/raid1/www/Hosts/bankrupt/TCR_Public/211103.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Wednesday, November 3, 2021, Vol. 25, No. 306
Headlines
500 W 184: Unsecureds Will Recover 8% Under Plan
AIX VENTURES: Voluntary Chapter 11 Case Summary
AMG ADVANCED: Moody's Affirms B2 CFR & Rates Credit Facilities Ba3
AMG ADVANCED: S&P Alters Outlook to Stable & Affirms 'B+' ICR
AMPHILL GROUP: Seeks to Hire Michael Jay Berger as Legal Counsel
AR TEXTILES: Dec. 16 Plan Confirmation Hearing Set
ARMATA PHARMACEUTICALS: CF Foundation Makes $3M Equity Investment
ASTA HOLDINGS: Case Summary & 24 Largest Unsecured Creditors
AVINGER INC: Changes Quorum Requirement for Meeting of Stockholders
BANROC CORP: Seeks Approval to Hire Dal Lago Law as Legal Counsel
BCT DEALS: Wins Cash Collateral Access
BIZGISTICS INC: Has Interim Cash Collateral Access Thru Nov 18
BOULDER BOTANICAL: Case Summary & 20 Largest Unsecured Creditors
BV GLENDORA: Unsecureds Will be Paid in Full in 36 Months
CALPLANT I LLC: Seeks to Hire Morris James as Co-Counsel
CAPITOL CLOSET: Seeks Use of IRS' Cash Collateral
CBL PROPERTIES: Exits from Chapter 11 Bankruptcy Protection
CHESAPEAKE ENERGY: Fitch Assigns First Time 'BB' LongTerm IDR
CHIP'S SOUTHINGTON: Wins Cash Collateral Access Thru Dec 5
COLORADO HOMES: Voluntary Chapter 11 Case Summary
COMMERCIAL PRODUCTS: Unsecureds Will Get 10% Under Plan
COOK & BOARDMAN: Moody's Affirms 'B3' CFR, Outlook Stable
COTTAGE CAR WASH: Wins Cash Collateral Access Thru Feb 2022
COVIA CORP: Appoints New Chief Legal Officer
CRC BROADCASTING: Seeks Cash Access to Hire Special Counsel
CRESTLLOYD LLC: Seeks to Hire Levene Neale as Bankruptcy Counsel
DEA BROTHERS: Unsecureds to Get 5% Return in Plan
DELPHI CORP: Lawmakers Support Retirees' High Court Review Bid
DELTA COUNTY MEMORIAL: S&P Cuts Revenue Bonds Rating to 'CCC+'
DIXIE CENTERS: Seeks to Hire Frank & De La Guardia as Counsel
DLR EXPRESS: $104K Unsecured Claims to Recover 100% in 6 Months
ENSEMBLE RCM: S&P Affirms 'B' ICR, Off CreditWatch Positive
EXPRESS GRAIN TERMINALS: Farmers Could Lose Big from Bankruptcy
EXPRESS GRAIN: Wins Cash Collateral Access Thru Nov 6
FANNIE MAE: Reports Net Income of $4.8 Billion for Third Quarter
FIRSTCASH INC: Moody's Puts Ba1 CFR Under Review for Downgrade
FLORIDA TILT: Says Amended Plan Product of Negotiations
FOSSIL GROUP: S&P Rates New $125MM Senior Unsecured Notes 'B'
FRESH ACQUISITIONS: Creditors' Bankruptcy Plan Okayed for Vote
GENOCEA BIOSCIENCES: Incurs $3.6 Million Net Loss in Third Quarter
GLOBAL WINDREST I: Gets Access to Cash Collateral
GRUPO AEROMEXICO: Milbank Represents BSPO Investors
GTT COMMUNICATIONS: In Chapter 11 to Cut Debt by $1.16 Billion
HARDY ALLOYS: Seeks Access to SBA's Cash Collateral
HBL SNF LLC: Nursing Facility in Chapter 11 Amid Landlord Dispute
HOLLEY INC: Moody's Gives B2 CFR & Rates New Credit Facilities B2
HOLLEY INC: S&P Assigns 'B' ICR on Refinancing, Outlook Positive
IDEANOMICS INC: Secures $75M Convertible Debenture Financing
IN-SHAPE HOLDINGS: San Joaquin County Eyes Building, Parking Lot
INFORMATICA INC: Moody's Assigns 'B1' CFR Amid Recent IPO
INPIXON: Receives Noncompliance Notice From Nasdaq
INSYS THERAPEUTICS: Quinn Emanuel Can't Escape Suit Over Payments
JANE STREET: Moody's Affirms Ba1 CFR & Rates $500MM Sec. Notes Ba2
JSM CONSULTING: Wins Cash Collateral Access Thru Nov 19
KKR REAL ESTATE: $50MM Loan Upsize No Impact on Moody's Ba3 CFR
LIMETREE BAY: Judge Grants Request to Delay Auction to Nov. 12
LIMETREE BAY: Reaches Deal With J. Aron, Lenders Skeptical
LW RETAIL: Wins Cash Collateral Access Thru Dec 2
MAIN STREET INVESTMENTS III: Taps Goldsmith & Guymon as Counsel
MALLINKRODT PLC: Chapter 11 Hearing Opens With Valuation Questions
MICROVISION INC: Incurs $9.4 Million Net Loss in Third Quarter
MID ATLANTIC PRINTERS: Seeks Access to BOTJ Cash Collateral
MKS GROUP: Case Summary & 11 Unsecured Creditors
MOLINA HEALTHCARE: Moody's Rates New $750MM Unsecured Notes 'Ba3'
MOLINA HEALTHCARE: S&P Rates $750MM Senior Unsecured Notes 'BB-'
NANO MAGIC: Incurs $473,597 Net Loss in Second Quarter
NATIONSTAR MORTGAGE: Moody's Rates New $600MM Unsecured Notes 'B2'
NATURE COAST: Hires Fitch & Associates as Financial Consultant
NATURE COAST: Seeks Approval to Hire Hogan Law as Business Counsel
NEUTRAL POSTURE: Case Summary & 20 Largest Unsecured Creditors
NEW YORK CLASSIC: Wins Cash Collateral Access Thru Nov. 18
OPTION CARE: Issues $500 Million Senior Notes Due 2029
PACIFIC PANORAMA: Unsec. Creditors Will Recover 6% in Plan
PACKAGING COORDINATORS: Moody's Affirms B3 CFR on LSNE Transaction
PAI HOLDCO: Moody's Affirms B2 CFR & Alters Outlook to Negative
PG&E CORP: Faces Federal Inquiry, $1.15-Bil. Losses Over Dixie Fire
PG&E CORP: To Challenge Criminal Charges in 2020 Zogg Fire
POLK AZ: Wins Cash Collateral Access Thru Jan 2022
POST OAK TX: U.S. Trustee Unable to Appoint Committee
PURE BIOSCIENCE: Incurs $2.3 Million Net Loss in FY Ended July 31
PWM PROPERTY: HNA-Linked Manhattan Skyscraper in Chapter 11
REDSTONE BUYER: Moody's Lowers CFR to B3, Outlook Stable
ROCKWORX INC: Seeks Cash Collateral Access Thru Feb 2022
SCP COLDWORKS: Seeks Cash Collateral Access, $200,000 DIP Loan
SEQUENTIAL BRANDS: Jessica Simpson Has No Rival Bidder
SHEKINAH OILFIELD: Voluntary Chapter 11 Case Summary
SOUTHEASTERN GROCERS: Pulls Off Plan to Go Public
TIANJIN JAHO: Taps Salish Sea & Christopher L. Young as Co-Counsel
TLG CAPITAL: Case Summary & 11 Unsecured Creditors
TRANSMONTAIGNE PARTNERS: Fitch Lowers LongTerm IDR to 'B+'
TRANSUNION: Moody's Assigns Ba2 CFR & Alters Outlook to Negative
TRANSUNION: S&P Affirms 'BB+' Issuer Credit Rating, Outlook Stable
TRIBUNE MEDIA: 2009 Disposition of Chicago Cubs a Disguised Sale
TRUE ENTERPRISE: Seeks to Hire David Marshall Brown as Counsel
TUKHI BUSINESS: Wins Cash Collateral Access Thru Dec 15
U.S. SILICA: Reports Third Quarter Net Loss of $20.2 Million
ULTRA PETROLEUM: Investor Asks Court to Dismiss Securities Suit
UNIFIED SECURITY: Case Summary & 5 Unsecured Creditors
VIZIV TECHNOLOGIES: Opposes Bid to Appoint Equity Committee
WESCO INT'L: Fitch Affirms 'BB-' LT IDRs & Alters Outlook to Pos.
WSCE CORP: Seeks to Hire Amsterdam Accounting as Accountant
YORK PARKING: Seeks Approval to Hire Macco Law as Legal Counsel
[*] New Hampshire Bankruptcy Rose Slightly in October 2021
*********
500 W 184: Unsecureds Will Recover 8% Under Plan
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Debtor 500 W 184 LLC and senior mortgagee Amsterdam Mixed Use LLC
filed an Amended Joint Plan of Reorganization for the Debtor.
On Oct. 15, 2021, the Bankruptcy Court entered the Stipulation and
Agreed Order Resolving Receiver Claim, pursuant to which, among
other things, the Receiver agreed to accept an allowed claim in the
reduced amount of $15,000 on account of the claims of the Receiver,
his attorneys, and his managing agent.
On Sept. 24, 2021, the Bankruptcy Court entered an order approving
the retention of Marcus & Millichap as the Debtor's real estate
broker. The Debtor will also be seeking authority to retain Maltz
Auctions, Inc. as the Debtor's auctioneer and co-broker.
Under the Plan, Class 4 Secured Creditor's Secured Claim totaling
$2,757,898 will receive the following treatment: (i) to the extent
any Cash and Sale Proceeds is remaining after payment of
Administrative Claims, Professional Fee Claims, Priority Tax
Claims, Class 1 Claims, Class 2 Claims, and Class 3 Claims, on the
Effective Date, or as soon as possible after the Secured Creditor's
Secured Claim becomes an Allowed Claim, the Secured Creditor shall
receive remaining Cash, if any, up to the full amount of its
Allowed Secured Claim, or (ii) if the Property is sold to Secured
Creditor by credit bid, then on the Effective Date, Secured
Creditor, or its designee, shall take title to the Property free
and clear of all Liens, except permitted encumbrances as determined
by Secured Creditor. To the extent that Cash and Sale Proceeds are
insufficient to pay the Class 4 Claim in full, the deficiency
amount shall be treated as a Class 5 Claim, and Secured Creditor
shall waive its right to receive a distribution on account of its
Class 5 Claim. The Secured Creditor's Secured Claim shall be deemed
an Allowed Secured Claim under the Plan. Class 4 is impaired.
Class 5 General Unsecured Claims totaling $233,783 will each
receive its pro rata payment of the remaining Cash and Sale
Proceeds after payment of Administrative Claims, Professional Fee
Claims, Priority Tax Claims, Class 1 Claims, Class 2 Claims, the
Class 3 Claim, and Class 4 Claims; provided, however, if the amount
of such remaining Cash and Sale Proceeds available to pay Allowed
Class 4 Claims is less than $20,000, Secured Creditor will fund the
GUC Contribution to the extent necessary to facilitate the Pro Rata
distribution of $20,000 to Class 5 General Unsecured Claims.
Unsecured creditors will recover 8% of their claims.
Payments under the Plan will be paid from either the Sale Proceeds,
Cash turned and/or Cash to be contributed by Secured Creditor.
Counsel for Amsterdam Mixed Use LLC:
Paul A. Rubin
Hanh V. Huynh
RUBIN LLC
345 Seventh Avenue, 21st Floor
New York, New York 10001
Tel: 212.390.8054
Fax: 212.390.8064
prubin@rubinlawllc.com
Counsel for 500 W 184 LLC:
Warren R. Graham
LAW OFFICE OF WARREN R. GRAHAM
450 Seventh Avenue, Suite 305
New York, New York 10123
Tel: 917.885.2370
showarg@gmail.com
A copy of the Disclosure Statement dated Oct. 27, 2021, is
available at https://bit.ly/3GzdqN2 from PacerMonitor.com.
