Claims Liquidation Trust.
The Plan cancels the equity interest in the Debtor and provides for
the termination of the Debtor's corporate existence.
* Insurance Policy Injunction
Moreover, the Plan provides for the issuance of an Insurance Policy
Injunction that will protect the Settling Asbestos Insurance
Protected Parties from any Claims or suits arising from or
attributable to the insurance relationship between the Debtor and
such Entities.
* Position of the Future Claimants Representative
The Plan provides for the discharge of Mr. Lawrence Fitzpatrick as
the Future Claimants Representative on the Effective Date as there
is no longer a need for a Future Claimants Representative in the
Debtor's Chapter 11 Case.
The Plan also provides for the cancellation and termination of the
Debtor's corporate existence once:
-- the Plan becomes effective and, as part of that, the Insurance
Settlement Agreements are approved and become effective;
-- the Asbestos Claims Liquidation Trust has been established;
and
-- all Trust assets have been transferred to the Asbestos Claims
Liquidation Trust.
The Debtor believes that there will be substantially more assets
available to pay asbestos claimants under the Plan than would be
the case if there were no Plan because without the distribution
procedures in the Plan, there likely would be years of costly and
time-consuming litigation involving asbestos claimants that will be
avoided through the Plan's orderly administrative process.
A full-text copy of the Disclosure Statement is available for free
at https://bit.ly/2RyeVGs from Logan and Company, balloting agent.
The Asbestos Claimants Committee consists of five individual
asbestos plaintiffs who asserted Asbestos PI Claims against the
Debtor. The five law firms representing each of the Committee
members include:
* Belluck & Fox;
* Weitz & Luxenberg, P.C.;
* Cooney & Conway;
* Baron & Budd, P.C.; and
* Goldberg, Persky & White, P.C.
The Asbestos Claimants Committee engaged the Gilbert firm as its
coverage counsel.
About Rapid-American Corp.
New York-based Rapid-American Corp. was formerly a holding company
with subsidiaries primarily engaged in retail sales and consumer
products and was never engaged in an asbestos business of any kind.
Through a series of merger transactions going back more than 45
years, Rapid has nevertheless incurred successor liability for
personal injury claims arising from plaintiffs' exposure to
asbestos-containing products sold by The Philip Carey Manufacturing
Company -- Old Carey -- as that entity existed prior to June 1,
1967.
Rapid-American filed for Chapter 11 bankruptcy protection in
Manhattan (Bankr. S.D. N.Y. Case No. 13-10687) on March 8, 2013, to
deal with debt related to asbestos personal-injury claims.
Attorneys at Reed Smith LLP serve as counsel to the Debtor. Logan
and Company, Inc. serves as the Debtor's balloting agent.
The Debtor disclosed assets in excess of $4,446,261 and unknown
liabilities.
On March 28, 2013, the United States Trustee appointed the Official
Committee of Unsecured Creditors. The Committee retained Caplin &
Drysdale, Chartered, as counsel.
Young Conaway Stargatt & Taylor, LLP, is counsel to Lawrence
Fitzpatrick, the Future Claimants' Representative.
RIVOLI & RIVOLI: U.S. Trustee Opposes Disclosure Statement
----------------------------------------------------------
William K. Harrington, United States Trustee for Region 2, said the
Disclosure Statement to the Chapter 11 Plan of Reorganization for
Small Business of Rivoli & Rivoli Orthodontics should not be
approved because it failed to provide creditors with sufficient
information to allow them to make an informed choice as to whether
to accept or reject the Plan.
The U.S. Trustee contended that:
1. The Disclosure Statement failed to fully articulate the
reasons [why] the Debtor does not have Court approval for the
purchase and sale of the DiVita practice.
The Debtor's principal, Dr. Peter S. Rivoli, and his wife, Lynne M.
Rivoli, contemporaneous with the filing of the Debtor's Plan, are
preparing a motion seeking authority for Dr. Rivoli to purchase the
dental practice of Carl L. DiVita, DDS, P.C., d/b/a Ogden Dental
Group and to assume the day-to-day management of the operations of
that office.
The U.S. Trustee related that the DiVita practice will make
substantially all orthodontics referrals exclusively to the Debtor,
which will result in additional revenues to the Debtor. In
exchange for this increased number of referrals, the proposed
agreement contemplates that for a period of two years, the Debtor
will turn over 30% of the revenues from the referred patients, at
which time, there will be an attempt to seek financing to pay off
the then outstanding balance of the purchase price. The Trustee
complained that this purchase price is not disclosed in the
statement. The Trustee pointed out that the terms of the purchase
of the DiVita practice are salient to the Disclosure Statement.
2. the Disclosure Statement failed to adequately address various
assets of the Debtor.
The Trustee noted that the Debtor has not included the value of the
upgraded equipment which the Debtor purchased from funds received
from the CARES Act. Such equipment upgrades are material to the
Debtor's valuation of assets, he said.
3. The U.S. Trustee said there was no explanation for the fact
that $561,751 is "due from Affiliates" to the Debtor, but the
Debtor lists the recovery of 0%.
4. The Debtor charges that it does not intend to pursue
preference, fraudulent conveyance of other avoidance actions. The
Trustee noted, however, that there are no explanations if those
actions (for the benefit of the estate) exist, and if they do
exist, why they are not being pursued.
Without cogent explanations of these meaningful matters, relevant
to apprising creditors with sufficient information, the Disclosure
Statement should not be approved, the U.S. Trustee told the Court.
A copy of the Trustee's objection is available for free at
https://bit.ly/3w6GGFm from PacerMonitor.com.
The Debtor's Plan provided that over a four-year period beginning
the month after the confirmation of the Plan, monthly deposits will
be made to the escrow account established for the benefit of
unsecured creditors at $3,000 for the first 12 months. For Years 2
through 4, these payments will be $3,500 monthly. General
unsecured claims in Class 7 will be to be paid pro rata every six
months, beginning on or about December 1, 2021, from the escrow
account.
Class 7 General Unsecured Claims include (i) the unsecured balance
for $433,959 of the partially secured claim of Spring Pines Dental
Care, LLP claim (total claim amounts to $684,000), and (ii) the
Disputed Secured claim of Susquehanna Salt Lake, LLC for $65,504.
Spring Pines Dental Care is allowed a secured claim for $250,041.
A copy of the Disclosure Statement is available for free at
https://bit.ly/3irOFsh from PacerMonitor.com.
About Rivoli & Rivoli Orthodontics
Rivoli & Rivoli Orthodontics, P.C., offers orthodontic services
with locations in Spencerport, Rochester, Webster, and Brockport,
N.Y. Visit http://www.rivoliortho.com/for more information.
Rivoli & Rivoli Orthodontics filed a voluntary petition for relief
under Chapter 11 of the Bankruptcy Code (Bankr. W.D.N.Y. Case No.
19-20627) on June 21, 2019. In the petition signed by Peter S.
Rivoli, president, the Debtor disclosed $233,492 in assets and
$1,778,831 in liabilities. Daniel F. Brown, Esq., at Andreozzi
Bluestein LLP, is the Debtor's counsel.
Dr. Peter S. Rivoli and Lynne M. Rivoli, as individuals, filed a
single petition under Chapter 11 on June 21, 2019 (Bankr. W.D.N.Y.
Case No. 19-20628). The case is jointly administered with that of
the Debtor.
ROCKET TRANSPORTATION: Disclosure Statement Gets Preliminary OK
---------------------------------------------------------------
Judge Maria L. Oxholm approved on a preliminary basis the
Disclosure Statement to the First Amended Subchapter V Plan of
Reorganization of Rocket Transportation, Inc.
Judge Oxholm set June 18, 2021 as the deadline to return ballots on
the Plan. The last day by which parties in interest may file
objections to final approval of the Disclosure Statement and
objections to confirmation of the Plan is also June 18.
No later than June 25, 2021, the Debtor shall file a verified
summary of the ballot count.
The hearing on the final approval of the Disclosure Statement and
confirmation of the Plan will be held on Thursday, July 8, 2021, at
11 a.m. in the U.S. Bankruptcy Court for the Eastern District of
Michigan, Room 1875, 211 W. Fort Street, Detroit, Michigan.
A copy of the order is available for free at https://bit.ly/2ShAprz
from PacerMonitor.com.
About Rocket Transportation
Taylor, Mich.-based Rocket Transportation, Inc., is a privately
held company in the general freight trucking industry.
Rocket Transportation filed a Chapter 11 petition under Subchapter
V (Bankr. E.D. Mich. Case No. 20-52337) on Dec. 14, 2020. In its
petition, the Debtor disclosed $500,000 to $1 million in assets and
$1 million to $10 million in liabilities. Rocket Transportation
President Amar Al Hadad signed the petition.
Judge Maria L. Oxholm presides over the case. Gold, Lange, Majoros
& Smalarz, P.C. currently serves as the Debtor's counsel. The
Court denied the Debtor's prior request to employ Jaafar Law Group
PLLC as its counsel. Charles M. Mouranie is the Debtor's
Subchapter V Trustee.
ROCKET TRANSPORTATION: Unsecs. to Recover 9.6% of Allowed Claims
----------------------------------------------------------------
Rocket Transportation, Inc., filed a First Amended Subchapter V
Plan of Reorganization on June 3, 2021.
As part of the reorganization plan, the Debtor developed a viable
turnaround strategy, which included trimming its existing rolling
stock through surrender of certain collateral. The relatively
large fixed cost structure of owning and insuring rolling stock,
coupled by the impact of COVID-19 in the first quarter of 2020,
delivered a devastating blow to the Debtor.
The Debtor has also implemented both financial and operational
systems to ensure ongoing success once the plan of reorganization
is confirmed. A comprehensive analysis on the removal of costs
from the Debtor's operating model led to the decision to transfer
from utilizing purely company drivers to an owner-operator model in
March 2021.
* Classes of Claims under the Plan
I. Secured and Partially Secured Classes of Claims
A total of $1,692,114, including interest, shall be paid to the
Secured Creditors over the term of the Plan.
A. Class I consists of the Allowed Secured Claim of Ally Bank for
$71,231. Class I is impaired.
B. Class II consist of the partially secured claim of Lincoln
Automotive Financial Services/Ford Motor Credit Co., LLC., which
will be allowed for $49,549. Class II is impaired.
C. Class III consists of the partially secured claims of:
1. Financial Pacific Leasing, Inc., a/k/a /Axis Title;
2. BB&T Commercial Equipment Capital Corp.;
3. BMO Harris Bank N.A.;
4. BMO Harris Bank N.A./U.S. Bank Equipment Finance;
5. Bryn Mawr Equipment Finance, Inc.;
6. Byline Financial Group;
7. CIT Bank, N.A.;
8. De Lage Landen Financial Service, Inc.;
9. Hitachi Capital America Corp.;
10. Midland States Bank;
11. Sumitomo Mitsui Finance and Leasing Company Ltd.;
12. Stearns Bank National Bank;
13. Time Payment Corp.;
14. Trans Advantage, Inc.;
15. Volvo Financial Services;
16. Wells Fargo Equipment Finance, Inc.; and
17. PNC Equipment Finance, LLC.
The unsecured portion of the Class III Claims shall be treated in
Class VII Allowed Unsecured Claims. Class III is impaired.
D. Class IV consists of the Allowed Claims of the Debtor's
Vehicle Lease Claimants. The claims of the Class IV Claimants are
equal to the amounts owed to them under their respective leases,
which have been assumed by order of the Court dated March 26, 2021,
and all cure amounts owed for unpaid pre-petition rental charges
will be paid by the Debtor on the Effective Date of the Plan. This
Class is unimpaired.
E. Class V consists of the secured claim of First Bank & Trust,
d/b/a FirstLine Funding Group, for $664,595, stemming from an
ongoing future receivables sale agreement entered into between
FirstLine and the Debtor. FirstLine will not be paid in full upon
confirmation of the Plan. The FirstLine Claim will be paid by, or
on behalf of, the Debtor through the purchased account receivables
sold or transferred after the Effective Date by the Debtor in
accordance with the terms of the pre-petition Factoring and
Security Agreement. Class V is impaired.
II. Unsecured Classes of Claims
Under the Plan, unsecured creditors, with claims aggregating
$3,445,668 shall receive a 9.6% recovery, or $330,646, of their
allowed unsecured claims.
F. Class VI consists of the Unsecured Claims of certain MCA
lenders. The assets allegedly securing the MCA lenders' claims
secure bigger claims that are senior in priority to those of the
MCA lenders.
G. Class VII consists of holders of Allowed Unsecured Claims.
Holders of Allowed General Unsecured Claims in Class 7 shall
receive an annual pro-rata distribution from the Debtor's projected
disposable income, for five years. The first payment shall be due
on or before May 31, 2022 and shall continue to be made on the same
date each year until (i) the respective Claim is paid in full or
(ii) May 31, 2026. No interest shall be paid to this class.