About 500 W 184 LLC
500 W 184 LLC is the owner of real property located at 500 West
184th Street, Bronx, New York 10467. It sought protection under
Chapter 11 of the Bankruptcy Code (Bankr. S.D.N.Y. Case No.
21-10392) on March 2, 2021. At the time of the filing, the Debtor
disclosed assets of between $1 million and $10 million and
liabilities of the same range. Judge Michael E. Wiles oversees the
case. The Law Office of Warren R. Graham serves as the Debtor's
legal counsel.
AIX VENTURES: Voluntary Chapter 11 Case Summary
-----------------------------------------------
Debtor: AIX Ventures LLC
785 Crandon Boulevard
Apartments 705 & 805
Key Biscayne, FL 33149
Chapter 11 Petition Date: November 2, 2021
Court: United States Bankruptcy Court
Southern District of Florida
Case No.: 21-20530
Judge: Hon. Robert A. Mark
Debtor's Counsel: Joel M. Aresty, Esq.
JOEL M. ARESTY P.A.
309 1st Ave S
Tierra Verde, FL 33715
Tel: 305-904-1903
Email: aresty@icloud.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $100,000 to $500,000
The petition was signed by Guillermo Lopez as manager.
The Debtor stated it has no creditors holding unsecured claims.
A full-text copy of the petition is available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/GAC24SQ/AIX_Ventures_LLC__flsbke-21-20530__0001.0.pdf?mcid=tGE4TAMA
AMG ADVANCED: Moody's Affirms B2 CFR & Rates Credit Facilities Ba3
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Moody's Investors Service affirmed AMG Advanced Metallurgical Group
N.V.'s ("AMG") B2 corporate family rating and B2-PD probability of
default rating. Moody's also assigned a Ba3 rating to AMG's new
revolving credit facility ("RCF") maturing in 2026 and the new term
loan B ("TLB") maturing in 2028. Additionally, Moody's affirmed a
B3 rating of the Ohio Air Quality Development Authority 30-year
tax-exempt revenue bonds (State of Ohio Exempt Facilities Revenue
Bonds) which are guaranteed by AMG Advanced Metallurgical Group
N.V., the parent company of AMG Vanadium LLC. Proceeds from the new
RCF and TLB will be used to refinance the existing revolver and
TLB, pay for the transaction fees and expenses and for working
capital and other general corporate purposes. The Speculative Grade
Liquidity Rating is maintained at SGL-2. The ratings outlook is
changed to positive from stable.
"The change in the outlook to positive from stable reflects Moody's
expectations that AMG's financial performance and credit metrics
will strengthen materially in 2022-2023 benefitting from the
anticipated completion of the Cambridge II and Spodumene 1+
projects, improving demand for its products and the continuing
recovery in the commercial aerospace demand", says Botir Sharipov,
the lead analyst for AMG.
Assignments:
Issuer: AMG Advanced Metallurgical Group N.V.
Senior Secured Term Loan B, Assigned Ba3 (LGD2)
Senior Secured Revolving Credit Facility, Assigned Ba3 (LGD2)
Affirmations:
Issuer: AMG Advanced Metallurgical Group N.V.
Corporate Family Rating, Affirmed B2
Probability of Default Rating, Affirmed B2-PD
Issuer: Ohio Air Quality Development Authority
Gtd Senior Unsecured Revenue Bonds, Affirmed B3 (LGD5)
Outlook Actions:
Issuer: AMG Advanced Metallurgical Group N.V.
Outlook, Changed To Positive From Stable
RATINGS RATIONALE
AMG's B2 credit rating reflects its currently still high but
improving financial leverage, good liquidity, broad geographic and
end market diversity. The company has a strong market position with
only a few major competitors for most of its critical materials and
sells those materials to a number of blue-chip customers with whom
it has established long- term relationships. The importance of its
products in lightweighting, energy efficiency and carbon emissions
reduction should provide for a relatively steady customer demand
over the longer term. The rating is also supported Moody's
expectations that AMG will preserve its good liquidity position
throughout its current growth phase. AMG's rating is constrained by
its modest scale versus higher rated manufacturers, increasing
exposure to ferrovanadium, high capex and expectations of negative
free cash flow in 2022-2023. The company will continue to benefit
from the agreement with Glencore for the sale of the FeV from both
Cambridge I and II plants that effectively removes the market
volume risk and reduces its exposure to the FeV price volatility.
Moody's estimates that AMG will generate about $110 million in
Moody's-adjusted EBITDA in 2021 and that leverage will improve to
about 9.0x this year, benefitting from the implemented cost
reductions, higher prices for most of the products it manufacturers
and better end-market demand. Moody's expects that 2022 EBITDA will
be in the range of $125-145 million and for 2023 Moody's-adjusted
EBITDA to approach $180 million, which will reduce the leverage to
about 5x by 2023 year-end. AMG is expected to begin generate
positive free cash flow in 2024 after the company completes the
construction of the Cambridge II project in the U.S (Q1 2022),
Spodumene 1+ project in Brazil (2023) and the battery grade
hydroxide plant in Germany (2023).
The positive outlook reflects Moody's view that a favorable demand
environment, completion of growth projects and the continuing
recovery in the commercial aerospace sector will lead to a material
growth in AMG's revenues and EBITDA in 2022-2023 and result in
improved credit metrics. The positive outlook also presumes that
AMG will carefully manage its liquidity and the company will not
experience any significant issues related to its growth projects.
AMG overall faces elevated environmental social and governance
risks given the nature of the company's operations which include
mining and high heat metallurgical processes and the location of
some of its mines and facilities in emerging markets such as China
and Brazil. The governance risk is also above average due to the
management's high tolerance for elevated leverage. However, the
AMG's $120 million equity issuance in April 2021 signifies the
company's willingness to balance the interests of both equity and
credit stakeholders.
Moody's expect AMG to maintain good liquidity in the next 12-18
months, as reflected in the company's SGL-2 Speculative Grade
Liquidity rating. AMG will have no meaningful debt maturities prior
to the maturity date of the revolver in 2026 and the term loan B in
2028. As of September 30, 2021, the company had $319 million in
cash and cash equivalents, $114 million in restricted cash for the
Cambridge II project and $170 million available under its $200
million revolver, which is undrawn but has a reduced borrowing
capacity due to the outstanding debt at the Brazilian subsidiary.
Moody's expects the revolving facility to remain undrawn over the
rating horizon. Moody's also expects the company to have ample
headroom under its 3.5x first lien leverage covenant.
The Ba3 rating of the new senior secured revolving credit facility
and senior secured term loan B reflects their priority position in
the company's capital structure, strong liquidity position and
pre-funded nature of the growth projects. The credit facilities are
secured by a first priority lien on substantially all of the assets
of several of the company's operating subsidiaries and a first
priority lien on 100% of the capital stock (limited to 65% of
voting stock for foreign subsidiaries) of each subsidiary borrower
and each material wholly-owned subsidiary. However, the security
package excludes the assets of a number of key foreign subsidiaries
that account for about 50-60% of the overall assets of the company.
The B3 rating of the tax-exempt unsecured bonds reflects a
relatively high proportion of secured debt and the bonds' effective
subordination to the secured debt. The bonds are issued by the Ohio
Air Quality Development Authority and guaranteed by AMG Advanced
Metallurgical Group N.V.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The ratings upgrade could be considered if the company successfully
completes and ramps up the Cambridge II project, and achieves a
material improvement in its operating and financial results in
2022-2023. Quantitatively, the ratings could be upgraded if the
company is expected to reduce and sustain a leverage ratio below
5.0x, an interest coverage ratio above 2.0x and return to free cash
flow generation over the following 12-18 months. However, AMG's
moderate scale will limit its upside ratings potential.
Negative rating pressure could develop if the company experiences
any significant issues related to its growth projects. Any material
operating disruptions, weaker than expected financial and operating
performance, or the pursuit of other debt financed growth projects
that result in further deterioration of debt protection metrics
would negatively impact the company's rating. Quantitatively, the
ratings could be downgraded if the leverage is expected to be
sustained above 6.0x or the interest coverage ratio sustained below
1.5x. A significant reduction in borrowing availability or
liquidity could also result in a downgrade.
Advanced Metallurgical Group N.V., headquartered in Wayne,
Pennsylvania, operates through three divisions - Clean Energy
Materials, Critical Materials Technologies, and Critical Minerals.
8The Clean Energy Materials segment produces materials used in
energy storage products such as electric vehicle batteries, grid
stabilization batteries and semiconductor capacitors. Its Critical
Materials Technologies segment designs and produces vacuum furnace
equipment and systems, titanium alloys and coatings as well as
chrome metal for aerospace, renewable energy and other industrial
end-markets. The Critical Minerals segment produces specialty
metals and chemicals and other products used in infrastructure,
automotive and other industrial applications. The company sells its
products to the transportation, infrastructure, energy, and
specialty metals & chemicals end markets from production facilities
in Germany, the United Kingdom, France, United States, China,
Mexico, Brazil and India. The company produced revenues of about
$1.1 billion for the twelve months ended September 30, 2021.
The principal methodology used in these ratings was Manufacturing
published in September 2021.
AMG ADVANCED: S&P Alters Outlook to Stable & Affirms 'B+' ICR
-------------------------------------------------------------
S&P Global Ratings affirmed its ratings on AMG Advanced
Metallurgical Group N.V., including its 'B+' issuer credit rating,
and revised its outlook to stable from negative.
At the same time, S&P assigned its 'BB-' issue-level rating and '2'
recovery rating to its proposed $550 million secured credit
facility.
The stable outlook reflects S&P's view that AMG's leverage should
be about 5x over the next 12 months under current strong end-market
demand for AMG's products, despite potential for further price
volatility.
Credit metrics should improve this year since volumes and pricing
recovered across the majority of AMG's portfolio. S&P anticipates
AMG will maintain leverage of 5x as EBITDA continues to recover
over the next 12 months from improving end market demand,
increasing volumes from capacity expansions, and pricing
improvements. Demand picked up since the COVID-19 pandemic-related
slowdown in 2020, driving volume growth across AMG's portfolio in
metals such as vanadium, lithium concentrate, tantalum, graphite,
antimony, and silicon. In addition, prices across AMG's businesses
have broadly recovered from depressed levels of 2020, in particular
vanadium and spodumene. Vanadium prices rebounded to $17 per pound
from $10.50 per pound a year ago, and spodumene to over $1,000 per
metric ton from $440 per metric ton. Markets largely worked through
disruptions and excess supply built during 2020, supporting the
price recovery. Additionally, disruptions to metal supply for
metals such as silicon and antimony also provide upside to prices.
AMG's metals serve markets with strong demand trends that should
support volume growth. Key end markets include construction demand
for high-strength steel, robust automotive demand, further
bolstered by battery demand for electric vehicles (EV), robust
semiconductor demand due to the ongoing 5G network rollout, and
increased need for microchips in EVs. However, profitability from
the commercial aerospace business remains depressed in the early
stages of recovery. The recovery in air travel will be very uneven
around the world. Additional COVID-19 outbreaks could stall
improvement, particularly for international travel, which could
lead to renewed aircraft order cancellations or deferrals. Thus,
S&P expects EBITDA to recover to about $100 million in 2021 and
$130 million-$160 million in 2022.
Over the next 12-24 months, AMG will generate additional EBITDA
from expansion projects coming online. Cambridge II, AMG's newly
built spent catalyst recycling facility in Zanesville, Ohio, will
start production in 2022 and complete its ramp-up by 2023. S&P
anticipates this will add $30 million-$40 million of EBITDA
annually by 2023, should vanadium prices remain $15-$20 per pound.
In addition, AMG's spodumene production expansion project will
contribute to earnings in the backdrop of robust EV battery demand
and current prices.
AMG's long-term growth prospects and gradually improving end-market
demand should support its competitive position. We continue to take
into account AMG's growth strategy of focusing on areas of its
portfolio marked for stronger demand or supply limitations. The
post-pandemic recovery has further underscored long-term trends,
which should increase consumption of key metals (for example,
vanadium and lithium) by reducing carbon dioxide emissions through
higher energy efficiency, battery storage technologies, and
light-weighting transport and infrastructure components. AMG is
well positioned to benefit from this end-market growth due to its
low-cost and diversified production footprint. However, leverage
could continue to fluctuate on metal price volatility.
The stable outlook reflects S&P's view that AMG's leverage should
be about 5x over the next 12 months under current strong end-market
demand and despite potential for further price volatility.
S&P could lower the ratings on AMG if it sustains leverage above
7x. This could result if:
-- Higher than anticipated metals price volatility sustained a
decline in earnings, deteriorating profitability and leading to
further negative free operating cash flow (FOCF) as the company
undertakes another year of elevated capital expenditure (capex).
-- The company took on additional debt to fund capex projects.
S&P could raise the ratings if AMG demonstrated:
-- Sustainable positive FOCF and leverage below 4x, even under a
weaker metals price environment.
-- Reduced execution risk from completion of its major ongoing
investment projects.
AMPHILL GROUP: Seeks to Hire Michael Jay Berger as Legal Counsel
----------------------------------------------------------------
Amphil Group, LLC seeks approval from the U.S. Bankruptcy Court for
the Central District of California to hire the Law Offices of
Michael Jay Berger to handle its Chapter 11 case.
The hourly rates of the firm's attorneys and staff are as follows:
Michael Jay Berger $595 per hour
Sofya Davtyan $495 per hour
Debra Reed $435 per hour
Carolyn M. Afari $435 per hour
Samuel Boyamian $350 per hour
Gary Badin $275 per hour
Senior Paralegals and Law Clerks $225 per hour
Bankruptcy Paralegals $200 per hour
The firm received a retainer of $15,000 from the Debtor. It will
also receive reimbursement for out-of-pocket expenses incurred.
Michael Jay Berger, Esq., disclosed in a court filing that his firm
is a "disinterested person" as the term is defined in Section
101(14) of the Bankruptcy Code.
The firm may be reached at:
Michael Jay Berger, Esq.
Law Offices of Michael Jay Berger
9454 Wilshire Boulevard, 6th Floor
Beverly Hills, CA 90212-2929
Tel: (310) 271-6223
Fax: (310) 271-9805
Email: michael.berger@bankruptcypower.com
About Amphil Group, LLC
Amphil Group, LLC is the fee simple owner of a single family
residence located at 19650 Chalina Drive, Walnut, CA having a
current value of $2 million.
Amphil Group, LLC filed its voluntary petition for relief under
Chapter 11 of the Bankruptcy Code (Bankr. C.D. Cal. Case. No.
21-18014) on Oct. 18, 2021. The petition was signed by Frank
Hernandez Jr. as managing member. At the time of filing, the Debtor
estimated $2,000,160 in assets and $1,161,738 in liabilities.
Michael Jay Berger, Esq. at the LAW OFFICES OF MICHAEL JAY BERGER
represents the Debtor as counsel.
AR TEXTILES: Dec. 16 Plan Confirmation Hearing Set
--------------------------------------------------
On Oct. 27, 2021, debtor AR Textiles Ltd. filed with the U.S.
Bankruptcy Court for the Eastern District of North Carolina a
disclosure statement and plan.
On Oct. 28, 2021, Judge David M. Warren conditionally approved the
disclosure statement and ordered that:
* Dec. 9, 2021, is fixed as the last day for filing and
serving written objections to the disclosure statement.
* Dec. 16, 2021, at 11:00 a.m., in 300 Fayetteville Street,
3rd Floor Courtroom, Raleigh, NC 27601 is the hearing on
confirmation of the plan.
* Dec. 9, 2021, is fixed as the last day for filing written
acceptances or rejections of the plan.
* Dec. 9, 2021, is fixed as the last day for filing and
serving written objections to confirmation of the plan.
A full-text copy of the order dated Oct. 28, 2021, is available at
https://bit.ly/2ZJ4LHk from PacerMonitor.com at no charge.
About AR Textiles
Robersonville, N.C.-based AR Textiles Ltd. filed a Chapter 11
petition (Bankr. E.D.N.C. Case No. 21-01441) on June 28, 2021. In
the petition signed by Pasqual Alles, vice president, the Debtor
disclosed $5,744,986 in assets and $22,227,509 in liabilities.
Judge David M. Warren oversees the case. Joseph Z. Frost, Esq., at
Buckmiller, Boyette & Frost, PLLC is the Debtor's legal counsel.
ARMATA PHARMACEUTICALS: CF Foundation Makes $3M Equity Investment
-----------------------------------------------------------------
Armata Pharmaceuticals, Inc. has received an equity investment from
the Cystic Fibrosis Foundation with participation from Innoviva
Strategic Opportunities LLC, a wholly-owned subsidiary of Innoviva,
Inc.
In accordance with the terms of the investment agreement, the CF
Foundation has elected to make a $3.0 million equity investment in
common stock of Armata. Innoviva, Armata's majority shareholder,
has also elected to invest $4.0 million at the same terms. Armata
intends to register the shares to be issued in this financing
within 120 days.
Armata is currently evaluating its lead clinical candidate,
AP-PA02, in a Phase 1b/2a clinical trial (SWARM-P.a.) for chronic
Pseudomonas aeruginosa respiratory infections in people with cystic
fibrosis. This investment follows a $5.0 million Therapeutics
Development Award from the CF Foundation in March 2020.
"Difficult-to-treat pathogens such as Pseudomonas aeruginosa
represent a significant source of morbidity and mortality among
people with CF, highlighting the urgent need for more effective
treatment alternatives," stated Mina Pastagia, MD, MS, vice
president of Clinical Development at Armata. "AP-PA02 is a
multi-phage cocktail directed against Pseudomonas aeruginosa that
offers enhanced potency and aid in preventing the development of
bacterial resistance. We look forward to results from the
SWARM-P.a. study as we work to quickly and efficiently bring new
therapeutic options to market."
"We are pleased by this investment by the CF Foundation as we
endeavor to develop new, innovative therapies for
difficult-to-treat bacterial infections for cystic fibrosis,"
stated Dr. Brian Varnum, chief executive officer of Armata. "We
could not ask for a better supporter of our research than the CF
Foundation, and we look forward to continuing this mutually
beneficial relationship."
About Armata Pharmaceuticals
Marina del Rey, CA-based Armata is a clinical-stage biotechnology
company focused on the development of pathogen-specific
bacteriophage therapeutics for the treatment of
antibiotic-resistant and difficult-to-treat bacterial infections
using its proprietary bacteriophage-based technology. Armata is
developing and advancing a broad pipeline of natural and synthetic
phage candidates, including clinical candidates for Pseudomonas
aeruginosa, Staphylococcus aureus, and other pathogens. In
addition, in collaboration with Merck, known as MSD outside of the
United States and Canada, Armata is developing proprietary
synthetic phage candidates to target an undisclosed infectious
disease agent. Armata is committed to advancing phage with drug
development expertise that spans bench to clinic including in-house
phage specific GMP manufacturing.
Armata reported a net loss of $22.18 million for the year ended
Dec. 31, 2020, compared to a net loss of $19.48 million for the
year ended Dec. 31, 2019. As of June 30, 2021, the Company had
$48.28 million in total assets, $19.66 million in total
liabilities, and $28.62 million in total stockholders' equity.
ASTA HOLDINGS: Case Summary & 24 Largest Unsecured Creditors
------------------------------------------------------------
Debtor: Asta Holdings, LLC
20 Tellus Dr.
Cartersville, GA 30184
Business Description: Asta Holdings operates a continuing care
retirement community and assisted living
facility for the elderly.
Chapter 11 Petition Date: November 1, 2021
Court: United States Bankruptcy Court
Northern District of Georgia
Case No.: 21-41336
Debtor's Counsel: John A. Christy, Esq.
SCHREEDER, WHEELR & FLINT, LLP
1100 Peachtree Street, Suite 800
Altanta, GA 30309
Tel: 404-681-3450
Email: jchristy@swfllp.com
Estimated Assets: $10 million to $50 million
Estimated Liabilities: $10 million to $50 million
The petition was signed by Bhavik Patel as manager.
A full-text copy of the petition is available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/NHPXXKY/Asta_Holdings_LLC__ganbke-21-41336__0001.0.pdf?mcid=tGE4TAMA
List of Debtor's 24 Largest Unsecured Creditors:
Creditor Nature of Claim Claim Amount
-------- --------------- ------------
1. Elite SNP $746,666
1745 Sugarloaf Club Dr
Duluth, GA, 30097
2. MPC Cartersville LLC $477,965
5485 Mirror Lake Drive
Cumming, GA 30028
3. Shree Hari LLC $381,908
1745 Silvermere Ct.
Duluth, GA 30097
4. VJSR, LC $273,000
3501 Bessie Colemand Blvd
Tampa, FL 33609
5. Shailesh Patel $208,000
2326 Hrevester Ave
Fort Mill, SC 29708
6. Om RSM $105,333
114 Winningham Road
Saint George, SC 29477
7. Ascent Inc. $78,750
1553 Southgate Rd
Bartlett, IL 60103
8. Bartlow County Tax Commissioner $63,819
135 W Cherokee Ave, Ste 217A
Cartersville, GA 30120
9. Team Contractors $55,184
4072 US Highway 62
Calvert City, KY 42029
10. Chastain Plumbing Heating and Cooling, LLC $21,719
800 Burnt Hickory Rd SW, Ste D
Cartersville, GA 30120
11. Performance Foodservice $17,065
3501 Old Oakwood Rd E
Oakwood, GA 30566
12. D and B Restoration $14,310
P.O. Box 1237
Cartersville, GA 30120
13. Dickson Wright PLLC $12,119
350 Est Las Olas Blvd
Suite 1750
Ft Lauderdale, FL 33301
14. Staples $4,668
500 Staples Dr.
Framingham, MA 01702
15. Elite Lifts $4,440
5752 Taggart Dr.
Hixson, TN 37343
16. Kitchens Kelley Gaynes, P.C. $4,403
5555 Glenridge Connector
Atlanta, GA 30342
17. Berkley Human Services $4,236
222 South Ninth Street
Suite 2700
Minneapolis, MN 55402
18. Acme American $3,334
319 Atlanta St. SE Suite 240
Marietta, GA 30060
19. Fire Door Solutions $1,950
7500 W 160th St
Stillwell, KS 66085
20. Chivas Electric Group LLC $1,400
2866 Swarthmore Dr
Lawrenceville, GA 30044
21. ASA Fire Protection, LLC $691
1121 Grassdale Rd NW
Cartersville, GA 30121
22. Security and Fire Engineers, Inc. $515
123 Holcomb Rd SW
Calhoun, GA 30701
23. Marsh & McLennan Agency LLC $324
CT Corporation System
289 S Culver Street
Lawrenceville, GA 30046
24. Occupational Health Centers of Georgia $156
CT Corporation System, 289 S Culvert Street
Lawrenceville, GA 30046
AVINGER INC: Changes Quorum Requirement for Meeting of Stockholders
-------------------------------------------------------------------
The Board of Directors of Avinger, Inc. adopted and approved an
amendment to the company's Amended and Restated Bylaws in order to
change the number of stockholders required to constitute a quorum
at a meeting of stockholders, from requiring a majority, to
requiring at least one-third, of the stock issued and outstanding
and entitled to vote, present in person or represented by proxy.
About Avinger
Headquartered in Redwood City, California, Avinger --
http://www.avinger.com-- is a commercial-stage medical device
company that designs and develops image-guided, catheter-based
system for the diagnosis and treatment of patients with Peripheral
Artery Disease (PAD).