Unless the Plan provides otherwise, the Debtor shall make all
required payments under the Plan in 20 equal quarterly
installments, to commence 30 days after the Effective Date.
The amounts to be recovered under the Plan by each creditor are
detailed in the Financial Model for the Plan (Exhibit C) and in the
Summary of Plan Payment (Exhibit D) in the Plan, a copy of which
may be accessed for free at https://bit.ly/3ghfwEV from
PacerMonitor.com
III. Equity
H. Class VIII consists of the Interest of the Equity Security
Holders in the Debtor. Holders of Allowed Interests shall retain
their Allowed Interests in the Debtor and Reorganized Debtor. Amar
Al Hadad, the Debtor's president, is the sole Interest Holder of
the Debtor.
Mr. Al Hadad shall be retained by the Reorganized Debtor and shall
receive a salary of $1,500 per week.
Counsel for the Debtor:
Jason P. Smalarz, Esq.
Gold, Lange, Majoros & Smalarz, P.C.
24901 Northwestern Highway, Suite 444
Southfield, MI 48075
Telephone: 248-350-8220
Email: jsmalarz@glmpc.com
About Rocket Transportation
Taylor, Mich.-based Rocket Transportation, Inc., is a privately
held company in the general freight trucking industry.
Rocket Transportation filed a Chapter 11 petition under Subchapter
V (Bankr. E.D. Mich. Case No. 20-52337) on Dec. 14, 2020. In its
petition, the Debtor disclosed $500,000 to $1 million in assets and
$1 million to $10 million in liabilities. Rocket Transportation
President Amar l Hadad signed the petition.
Judge Maria L. Oxholm presides over the case.
Gold, Lange, Majoros & Smalarz, P.C. currently serves as the
Debtor's counsel. The Court denied the Debtor's prior request to
employ Jaafar Law Group PLLC as its counsel. Charles M. Mouranie
is the Debtor's Subchapter V Trustee.
SAMSONITE INT'L: S&P Hikes Rating on EUR350MM Unsec. Notes to 'B'
-----------------------------------------------------------------
S&P Global Ratings raised its issue-level rating on Samsonite
International S.A.'s EUR350 million 3.5% senior unsecured notes due
2026 to 'B' from 'B-' after the company announced that it repaid
$125 million of its senior secured term loan A balance. The company
also plans to repay $100 million of its senior secured term loan B
balance as part of the repricing transaction for the instrument.
S&P revised the recovery rating on the senior unsecured notes to
'4' from '5'. Samsonite also repaid $100 million of its outstanding
balance on its $850 million revolving credit facility. The company
is utilizing its cash balances to make these payments, lowering the
amount of debt ahead of the senior unsecured notes, improving the
recovery prospects. The '4' recovery rating indicates its
expectation for average (30%-50%; rounded estimate: 35%) recovery
in the event of a payment default. S&P's ratings also reflect the
repayment of the term loan B balance, which is subject to review
upon the receipt of final documentation.
S&P said, "We also affirmed our 'B+' issue-level rating on the
company's senior secured facilities. The senior secured facilities
include an $850 million revolving credit facility due 2025 ($717
million outstanding as of June 7, 2021), an $800 million term loan
A due in 2025 ($655 million outstanding as of June 7, 2021), a $665
million term loan B due in 2025 ($547 million outstanding as of
June 7, 2021), and an incremental $600 million term loan B due in
2025 ($496 million outstanding pro-forma for $100 million debt
repayment as part of the announced repricing transaction). The '2'
recovery rating is unchanged and indicates our expectation for
substantial recovery (70%-90%; rounded estimate: 80%) in the event
of a default.
"All of our other ratings on the company, including the 'B' issuer
credit rating and negative outlook, are unaffected by this
transaction."
SANUWAVE HEALTH: Alan Rubino Resigns as Director
------------------------------------------------
Alan Rubino resigned as a member of the board of directors of
SANUWAVE Health, Inc., effective immediately.
Mr. Rubino's resignation was not the result of any disagreement
with the Company.
About SANUWAVE Health
Headquartered in Suwanee, Georgia, SANUWAVE Health, Inc.
(OTCQB:SNWV) -- http://www.SANUWAVE.com-- is focused on the
research, development, and commercialization of its patented,
non-invasive and biological response-activating medical systems for
the repair and regeneration of skin, musculoskeletal tissue, and
vascular structures.
SANUWAVE reported a net loss of $10.43 million for the year ended
Dec. 31, 2019, compared to a net loss of $11.63 million for the
year ended Dec. 31, 2018. As of Sept. 30, 2020, the Company had
$32.87 million in total assets, $33.74 million in total
liabilities, and a total stockholders' deficit of $873,002.
Marcum LLP, in New York, NY, the Company's auditor since 2018,
issued a "going concern" qualification in its report dated March
30, 2020 citing that the Company has a significant working capital
deficiency, has incurred significant losses and needs to raise
additional funds to meet its obligations and sustain its
operations. These conditions raise substantial doubt about the
Company's ability to continue as a going concern.
SC SJ HOLDINGS: July 15 Plan Confirmation Hearing Set
-----------------------------------------------------
SC SJ Holdings LLC, et al., filed with the U.S. Bankruptcy Court
for the District of Delaware a motion for entry of an order
approving a disclosure statement.
On June 3, 2021, Judge John T. Dorsey granted the motion and
ordered that:
* The Disclosure Statement is approved.
* July 15, 2021, at 11:00 a.m. at the United States Bankruptcy
Court for the District of Delaware, 5th Floor, Courtroom No. 5, 824
North Market Street, Wilmington, Delaware 19801 is the hearing to
consider confirmation of the Plan.
* July 2, 2021, at 4:00 p.m., is the deadline for filing and
serving objections to confirmation of the Plan.
* July 12, 2021, is the deadline for filing and serving briefs
in support of the Plan.
* June 15, 2021, at 4:00 p.m., is the deadline for filing and
serving objections to claims that may affect the tabulation of
votes on the Plan.
* July 2, 2021, is the deadline to submit Ballots for
accepting or rejecting the Plan.
A full-text copy of the order dated June 3, 2021, is available at
https://bit.ly/3xcektp from Stretto, the claims agent.
Counsel to the Debtors:
Patrick Potter
Dania Slim
Jonathan Doolittle
Rahman Connelly
PILLSBURY WINTHROP SHAW
PITTMAN LLP
1200 Seventeenth Street, NW
Washington, DC 20036
Telephone: (202) 663-8928
Facsimile: (202) 663-8007
Justin Alberto
Patrick Reilley
COLE SCHOTZ P.C.
500 Delaware Avenue, Suite 1410
Wilmington, Delaware 19801
Telephone: (302) 652-3131
Facsimile: (302) 574-2104
About SC SJ Holdings and FMT SJ
San Ramon, Caliofrnia-based Eagle Canyon Management's SC SJ
Holdings LLC owns The Fairmont San Jose, an 805-room luxury hotel
located at 170 South Market St., San Jose, Calif. The hotel is
near many of the largest Fortune 1000 corporations and is a popular
location for conferences and conventions, particularly in the
technology industry.
On March 5, 2021, SC SJ Holdings' affiliate, FMT SJ LLC, filed a
voluntary petition for relief under Chapter 11 of the Bankruptcy
Code (Bankr. D. Del. Case No. 21-10521). On March 10, 2021, SC SJ
Holdings sought Chapter 11 protection (Bankr. D. Del. Case No. 21
10549). The cases are jointly administered under Case No. 21
10549.
At the time of the filing, SC SJ Holdings disclosed assets of
between $100 million and $500 million and liabilities of the same
range. FMT SJ disclosed that it had estimated assets of between
$500,000 and $1 million and liabilities of between $100 million and
$500 million.
The Debtors tapped Pillsbury Winthrop Shaw Pittman, LLP, as their
bankruptcy counsel, Cole Schotz P.C. as local counsel, and Verity
LLC as financial advisor. Stretto is the claims agent and
administrative advisor.
SC SJ HOLDINGS: Secures Eagle Canyon Commitment Letter; Amends Plan
-------------------------------------------------------------------
SC SJ Holdings LLC, et al., submitted an Amended Joint Chapter 11
Plan of Reorganization and a corresponding Disclosure Statement on
June 3, 2021.
After extensive discussions, on March 9, 2021, the Debtors entered
into a Restructuring Support Agreement ("RSA") with the Prepetition
Secured Lender on the material terms of a chapter 11 plan. The RSA
and Restructuring Term Sheet are designed around the Debtors' goals
of transitioning from Fairmont to a new hotel operator that is
approved by the Prepetition Secured Lender and raising exit
financing, which, subject to the other terms and conditions of the
RSA, will allow the Debtors to extend the maturity date of the
Prepetition Secured Loan by up to five years and carry the costs of
preserving the Hotel through the pandemic.
The Plan provides holders of Allowed FMT General Unsecured Claims
will receive their Pro Rata share of a $500,000 FMT GUC Cash Pot.
Debtor FMT anticipates securing Cash necessary to fund the FMT GUC
Cash Pot from external sources. The Plan provides, as a condition
precedent to the Effective Date, that Debtor FMT shall have funded
the FMT GUC Cash Pot. There is no guarantee that Debtor FMT will be
able to secure the funds necessary to satisfy that condition
precedent.
The Debtors have received that certain Commitment Letter for New
Money to Address Certain Allowed Claims Under the Amended Joint
Chapter 11 Plan of Reorganization (the "Eagle Canyon Commitment
Letter"), pursuant to which the Debtors' indirect parent company,
Eagle Canyon Capital LLC, has agreed to contribute (a) up to
$1,376,000 to Debtor FMT so that it can make distributions under
the Plan on account of Allowed Priority Tax Claims, (b) up to
$389,000 to Debtor FMT so that it can make distributions under the
Plan on account of Allowed Other Priority Claims, (c) $500,000 to
Debtor FMT so that Debtor FMT can fund the FMT GUC Cash Pot, (d) up
to $207,481 for Debtor to use to make distributions on account of
Other Secured Claims, (e) up to $1,536,463 for Debtor SC SJ to use
to make distributions on account of Allowed SC SJ General Unsecured
Claims, and (f) up to $3,976,247 for Debtor SC SJ to make
distributions on account of Allowed Fairmont General Unsecured
Claims. Eagle Canyon's commitments are conditioned on confirmation
of the Plan and other conditions precedent set forth in the Eagle
Canyon Commitment Letter.
The Plan will treat claims as follows:
* Class 3B: FMT Prepetition Secured Loan Claim totaling
$728,600 will recover 3.4% of their claims. The Prepetition
Secured Lender shall receive, on account of the FMT Prepetition
Secured Loan Claim, the FMT Collateral Payment, and all Prepetition
FMT Collateral, other than cash collateral, shall be delivered in
kind to Reorganized SC SJ and repayment of the debt secured by the
Prepetition FMT Collateral shall be made over time by Reorganized
SC SJ pursuant to the Post-Effective Date Secured Loan Documents.
* Class 4A: SC SJ General Unsecured Claims totaling $1,536,463
will recover 100% of their claims. Each Holder will receive payment
in full in Cash plus interest at the Federal judgment rate, payable
on the later of the Effective Date and the date that is 10 Business
Days after the date on which such SC SJ General Unsecured Claim
becomes an Allowed SC SJ General Unsecured Claim.
* Class 4B: FMT General Unsecured Claims totaling $18,182,000
to $192,476,857 will recover 0.26% to 2.75% of their claims. Each
Holder of an Allowed FMT General Unsecured Claim will receive on
account of such Allowed FMT General Unsecured Claim, in full and
final satisfaction of such Allowed FMT General Unsecured Claim, its
Pro Rata share of the FMT GUC Cash Pot. For the avoidance of doubt,
the FMT Deficiency Claim is an Allowed FMT General Unsecured
Claim.
* Class 4C: Fairmont General Unsecured Claims totaling
$3,976,655 will recover 100% of claims. Each Holder will receive
payment in full in Cash plus interest at the Federal judgment rate,
payable on the later of the Effective Date and the date that is 10
Business Days after the date on which such Fairmont General
Unsecured Claim becomes an Allowed Fairmont General Unsecured
Claim.
All Cash necessary for the Debtors or Post-Effective Date Debtors,
as applicable, to make payments required pursuant to or
contemplated under the Plan shall be funded from proceeds advanced
under the DIP Facility, Cash on hand as of the applicable date of
such payment, the Qualified Mezzanine Loan, and proceeds of the
Parent Capital Contribution.
The Parent Capital Contribution shall be made in accordance with
the terms of the Eagle Canyon Commitment Letter. In accordance with
the Eagle Canyon Commitment Letter and subject to the terms and
conditions, Eagle Canyon has agreed to make certain contributions
to the Debtors that the Debtors will be permitted to use to make
distributions to holders of certain Allowed Claims under the Plan.