Avinger reported a net loss applicable to common stockholders of
$22.87 million for the year ended Dec. 31, 2020, compared to a net
loss applicable to common stockholders of $23.03 million for the
year ended Dec. 31, 2019. As of June 30, 2021, the Company had
$38.19 million in total assets, $20.91 million in total
liabilities, and $17.28 million in total stockholders' equity. Cash
and cash equivalents totaled $26.7 million as of June 30, 2021.
BANROC CORP: Seeks Approval to Hire Dal Lago Law as Legal Counsel
-----------------------------------------------------------------
Banroc Corp d/b/a Solara Homes seeks approval from the U.S.
Bankruptcy Court for the Middle District of Florida to hire Dal
Lago Law to serve as its counsel.
The firm's services include:
a. providing the Debtor with legal advice and counsel with
respect to: (i) its rights, duties, and powers in the Case; and
(ii) compliance with the Bankruptcy Code, Bankruptcy Rules, Local
Rules, and all orders issued by the Court in the Case;
b. preparing, on behalf of the Debtor, all necessary
pleadings, motions, applications, reports, and other legal papers
as may be necessary in furtherance of the Debtor’s interests and
objectives in the Case;
c. prosecuting and defending any causes of action on behalf of
the Debtor where special counsel is deemed unnecessary;
d. assisting in the formulation of a plan of reorganization or
liquidation, and advising the Debtor with regard to same;
e. assisting the Debtor in considering and requesting the
appointment of a trustee or examiner, should such action become
necessary;
f. consulting with the Office of the United States Trustee
and the Subchapter V Trustee concerning the administration of the
Debtor’s estate, to the extent applicable;
g. representing the Debtor at hearings and other judicial
proceedings; and
h. performing such other legal services as may be required,
and as are deemed to be in the best interest of the Debtor, in
accordance with the powers and duties afforded to the Debtor under
the Bankruptcy Code.
The firm will be paid at these hourly rates:
Michael R. Dal Lago $395
Associates and
Paraprofessionals $180 - $325
According to court filings, Dal Lago Law and its attorneys are
"disinterested" as such term is defined in Bankruptcy Code section
101(14).
The firm can be reached through:
Michael R. Dal Lago, Esq.
DAL LAGO LAW
999 Vanderbilt Beach Road, Suite 200
Naples, FL 34108
Telephone: (239) 571-6877
About Banroc Corp
d/b/a Solara Homes
Banroc Corp d/b/a Solara Homes is in the real estate business.
Banroc Corp filed its voluntary petition for relief under Chapter
11 of the Bankruptcy Code (Bankr. M.D. Fla. Case No. 21-01258) on
Sept. 22, 2021. The petition was signed by Roland H. Bandinel as
president. At the time of filing, the Debtor estimated $2,925,000
in assets and $4,261,913 in liabilities. Mike Dal Lago, Esq. at DAL
LAGO LAW represents the Debtor as counsel.
BCT DEALS: Wins Cash Collateral Access
--------------------------------------
The U.S. Bankruptcy Court for the Central District of California,
Los Angeles Division, has authorized BCT Deals, Inc., d/b/a Best
Costumes and Toy Deals, to use cash collateral on an interim basis
in accordance with the budget.
The order provides that the interests of FC Marketplace, LLC and
PayPal/Swift is secured by all of the Debtor's assets, which
constitute cash collateral.
The Debtor is directed to pay FC Marketplace $8,000 per month,
PayPal/Swift $1,000 per month, and Penske Truck Leasing Co., LP
$1,665 per month.
The Budget provides for monthly salary payments to be made to the
Debtor's three insiders. Payments to insiders may be made only
after the Debtor files a Notice of Setting/Increasing of Insider
Compensation in accordance with Local Bankruptcy Rule
2014-1(a)(1).
The Court finds that the remainder of the expenditures proposed in
the Budget--including expenses for shipping, rent, marketing fees,
and non-insider payroll—are necessary to sustain the Debtor's
operations.
A continued hearing on the further use of cash collateral is
scheduled for December 8, 2021 at 10 a.m.
About BCT Deals, Inc.
BCT Deals, Inc. sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. C.D. Cal. Case No. 21-18156) on October 22,
2021. In the petition signed by Michael J. Ward, president, the
Debtor disclosed up to $10 million in both assets and liabilities.
Judge Ernest M. Robles oversees the case.
The Debtor hired Michael Jay Berger, Esq., at the Law Office of
Michael Jay Berger as Chapter 11 counsel.
BIZGISTICS INC: Has Interim Cash Collateral Access Thru Nov 18
--------------------------------------------------------------
The U.S. Bankruptcy Court for the Middle District of Florida
granted through November 18, 2021, the motion to use cash
collateral filed by Bizgistics, Inc.
Subject to the provisions of the Order, the Debtor is permitted to
use cash collateral to pay:
a. $200 per truck (4 trucks) for towing services to a secure
lot.
b. Storage costs to store the Debtors’ vehicles (approx.
$2,600 / month).
c. Employee payroll for the week ending October 15, 2021 (up
to $33,000).
Any other use of cash collateral is prohibited unless the Debtor
receives written consent from ReadyCap Lending, LLC for such use.
ReadyCap will have a perfected post-petition lien against cash
collateral to the same extent and with the same validity and
priority as the prepetition lien, without the need to file or
execute any document as may otherwise be required under applicable
non bankruptcy law.
A copy of the order is available for free at https://bit.ly/3CEHowv
from PacerMonitor.com.
About Bizgistics Inc.
Bizgistics, Inc. is a Rydal, Pa.-based company that provides
freight transportation arrangement services.
Bizgistics filed a petition for Chapter 11 protection (Bankr. M.D.
Fla. Case No. 21-02197) on Sept. 12, 2021, listing as much as $10
million in both assets and liabilities. Darrell Giles, chief
executive officer and director, signed the petition. Underwood
Murray, P.A. serves as the Debtor's legal counsel.
BOULDER BOTANICAL: Case Summary & 20 Largest Unsecured Creditors
----------------------------------------------------------------
Debtor: Boulder Botanical & Bioscience Laboratories Inc.
1150 Catamount Drive
Golden, CO 80403
Business Description: Boulder Botanical & Bioscience Laboratories
operates a hemp CBD product manufacturing
facility. BBB Labs is vertically integrated
from the farm to the consumer for full
supply chain transparency from seed-to-
shelf. BBB Labs is both a white label
manufacturer for multiple established and
recognized CBD brands, and also manufactures
its own branded products.
Chapter 11 Petition Date: October 21, 2021
Court: United States Bankruptcy Court
District of Colorado
Case No.: 21-15340
Debtor's Counsel: Stephen Berken, Esq.
BERKEN CLOYES, PC
1159 Delaware Street
Denver, CO 80204
Tel: 303-623-4357
Email: stephenberkenlaw@gmail.com
Estimated Assets: $100,000 to $500,000
Estimated Liabilities: $1 million to $10 million
The petition was signed by Robert Dimarco as CEO.
A copy of the Debtor's list of 20 largest unsecured creditors is
available for free at PacerMonitor.com at:
https://www.pacermonitor.com/view/CC5AISI/Boulder_Botanical__Bioscience__cobke-21-15340__0006.0.pdf?mcid=tGE4TAMA
A full-text copy of the petition is available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/NYWGDHQ/Boulder_Botanical__Bioscience__cobke-21-15340__0001.0.pdf?mcid=tGE4TAMA
BV GLENDORA: Unsecureds Will be Paid in Full in 36 Months
---------------------------------------------------------
BV Glendora LLC, a Colorado limited liability company, submitted a
Second Amended Chapter 11 Plan and a corresponding Disclosure
Statement.
Cadence Capital Investments LLC (the Debtor's affiliate and exit
financing lender) has made payments on account of the Debtor's
prepetition obligations and post-Petition expenses. The reason for
making payments prepetition creditors is that Cadence has important
relationships with these vendors independent of the Debtor and
Cadence is the Debtor's exit financing lender and supports the
Debtor's restructuring efforts.
The Debtor expects to require an 18-month period to market the
Glendora Property to obtain tenants. Thereafter, an additional 18
months will be required to entitle, permit, and buildout the tenant
spaces, at the tenant's expense. After this 3-year period, the
Glendora Property shall produce net cash flow of $102,650 in year 4
of the Plan, $106,194 in year 5 of the Plan, $128,363 in year 6 of
the Plan and $152,367 in year 7 of the Plan.
The Plan will treat claims as follows:
* Class 3 - Secured claim of Palo Plesnik and Crystal Plesnik
totaling $4,884,850 (est.). The Plesniks shall retain their lien
on the Glendora Property until their claim, is paid in full. Based
on the Plesniks' filed claim, the payments to them from the Debtor
shall be $2,500 from month 1 through 36 of the Plan, $13,308 from
month 37 - 84 of the Plan, with a balloon payment of $5,246,813 in
month 84 of the Plan. Class 3 is impaired.
* Class 4 - General unsecured claims. Class 4 consists of 3
non-insider claims, Dasher & Tabata in the amount of $2,011, Tait &
Associates in the amount of $520.00, and DK Design in the amount of
$700 and these claims shall be paid in full 36 months after the
Effective Date. Class 4 is impaired.
* Class 5 - Unsecured claim of the Debtor's affiliate Cadence
Capital Investments LLC. Cadence's prepetition claim in the amount
of $595,060 will be subordinated and junior to all other classes
and which will receive no distribution unless and until all other
allowed senior claims are paid in full.
The Plan will be funded by $100,000 new value contribution and
financing from Glendora EF Investors, LLC, and the Cadence
Financing facility.
The hearing where the Court will determine whether or not to
confirm the Plan will take place on Dec. 13, 2021, at 10:00 a.m.,
in Courtroom 1539. Objections to the confirmation of the Plan must
be filed with the Court and served by Dec. 8, 2021.
Ballots must be submitted by Dec. 8, 2021 by 5 p.m., or it will not
be counted.
Attorneys for the Debtor:
Jeffrey S. Shinbrot, Esq.
JEFFREY S. SHINBROT, APLC
15260 Ventura Blvd., Suite 1200
Sherman Oaks, CA 91403
Tel: (310) 659-5444
Fax: (310) 878-8304
E-mail: jeffrey@shinbrotfirm.com
A copy of the Disclosure Statement dated Oct. 27, 2021, is
available at https://bit.ly/3blSquJ from PacerMonitor.com.
About BV Glendora
BV Glendora, LLC, is a Colorado limited liability company debtor
and is the owner and developer a real estate project commonly known
as 401 East Arrow Highway, in Glendora, California. The Glendora
Property consists of a 32,000 square foot commercial building
together with two adjoining parcels of commercial real estate. The
Debtor acquired the Glendora Property in November, 2019, for a
purchase price of $5,250,000, with $1,000,000 down-payment and a
first deed of trust via a seller carryback for the remainder of the
purchase price. The Glendora Property is currently vacant.
Glendora EF Investors, LLC, is the 100% owner of BV Glendora's
membership
interests. Mr. William R. Rothacker is the manager of both the
Debtor and Glendora EF Investors, LLC.
BV Glendora, LLC, sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. C.D. Cal. Case No. 21-11627) on March 1,
2021. David B. Runberg, chief financial officer, signed the
petition. In the petition, the Debtor disclosed assets of between
$1 million and $10 million and liabilities of the same range.
Judge Sheri Bluebond oversees the case.
Jeffrey S. Shinbrot, APLC, is the Debtor's legal counsel.
CALPLANT I LLC: Seeks to Hire Morris James as Co-Counsel
--------------------------------------------------------
CalPlant I Holdco, LLC and CalPlant I LLC seek approval from the
U.S. Bankruptcy Court for the District of Delaware to hire Morris
James LLP as their co-counsel.