The Bankruptcy Court has scheduled a hearing to consider
confirmation of the Plan for July 15, 2021 at 11:00 a.m. in the
United States Bankruptcy Court for the District of Delaware, 824
North Market Street, 6th Floor, Courtroom No. 3, Wilmington,
Delaware 19801. The Bankruptcy Court has directed that objections,
if any, to confirmation of the Plan be filed and served on or
before July 2, 2021 at 4:00 p.m.
A full-text copy of the Amended Disclosure Statement dated June 3,
2021, is available at https://bit.ly/3zgKFRI from Stretto, the
claims agent.
Counsel to the Debtors:
Patrick Potter
Dania Slim
Jonathan Doolittle
Rahman Connelly
PILLSBURY WINTHROP SHAW
PITTMAN LLP
1200 Seventeenth Street, NW
Washington, DC 20036
Telephone: (202) 663-8928
Facsimile: (202) 663-8007
Justin Alberto
Patrick Reilley
COLE SCHOTZ P.C.
500 Delaware Avenue, Suite 1410
Wilmington, Delaware 19801
Telephone: (302) 652-3131
Facsimile: (302) 574-2104
About SC SJ Holdings and FMT SJ
San Ramon, Caliofrnia-based Eagle Canyon Management's SC SJ
Holdings LLC owns The Fairmont San Jose, an 805-room luxury hotel
located at 170 South Market St., San Jose, Calif. The hotel is
near many of the largest Fortune 1000 corporations and is a popular
location for conferences and conventions, particularly in the
technology industry.
On March 5, 2021, SC SJ Holdings' affiliate, FMT SJ LLC, filed a
voluntary petition for relief under Chapter 11 of the Bankruptcy
Code (Bankr. D. Del. Case No. 21-10521). On March 10, 2021, SC SJ
Holdings sought Chapter 11 protection (Bankr. D. Del. Case No.
21-10549). The cases are jointly administered under Case No.
21-10549.
At the time of the filing, SC SJ Holdings disclosed assets of
between $100 million and $500 million and liabilities of the same
range. FMT SJ disclosed that it had estimated assets of between
$500,000 and $1 million and liabilities of between $100 million and
$500 million.
The Debtors tapped Pillsbury Winthrop Shaw Pittman, LLP, as their
bankruptcy counsel, Cole Schotz P.C. as local counsel, and Verity
LLC as financial advisor. Stretto is the claims agent and
administrative advisor.
SEMINOLE HARD ROCK: Moody's Alters Outlook on B1 CFR to Stable
--------------------------------------------------------------
Moody's Investor Service revised the rating outlook of Seminole
Hard Rock Entertainment, Inc. ("SHRE") to stable from negative.
SHRE's B1 Corporate Family Rating, B2-PD Probability of Default
Rating, and the B1 rating on the company's term loan were
affirmed.
"The outlook revision to stable incorporates Moody's expectation
that there will be a gradual easing of social distancing
requirements that will result in increased visitation relative to
the past year, and in turn, a continued improvement in revenue,
EBITDA and operating margins that began in the most recent quarter
ended 31-Mar-2021," stated Keith Foley, a Senior Vice President at
Moody's.
"SHRE's stable outlook also acknowledges the financial support that
SHRE has available to it from its parent, Seminole Tribe of
Florida," added Foley.
SHRE is a wholly owned subsidiary of the Seminole Tribe of Florida
("Tribe"). While SHRE and the Tribe have their own distinct
restricted group financing, there is a meaningful amount of
economic and strategic linking between the two entities. SHRE
receives fees from the Tribe and unrelated third parties for use of
the Hard Rock name. SHRE has also received a considerable amount of
cash contributions from the Tribe for acquisitions and operations.
The Tribe also provides a payment guarantee on SHRE's term loan
debt.
Moody's revised the outlook to stable from negative this past April
on the Tribe's debt that is secured by its gaming operations and
expects that the Tribe will continue to fund any of SHRE's free
cash flow deficits. Moody's anticipates that SHRE will generate a
slight free cash deficit in fiscal 2021, about $10 million to $20
million (Moody's free cash flow calculation excludes the $54.2
million cash payment that SHRE received in March as a repayment for
a loan made to an affilate). However, as social distancing
requirements ease going forward and comps become easier, Moody's
expects that SHRE's free cash flow and leverage will show
improvement and that the company will be able to manage its
debt-to-EBITDA below 6.0x by itself or with the help of the Tribe,
if necessary. For the 12-month period ended 31-Mar-2021, SHRE's
EBITDA calculated on a Moody's adjusted basis was only at a
breakeven level, although it had improved about 50% between the
3-month periods ended 31-Mar-2021 and 31-Mar-2020.
Moody's took the following rating actions:
Ratings Affirmed:
Issuer: Seminole Hard Rock Entertainment, Inc.
Corporate Family Rating, Affirmed B1
Probability of Default Rating, Affirmed B2-PD
Gtd Senior Secured Bank Credit Facility, Affirmed B1 (LGD3)
Outlook Actions:
Issuer: Seminole Hard Rock Entertainment, Inc.
Outlook, Changed To Stable From Negative
RATINGS RATIONALE
SHRE's B1 Corporate Family Rating considers the company's
significant geographic diversification and expectation for growth
in high margin fee income from franchised cafes, casinos and
hotels. In addition, Moody's anticipates that the company's
licensed, managed, and franchised operations, which are primarily
asset light, will become a larger contributor to the company's
overall earnings over time. The company also benefits from its
ownership by the Tribe, which provides a payment guarantee on
SHRE's term loan debt. The ownership and guarantee diminish SHRE's
default risk and improve the company's financial flexibility, which
factors provide multiple notches of lift to SHRE's rating relative
to the stand-alone credit profile.
SHRE's ratings are constrained by its modest scale in terms of
number of restaurants and earnings concentration in the casual
dining segment. The casual dining segment remains vulnerable to the
coronavirus pandemic given the restrictions placed on in-restaurant
dining. In addition, prior to the pandemic the casual dining
industry had been experiencing weak traffic patterns and cost
pressures. SHRE's credit profile is also constrained by its very
high leverage and weak interest coverage.
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, the recovery is tenuous, and continuation will be closely
tied to containment of the virus. As a result, a degree of
uncertainty around Moody's forecasts remains. Moody's regards the
coronavirus outbreak as a social risk under Moody's ESG framework,
given the substantial implications for public health and safety.
The restaurant sector has been one of the sectors most
significantly affected by the shock given its sensitivity to
consumer demand and sentiment. More specifically, SHRE remains
vulnerable to a renewed spread of the outbreak. SHRE also remains
exposed to discretionary consumer spending that leave it vulnerable
to shifts in market sentiment in these unprecedented operating
conditions.
Governance is a key rating factor for SHRE, which is a 100% owned
subsidiary of the Tribe. The Tribe, in early November 2018, signed
a resolution and an agreement to guarantees SHRE's Term Loan A
facility. The guarantee from the Tribe, on a senior unsecured
basis, is a guarantee of payment that is subordinated in payment
priority to the Tribe Gaming enterprise. The resolution and payment
guarantee, along with the continued financial strength of the
Tribe, increasingly shows the Tribe's ability and willingness to
support SHRE.
SHRE has adequate liquidity. Although the company is only expected
to have modest free cash flow deficit in fiscal 2021, and does not
have a revolver, SHRE's does have sufficient unrestricted cash to
fund any free cash flow deficit should it occur. In addition, the
Tribe's financial support and timely payment guaranty provides
incremental liquidity support. Additionally, Moody's expects SHRE
will meet its minimum liquidity covenant.
As part of obtaining a covenant waiver relief for the quarters
ending 31-Mar-2021 through 30-Sep-2022, SHRE agreed to an
incremental debt covenant. SHRE is required to maintain a minimum
unrestricted cash amount of $30 million through 30-Sep-2021, 2021,
$35 million through 31-Dec-2021, $40 million through 31-Mar-2022
and $45 million through 30-Sep-2022. At 31-Mar-2021, SHRE had $115
million of unrestricted cash.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Ratings could be downgraded if the Tribe's rating is downgraded for
any reason, or SHRE's credit metrics will remain weak despite a
lifting of restrictions and a subsequent recovery in earnings and
liquidity. Specifically, ratings could be downgraded to the extent
Moody's believes that SHRE will not be able to achieve and maintain
debt/EBITDA at or below 6.0x or EBIT coverage of interest above
1.5x on a sustained basis.
A ratings upgrade would require a high degree of confidence on
Moody's part that SHRE's various revenue and earnings streams have
returned to a period long-term stability, and that SHRE demonstrate
the ability to generate positive free cash flow, maintain good
liquidity, and operate at a debt-to-EBITDA level at 5.0x or lower
and EBIT coverage of interest 2.0x or greater.
Seminole Hard Rock Entertainment, Inc. is an owner-operator and
franchisor of Hard Rock cafes, casinos and hotels throughout the
world. The company is a wholly owned subsidiary of the Seminole
Tribe of Florida and generated revenue of approximately $385
million for the fiscal year ended Mar. 31, 2021.
The principal methodology used in these ratings was Restaurant
Industry published in January 2018.
SIRIUS XM: Moody's Assigns New $1.5BB Unsecured Notes 'Ba3'
-----------------------------------------------------------
Moody's Investors Service assigned a Ba3 rating to Sirius XM Radio
Inc.'s proposed 7-year senior unsecured notes offering totaling
$1.5 billion. Sirius XM's Ba3 Corporate Family Rating, Ba3-PD
Probability of Default Rating, Ba3 senior notes rating and stable
outlook remain unchanged.
Proceeds will be used to fully repay the $1 billion outstanding
3.875% senior notes due August 1, 2022 and reduce borrowings under
the $1.75 billion revolving credit facility, which had
approximately $1 billion outstanding at March 31, 2021. The new
senior notes will rank pari passu with Sirius XM's existing senior
notes and will be guaranteed on a senior unsecured basis by the
same operating subsidiaries that guarantee the company's current
senior notes.
Following is a summary of the rating action:
Assignment:
Issuer: Sirius XM Radio Inc.
$1.5 Billion Senior Unsecured Notes due 2028, Assigned Ba3 (LGD4)
The assigned rating is subject to review of final documentation and
no material change in the size, terms and conditions of the
transaction as advised to Moody's.
RATINGS RATIONALE
Moody's expects that the refinancing transaction will be leverage
neutral since Sirius XM's total debt quantum and financial leverage
will remain unchanged with pro forma total debt to EBITDA staying
at roughly 3.9x (as calculated by Moody's at March 31, 2021).
Moody's views the transaction favorably given the expected
extension of the 2022 debt maturity and creation of more borrowing
capacity under the RCF. Upon full extinguishment of the 3.875%
senior notes, Moody's will withdraw the rating.
Sirius XM's Ba3 Corporate Family Rating (CFR) is buttressed by
moderate leverage for the rating category, high EBITDA margins in
the 30%-35% range (as calculated by Moody's) and roughly 60% free
cash flow conversion. It also considers the company's sizable
self-pay in-vehicle satellite radio subscriber base, unique mix of
content and curated channels, Moody's forecast for a recovery in
domestic new light vehicle volume to 15.3 million units in 2021 and
16.0 million units in 2022 (17.9 million and 18.9 million,
respectively, in North America) and Sirius XM's increasing
penetration in the used car segment. Sirius XM derived revenue
diversification and scale benefits from the 2019 acquisition of
Pandora, which helped extend the company's presence to in-home and
mobile entertainment markets in North America, and enabled the
creation of new curated content. The acquisition of Stitcher
deepens Sirius XM's position in the fast-growing podcasting space.
With the combination of its satellite radio service, music
streaming platform and podcasting assets, Sirius XM has the largest
addressable audience across all digital audio categories in North
America giving it more ways to monetize across listeners,
advertisers, publishers and creators.
The rating is constrained by Sirius XM's historically aggressive
financial policy, which includes funding sizable share repurchases
with debt and most of its free cash flow generation. Moody's
expects that Sirius XM will continue to opportunistically use debt
and free cash flow to fund buybacks and/or engage in M&A activity.
Despite debt levels that have risen nearly each year, financial
leverage ratios along with other credit metrics have remained
well-positioned for the rating category. The company's majority
ownership by Liberty Media Corporation poses event risk given
Liberty's track record for M&A and shareholder-friendly
transactions. Other challenges include slowing subscriber and
revenue growth coupled with high monthly churn in Sirius XM's core
satellite radio business as a result of growing competition from
digital audio providers expanding into the vehicle market; and
declines in Pandora's monthly ad-supported listener hours at a time
when rising capex levels and dividends will increasingly consume
free cash flow generation.
Sirius XM's business model remained fairly resilient during the
COVID-19 pandemic given the company's satellite radio
subscription-based revenue model, which accounts for nearly 80% of
revenue.
The stable outlook reflects Moody's view that Sirius XM's business
model and operating profitability will continue to remain resilient
during the gradual economic recovery following the recession and
generate robust free cash flow. Moody's expects that Sirius XM will
maintain very good liquidity, even during periods of economic
weakness and increased satellite construction spend. Potentially
higher leverage rising modestly above the 4x area (Moody's
adjusted) due to moderating EBITDA and/or higher debt levels is
also factored in the stable outlook.