The firm will render these services:
a. provide legal advice with respect to the Debtors' powers
and duties as debtors in possession in the continued operation of
their business, management of their properties and related
matters;
b. preparing and pursing confirmation of a plan and approval
of disclosure statement;
c. prepare necessary applications, motions, answers, orders,
reports and other legal papers on behalf of the Debtors;
d. appearing in Court and protecting the interests of the
Debtors before the Court; and
e. perform all other legal services for the Debtors that may
be necessary and proper in these proceedings.
The principal attorneys and paralegals to represent the Debtors
are:
Eric J. Monzo Partner $645
Brya M. Keilson Counsel $595
Sarah M. Ennis Associate $435
Stephanie Lisko Paralegal $285
Douglas Depta Paralegal $285
The Debtor paid the firm a retainer in the amount of $50,000.
As disclosed in court filings, Morris James is a "disinterested
person" within the meaning of Section 101(14) of the Bankruptcy
Code.
In accordance with Appendix B-Guidelines for reviewing fee
applications filed by attorneys in larger Chapter 11 cases, Morris
James disclosed that:
-- Morris James did not agree to a variation of its standard or
customary billing arrangements for this engagement;
-- None of the professionals included in this engagement have
varied their rate based upon the geographic location of the Chapter
11 Cases; and
-- The Debtors retained Morris James on September 10, 2021. The
billing rates for the period prior to this application are the same
as indicated in this application;
-- Morris James anticipates filing a budget at the time it files
its interim fee applications.
The firm can be reached through:
Eric J. Monzo, Esq.
Morris James, LLP
500 Delaware Avenue, Suite 1500
Wilmington, DE 19801
Tel: 302.888.5848
Fax: 302.504.3953
Email: emonzo@morrisjames.com
About CalPlant
CalPlant I, LLC -- http://www.eurekamdf.com/-- is a Northern
California-based company focused on manufacturing
sustainably-sourced building products, including the creation of
the world's first no-added-formaldehyde, rice straw-based medium
density fiberboard, Eureka MDF. CalPlant and its predecessor
company, CalAg, LLC, have spent many years researching, developing,
and patenting a process to make high-quality MDF using annually
renewable rice straw as the feedstock, the disposal of which has
posed environmental issues in California for decades.
CalPlant I and CalPlant I Holdco, LLC sought Chapter 11 protection
(Bankr. D. Del. Lead Case No. 21-11302) on Oct. 5, 2021. The cases
are handled by Honorable Judge John T. Dorsey.
CalPlant I Holdco listed up to $100 million in assets and up to
$50,000 in liabilities as of the bankruptcy filing while CalPlant I
listed as much as $500 million in both assets and liabilities.
The Debtors tapped Morrison & Foerster, LLP as bankruptcy counsel;
Morris James, LLP as local bankruptcy counsel; and Paladin
Management Group as financial advisor. Prime Clerk, LLC is the
claims and noticing agent.
CAPITOL CLOSET: Seeks Use of IRS' Cash Collateral
-------------------------------------------------
Capitol Closet Design, Inc. asks the U.S. Bankruptcy Court for the
Eastern District of Virginia, Alexandria Division, for authority to
use the cash collateral of the US Internal Revenue Service and
provide adequate protection.
The Debtor requires the use of Cash Collateral to continue to
operate, preserve and maintain its business operations.
With the exclusion of a few motor vehicles, the IRS has a lien
against the assets of the Debtor by reason of notices of tax lien.
As a result, the IRS holds a security interest in the Debtor's cash
collateral -- its accounts receivable, cash on hand, and proceeds
of operations and the proceeds -- pursuant to 11 U.S.C. section
363.
The Debtor proposes interim use of Cash Collateral to the extent
and in substantially the amounts set forth in the cash collateral
budget. The Debtor will use Cash Collateral to maintain and operate
its business affairs and pay the Debtor's post-petition secured and
ongoing (but not pre-petition) obligations as and when they come
due.
The Debtor is in arrears to the IRS for the payment of 940 and 941
taxes. The Debtor proposes that the IRS, pursuant to 11 U.S.C.
section 363, be granted a valid and perfected lien with the same
priority as held on the Petition Date on all present and
after-acquired property of the Debtor of any nature whatsoever. The
Replacement Lien will secure the IRS's prepetition claim in the
amount equal to the amount by which the value of the pre-petition
collateral as of any post-petition date of determination is less
than the value as of the Petition Date. The Replacement Lien will
be in addition to the lien that the IRS had in the assets and
property of the Debtor as of the Petition Date. Incident to any
Replacement Lien to secure the Adequate Protection Amount, the
Debtor proposes that the IRS will have an allowed administrative
claim with priority.
The amount of the IRS secured claim will be not less than
$1,815,240. The book value of the Debtor's tangible assets -- such
as machinery, equipment, inventory, work in process, and motor
vehicles -- is approximately $246,206. The face value of the
Debtor's Accounts Receivable (less than 60 days old) as of the date
of the Petition for relief is $43,626. The face value of the
Debtor's Accounts Receivable (more than 60 days old) as of the
bankruptcy petition date is $138,873. Based upon these values, the
IRS is under-secured by about $1,383,550.
Additional adequate protection is provided to the IRS through the
Debtor's continued business operations. The Debtor's failure to
continue its operations will result in termination of its service
contracts and loss of employees which will negatively impact the
value of the Debtor's business. The proposed use of the Cash
Collateral will protect the value of the IRS' collateral and will
allow for the Debtor to reorganize. The IRS may also be provided
additional adequate protection under 11 U.S.C. section 362(d)(3) as
the Court may determine.
A copy of the Debtor's motion is available at
https://bit.ly/3GE6EWe from PacerMonitor.com.
About Capitol Closet Design, Inc.
Capitol Closet Design, Inc. is a privately held company in the
custom closet construction business. The Debtor sought protection
under Chapter 11 of the US Bankruptcy Code (Bankr. E.D. Va. Case
No. 21-11781) on October 25, 2021. In the petition signed by Larry
Nordseth, president, the Debtor disclosed $311,442 in assets and
$1,415,004 in liabilities.
John P. Forest, II, Esq., at the Law Office of John P. Forest, II
is the Debtor's counsel.
CBL PROPERTIES: Exits from Chapter 11 Bankruptcy Protection
-----------------------------------------------------------
CBL Properties (NYSE: CBL) on Nov. 1, 2021, announced that it
successfully completed its Chapter 11 reorganization. CBL emerged
with a significantly improved capital structure, greater financial
flexibility and a lowered cost of capital, positioning the company
with a much-improved balance sheet and primed to pursue future
growth opportunities.
"This is a huge day for CBL," said Stephen D. Lebovitz, Chief
Executive Officer of CBL. "After a year of focused effort and
collaboration with our major stakeholders, we emerge a renewed
organization with a fresh start. The entire CBL team has shown
incredible resilience, persistence and extraordinary effort in
getting us to this point. Our improved cost structure, disciplined
approach to capital investment and diverse portfolio of
freestanding outparcels, open-air shopping centers and
market-dominant malls, along with our talented team, position CBL
to generate robust free cash flow and generate significant
shareholder value."
Lebovitz added, "As we emerge, we plan to utilize our new
flexibility to take advantage of market opportunities. While the
restructuring reduced overall interest expense significantly, a
major priority is to continue to lower borrowing costs and enhance
cash flow. The new senior secured 10% notes include an 18-month
open-to-par window, providing a strong incentive to reduce this
exposure in the near term. Additionally, our centers, and the
industry, have benefited from a strong rebound in traffic, sales
and tenant demand. As a result, we see unique opportunities for CBL
utilizing our operational expertise coupled with our enhanced cash
flow and improved capital structure.
"With these new priorities and focus, we are excited about the
bright future we envision for our company. I want to thank the CBL
team, the exiting Board of Directors, as well as our creditors,
lenders and other stakeholders for their confidence and support
during this process."
Through the restructuring, CBL has reduced its debt and preferred
obligations by approximately $1.7 billion. The post-restructuring
balance sheet includes a new $883.7 million secured term loan,
$455.0 million of new secured notes bearing interest at 10% ("10%
Notes") and $150.0 million of new convertible secured notes bearing
interest at 7% ("7% Notes"), including $50.0 million funded by new
money.
CBL intends to utilize the $50.0 million in new money proceeds and
$10.0 million in recent asset sale proceeds to redeem a portion of
the 10% Notes, which will result in a total of $395.0 million of
10% Notes outstanding post-redemption. Following the redemption and
$195 million in cash payments made as part of the emergence and
other fees and costs, CBL will have approximately $260.0 million in
cash and cash equivalents on the balance sheet.
All existing common and preferred shares were canceled upon
emergence. Existing common shareholders and common unitholders will
each receive their pro rata share of 5.5% in the newly reorganized
company and existing preferred shareholders will each receive their
pro rata share of 5.5% common equity in the newly reorganized
company. At emergence CBL will have approximately 20 million
diluted shares outstanding. As previously announced, the newly
issued shares are expected to begin trading on November 2, 2021, on
the NYSE under the symbol “CBL.”
The rate of New Common Equity to be issued to existing common and
preferred shareholders is as follows:
* Common Stock (CBLAQ): 0.005457723
* 7.375% Depositary Shares Representing 1/10 Interest in Series
D Cumulative Redeemable Preferred Stock (OTCMKS: CBLDQ):
0.043912176
* 6.625% Depositary Shares Representing 1/10 Interest in Series
E Cumulative Redeemable Preferred Stock (OTCMKS: CBLEQ):
0.043912176
Existing unsecured noteholders, holders of general unsecured claims
and Consenting Crossholders are receiving their share, in the
amounts set forth in the plan of reorganization, of $95.0 million
in cash, newly issued 10% Notes and as elected, 7% Notes, and 89%
of the newly reorganized equity. The remaining Bank Lenders,
holding $983.7 million in principal amount under the existing
secured credit facility, are receiving $100.0 million in cash and
an $883.7 million new secured term loan.
As announced previously, the new post-emergence Board includes
Jonathan Heller, Partner and head of the New York office of Canyon
Partners, as well as Stephen Lebovitz, Charles Lebovitz, Marjorie
Bowen, David Contis, David Fields, Robert Gifford, and Kaj Vazales.
Mr. Heller will assume the role of Chairman of the Board with Mr.
Contis serving as Lead Director.
About CBL Properties
Headquartered in Chattanooga, TN, CBL Properties owns and manages a
national portfolio of market-dominant properties located in dynamic
and growing communities. CBL's portfolio is comprised of 105
properties totaling 63.9 million square feet across 24 states,
including 63 high‑quality enclosed, outlet and open-air retail
centers and seven properties managed for third parties. CBL seeks
to continuously strengthen its company and portfolio through active
management, aggressive leasing and profitable reinvestment in its
properties. On the Web: http://www.cblproperties.com/
CBL, CBL & Associates Limited Partnership and certain other related
entities filed voluntary petitions for reorganization under Chapter
11 of the U.S. Bankruptcy Code in Houston, Texas, on Nov. 1, 2020
(Bankr. S.D. Tex. Lead Case No. 20-35226).
In their restructuring, the Debtors 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, was the claims agent.
* * *
CBL & Associates Properties in early August 2021 won approval of
its reorganization plan that cut $1 billion in debt, mainly by
handing ownership to bondholders. Under the plan, bondholders will
get 89 percent of the new CBL and existing shareholders will get 11
percent.
CHESAPEAKE ENERGY: Fitch Assigns First Time 'BB' LongTerm IDR
-------------------------------------------------------------
Fitch Ratings has assigned a first-time Long-Term Issuer Default
Rating (IDR) of 'BB' to Chesapeake Energy Corporation (Chesapeake),
a 'BBB-'/'RR1' rating to its senior secured Reserve Based Loan
(RBL) credit facility, a 'BB+'/'RR2' rating to its senior secured
term loan, and a 'BB'/'RR4' rating to its senior unsecured notes,
including the $950 million senior unsecured notes acquired in the
Vine Energy Inc. (Vine) acquisition that closed on Nov. 1, 2021.
The Rating Outlook is Stable.