Moody's expects Sirius XM to maintain very good liquidity provided
by access to its $1.75 billion unrated senior secured RCF maturing
June 2023 and free cash flow generation projected this year in the
range of $1.4 billion to $1.6 billion buttressed by revenue
visibility from its subscription-based model. Cash balances totaled
$59 million at March 31, 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
corporate assets arising from the current weakness in US 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.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
An upgrade could occur if management demonstrates a commitment to
balance debt holder returns with those of its shareholders, which
would include sizing share repurchases within annual free cash flow
generation and limiting debt-funded buybacks. Moody's would also
need assurances that Sirius XM will operate in a financially
prudent manner consistent with a higher rating. Upward ratings
pressure could also transpire if the company stabilized key
operator performance metrics in its core satellite radio business
and Pandora subsidiary, and demonstrated a track record for
sustaining total debt to EBITDA below 3.5x (including Moody's
standard adjustments) and free cash flow to debt above 12% (Moody's
adjusted) even during periods of satellite construction.
The ratings could be downgraded if: (i) Moody's expects total debt
to EBITDA will be sustained above 4.5x (including Moody's standard
adjustments); (ii) free cash flow generation falls below targeted
levels as a result of subscriber losses due to the weak economy,
customer migration to competing media services or functional
problems with satellite operations; or (iii) Sirius XM experienced
weakened liquidity below expected levels as a result of increased
share repurchases, dividends, capital spending or acquisitions.
Headquartered in New York, NY, Sirius XM Radio Inc., is a
wholly-owned operating subsidiary of Sirius XM Holdings Inc., which
provides satellite radio services in the United States and Canada
through a fleet of six owned satellites. The company creates and
broadcasts commercial-free music; premier sports talk and live
events; comedy; news; exclusive talk and entertainment; and
comprehensive Latin music, sports and talk programming. Sirius XM
services are available in vehicles from every major car company in
the US, and programming is also available online as well as through
applications for smartphones and other internet connected devices.
Sirius XM is publicly traded and a controlled company of Liberty
Media Corporation, which owns roughly 77% of its outstanding common
shares.
The principal methodology used in these ratings was Media Industry
published in June 2017.
SKS CONSTRUCTION: Case Summary & 20 Largest Unsecured Creditors
---------------------------------------------------------------
Debtor: SKS Construction, Inc.
10900 Houser Drive
Fredericksburg, VA 22408
Chapter 11 Petition Date: June 9, 2021
Court: United States Bankruptcy Court
Eastern District of Virginia
Case No.: 21-31862
Debtor's Counsel: David K. Spiro, Esq.
SPIRO & BROWNE, PLLC
6802 Paragon Place
Suite 410
Richmond, VA 23230
Tel: 804-441-6080
Fax: 804-836-1855
E-mail: dspiro@sblawva.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Steven J. Zuchowski, vice-president.
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/7PIOEDA/SKS_Construction_Inc__vaebke-21-31862__0001.0.pdf?mcid=tGE4TAMA
SKY STEEL: Case Summary & 20 Largest Unsecured Creditors
--------------------------------------------------------
Debtor: Sky Steel, Inc.
PO Box 300165
Casselberry, FL 32730
Business Description: Sky Steel, Inc. is in the structural steel
erection business.
Chapter 11 Petition Date: June 9, 2021
Court: United States Bankruptcy Court
Middle District of Florida
Case No.: 21-02638
Debtor's Counsel: Jeffrey S. Ainsworth, Esq.
BRANSONLAW, PLLC
1501 E. Concord Street
Orlando, FL 32803
Tel: 407-894-6834
Fax: 407 894 8559
E-mail: jeff@bransonlaw.com
Total Assets: $75,908
Total Liabilities: $1,689,320
The petition was signed by Stephen P. Collins, authorized
representative.
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/WHNSO4Q/Sky_Steel_Inc__flmbke-21-02638__0001.0.pdf?mcid=tGE4TAMA
SLIDEBELTS INC: Seeks to Employ Nord & Associates as Accountant
---------------------------------------------------------------
SlideBelts, Inc. seeks approval from the U.S. Bankruptcy Court for
the Eastern District of California to hire Nord & Associates CPAs
as its accountant.
The Debtor needs the accounting firm to compute tax liabilities for
the Internal Revenue Service and assist in its preparation of
federal and state income tax returns.
The firm's hourly rates are as follows:
Michael Nord $250 per hour
Paraprofessional services $150 per hour
Administrative services $75 per hour
A minimum fee of $2,750 will be charged to the Debtor if the hours
required total less than the prescribed rates of the firm.
Michael Nord, the firm's accountant who will be providing the
services, disclosed in court filings that he is a "disinterested
person" as the term is defined in Section 101(14) of the Bankruptcy
Code.
The firm can be reached at:
Michael S. Nord
Nord & Associates CPAs
101 Parkshore Drive, Suite 225
Folsom, CA 95630
Phone: (916) 294-0200
Fax: (916) 294-0020
Email: info@nordandassociates.com
About SlideBelts Inc.
SlideBelts, Inc. -- https://slidebelts.com -- is an El Dorado
Hills, Calif.-based belt company founded in 2004.
SlideBelts sought protection under Chapter 11 of the Bankruptcy
Code (Bankr. E.D. Calif. Case No. 20-24098) on Aug. 25, 2020. Brig
Taylor, president and chief executive officer, signed the petition.
At the time of the filing, the Debtor disclosed assets of between
$1 million and $10 million and liabilities of the same range.
Judge Fredrick E. Clement oversees the case.
The Debtor tapped Reynolds Law Corporation as bankruptcy counsel,
Goel & Anderson, LLC as special counsel, and Michael Nord of Nord &
Associates CPAs and Frances Hernandez as accountant.
SPENGLER PLUMBING CO: Files for Chapter 11 Bankruptcy Protection
----------------------------------------------------------------
Jacob Kirn of St. Louis Business Journal reports that an O'Fallon,
Illinois, plumbing firm, Spengler Plumbing Co., filed Chapter 11
bankruptcy this June 2021.
Spengler Plumbing Co. Inc., 1402 Frontage Road, made the filing in
bankruptcy court in East St. Louis, listing assets and liabilities
between $1 million and $10 million. Jason Spengler is the
president, court documents say. The company's website says it also
works on kitchen and bath remodels, plus heating and air
conditioning projects.
Court papers list large debts with local unions. The largest,
$753,000 for an alleged pension withdrawal liability with Plumbers
& Pipefitters Local 101, is disputed. So is a similar debt, worth
$235,000, with Plumbers Local 360's pension plan.
And Spengler listed a $403,000 debt with Local 101 and Local 360
for a National Labor Relations Board settlement agreement "for
payment of union benefits."
Further, Spengler said it has a $78,000 tax debt with the Internal
Revenue Service.
Spengler filed Chapter 11 once before, in 2019. It got permission
to dismiss that case so that it could file again, under provisions
of the federal Small Business Reorganization Act, which lowered
costs and streamlined the plan confirmation process to better
enable small businesses to survive bankruptcy, the American Bar
Association says.
About Spengler Plumbing Company
Founded in 1971, Spengler Plumbing Company, Inc., specializes in
plumbing and HVAC services.
Spengler Plumbing previously sought protection under Chapter 11 of
the Bankruptcy Code (Bankr. S.D. Ill. Case No. 19-30958) on July
19, 2019.
Spengler Plumbing recently sought Chapter 11 bankruptcy (Bankr.
S.D. Ill. Case No. 21-30409) on June 1, 2021. Silver Lake Group
Ltd., led by Steven M. Wallace, is the Debtor's counsel.
SPHERATURE INVESTMENTS: Seeks to Hire McDermott as New Counsel
--------------------------------------------------------------
Spherature Investments, LLC and its affiliates seek approval from
the U.S. Bankruptcy Court for the Eastern District of Texas to
employ McDermott Will & Emery, LLP as their new bankruptcy
counsel.
The firm's services will include:
a. giving advice to the Debtors regarding their powers and
duties in the continued operation of their business, including the
negotiation and finalization of any financing agreements;
b. assisting in the identification of assets and liabilities
of the Debtors' estate;
c. assisting the Debtors in formulating a plan of
reorganization or liquidation and taking the necessary legal steps
to confirm such plan;
d. preparing legal documents;
e. appearing in court;
f. analyzing claims and competing property interests, and
negotiating with creditors and parties-in-interest;
g. advising the Debtors in connection with any potential sale
of their assets; and
h. other legal services necessary to administer the Debtors'
bankruptcy cases.
The firm has agreed to provide a discount on the rates charged by
the primary attorneys who will be handling the Debtors' cases. The
discounted hourly rates are as follows:
Marcus A. Helt $915 per hour
Jack G. Haake $655 per hour
Shelby Taylor Perry $619 per hour
Cathy Miller Greer $342 per hour
McDermott will also provide a discount of approximately 25 percent
from the rates charged by other professionals at the firm who may
provide bankruptcy-related services. The current hourly rates
charged by these professionals are as follows:
Partners $1,050 - $2,200 per hour
Associates $645 - $1,065 per hour
Non-Lawyer Professionals $75 - $1,200 per hour
As disclosed in court filings, McDermott is a "disinterested
person" within the meaning of Bankruptcy Code Section 101(14).
In accordance with Appendix B-Guidelines for reviewing fee
applications filed by attorneys in larger Chapter 11 cases,
McDermott disclosed that:
-- the firm has agreed to a discount of approximately 25
percent from its customary hourly rates;
-- none of the professionals included in the engagement vary
their rate based on the geographic location of the bankruptcy
cases;
-- the firm has not represented the Debtors in the 12 months
prior to their Chapter 11 filing; and
-- the approved prospective budget is included in the
"cash-collateral" and debtor-in-possession financing motions and
related orders.
.
The firm can be reached through:
Marcus A. Helt, Esq.
Jack G. Haake, Esq.
McDermott Will & Emery LLP
2501 North Harwood Street, Suite 1900
Dallas, TX 75201
Tel: (214) 210-2801
Fax: (972) 528-5765
Email: mhelt@mwe.com
jhaake@mwe.com
About Spherature Investments
Plano, Texas-based Spherature Investments LLC and its affiliates
sought Chapter 11 protection (Bankr. E.D. Texas Lead Case No.
20-42492) on Dec. 21, 2020. Spherature Investments' affiliates
include WorldVentures Marketing, LLC, a company that sells travel
and lifestyle community memberships providing a diverse set of
products and experiences.
At the time of the filing, Spherature Investments had between $50
million and $100 million in both assets and liabilities.
The Hon. Brenda T. Rhoades is the case judge.
The Debtors tapped McDermott Will & Emery, LLP as their legal
counsel and Larx Advisors, Inc. as their restructuring advisor.
Erik Toth, a partner at Larx Advisors, serves as the Debtors' chief
restructuring officer. Stretto is the claims agent.
The U.S. Trustee for Region 6 appointed an official unsecured
creditors' committee on Jan. 22, 2021. The committee tapped
Pachulski Stang Ziehl & Jones, LLP as its legal counsel and
GlassRatner Advisory & Capital Group, LLC as its financial advisor.
STARWOOD PROPERTY: Moody's Alters Outlook on Ba2 CFR to Stable
--------------------------------------------------------------
Moody's Investors Service has affirmed the Ba2 corporate family and
Ba3 long-term senior unsecured ratings of Starwood Property Trust,
Inc. (Starwood) as well as the Ba2 senior secured rating of
subsidiary Starwood Property Mortgage, LLC. Moody's has also
revised the outlooks of both issuers to stable from negative.
The rating action reflects Starwood's strong financial performance
during the coronavirus pandemic-induced downturn in the commercial
real estate (CRE) sector, and Moody's expectations that asset
quality, profitability and leverage will remain stable over the
next 12-18 months.
Affirmations:
Issuer: Starwood Property Mortgage, LLC
Senior Secured Bank Credit Facility, Affirmed Ba2
Issuer: Starwood Property Trust, Inc.
Corporate Family Rating, Affirmed Ba2
Senior Unsecured Regular Bond/Debenture, Affirmed Ba3
Outlook Actions:
Issuer: Starwood Property Mortgage, LLC
Outlook, Changed To Stable From Negative
Issuer: Starwood Property Trust, Inc.
Outlook, Changed To Stable From Negative
RATINGS RATIONALE
Moody's affirmation of Starwood's ratings is based on the company's
effective credit and liquidity risk management during the pandemic
induced downturn in the commercial real estate sector, its superior
revenue diversity compared to peers, history of strong operating
performance and affiliation with Starwood Capital Group, the
well-established commercial real estate investment and asset
management firm. Starwood's ratings are constrained by its high
reliance on confidence-sensitive secured funding and its high
exposure to the cyclicality of the certain commercial property
segments, especially hotels.
Starwood's resilient operating performance is rooted in its
selective investments across broad property types and geographies
in the US and Europe. In commercial real estate lending, the
company strategically targets investments in transitional assets
such as construction projects and non-stabilized properties.
Starwood moved to a more conservative origination posture leading
up and during the downturn by reducing its construction exposure as
well as its portfolio weighted average loan-to-value, which
declined by about 5% since September 2019 to 60.1% at March 31,
2021. Starwood's net income-to-average assets profitability in the
first quarter of 2021 measured an improved 2.65%, approaching the
pre-COVID range of 3.0% - 3.5%.
Starwood's loan quality has held up well during the downturn,
considering the company's higher exposure to the hospitality sector
than certain rated peers. Of total assets, $2.2 billion (12%) was
hotel loans at March 31, 2021. Of note, just 13% of this amount is
in central business districts most impacted by the downturn in
business travel. At quarter end, 2.0% of the company's commercial
real estate loans were on non-accrual, most of which represented a
single exposure, and the rate of net charge offs was a low 0.2%.
Additionally, interest and rent collections rates across Starwood's
loan and property portfolios has been strong. Notwithstanding
strong portfolio performance, credit risks in sub-sectors including
central business district office and hotel remain elevated, which
will potentially increase portfolio and earnings volatility for the
next several quarters.
Starwood maintains a strong liquidity position, underscored by its
diverse sources of funding and manageable debt maturity profile.
While repurchase facilities are a key source of funding, totaling
$6.9 billion at March 31, 2021 or 51% of balance sheet debt, just
$2.2 billion was exposed to market-based margin calls, a lower
proportion than certain peers.The company has effectively managed
its liabilities during the downturn, including by deleveraging
credit-sensitive funding facilities, issuing new debt in advance of
approaching maturities and expanding funding sources to include
securitization of commercial real estate loans and energy
infrastructure loans. However, Starwood's funding, though diverse,
requires a pledge of most of its valuable earnings assets, which
Moody's believes limits unencumbered assets as a secondary source
of liquidity.
A key consideration for Starwood's credit profile is its ability to
maintain a solid capital cushion as the composition of its earning
assets evolves. The company reported that its adjusted on-balance
sheet debt-to-equity ratio measured 2.3x at the end of the first
quarter and 3.7x including non-recourse syndication and A-note
financing, up slightly from prior periods. Over the next 12-18
months, Moody's expects that leverage will range at about the same
level, which is consistent with the assigned Ba2 rating.
Moody's revised Starwood's outlook to stable from negative based on
the resilience of the company's asset performance and strong
liability ad liquidity management over the past year, which Moody's
expects positions the company well to generate improving operating
results even as uncertainties regarding asset performance linger in
certain property sectors and regions.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Moody's could upgrade Starwood's ratings if the company: 1) further
diversifies its funding sources to include additional senior
unsecured debt, resulting in a ratio of secured debt to tangible
assets declining to not more than 45%; 2) maintains strong, stable
profitability and low credit losses; and 3) maintains a ratio of
adjusted debt to adjusted tangible equity of not more than 3.0x.
Starwood's ratings could be downgraded if the company: 1) increases
exposure to volatile funding sources or otherwise encounters
material liquidity challenges, 2) increases its adjusted debt to
adjusted tangible equity leverage to more than 4.5x, 3) rapidly
accelerates growth, or 4) suffers a sustained decline in
profitability.
The principal methodology used in these ratings was Finance
Companies Methodology published in November 2019.
STEPHENS FARMS: July 8 Pretrial Conference on Plan Confirmation
---------------------------------------------------------------
On April 23, 2021, C. Jerome Teel, Jr. on behalf of Debtor Stephens
Farms, filed with the U.S. Bankruptcy Court for the Western
District of Tennessee an amended disclosure statement referring to
an amended plan.
On June 3, 2021, Judge Jimmy L. Croom approved the amended
disclosure statement and ordered that:
* July 2, 2021, is fixed as the last day for filing written
objections to the amended plan, and for filing written acceptances
or rejections of the amended plan.
* July 8, 2021, at 9:30 a.m., by telephone, if necessary is
the Pretrial Conference on confirmation of the amended plan.
* Not less than 7 days prior to the scheduled confirmation
hearing, the proponent of the amended plan shall file with the
Bankruptcy Court Clerk a summary tabulation of ballots.
A copy of the order dated June 3, 2021, is available at
https://bit.ly/352ub1y from PacerMonitor.com at no charge.
About Stephens Farms
Stephens Farms filed its voluntary petition for relief under
Chapter 11 of the Bankruptcy Code (Bankr. W.D. Tenn. Case No. 20
10599) on March 18, 2020. At the time of filing, the Debtor
estimated $1,000,001 to $10 million in both assets and liabilities.
C. Jerome Teel, Jr., Esq., at Teel & Maroney, PLC, represents the
Debtor.
SUSGLOBAL ENERGY: Appoints Site Selection Expert to Directors Board
-------------------------------------------------------------------
SusGlobal Energy Corp. has appointed Susan Harte, Esq., MCR to the
Company's Board of Directors.
Ms. Harte is a nationally recognized leader in site selection,
location economics and incentives. She is currently a principal of
the international site selection consulting firm Hickey &
Associates. For over 25 years, she has combined her expertise in
commercial real estate, site selection and economic development to
assist her clients with leveraging location as a competitive
advantage.
Throughout her practice, Ms. Harte has led her clients to achieve
better business outcomes by integrating strategic planning
techniques and implementation frameworks to drive internal
stakeholder consensus around location decisions. She has managed
major site selection projects for many Fortune 500 companies
involving complex multi-jurisdictional competitive strategies.
Pursuant to this work, she has structured, negotiated and secured
over US$1billion in location incentives such as real estate and
personal property tax abatements, sales tax exemptions, grants and
specialty bond financing for her clients' projects.
"The appointment of Ms. Harte to the Board of Directors continues
SusGlobal's strategy of expanding the strength and depth of its
Board through the appointment of accomplished industry veterans,"
commented Marc Hazout, executive chairman, president and CEO of
SusGlobal. "Susan brings significant experience in developing and
implementing location strategies that align with our corporate
goals and expansion objectives."
"Geography will be a key driver in SusGlobal's corporate
performance as its model and regional strategy is ripe for export
to municipalities across North America," commented Susan Harte. "I
look forward to working with management and the Board and in being
instrumental with implementing successful location strategies and
in guiding the Company through state and local governmental and
regulatory affairs."
Prior to her current position, Ms. Harte was a senior vice
president at CBRE, the world's largest commercial real estate
services and investment firm, in the global Location Advisory and
Transactions Services group. She previously was director of the
Business Economic Incentives Practice at Jones Lang LaSalle, having
joined the company after seven years with the New York City
boutique law firm of Stadtmauer Bailkin. She also served a term as
the Director of National Incentives Practice at Grant Thornton one
of the largest accounting firms in the world and as Director of
Industry Development at Empire State Development Corporation, New
York State's economic development agency.
Ms. Harte has been appointed a member of each of the Audit
Committee and the Corporate Governance and Nominating Committee.
Ms. Harte will serve as chairperson of the Corporate Governance and
Nominating Committee.
As compensation for her services as a member of the Board Ms. Harte
will be entitled to receive a CA$25,000 fee per annum, payable at
year end by either cash or shares of the Company at the Company's
discretion. If such fee is paid in shares of the Company, the
conversion of the CA$25,000 fee into shares will be based on the
average closing price of the Company's stock on a 10-trading day
lookback, with a portion of the fee payable, at Ms. Harte's sole
discretion, in cash to cover any taxes that may be owed by Ms.
Harte due to the issuance of the Company's shares.
About SusGlobal
Headquartered in Toronto, Ontario, Canada, SusGlobal Energy Corp.
-- www.susglobalenergy.com -- is a renewables company focused on
acquiring, developing and monetizing a global portfolio of
proprietary technologies in the waste to energy and regenerative
products application.
SusGlobal Energy reported a net loss of $2.01 million for the year
ended Dec. 31, 2020, compared to a net loss of $2.89 million for
the year ended Dec. 31, 2019. As of Dec. 31, 2020, the Company had
$5.76 million in total assets, $10.52 million in total liabilities,
and a total stockholders' deficiency of $4.76 million.
Toronto, Canada-based MNP LLP, the Company's auditor since 2020,
issued a "going concern" qualification in its report dated April
15, 2021, citing that the Company has experienced operating losses
since inception and expects to incur further losses in the
development of its business. These conditions, along with other
matters, raise substantial doubt about Company's ability to
continue as a going concern.
TD HOLDINGS: Incurs $5.9 Million Net Loss in 2020
-------------------------------------------------
TD Holdings, Inc. filed with the Securities and Exchange Commission
its Annual Report on Form 10-K disclosing a net loss of $5.95
million on $28.27 million of total revenues for the year ended Dec.
31, 2020, compared to a net loss of $6.94 million on $663,013 of
total revenues for the year ended Dec. 31, 2019.
As of Dec. 31, 2021, the Company had $167.18 million in total
assets, $47.15 million in total liabilities, and $120.03 million in
total equity.
The Company has financed its operations primarily through
shareholder contributions, cash flow from operations, borrowings
from third parties and related parties, and equity financing
through public offerings of its securities.
The Company expects to use the proceeds from this equity financing
as working capital to expand its commodity trading business.
During the year ended Dec. 31, 2020, the Company had a cash inflow
from operating activities of $29,856,033, a change of $32,021,665
from a cash outflow of $2,165,632 for the same period ended Dec.
31, 2019. For the years ended Dec. 31, 2020 and 2019, the Company
had a cash outflow of $125,133 and a cash inflow of $638,249 from
operating activities from discontinued operations, and the Company
incurred net loss of $3,551,258 and $1,722,158 from discontinued
operations, respectively.
Net cash used in investing activities for the year ended Dec. 31,
2020 was $132,582,547, which was primarily attributable to cash
payment of $82,227,328 in exchange for 100% equity interest in
Qianhai Biayu, loans of $47,114,208 and $173,673,614 made to
related parties and third parties, against collections of loans of
$170,432,603 from third parties.
Net cash used in investing activities for the year ended Dec. 31,
2019 was $8,873,916, which was primarily attributable to
investments in financial products of $1,000,000, loans made to
related parties and third parties of $2,865,070 and $576,647,
respectively, and cash of $4,432,199 used in investing activities
from discontinued operations.
During the year ended Dec. 31, 2020, the cash provided by financing
activities was mainly attributable to borrowings from related
parties of $1,613,696, cash raised of $18,500,000 from certain
private placements by issuance of 19,000,000 shares of common
stocks, cash raised of $20,000,000 from a registered direct
offering by issuance of 8,000,000 shares of common stocks, cash
raised of $66,000,000 from issuance of unsecured senior convertible
promissory notes in the aggregate principal amount of $30,000,000
and exercise of accompanied warrants to purchase 20,000,000 shares
of common stock at an exercise price of $1.80.
The Company said, "While the potential economic impact brought by
and the duration of COVID-19 may be difficult to assess or predict,
a widespread pandemic could result in significant disruption of
global financial markets, reducing our ability to access capital,
which could in the future negatively affect our liquidity. In
addition, a recession or market correction resulting from the
spread of COVID-19 could materially affect our business and the
value of our common stock. While it is too early to tell whether
COVID-19 will have a material effect on our business over time, we
continue to monitor the situation as it unfolds. The extent to
which COVID-19 affects our results will depend on many factors and
future developments, including new information about COVID-19 and
any new government regulations which may emerge to contain the
virus, among others."
A full-text copy of the Form 10-K is available for free at:
https://www.sec.gov/Archives/edgar/data/1556266/000121390021030939/f10k2020_tdholdingsinc.htm
About TD Holdings
Headquartered in Beijing, People's Republic of China, TD Holdings,
Inc., (formerly known as Bat Group, Inc.) has become a used
luxurious car leasing business as well as a commodities trading
business operating in China since the disposition of its direct
loans, loan guarantees and financial leasing services to
small-to-medium sized businesses, farmers and individuals in July
2018. The Company's current operations consist of leasing of
luxurious pre-owned automobiles and operation of a non-ferrous
metal commodities trading business.
TEEFOR2 INC: Court OKs Use of SBA Cash Collateral
-------------------------------------------------
Judge Scott H. Yun authorized Teefor2, Inc. to use the cash
collateral of the U.S. Small Business Association for reasonable,
ordinary, and actual business expenses, on an interim basis,
pursuant to the approved budget. The budget does not include the
lease payment on the Audi automobile by Larry Lazalde, the Debtor's
president.
In consideration for the use of cash collateral, the Debtor will
grant the SBA a replacement lien on the Debtor's postpetition cash,
accounts receivable, and the proceeds thereof, to the same extent
and priority as any lien, if any, held by the SBA as of the
Petition Date, in the same priority and subject to the same
defenses and avoidance actions, such replacement liens being
further limited to the extent the cash collateral is actually used
by the Debtor.