Chesapeake's ratings reflect its net leverage of less than 1.0x,
its clean capital structure and multi-basin gas-weighted asset base
including its leading position in the dry gas Haynesville shale
play. Fitch would like to see Chesapeake develop a track record in
line with its post-bankruptcy emergence conservative financial
policy and visibility on longer term asset profile.
Fitch has withdrawn the ratings of Vine and Vine Energy Holdings
LLC as they no longer exist. Accordingly, Fitch will no longer
provide ratings or analytical coverage.
KEY RATING DRIVERS
Significant Haynesville Position: At close of the acquisition of
Vine, Chesapeake added 123,000 net surface acres located entirely
within the dry gas Haynesville in northwest Louisiana and focus on
the Haynesville and Mid-Bossier plays. This increased its
Haynesville position to 348,000 net acres, and added production of
1,050 MMcfd at 2Q21 for proforma total company production of 3,368
MMcfed (608Mboepd).
The acquisition of Vine sees Chesapeake become the largest producer
in the Haynesville, which is less consolidated than more mature gas
basins, and provides opportunity for future drill-bit and potential
consolidator acquisition growth. The combined Haynesville position
improves the contiguousness of Chesapeake's acreage, allowing the
company to drill more consistent longer laterals and positions
Chesapeake to be a considerable supplier to the Gulf Coast.
Positive Post-Dividend FCF: Fitch forecasts Chesapeake to generate
positive annual FCF in excess of dividends of between $100
million-$200 million between 2022 and 2024 in Fitch's mid-cycle
base case ($500 million to $600 million before dividends). Fitch's
forecast expects low to mid-single digit percentage drill bit
growth and its price deck assumes $50 WTI and $2.45 gas in 2023 and
2024, with further upside to FCF if current strip pricing holds.
FCF benefits from expected annual cost synergies of $50 million
through $20 million of operating and $30 million of capital
synergies from the Vine acquisition.
Forecast Sub 1.0x Net Leverage: Fitch forecasts gross and net
leverage of 1.0x and 0.6x at YE 2022 and debt to flowing barrel
below $4,000/bbl. Chesapeake's low leverage benefits from
Chesapeake's initial capital structure after its emergence from
bankruptcy in February 2021, as, well as the structure of the
acquisition of Vine being funded largely with Chesapeake shares,
with the exception of a modest cash payment ($1.20 cash per Vine
share, equating to approximately $90 million).
Financial Policy: Chesapeake targets maintaining net debt at sub
1.0x and a 60%-70% reinvestment rate that emphasizes FCF generation
over drill bit growth. The combination of Chesapeake and Vine
benefits from a more diversified ownership structure than
standalone Vine, with Blackstone's ownership of Chesapeake reduced
to approximately 10%. Given its new board of directors and CEO,
Fitch would like to see Chesapeake develop a track record in line
with its conservative financial policy and visibility on longer
term asset profile.
Multi-Basin Production: Chesapeake benefits from production in
onshore U.S. plays including the Marcellus shale, the Haynesville,
Eagle Ford and Brazos Valley Shale in Texas and the Powder River
Basin in Wyoming. Proforma the Vine acquisition, 78% of production
is in the Appalachian Basin and Haynesville plays, with 100% gas
exposure. The oil exposure and economics outside these areas
benefit its overall unhedged cash netbacks, proforma Vine
acquisition in 2Q21 of $11.1/boe, which compares strongly with
typical gas weighted peers.
Hedges Support Cash Flow Visibility: Inclusive of the Vine
acquisition, Chesapeake has over 75% of its gas hedged through YE
2021 and hedges on approximately 45% of 2022 production at an
average of $2.52/Mcf in place. Fitch expects the company will
continue to hedge future production at similar levels to de-risk
cash flows and reduce pricing volatility. Future FCF, beyond
Fitch's forecast period, also benefits from Chesapeake's
cancelling, as part of the Vine acquisition, Vine's Tax Receivable
Agreement that would have otherwise affected future cash flows
after 2025 by sharing the benefit derived from post-IPO tax
attributes with the pre-IPO Vine investors.
Variable Dividend: Upon closing of the Vine acquisition, Chesapeake
is instituting a fixed plus variable dividend policy. The fixed
portion is $1.375/share annually or an approximately $205 million
total distribution inclusive of shares issued in the Vine
acquisition. This fixed component is a meaningful distribution that
is covered by pre-dividend FCF under Fitch's mid-cycle pride deck
through its forecast. The variable component, first payable in
1Q22, distributes quarterly 50% of post fixed dividend FCF. The
variable dividend component provides flexibility to naturally
reduce dividends in a potential lower oil and gas price
environment.
DERIVATION SUMMARY
Chesapeake at 2Q21, proforma the Vine acquisition, produced
607Mboed (84% gas). This is in line with Coterra Energy's
(BBB/Stable) proforma the Cimarex merger, production of 605Mboed
(77% gas). While Chesapeake's gas production is more Haynesville
weighted than Coterra, both companies benefit from their greater
liquids weighting than more fully gas weighted competitors such as
EQT (BB+/Stable) and Comstock (B/Positive). Production for EQT
Corporation was 933Mboepd (3Q21), while Haynesville operator
Comstock produced 232Mboepd (98% gas).
Southwestern Energy (BB/Positive), similar to Chesapeake grew is
Haynesville position recently through M&A, as it closed its
acquisition of Haynesville operator Indigo Natural Resources on
Sept. 1, 2021. The combined company produced approximately
682Mboepd at proforma 2Q21. Fitch estimates Southwestern Energy's
2022 total debt/EBITDA at 2.0x compared with a 1.0x forecast for
Chesapeake in the same period.
Proforma 2Q21 for the three-way merger of Bonanza Creek Energy,
Extraction Oil & Gas Inc. and Crestone Peak Resources to form
Civitas Resources (BB-/Stable), the company produced 162Mboepd.
Civitas' leverage, similarly to Chesapeake's, is very low for its
rating category at approximately 0.5x total debt/operating EBITDA.
Both companies' current capital structures benefit from recent
emergences from bankruptcies. For Civitas, Bonanza Creek emerged in
2017 and Extraction Oil & Gas in 2021, while Chesapeake emerged in
February 2021 with its very low leverage profile. Chesapeake
operates in states and basins with lower regulatory risks than
Civitas, who operates in the DJ Basin in Colorado.
KEY ASSUMPTIONS
-- WTI (USD/bbl) of $60 in 2021, $52 in 2022 and $50 thereafter;
-- Henry Hub (USD/mcf) of $3.40 in 2021, $2.75 in 2022 and $2.45
thereafter;
-- Assumes a successful acquisition of Vine Energy consistent
with the details in Chesapeake's S4 filing;
-- Production in 2022-2024 of between 580Mboepd and 625Mboepd;
-- 2022 total capex at midpoint of $1.3 billion-$1.6 billion
guidance and relatively stable though forecast;
-- $50 million in annual synergies are realized as planned;
-- No stock repurchases during the forecast period.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
-- Commitment to its stated financial policy resulting in post
dividend FCF generation through the cycle;
-- Credit conscious longer-term asset strategy, M&A or organic
driven, that maintains financial flexibility;
-- Continued de-risking and operational momentum in the
Haynesville and/or other plays that results in material
increase of PDP reserves and competitive unit costs;
-- Mid-cycle total debt with equity credit/operating EBITDA
sustained at or below 2.0x.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
-- Failure to maintain a clear, conservative financial and
operational policy;
-- A trend of negative FCF contributing to diminished liquidity
or utilization of revolver commitment above 50%;
-- Mid-cycle total debt with equity credit/operating EBITDA
sustained over 2.5x;
-- Loss of operational momentum with organic production trending
below 450Mboepd or materially increasing production costs.
BEST/WORST CASE RATING SCENARIO
International scale credit ratings of Non-Financial Corporate
issuers have a best-case rating upgrade scenario (defined as the
99th percentile of rating transitions, measured in a positive
direction) of three notches over a three-year rating horizon; and a
worst-case rating downgrade scenario (defined as the 99th
percentile of rating transitions, measured in a negative direction)
of four notches over three years. The complete span of best- and
worst-case scenario credit ratings for all rating categories ranges
from 'AAA' to 'D'. Best- and worst-case scenario credit ratings are
based on historical performance.
LIQUIDITY AND DEBT STRUCTURE
Clean Capital Structure: Liquidity is supported by Chesapeake's
undrawn $1.75 billion RBL facility as well as by Fitch's post
dividend positive FCF through its forecast period. At close of the
Vine acquisition, Chesapeake paid $202 million to repay the $35
million outstanding on Vine's first lien Reserve Based Loan (RBL),
closed this facility and repaid Vine's $150 million second lien
term loan removing any second lien encumbrances from being part of
Chesapeake's capital structure.
The only remaining outstanding debt instrument acquired during the
Vine acquisition is Vine's $950 million 6.5% senior unsecured notes
maturing in 2029, which rank pari-passu with Chesapeake's existing
senior unsecured debt. Post-acquisition, Chesapeake has maintained
a favorable maturity schedule with $1.45 billion of approximately
$2.2 billion of total debt maturing in 2029.
ISSUER PROFILE
Chesapeake is a gas weighted U.S. onshore E&P company. Its asset
base consists of resource plays located in the Marcellus shale, the
Haynesville/Bossier shales, the Eagle Ford shale, Brazos Valley and
the Powder River Basin.
ESG CONSIDERATIONS
Unless otherwise disclosed in this section, the highest level of
ESG credit relevance is a score of '3'. This means ESG issues are
credit-neutral or have only a minimal credit impact on the entity,
either due to their nature or the way in which they are being
managed by the entity.
CHIP'S SOUTHINGTON: Wins Cash Collateral Access Thru Dec 5
----------------------------------------------------------
The U.S. Bankruptcy Court for the District of Connecticut approved
the stipulation between Chip's Southington, LLC and M&T Bank
allowing the Debtor access to cash collateral until the earlier of
(i) December 5, 2021; or (ii) the occurrence of a termination
event, to pay its actual, necessary and ordinary course expenses as
set forth in the budget.
The budget, covering the period from November 1 through December 3,
2021, provided for these total weekly costs:
$27,948 for the week ending November 7, 2021;
$27,948 for the week ending November 14, 2021;
$27,948 for the week ending November 21, 2021;
$27,948 for the week ending November 28, 2021; and
$63,308 for the week ending December 5, 2021.
Prepetition, M&T Bank extended a loan to the Debtor for $1,200,000,
secured, among others, by a General Security Agreement granting M&T
Bank a first priority security interest in substantially all of the
Debtor's assets. As of the Petition Date, $1,038,135 is
outstanding on the loan.
Other Claimants on the Debtor's cash collateral include Celtic Bank
Corporation; The Business Backer, LLC; American Express National
Bank; and the U.S. Small Business Administration.
As adequate protection for the use of cash collateral, the
Claimants are granted senior security interests in and liens on all
personal property and real estate of the Debtor, to attach with the
same validity, extent and priority that the Claimants possessed as
to said liens on the Petition Date. The Claimants will also have
allowed administrative expense claims to the extent of postpetition
diminution in value of their interests, except with respect to the
carve-out.
The carve-out includes the allowed administrative claims accrued
during the cash collateral period through October 31, 2021 of (i)
Green & Sklarz LLC for $57,000; (ii) Premier Tax Consultant, LLC
for $3,7500; and (iii) the Subchapter V Trustee, George Purtill,
for $14,500.
In addition, the Debtor will pay M&T Bank, monthly interest of
$3,570 by November 30, 2021.
The Court will continue hearing on the Debtor's use of cash
collateral on November 30 at 10 a.m. via Zoom.
A copy of the order is available for free at https://bit.ly/3q6hwpQ
from PacerMonitor.com.
About Chip's Southington
Southington, Conn.-based Chip's Southington LLC is a privately
owned restaurant founded in 1966. It conducts business under the
name Chip's Family Restaurant. Chip's Southington filed a Chapter
11 petition (Bankr. D. Conn. Case No. 20-21458) on Dec. 29, 2020.