A copy of the order is available for free at https://bit.ly/3cptx2i
from PacerMonitor.com.
About Teefor2, Inc.
Teefor2, Inc. owns and operates a graphic design and screen
printing business in the City of Chino, California. It sought
protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr.
C.D. Cal. Case No. 21-12580) on May 10, 2021. In the petition
signed by Larry Lazalde, president, the Debtor disclosed up to
$500,000 in assets and up to $10 million in liabilities.
The Law Offices of Stephen R. Wade, P.C. is the Debtor's counsel.
TRANSOCEAN LTD: Signs Deal to Delay Delivery of Drillships
----------------------------------------------------------
Transocean Ltd. has agreed with Sembcorp Marine's subsidiary,
Jurong Shipyard Pte Ltd (JSPL), on the delayed delivery of the
ultra-deepwater drillships Deepwater Atlas and Deepwater Titan. As
part of the agreement, JSPL has agreed to accept deferred payment
for both rigs.
The Deepwater Atlas and Deepwater Titan are the world's first
eighth generation ultra-deepwater drillships and only rigs to
feature a 3,000,000 pound hook-load. These drillships are the most
capable and highest specification rigs in the world and will
include the first 20,000 psi well control system. In addition to
their state-of-the-art drilling capabilities, these rigs are also
designed and equipped to optimize fuel consumption, reduce
emissions, and thus minimize the associated carbon footprint of
each offshore project.
Deepwater Atlas: Delivery of the drillship is now expected to be in
December 2021. Upon delivery, Transocean will make a $50 million
payment to JSPL; the balance of payments owed to the shipyard, or
approximately $370 million, will be payable during a five-year
period following delivery pursuant to a secured financing
arrangement with the shipyard.
Transocean also has agreed with BOE Exploration & Production LLC
(Beacon) that drilling operations on the Shenandoah project in the
U.S. Gulf of Mexico are expected to commence during the third
quarter of 2022. Transocean expects Beacon to commence drilling on
its Shenandoah project utilizing the Deepwater Atlas following a
final investment decision from Beacon and its partners. That
decision is expected to be made on or before July 31, 2021.
Deepwater Titan: Delivery of the drillship is now expected to be in
May 2022. Upon delivery, Transocean will pay JSPL 80% of amounts
owed, or approximately $350 million. Twenty percent of amounts
owed, or approximately $90 million will be deferred and payable
over a five-year period following delivery pursuant to a deferred
payment arrangement with the shipyard.
Transocean also has agreed with Chevron U.S.A., Inc. (Chevron) that
commercial operations of the Deepwater Titan are expected to
commence in the first quarter of 2023. Transocean's contract with
Chevron maintains its duration and estimated backlog of $830
million, excluding mobilization and reimbursables.
Payments under each arrangement will be made in accordance with the
respective payment schedules over the terms of each arrangement.
Principal balances will carry an interest rate of 4.5% per annum.
"These agreements clearly represent a monumental achievement for
Transocean. As the result, we will take delivery of the two
highest specification ultra-deepwater drillships in the world, and
the only two assets capable of drilling and completing 20,000 psi
wells. Notably, as a critical element of these agreements, we will
receive shipyard financing, which materially improves our year-end
2022 liquidity by over $450 million, thus extending our runway and
providing us with additional investment flexibility as the industry
recovers," said Jeremy Thigpen, president and CEO.
Thigpen concluded: "On behalf of Transocean, I sincerely thank
JSPL, Chevron, and Beacon Offshore for their significant
contributions to this process. I would especially like to thank
our customers, as these agreements clearly demonstrate the trust
that they have in Transocean's track record of successfully
introducing revolutionary new technologies to the industry, and the
confidence that they have in our ability to consistently deliver
safe, reliable and efficient drilling operations across our global
fleet. We are extremely excited about these initial campaigns for
the Deepwater Atlas and Deepwater Titan and we are excited about
the expanding list of 20,000 psi opportunities requiring the
extraordinary capabilities of these rigs."
About Transocean
Transocean is an international provider of offshore contract
drilling services for oil and gas wells. The company specializes
in technically demanding sectors of the offshore drilling business
with a particular focus on ultra-deepwater and harsh environment
drilling services. The company's mobile offshore drilling fleet is
considered one of the most versatile fleets in the world.
Transocean Ltd. reported a net loss of $568 million for the year
ended Dec. 31, 2020, compared to a net loss of $1.25 billion for
the year ended Dec. 31, 2019. As of Dec. 31, 2020, the Company had
$21.80 billion in total assets, $1.38 billion in total current
liabilities, $8.98 billion in total long-term liabilities, and
$11.43 billion in total equity.
* * *
As reported by the TCR on Dec. 1, 2020, S&P Global Ratings raised
its issuer credit on Switzerland-based offshore drilling contractor
Transocean Ltd. to 'CCC-' from 'SD' (selective default). The
upgrade follows the company's repurchase of at least $347.6 million
of the principal amount on various of its secured and unsecured
debt issues (with maturities ranging from 2020 to 2025) for about
$213 million in cash.
TRAXIUM LLC: Unsecureds to Split Pro Rata of $850K Creditor Fund
----------------------------------------------------------------
Traxium, LLC, and debtor affiliates filed a First Amended Joint and
Consolidated Disclosure Statement accompanying their Plan of
Reorganization.
The Debtors project that holders of allowed general unsecured
claims in Class 3 will be paid between 14.42% and 38.59% of their
allowed claims. The distributions will be paid on an annual basis
out of a Creditor Fund amounting to $850,000 funded from future
income and cash flow generated from operations.
In addition to the $850,000 Creditor Fund, the Reorganized Debtors
will also contribute 50% of any net proceeds recovered from
prosecution of causes of action, increasing distribution to holders
of allowed Class 3 general unsecured claims to 38.59%.
* Classes of Claims and Their Treatment Under the Plan:
a. Class 1 – Secured Claims. Impaired, entitled to vote on the
Plan.
Class 1 consists of the claims of TCF Bank and Wells Fargo Bank.
TCF Bank is owed $923,565 and Wells Fargo is owed $799,644.
Each holder of an Allowed Class 1 Claim will retain its lien on its
collateral and shall receive monthly principal and interest
payments sufficient to pay the Class 1 Claim holders in full
pursuant to the terms of promissory notes with TCF Bank and Wells
Fargo Bank on all outstanding loans with payments commencing within
30 days of the Confirmation Date.
b. Class 2 - Secured Claim. Impaired, entitled to vote on the
Plan.
Class 2 consists of the allowed claim of Fifth Third Bank, which is
owed $4,227,460.
Each holder of an Allowed Class 2 Claim shall (i) retain its lien
on its collateral and shall (ii) receive monthly payments for
principal and interest (at the rate of 6.75% per annum, amortized
over 10 years). All [remaining and unpaid] principal and accrued
interest, if any, shall be due and payable on the fifth year
anniversary after the Effective Date, pursuant to the terms of
amended and restated notes with Fifth Third Bank.
c. Class 3 - General Unsecured Claims. Impaired, entitled to vote
on the Plan.
Each holder of an Allowed Class 3 General Unsecured Claim shall
receive a Pro Rata portion of the Creditor Fund assets of $850,000
in full satisfaction of its Allowed Claim. The Debtors shall also
contribute an additional 50% of any net proceeds recovered from the
prosecution of causes of action to the Distribution Agent for the
sole benefit of Holders of Allowed Class 3 General Unsecured
Claims.
Payments to Class 3 Claim Holders shall be made annually over a
five-year period as follows:
December 31, 2021 - $25,000;
December 31, 2022 - $75,000;
December 31, 2023 - $250,000;
December 31, 2024 - $250,000; and
December 31, 2025 - $250,000.
The Reorganized Debtors shall execute a promissory note (Unsecured
Creditor Note) as evidence of the debt.
d. Class 4 – Interests. Unimpaired, deemed to have accepted the
Plan and will not be solicited to vote on the Plan.
The holder of Interests shall continue their equity ownership under
the Plan, provided that they shall not receive any distributions
for their Interest from the Debtors or Reorganized Debtors until
the Unsecured Creditor Note is paid in full.
* New Financing
On or before the final payment due creditors under the Plan, the
Reorganized Debtors may obtain financing at a rate acceptable to
the Reorganized Debtors to fund operations and/or pay off any
balance still owing under the Unsecured Creditor Note.
* New Value
To demonstrate the ownership's conviction to perform their
obligations under the Plan, George Schmutz has agreed to reduce his
previous $205,000 annual compensation package to: $120,000 in 2021;
$135,000 in 2022; $150,000 in 2023; $165,000 in 2024 and $180,000
in 2025. In addition, George and Tina Schmutz will irrevocably
transfer and assign their right, title and interest to their
Counterclaims filed against CENPRAA in the Summit County Court of
Common Pleas to Debtor Traxium.
* Post-confirmation Management
The Reorganized Debtors' business shall be managed by the Debtors'
existing management of George Schmutz. Existing management shall
also be entitled to health insurance, life insurance, the use of a
company vehicle and reimbursement of expenses consistent with its
filed monthly operating reports.
The Distribution Agent, Gertz & Rosen, Ltd., shall make the
distributions to the holders of Class 3 Allowed General Unsecured
Claims. The Reorganized Debtors shall make distributions of cash
and other instruments to Allowed Claims in Classes 1 and 2.
George Schmutz and Tina Schmutz will remain as the sole equity
holders of the Reorganized Debtors.
A copy of the Disclosure Statement is available for free at
https://bit.ly/3geytrM from PacerMonitor.com.
The Court will conduct a remote hearing to consider the adequacy of
the Disclosure Statement on July 6, 2021 at 10 a.m.
About Traxium LLC
Traxium, LLC is a holding company comprised of commercial printing
and marketing businesses. The Debtors provide a complete platform
of graphic design, marketing, and printing solutions and services
consisting of print, bindery, and finishing services, mailing
services, and other products and services to customers throughout
the region and across the country.
Traxium filed its voluntary petition for relief under Chapter 11 of
the Bankruptcy Code (Bankr. N.D. Ohio Case No. 20-51888) on October
16, 2020.
Affiliate, Serendipity Holdings, LLC filed a Chapter 11 petition
(Bankr. N.D. Ohio Case No. 20-51889) also on October 16.
On Oct. 20, another affiliate, Cadence Holdings, LLC, filed a
Chapter 11 petition (Bankr. N.D. Ohio Case No. 20-51908). The
cases are jointly administered under Traxium LLC. The petitions
were signed by George Schmutz, chief executive officer.
On the Petition Date, Debtor Traxium reported $4,420,019 in total
assets and $5,665,021 in total liabilities. Debtor Serendipity
Holdings disclosed $2,435,809 in total assets and $9,870,438 in
total liabilities. Debtor Cadence Holdings estimated between
$500,001 and $1,000,000 in total assets and between $1,000,001 and
$10,000,000 in total liabilities at the time of filing.
The Honorable Alan M. Koschik oversees the cases.
Gertz & Rosen, Ltd. and Rysenia Capital Solutions, LLC serve as the
Debtors' legal counsel and restructuring advisor, respectively.
Dennis Durco of Rysenia Capital is the Debtors' operations
consultant and chief restructuring officer.
TWIN PINES: Seeks Cash Collateral Access Thru Sept. 30
------------------------------------------------------
Twin Pines, LLC asks the U.S. Bankruptcy Court for the District of
New Mexico for authority to use cash collateral on an interim basis
from July 1 to September 30, 2021 in accordance with its proposed
budget.
The Debtor requires the use of cash collateral to continue the
operation of its business. The Debtor requires funding to pay for,
among other things, equipment, payroll, payroll taxes, gross
receipts taxes, insurance, materials and supplies, other expenses
incurred in the ordinary course of the Debtor's business, and
professional fees and expenses incurred in connection with the
case.
The Debtor collects rents from tenants residing in its multi-unit
residential rental property under long-term leases and payments
from customers who bring their vehicles to its car wash for
cleaning. These rents and payments may constitute cash collateral.
Twin Pines entered into a loan agreement with First National Bank
pursuant to which Twin Pines may have granted First National Bank a
security interest in its "cash collateral."
The Debtor proposes these as adequate protection for First National
Bank:
a. The Debtor will make monthly adequate protection payments
to First National Bank of $2500 per month on the first business day
of July, August and September of 2021.
b. First National Bank will continue to have a security
interest upon, and the Debtor's obligations to First National Bank
and will be secured by, a security interest in all assets in which
Bank had a lien or security interest as of the Petition Date, in
the same order of priority that existed at that time, which will be
subject to the same defenses and avoidance powers (if any) as
existed on the Petition Date. In addition, First National Bank
will be granted a lien against property of the same type as the
Pre-Petition Collateral acquired by the Debtor post-petition, to
the extent of any reduction or diminution in the value of First
National Bank's collateral.
c. The Replacement Lien will be deemed valid and perfected as
of the Petition Date, without further filing or recording under any
applicable law, to the same extent as the liens in the Pre-Petition
Collateral were valid and perfected at that time and will have the
same priority as their liens and security interests in the
Pre-Petition Collateral of the same type. The Replacement Lien will
be retroactive to the Petition Date.
d. Furthermore, the Debtor proposes as an additional adequate
protection requirement to:
(1) maintain accurate records of operating revenues and
expenses and provide such information to First National Bank upon
reasonable written request;
(2) timely pay all post-petition payroll taxes,
unemployment taxes, and New Mexico CRS taxes incurred
post-petition; and
(3) maintain insurance as required by the United States
Trustee and as otherwise required by First National Bank.
A copy of the motion and the Debtor's budget through September 30
is available at https://bit.ly/2RACIpg from PacerMonitor.com.
The Debtor projects total monthly income of $12,250 and total
monthly expenses of $17,095 for July.
About Twin Pines LLC
Twin Pines LLC, a New Mexico limited liability company, provides
automotive repair and maintenance services. Twin Pines owns condos
valued at $523,618, and a commercial property valued at $741,908,
in Ruidoso, New Mexico.
Twin Pines LLC sought Chapter 11 protection (Bankr. D.N.M. Case No.
19-10295) on Feb. 12, 2019, in Albuquerque, N.M. At the time of
filing, the Debtor disclosed $1,361,978 in assets and $1,338,629 in
liabilities.
Judge Robert H. Jacobvitz oversees the case.
William F. Davis & Assoc., P.C. is the Debtor's legal counsel.
First National Bank, as lender, is represented by:
Rebekah Courvoisier, Esq.
COURVOISIER LAW, LLC
1109 Indiana Ave.
Alamogordo, NM 88310
US CONCRETE: Moody's Puts B1 CFR Under Review for Upgrade
---------------------------------------------------------
Moody's Investors Service placed U.S. Concrete, Inc.'s B1 corporate
family rating, B1-PD probability of default rating, Ba3 senior
secured bank facility rating, and B3 senior unsecured notes rating
on review for upgrade following the announcement that Vulcan
Materials Company (Baa2 stable) had entered into a definitive
agreement to acquire U.S. Concrete for $2.1 billion. In addition,
U.S. Concrete's rating outlook was changed to ratings under review
from stable.
Currently, U.S. Concrete has about $800 million of debt
outstanding. At the close of the transaction, Moody's anticipates
that all debt, which have a change of control provision will be
repaid, at which time Moody's expects to withdraw all of the
company's credit ratings. Moody's expects the transaction will be
subject to regulatory approvals and will likely close in around
twelve months or less.
On Review for Upgrade:
Issuer: U.S. Concrete, 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 Bank Facility, Placed on Review for Upgrade,
currently Ba3 (LGD3)
Senior Unsecured Regular Bond/Debenture, Placed on Review for
Upgrade, currently B3 (LGD5)
Outlook Actions:
Issuer: U.S. Concrete, 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 U.S.
Concrete and Vulcan Materials Company (Vulcan Materials) have
signed a definitive agreement for Vulcan Materials to acquire U.S.
Concrete for $2.1 billion in cash. The Moody's review will focus on
the completion of the announced acquisition plan. Moody's
anticipates that all of the debt will be repaid at the close of the
transaction. However, if any debt remains outstanding in the
post-acquisition capital structure, an upgrade is likely given
Vulcan Materials' substantially (Baa2 ) stronger credit profile.
The principal methodology used in these ratings was Building
Materials published in May 2019.
Headquartered in Euless, Texas, US Concrete is a publicly traded
company on the NASDAQ with the ticker symbol [USCR]. The company
operates within two primary segments: ready-mixed concrete and
aggregate products. The company is one of the leading producers of
ready-mixed concrete in north and west Texas, northern California,
New Jersey, New York, Washington DC, and the US Virgin Islands.
The company has 194 ready-mixed concrete operating facilities and
20 aggregates producing facilities. In 2020, USCR produced 12.6
million tons of aggregates and 8.2 million cubic yards in ready mix
concrete.
WEATHERFORD INT'L: Receives First Buy Rating After Bankruptcy Exit
------------------------------------------------------------------
Michael Bellusci of Bloomberg News reports that Weatherford
International got its first buy-equivalent, as Piper Sandler
initiated with an overweight and PT $22 shortly after the oil
services company got approval to trade on the Nasdaq following its
restructuring.
Piper analyst Ian Macpherson says the new recently restructured
WFRD is set for the international upcycle in oilfield services. It
calls WFRD "interesting and catalyst rich."
About Weatherford International PLC
Weatherford (NYSE: WFT), an Irish public limited company and Swiss
tax resident -- http://www.weatherford.com/-- is a multinational
oilfield service company providing innovative solutions, technology
and services to the oil and gas industry. The Company operates in
over 80 countries and has a network of approximately 650 locations,
including manufacturing, service, research and development and
training facilities and employs approximately 26,000 people.
Weatherford reported a net loss attributable to the company of
$2.81 billion for the year ended Dec. 31, 2018, compared to a net
loss attributable to the company of $2.81 billion for the year
ended Dec. 31, 2017.
As of March 31, 2019, Weatherford had $6.51 billion in total
assets, $10.62 billion in total liabilities, and a total
shareholders' deficiency of $4.10 billion.
On July 1, 2019, Weatherford International plc, Weatherford
International, LLC, and Weatherford International Ltd. sought
Chapter 11 protection (Bankr. S.D. Tex. Lead Case No. 19-33694).
The Hon. David R. Jones is the case judge.
The Debtors tapped Hunton Andrews Kurth LLP and Latham & Watkins
LLP as counsel; Alvarez & Marsal North America LLC as financial
advisor; Lazard Freres & Co. LLC as investment banker; and Prime
Clerk LLC as claims agent.
Henry Hobbs Jr., acting U.S. trustee for Region 7, on July 17,
2019, appointed three creditors to serve on the official committee
of unsecured creditors in the Chapter 11 cases.
WITCHEY ENTERPRISES: Disclosure Statement Hearing Reset to July 15
------------------------------------------------------------------
Judge Patricia M. Mayer moved to July 15, 2021 at 9:30 a.m. the
hearing to consider approval of the Amended Disclosure Statement of
Witchey Enterprises, Inc.
The hearing will be held at the U.S. Bankruptcy Court for the
Middle District of Pennsylvania, Max Rosenn US Courthouse,
Courtroom 2, 197 South Main Street, Wilkes−Barre, Pennsylvania.
A copy of the order is available for free at https://bit.ly/2T3zmLT
from PacerMonitor.com.
About Witchey Enterprises
Witchey Enterprises, Inc., a Wilkes-Barre, Pa.-based provider of
courier and express delivery services, filed a Chapter 11 petition
(Bankr. M.D. Pa. Case No. 19-00645) on Feb. 14, 2019. Louis
Witchey, president, signed the petition. At the time of filing,
the Debtor had between $1 million and $10 million in both assets
and liabilities. Judge Patricia M. Mayer oversees the case. The
Debtor tapped Andrew Joseph Katsock, III, Esq., as legal counsel
and David L. Haldeman as accountant.
WITCHEY ENTERPRISES: Taps Andrew Katsock as Bankruptcy Attorney
---------------------------------------------------------------
Witchey Enterprises, Inc. seeks approval from the U.S. Bankruptcy
Court for the Middle District of Pennsylvania to employ Andrew
Joseph Katsock, III, Esq., an attorney practicing in Wilkes-Barre,
Pa., to handle its Chapter 11 case.
Mr. Katsock's services include:
(a) preparing and filing a disclosure statement, Chapter 11
plan of reorganization and supporting documents;
(b) electronic filing of the Debtor's monthly reports;
(c) representing the Debtor at bankruptcy court proceedings;
(d) attending meetings and consultations with the Debtor;
(e) preparing responses to court filings or adversary actions
filed by creditors or the Office of the U.S. Trustee; and
(f) seeking confirmation of a Chapter 11 plan.
The attorney will be paid at the rate of $200 per hour.
Mr. Katsock disclosed in a court filing that he is a disinterested
person as that term is defined in Section 101(14) of the Bankruptcy
Code.
Mr. Katsock can be reached at:
Andrew J. Katsock, III,Esq.
15 Sunrise Drive
Wilkes-Barre, PA 18705
Tel: (570) 829-5884
Email: ajkesq@comcast.net
About Witchey Enterprises
Witchey Enterprises, Inc., a Wilkes-Barre, Pa.-based provider of
courier and express delivery services, filed a Chapter 11 petition
(Bankr. M.D. Pa. Case No. 19-00645) on Feb. 14, 2019. Louis
Witchey, president, signed the petition. At the time of the filing,
the Debtor had between $1 million and $10 million in both assets
and liabilities. Judge Patricia M. Mayer oversees the case. The
Debtor tapped Andrew Joseph Katsock, III, Esq., as legal counsel
and David L. Haldeman as accountant.
WOODBRIDGE HOSPITALITY: Taps Sacks Tierney as Bankruptcy Counsel
----------------------------------------------------------------
Woodbridge Hospitality, LLC seeks approval from the U.S. Bankruptcy
Court for the District of Arizona to employ Sacks Tierney P.A. to
serve as legal counsel in its Chapter 11 case.
The firm's hourly rates are as follows:
Partners $370 - $550 per hour
Associates $250 - $370 per hour
Paralegal assistants $125 - $245 per hour
As disclosed in court filings, Sacks Tierney is a "disinterested
person" as the term is defined in Section 101(14) of the Bankruptcy
Code.
The firm can be reached at:
Randy Nussbaum, Esq.
Philip R. Rudd, Esq.
Sierra M. Minder, Esq.
Sacks Tierney P.A.
4250 N. Drinkwater Blvd., 4th Floor
Scottsdale, AZ 85251-3693
Tel.: 480.425.2600
Fax: 480.970.4610
Emails: Randy.Nussbaum@SacksTierney.com
Philip.Rudd@SacksTierney.com
Sierra.Minder@SacksTierney.com
About Woodbridge Hospitality
Scottsdale, Ariz.-based Woodbridge Hospitality, LLC sought
protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Ariz.
Case No. 21-04096) on May 26, 2021. At the time of the filing, the
Debtor had between $10 million and $50 million in both assets and
liabilities. Judge Paul Sala oversees the case. Sacks Tierney
P.A. is the Debtor's legal counsel.
YIELD10 BIOSCIENCE: Registers 300K Shares Under 2018 Plan
---------------------------------------------------------
Yield10 Bioscience, Inc. filed with the Securities and Exchange
Commission a Form S-8 registration statement to register an
additional 300,000 shares of the Company's Common Stock reserved
for issuance under the 2018 Plan, which were added to the shares
authorized for issuance under the 2018 Plan pursuant to an
amendment to the 2018 Plan adopted by the Company's stockholders on
May 24, 2021.
As of June 2, 2021, there were an aggregate of 494,090 shares of
the Company's Common Stock reserved for issuance pursuant to
outstanding options under the 2018 Plan. A full-text copy of the
prospectus is available for free at:
https://www.sec.gov/Archives/edgar/data/1121702/000112170221000037/yten-20210604sx82018stockp.htm
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, MA and has an Oilseeds Center of
Excellence in Saskatoon, 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.
ZUCA PROPERTIES: Case Summary & 7 Unsecured Creditors
-----------------------------------------------------
Debtor: Zuca Properties LLC
JTC (Suisse) SA
80-84 Rue du Rhone, 1204
Geneva, Switzerland
Case No.: 21-11082
Business Description: Zuca Properties LLC is engaged in activities
related to real estate.
Chapter 11 Petition Date: June 7, 2021
Court: United States Bankruptcy Court
Southern District of New York
Judge: Hon. Martin Glenn
Debtor's Counsel: Kyle J. Ortiz, Esq.
Brian F. Moore, Esq.
Katharine E. Scott, Esq.
TOGUT, SEGAL & SEGAL LLP
One Penn Plaza, Suite 3335
New York, NY 10119
Tel: 212-594-5000
Email: bmoore@teamtogut.com
Email: kortiz@teamtogut.com
Email: kscott@teamtogut.com
Estimated Assets: $10 million to $50 million
Estimated Liabilities: $50 million to $100 million
The petition was signed by Julie Zingiloglu, managing director of
JTC (Suisse) S.A. as Trustee of the Woofy Trust and sole managing
member of Zuca Properties LLC.
A full-text copy of the petition is available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/BNPQ3OY/Zuca_Properties_LLC__nysbke-21-11082__0001.0.pdf?mcid=tGE4TAMA
List of Debtor's Seven Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
1. TECREF Sarl Guarantee $53,230,705
9A Boulevard Prince Henry
L-1724 Luxembourg
Daniela Ingeborg Klassen
Tel: +352 2621 5400
Email: tecref.lux@crestbridge.com
2. Rahula Withanage Loan/Debt $2,083,033
Apartment 1101 River Desari
Jalan Kumbang Pasang Bandar
Seri Begawan Negara BA1512
Brunei Darussalam
Rahula Withanage
Tel: (673) 2 611 481
Email: rahul@withanage.com
3. JTC (Suisse) SA Management/ $306,877
80-84 Rue du Rhone, Administration
1204 Geneva Switzerland Fees
Julie Zingiloglu
Tel: +41 22 596 3322
Email: julie.zingiloglu@jtcgroup.com
4. Tyrus Capital European Loan/Debt $75,000
Commercial Real Estate Finance L.P.