In its petition, the Debtor estimated $500,000 to $1 million in
assets and $1 million to $10 million in liabilities.
Judge James J. Tancredi presides over the case.
Green & Sklarz LLC is the Debtor's bankruptcy counsel. The Debtor
tapped the law firms of DanaherLagnese, PC, Kanner & Whiteley, LLC
and Sweeney Merrigan Law, LLP as its special counsel. George
Purtill is the Debtor's Subchapter V Trustee.
COLORADO HOMES: Voluntary Chapter 11 Case Summary
-------------------------------------------------
Debtor: Colorado Homes, LLC
6460 S Quebec St
Centennial, CO 80111-4628
Business Description: Colorado Homes, LLC is a Single Asset Real
Estate debtor (as defined in 11 U.S.C.
Section 101(51B)).
Chapter 11 Petition Date: November 2, 2021
Court: United States Bankruptcy Court
District of Colorado
Case No.: 21-15521
Judge: Hon. Kimberley H. Tyson
Debtor's Counsel: Bonnie Bell Bond, Esq.
LAW OFFICE OF BONNIE BELL BOND, LLC
8400 E Prentice Ave Ste 1040
Greenwood Village, CO 80111-2922
Tel: (303) 770-0926
Email: bonnie@bellbondlaw.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $10 million to $50 million
The petition was signed by Ranko Mocevic as member/manager.
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/Z2ZMZNY/Colorado_Homes_LLC__cobke-21-15521__0001.0.pdf?mcid=tGE4TAMA
COMMERCIAL PRODUCTS: Unsecureds Will Get 10% Under Plan
-------------------------------------------------------
Commercial Products Co., Inc., submitted a Combined Plan of
Reorganization and Disclosure Statement.
The Plan is a reorganizing plan and contemplates the continuation
of the Debtor's business and retention of prepetition assets of the
Debtor. Pursuant to the Plan, Debtor will fund an approximately
10% dividend to allowed unsecured creditors. The Debtor will also
make the payments committed to herein to allowed priority claims,
allowed administration costs inclusive of United States Trustee
quarterly fees and professional fees for the Debtor. The Debtor
will abandon its interest in 117 Ethel Avenue, Hawthorne, New
Jersey 07506, though the Debtor will continue to occupy the
Property and operate its business out of the Property pending the
foreclosure of the Property.
The Debtor valued the Property at $700,000 in its petition. This
is based upon Mrs. Arnoldi's best estimate. Mrs. Arnoldi continues
to believe that this estimate is accurate.
Class 2 General Unsecured Claims totaling $461,479 will receive
approximately 10% of allowed claims, payable in 36 monthly
installments commencing on the Effective Date as follows: $1,285
per month.
On confirmation of the Plan, all property of the Debtor, tangible
and intangible, including, without limitation, licenses, furniture,
fixtures and equipment, will revert, free and clear of all Claims
and Equitable Interests except as provided in the Plan, to the
Debtor. The Debtor expects to have sufficient cash on hand to make
the payments required on the Effective Date.
Attorneys for COMMERCIAL PRODUCTS CO.:
STEPHEN B. McNALLY, ESQ.
McNALLY & ASSOCIATES, LLC
93 Main Street
Newton, New Jersey 07860
Tel: (973) 300-4260
A copy of the Disclosure Statement dated Oct. 27, 2021, is
available at https://bit.ly/3pKalnn from PacerMonitor.com.
About Commercial Products
Commercial Products Co, Inc. --
https://www.commercial-products.com/ -- produces chemical products
for the finishing of fabrics. These include stiffeners, softeners
and additives such as those that provide flame retardancy
(www.greenflameretardant.com). Its customers range from the
domestic U.S., to
the new textile centers in South America, Central America and
Asia.
On Aug. 7, 2020, Commercial Products Co, Inc., sought Chapter 11
protection (Bankr. D.N.J. Case No. 20-19358). The Debtor disclosed
total assets of $802,156 and total liabilities of $1,627,935 as of
the bankruptcy filing. The Debtor tapped Stephen B. McNally, at
McNALLY & ASSOCIATES, LLC, in Newton, New Jersey, as counsel.
COOK & BOARDMAN: Moody's Affirms 'B3' CFR, Outlook Stable
---------------------------------------------------------
Moody's Investors Service affirmed The Cook & Boardman Group, LLC's
(C&B) B3 Corporate Family Rating and B3-PD Probability of Default
Rating. Moody's also affirmed the B3 rating on the company's senior
secured term loan maturing 2025. The outlook is stable.
The affirmation of C&B's B3 CFR reflects Moody's expectation that
the company will generate significant revenue and earnings from its
record-high backlog over the next twelve months, reducing leverage
to levels more in-line with its current ratings.
"C&B's failure to execute on its operating plans or integrate
acquisitions could result in a negative rating action," according
to Peter Doyle, Vice President at Moody's.
The following ratings are affected by the action:
Affirmations:
Issuer: Cook & Boardman Group, LLC (The)
Corporate Family Rating, Affirmed B3
Probability of Default Rating, Affirmed B3-PD
Senior Secured Bank Credit Facility, Affirmed B3 (LGD4)
Outlook Actions:
Issuer: Cook & Boardman Group, LLC (The)
Outlook, Remains Stable
RATINGS RATIONALE
C&B's B3 CFR reflects Moody's expectation that the company will
retain a leveraged capital structure through 2022. Moody's projects
adjusted debt-to-EBITDA slightly below 7.0x at year end 2022 versus
8.2x at June 30, 2021. Deleveraging has been delayed due to the
impact of coronavirus on nonresidential construction projects,
which are the driver of C&B's revenue. Moody's forward view
includes C&B repaying all seasonal borrowings under its revolving
credit facility by year end 2022, only term loan amortization and
modest organic growth. Further constraining the rating is that C&B
is a small company based on revenue and product line, limiting its
ability to generate significant earnings and free cash flow. Also,
Moody's believes that C&B will pursue acquisitions to build scale,
creating integrating risk.
Providing an offset to the company's leveraged capital structure is
the potential for better operating performance. Moody's also
forecast adjusted EBITDA margin in the range of 8% - 10% over the
next two years, which is in-line with current performance, and
based on revenue approaching $620 million by late 2022. Moody's
also calculates adjusted free cash flow-to-debt in the range of 3%
- 5% for 2022, which is reasonable given C&B's size and amount of
debt in its capital structure. No near term maturities, revolver
availability and good headroom under the company's term loan
financial covenant further enhance C&B's credit profile.
C&B should benefit from the rebound in nonresidential construction
(including new and repair and remodeling). Also, Moody's Global
Macro Outlook projects that the US GDP will grow by 6.5% in 2021
and by 4.5% for 2022, which should benefit all sectors including
commercial and education-related construction projects from which
C&B derives most its revenue.
The stable outlook reflects Moody's expectation that C&B's leverage
will improve over the next twelve months. Sufficient revolver
availability, no near term maturities and end market dynamics that
support modest growth further support the stable outlook.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
An upgrade of C&B's ratings could ensue if end markets remain
supportive of organic growth and the company delevers such that
adjusted debt-to-LTM EBITDA is sustained near 5.0x and adjusted
EBITA-to-interest expense is maintained above 2.5x, while improving
liquidity. The CFR could be downgraded if C&B's adjusted
debt-to-LTM EBITDA does not improve and stays above 6.5x or
EBITA-to-interest expense trends towards 1.0x. Deterioration in
liquidity or aggressive acquisition with additional debt or
shareholder return activity could result in downward rating
pressure as well.
The principal methodology used in these ratings was Distribution &
Supply Chain Services Industry published in June 2018.
The Cook & Boardman Group, LLC, headquartered in Winston-Salem,
North Carolina, is a national distributor of commercial doors and
related products primarily used in commercial applications.
Littlejohn & Co., through its affiliates, is the primary owner of
C&B.
COTTAGE CAR WASH: Wins Cash Collateral Access Thru Feb 2022
-----------------------------------------------------------
The U.S. Bankruptcy Court for the District of Massachusetts
authorized Cottage Car Wash, LLC to use cash collateral on an
interim basis through February 2, 2022, on the same terms and
conditions as set forth in the order authorizing interim use of
cash collateral dated April 30, 2021.
The Debtor is directed to use any cash collateral substantially in
accordance with the budget filed on October 18 and the supplemental
budget. The Debtor will by January 11, 2022, file a reconciliation
of budget to actual expenses with monthly totals and cash balances
for the period ending December 31, 2021.
A further hearing on the matter is scheduled for February 1, 2022
at 10 a.m.
A copy of the order is available at https://bit.ly/3q24lq2 from
PacerMonitor.com.
About Cottage Car Wash
Cottage Car Wash, LLC, a Norfolk, Mass.-based company in the car
wash business, filed a voluntary petition for relief under Chapter
11 of the Bankruptcy Code (Bankr. D. Mass. Case No. 21-10596) on
April 26, 2021. Michael Brabants, manager, signed the petition. The
Debtor disclosed total assets of $916,000 and total liabilities of
$1,481,676.
Judge Janet E. Bostwick oversees the case.
Madoff & Khoury LLP serves as the Debtor's legal counsel.
COVIA CORP: Appoints New Chief Legal Officer
--------------------------------------------
Covia, a leading provider of mineral-based and material solutions
for the Industrial and Energy markets, on Nov. 1, 2021, announced
that Duncan Stuart has joined the company as Executive Vice
President, Chief Legal Officer & Secretary, effective immediately.
Mr. Stuart joins Covia after having served in senior legal
positions over his 28 years at The Dow Chemical Company (NYSE:
DOW), most recently as Deputy General Counsel. Through his tenure
at Dow, he gained global experience in Mergers & Acquisitions,
Corporate Transactions and Strategy, Litigation, Operations, Human
Resources, Commercial, Governance and Intellectual Property.
Mr. Stuart's experience also includes serving as a Partner at
Bankston & McCollum in Anchorage, Alaska, with emphasis in complex
financial institution and construction litigation. He has served
on many non-profit boards, including recently serving as Chair for
the Midland (MI) Area Community Foundation. He also is currently
on the Board for the United Way of Midland (MI) County. He earned
both his J.D. and B.S. in Chemical Engineering degrees from The
University of Michigan and is admitted to practice before numerous
state and federal courts, including the Supreme Court of the United
States.
In addition, Mr. Stuart is currently a Stakeholder Representative
to the American Cancer Society's Extramural Research and Training
Peer Review Program for Translational Cancer Research, focusing on
Tumor Biology and Genomics Mr. Shawn Williams, Chairman of the
Board and Acting Chief Executive Officer, commented, “I am
pleased to have Duncan join our Covia Team. The Board and
Leadership team welcome him and look forward to the critical impact
that his extensive legal experience will bring to Covia.
About Covia Holdings Corporation
Covia Holdings Corporation and its affiliates --
http://www.coviacorp.com/-- provide diversified mineral-based and
material solutions for the energy and industrial markets. They
produce a specialized range of industrial materials for use in the
glass, ceramics, coatings, foundry, polymers, construction, water
filtration, sports and recreation, and oil and gas markets.
Covia Holdings Corporation, based in Independence, Ohio, and its
affiliates sought Chapter 11 protection (Bankr. S.D. Tex. Lead Case
No. 20-33295) on June 29, 2020.
In its petition, Covia disclosed $2,504,740,814 in assets and
$1,903,952,839 in liabilities. The petition was signed by Andrew D.
Eich, executive vice president, chief financial officer, and
treasurer.
The Hon. Marvin Isgur presides over the case.
The Debtors tapped KIRKLAND & ELLIS LLP, and KIRKLAND & ELLIS
INTERNATIONAL LLP, as counsel; JACKSON WALKER L.L.P., as
co-counsel; KOBRE & KIM LLP, as special litigation counsel; PJT
PARTNERS LP, as investment banker; ALIXPARTNERS, LLP, as financial
advisor; and PRIME CLERK LLC, as claims and noticing agent.
* * *
Covia on Dec. 31, 2020, disclosed that it has successfully
completed its financial restructuring and emerged from Chapter 11.