47 Esplanade St Helier Jersey
JE1 OBD Jersey, Channel Islands
Tyrus Capital
Tel: +44 (0)207 245 7985
Email: fr@tyruscap.com
5. McDermott Will & Emery LLP Legal Service $44,735
333 SE 2nd Avenue, Suite 4500 Fees
Miami, FL. 33131-2184
Michael J. Bruno
Tel: 1 305 347 6504
Email: mjbruno@mwe.com
6. JTC Law Legal Service $34,098
28 Esplanade St Heller Fees
JE4 2QP Jersey
Channel Islands
Direct: +44 1534 868 250
Cell: +44 7700 709 588
Email: Jeremy.Garrood@jtclegalservices.com
7. Charles Russell Speechlys SA Legal Service $11,847
5 Rue de La Confederation Fees
1204 Geneva
Switzerland
Michael Wells-Greco
Tel: +44(0) 20 7427 6763
Fax: +41(0) 22 591 18 99
Email: michael.wellsgreco@crsblaw.com
[^] Recent Small-Dollar & Individual Chapter 11 Filings
-------------------------------------------------------
In re Levant Group
Bankr. C.D. Cal. Case No. 21-14537
Chapter 11 Petition filed May 31, 2021
See
https://www.pacermonitor.com/view/OJ5E5TY/Levant_Group__cacbke-21-14537__0001.0.pdf?mcid=tGE4TAMA
represented by: RoseAnn Frazee, Esq.
FRAZEE LAW GROUP
E-mail: roseann@frazeelawgroup.com
In re National Services Corp and US Holdings Corp
Bankr. D. Colo. Case No. 21-13003
Chapter 11 Petition filed June 2, 2021
See
https://www.pacermonitor.com/view/KA5GXVQ/National_Services_Corp_and_US__cobke-21-13003__0001.0.pdf?mcid=tGE4TAMA
Filed Pro Se
In re Joseph C. Rallo
Bankr. D. Maine Case No. 21-20135
Chapter 11 Petition filed June 2, 2021
represented by: James Molleur, Esq.
In re Charlene Pamela Brooks
Bankr. D. Md. Case No. 21-13711
Chapter 11 Petition filed June 2, 2021
represented by: Brett Weiss, Esq.
In re Wow V, LLC
Bankr. D.N.J. Case No. 21-14606
Chapter 11 Petition filed June 2, 2021
See
https://www.pacermonitor.com/view/GOG54UY/WOW_V_LLC__njbke-21-14606__0001.0.pdf?mcid=tGE4TAMA
represented by: Andrew J. Kelly, Esq.
THE KELLY FIRM, P.C.
E-mail: akelly@kbtlaw.com
In re 505 South Livingston Avenue Realty, LLC
Bankr. D.N.J. Case No. 21-14597
Chapter 11 Petition filed June 2, 2021
See
https://www.pacermonitor.com/view/7JFBZZI/505_South_Livingston_Avenue_Realty__njbke-21-14597__0001.0.pdf?mcid=tGE4TAMA
represented by: David A. Ast, Esq.
AST & SCHMIDT, P.C.
E-mail: david@astschmidtlaw.com
In re ProSite, LLC
Bankr. W.D.N.C. Case No. 21-40092
Chapter 11 Petition filed June 2, 2021
See
https://www.pacermonitor.com/view/SZ7JEFA/ProSite_LLC__ncwbke-21-40092__0001.0.pdf?mcid=tGE4TAMA
represented by: R. Keith Johnson, Esq.
LAW OFFICES OF R. KEITH JOHNSON, P.A.
E-mail: kjparalegal@bellsouth.net
In re Diomedes Galarza Negron and Maria Elisa Diaz Millan
Bankr. D.P.R. Case No. 21-01721
Chapter 11 Petition filed June 2, 2021
represented by: Jaime Rodriguez Perez, Esq.
In re Deborah Marie Rose Stine
Bankr. D.N.J. Case No. 21-14620
Chapter 11 Petition filed June 3, 2021
represented by: David Stevens, Esq.
In re Willie J. Mingo
Bankr. D.N.J. Case No. 21-14623
Chapter 11 Petition filed June 3, 2021
represented by: Allen Gorski, Esq.
GORSKI & KNOWLTON
E-mail: agorski@gorskiknowlton.com
In re Karen Pamelia Shrier
Bankr. W.D. Tex. Case No. 21-10458
Chapter 11 Petition filed June 3, 2021
represented by: Stephen Sather, Esq.
BARRON & NEWBURGER, P.C.
E-mail: ssather@bn-lawyers.com
In re GrayGull Holdings, LLC
Bankr. W.D. La. Case No. 21-30403
Chapter 11 Petition filed June 4, 2021
See
https://www.pacermonitor.com/view/2EG43HI/GrayGull_Holdings_LLC__lawbke-21-30403__0001.0.pdf?mcid=tGE4TAMA
represented by: Bradley L. Drell, Esq.
GOLD, WEEMS, BRUSER, SUES & RUNDELL
E-mail: bdrell@goldweems.com
In re Evan Robbins Wechsler
Bankr. D. Md. Case No. 21-13756
Chapter 11 Petition filed June 4, 2021
represented by: Alan Eisler, Esq.
In re National Jewelry, LLC
Bankr. D.P.R. Case No. 21-01742
Chapter 11 Petition filed June 4, 2021
See
https://www.pacermonitor.com/view/5PT7GIQ/NATIONAL_JEWELRY_LLC__prbke-21-01742__0001.0.pdf?mcid=tGE4TAMA
represented by: Luis D. Flores Gonzalez, Esq.
LAW OFFICES OF LUIS D. FLORES GONZALEZ
E-mail: dfglaw@coqui.net
ldfglaw@yahoo.com
In re Ashwood Development Company
Bankr. S.D. Tex. Case No. 21-31853
Chapter 11 Petition filed June 4, 2021
See
https://www.pacermonitor.com/view/ITO5CDQ/Ashwood_Development_Company__txsbke-21-31853__0001.0.pdf?mcid=tGE4TAMA
represented by: Reese Baker, Esq.
BAKER & ASSOCIATES
In re T&A Longoria Ventures, L.L.C.
Bankr. W.D. Tex. Case No. 21-50713
Chapter 11 Petition filed June 4, 2021
See
https://www.pacermonitor.com/view/JFRTLNY/TA_Longoria_Ventures_LLC__txwbke-21-50713__0001.0.pdf?mcid=tGE4TAMA
represented by: William R. Davis, Jr., Esq.
LANGLEY & BANACK, INC.
E-mail: wrdavis@langleybanack.com
In re Chido, Inc.
Bankr. W.D. Tex. Case No. 21-30449
Chapter 11 Petition filed June 4, 2021
See
https://www.pacermonitor.com/view/HJCULCQ/Chido_Inc__txwbke-21-30449__0001.0.pdf?mcid=tGE4TAMA
represented by: E.P. Bud Kirk, Esq.
E.P. BUD KIRK
E-mail: budkirk@aol.com
In re Kingland Realty Corp, Inc.
Bankr. S.D. Fla. Case No. 21-15563
Chapter 11 Petition filed June 6, 2021
See
https://www.pacermonitor.com/view/UO7UW2Y/Kingland_Realty_Corp_Inc__flsbke-21-15563__0001.0.pdf?mcid=tGE4TAMA
represented by: Elias Leonard. Dsouza, Esq.
ELIAS LEONARD DSOUZA, PA
E-mail: dtdlaw@aol.com
In re Prime Restoration, LLC
Bankr. M.D. Fla. Case No. 21-01421
Chapter 11 Petition filed June 7, 2021
See
https://www.pacermonitor.com/view/SI2SNUQ/Prime_Restoration_LLC__flmbke-21-01421__0001.0.pdf?mcid=tGE4TAMA
represented by: Christopher W. Wickersham, Jr., Esq.
LAW OFFICES OF C.W. WICKERSHAM JR. P.A.
E-mail: pleadings@chriswickersham.com
In re RND Properties, Inc.
Bankr. S.D. Fla. Case No. 21-15570
Chapter 11 Petition filed June 7, 2021
See
https://www.pacermonitor.com/view/KT3535I/RND_Properties_Inc__flsbke-21-15570__0001.0.pdf?mcid=tGE4TAMA
represented by: Adam I. Skolnik, Esq.
LAW OFFICE OF ADAM I. SKOLNIK, PA
E-mail: askolnik@skolniklawpa.com
In re Howard Feldman Insurance Agency, Inc.
Bankr. D. Md. Case No. 21-13781
Chapter 11 Petition filed June 7, 2021
See
https://www.pacermonitor.com/view/DPCESII/Howard_Feldman_Insurance_Agency__mdbke-21-13781__0001.0.pdf?mcid=tGE4TAMA
represented by: Keith R. Havens, Esq.
HAVENS & ASSOCIATES, LLC
E-mail: keith.r.havens@havenslawfirm.com
In re Alan John Roers
Bankr. D. Minn. Case No. 21-41036
Chapter 11 Petition filed June 7, 2021
represented by: Thomas Olive, Esq.
In re Serene Meadows Hospice LLC
Bankr. N.D. Tex. Case No. 21-41368
Chapter 11 Petition filed June 7, 2021
See
https://www.pacermonitor.com/view/OYYYAWI/Serene_Meadows_Hospice_LLC__txnbke-21-41368__0001.0.pdf?mcid=tGE4TAMA
represented by: Joyce W. Lindauer, Esq.
JOYCE W. LINDAUER ATTORNEY, PLLC
E-mail: joyce@joycelindauer.com
In re Imtiaz Ahmed Jabbar
Bankr. N.D. Ill. Case No. 21-07222
Chapter 11 Petition filed June 8, 2021
represented by: Paul M. Bach, Esq.
In re Justin Eric Pattison
Bankr. D. Kan. Case No. 21-20635
Chapter 11 Petition filed June 8, 2021
represented by: Ryan Blay, Esq.
In re Marty Ray Dauzat
Bankr. W.D. La. Case No. 21-80209
Chapter 11 Petition filed June 8, 2021
represented by: Kevin Molloy, Esq.
In re Encore Audio Visual Design, LLC
Bankr. D. Nev. Case No. 21-50431
Chapter 11 Petition filed June 8, 2021
See
https://www.pacermonitor.com/view/5KW4SOY/ENCORE_AUDIO_VISUAL_DESIGN_LLC__nvbke-21-50431__0001.0.pdf?mcid=tGE4TAMA
represented by: Kevin A. Darby, Esq.
DARBY LAW PRACTICE
E-mail: kevin@darbylawpractice.com
In re Kissmyassets, L.L.C.
Bankr. E.D.N.C. Case No. 21-01316
Chapter 11 Petition filed June 8, 2021
See
https://www.pacermonitor.com/view/XI7EDEQ/Kissmyassets_LLC__ncebke-21-01316__0001.0.pdf?mcid=tGE4TAMA
represented by: George Mason Oliver, Esq.
THE LAW OFFICES OF OLIVER & CHEEK, PLLC
E-mail: george@olivercheek.com
In re Corsair-USA-NJ, LLC
Bankr. E.D. Pa. Case No. 21-11632
Chapter 11 Petition filed June 8, 2021
See
https://www.pacermonitor.com/view/WIEOX4Y/CORSAIR-USA-NJ_LLC__paebke-21-11632__0001.0.pdf?mcid=tGE4TAMA
represented by: Maggie Soboleski, Esq.
CENTER CITY LAW OFFICES, LLC
E-mail: msoboles@yahoo.com
In re Samuel J Lester
Bankr. W.D. Tex. Case No. 21-50719
Chapter 11 Petition filed June 8, 2021
represented by: Albert Van Cleave, Esq.
*********
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.
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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
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than a balance sheet solvency test.
On Thursdays, the TCR delivers a list of recently filed
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liabilities delivered to nation's bankruptcy courts. The list
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Each Friday's edition of the TCR includes a review about a book of
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Monthly Operating Reports are summarized in every Saturday edition
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then-ending.
TCR subscribers have free access to our on-line news archive.
Point your Web browser to http://TCRresources.bankrupt.com/and use
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*********
S U B S C R I P T I O N I N F O R M A T I O N
Troubled Company Reporter is a daily newsletter co-published
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,
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Sheryl Joy P. Olano, Psyche A. Castillon, Ivy B. Magdadaro, Carlo
Fernandez, Christopher G. Patalinghug, and Peter A. Chapman, Editors.
Copyright 2021. All rights reserved. ISSN: 1520-9474.
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