Through the restructuring, Covia has reduced its long-term debt by
approximately $750 million and its fixed costs, including railcar
obligations, by an additional $300 million. Golden Gate Capital, a
private equity investment firm in San Francisco, announced it had
made an investment of an undisclosed amount in Covia.
CRC BROADCASTING: Seeks Cash Access to Hire Special Counsel
-----------------------------------------------------------
CRC Broadcasting Company and CRC Media West, LLC ask the U.S.
Bankruptcy Court for the District of Arizona for authority to use
certain cash and cash equivalents in which Desert Financial
Federal Credit Union claims an interest in, to pay essential
post-petition operating expenses on an emergency basis.
Specifically, the Debtors seek authority from the Court to use
$25,000 of the currently sequestered cash to deposit a retainer
into the Trust Account of Michael W. Carmel, Esq., of Michael W.
Carmel, Ltd. for the purpose of representation relating to the
contested confirmation of the Debtors' Amended Chapter 11 Plans.
The Court has scheduled an evidentiary confirmation hearing on
February 17 and 18, 2022. An Application to Employ Carmel will be
filed the early part of the week of November 1, 2021.
Carmel, in anticipation of the Application to Employ, reached out
to Counsel for Desert Financial seeking its consent to transfer
$15,000 from CRC Broadcasting Company and $10,000 CRC Media West,
LLC, for a total of $25,000 into the Firm's Trust Account, to be
held pending further Court order. Desert Financial, who holds the
purse strings, refused the request. This refusal is not justified,
the Debtors argue, and is simply being done in an effort to
continue Desert Financial's scorched earth policy that shackles the
very Debtors who are attempting to reorganize and provide proper
payment to all creditors.
In the nearly 10 months between the filing of the Debtors'
respective Amended Chapter 11 Plans of Reorganization and the
Objections thereto, the Debtors and Desert Financial worked towards
settlement. Unfortunately, in Desert Financial's eyes, the only
settlement would be a complete liquidation of the Debtors,
something that is not contemplated in either Amended Plan, nor is
in the best interest of the creditors of the estate.
The Bankruptcy Court thus set an Evidentiary Hearing on Plan
Confirmation as a result of the inability to settle. Prior to that
Hearing, and by agreement of the parties, the Court adopted certain
dates and deadlines for discovery, hiring experts, holding
depositions and filing a Joint Pretrial Statement.
Due to the complexity of the matter, the Debtors wish to enlist the
aide of Mr. Carmel, a seasoned and sophisticated trial attorney.
"Unlike undersigned who is owed a substantial amount but has yet to
request payment, Mr. Carmel rightfully requires a retainer before
he will begin his representation (assuming his Application is
approved by the Court). The full retainer and all sources will be
disclosed in the separate Employment Application. Carmel has
requested a retainer in the amount of $100,000, $25,000 of which
will be coming from cash collateral," Allan D. NewDelman, Esq., the
Debtor's counsel, tells the Court.
"Desert Financial has refused to consent to the use of cash
collateral despite the fact that the Debtors have jumped through
every hoop and roadblock the Creditor has thrown in its path,
including but not limited to supplying bi-monthly financials not
typically required of such Debtors."
The Debtors propose to use the purported cash collateral to allow
it to continue the business operations during the course of this
reorganization, specifically, the retention of Special Counsel.
Despite the potential equity in the Debtors' assets, the Debtors
have granted Desert Financial post-petition replacement liens, in
the same order of priority, in such cash collateral as additional
adequate protection. During the course of these proceedings Desert
Financial's collateral position has only improved.
The Debtors contend Desert Financial is further adequately
protected by the Debtors' continuation and preservation of the
continually increasing going concern value of the business and the
non-cash collateral (equipment etc.) as may be reflected in the
bankruptcy schedules when filed. The Debtors have met each budget
previously approved by the Court. Furthermore, the Debtors have
paid Desert Financial Federal Credit Union every month an amount no
less than what was proposed in the Debtors' Amended Plans of
Reorganization filed in December 2020.
Although Desert Financial may object to the Debtors' use of the
Cash, the Debtors contend the lender's interest is significantly
protected by allowing the Debtors to continue to operate the
business and to protect and preserve the value of its assets.
A copy of the motion is available at https://bit.ly/3pWyp6s from
PacerMonitor.com.
About CRC Broadcasting Co.
CRC Broadcasting Company, Inc., a broadcast media company based in
Scottsdale, Ariz., filed a voluntary petition under Chapter 11 of
the Bankruptcy Code (Bankr. D. Ariz. Case No. 20-02349) on March 6,
2020, listing under $1 million in both assets and liabilities.
Affiliate CRC Media West, LLC also filed for Chapter 11 petition
(Bankr. D. Ariz. Case No. 20-02352) on March 6, 2020, listing under
$1 million in both assets and liabilities.
The cases are jointly administered.
Judge Paul Sala oversees both cases.
Allan D. NewDelman, Esq., at Allan D. NewDelman, P.C., is the
Debtors' legal counsel.
CRESTLLOYD LLC: Seeks to Hire Levene Neale as Bankruptcy Counsel
----------------------------------------------------------------
Crestlloyd, LLC seeks approval from the U.S. Bankruptcy Court for
the Central District of California to hire Levene, Neale, Bender,
Yoo & Golubchik L.L.P. as its bankruptcy counsel.
The firm's services include:
a. advising the Debtor with regard to the requirements of the
Bankruptcy Court, the Bankruptcy Code, the Bankruptcy Rules and the
Office of the United States Trustee as they pertain to the Debtor;
b. advising the Debtor with regard to certain rights and
remedies of the Debtor's bankruptcy estate and the rights, claims
and interests of his creditors;
c. representing the Debtor in any proceeding or hearing in the
Bankruptcy Court involving the Debtor's estate, unless the Debtor
is represented in such proceeding or hearing by other special
counsel;
d. conducting examinations of witnesses, claimants or adverse
parties and representing the Debtor in any adversary proceeding
except to the extent that any such adversary proceeding is in an
area outside of LNBYG's expertise or which is beyond LNBYG's
staffing capabilities;
e. preparing and assisting the Debtor in the preparation of
reports, applications, pleadings and orders including, but not
limited to, applications to employ professionals, monthly operating
reports, quarterly reports, initial filing requirements, schedules
and statement of financial affairs, lease pleadings, financing
pleadings, and pleadings with respect to the Debtor's use, sale or
lease of property outside the ordinary course of business;
f. assisting the Debtor in the negotiation, formulation,
preparation and confirmation of a plan of reorganization and the
preparation and approval of a disclosure statement in respect of
the plan; and
g. performing any other services which may be appropriate in
LNBYG's representation of the Debtor during the Debtor's bankruptcy
case.
The firm received $20,000 and $80,000, respectively, from Juliami
Art Ventures, LLC as a retainer.
David Golubchik, Esq. disclosed in court filings that his firm is a
"disinterested person" as defined in Section 101(14) of the
Bankruptcy Code.
The firm can be reached through:
David B. Golubchik, Esq.
Levene, Neale, Bender, Yoo & Brill, LLP
10250 Constellation Blvd., Ste. 1700
Los Angeles, CA 90067
Telephone: (310) 229-1234
Facsimile: (310) 229-1244
Email: dbg@lnbyb.com
About Crestlloyd, LLC
Crestlloyd, LLC sought protection for relief under Chapter 11 of
the Bankruptcy Code (Bankr. C.D. Cal. Case No. 21-18205) on Oct.
26, 2021. At the time of filing, the Debtor estimated $100,000,001
to $500 million in both assets and liabilities.
Judge Deborah J Saltzman presides over the case. David B Golubchik,
Esq. at Levene, Neale, Bender, Yoo & Golubchik L.L.P. represents
the Debtor as counsel.
DEA BROTHERS: Unsecureds to Get 5% Return in Plan
-------------------------------------------------
DEA Brothers Sisters LLC submitted a Second Amended Chapter 11 Plan
and a corresponding Disclosure Statement.
This is a "single asset real estate case." As such, the valuation
in issue in this case pertains to Debtor's multi-tenant retail
strip center located at 16502 S. Main St., Carson, CA 90248 ("the
subject"). The Debtor formally employed, with Court permission,
the appraisal services of Mr. Roger Douglass who issued a formal
appraisal of value for the subject in the amount of $1,445,000.
The anticipated future of the company appears bright at this time
if Debtor is permitted to continue ownership and management of the
subject property. The Debtor's very effective management has been
able to procure actual vacancies for unit no 2 (now unit 2 and 3)
and 5 even in view of the Los Angeles County Eviction Moratorium.
The Debtor has effectively rehabbed and prepared unit 2 (now 2 and
3) and hopes to lease them at a prevailing market rent. On the
other hand, unit no. 5 has essentially been trashed by the tenant
and extensive rehab efforts are underway with the hope that this
unit will be ready for market in 30 days.
If each of these units were rented within the next 6 to 12 months,
this could effectively increase gross income from $10,400 to
$13,479. -- which would enable Debtor to withstand vacancy from
existing units with overmarket rents (units 1,4, and 6) or allow
Debtor to renegotiate lease rates, if necessary, to retain the
existing tenants at market rate. Due to Mr. Jiwani's personal
contribution, however, the property will be able to withstand the
vacancy and plan obligations.
Classes of General Unsecured Claims
As to Class 2, if the Court rules that A&G's two 2017 tax liens in
favor of the IRS and FTB, previously secured on the subject
property, are to remain Debtor's responsibility for repayment
within this Plan, Debtor will move this Court, pursuant to 11
U.S.C. Section 506, to find that each of these claims shall be
deemed a general unsecured claim as there is no property equity to
support either of them:
(a) IRS 2017 Tax Lien: $288,982
(b) FTB 2017 Tax Lien: $10,883
--------
$299,865
Each lien will be repaid on the basis of a 5% return, 0% interest,
on a quarterly basis for 4 years to be fully consistent with 11
U.S.C. Section 1129(a)(9)(D). The IRS lien will therefore be paid
$301.02 per month for 48 months. The FTB lien will be paid $11.34
per month for 48 months. The 95% remaining balance of these liens
shall remain the sole responsibility for payment by A&G and Ignacio
Gonzalez as their unpaid balance will be general unsecured debts
which are no longer the responsibility of the Debtor to pay. The
same payment formula (5% at 0% interest over 48 months) will apply
where the Court finds that only a single lien shall remain Debtor's
responsibility but the Class 2 payment shall be reduced.
Alternative to Class 2: If this Court rules that the Tax Liens or
either Tax Lien should be the sole and exclusive liability of A&G
and/or Ignacio Gonzalez, that lien/those liens will not be included
within Class 2 for any repayment. Debtor's motion to the court
asking for this relief is scheduled for November 4, 2021.
Class 3 relates directly to the amount of A&G's 4th Lien which was
previously secured on the subject property as a purchase money
lien. Debtor will move that this Claim shall be deemed a general
unsecured debt within this Plan and be paid as such, based upon the
following:
* Scenario #1; A&G Claim of $400,845.38: this claim will be
paid on the basis of a 5% return with a balance of $20,042.27, 0%
interest, payable at $334.04/mo. on a quarterly basis for maximum
period of 5 years;
* Scenario #2: A&G' claim of $287,202: this claim will be paid
on the basis of a 5% return with a balance of $14,360., 0%
interest, payable at $239.33/mo. on a quarterly basis for maximum
period of 5 years.
Payments for each and every General Unsecured Class shall be paid
on the basis of a 5% return, 0% interest, over a 5-year period to
be paid quarterly. The first payments shall begin on the 1st day
of the month following the Effective Date of the Chapter 11 Plan.
The Final Payments may occur as late as the 60th month of the Plan
(following Quarterly Payments to that date).
The funding of the Plan will be accomplished through "available
cash" on the Effective Date of the Plan, the scheduled "future
monthly disposable income", and up-front capitalization and monthly
contributions on an as needed basis.
Attorney for the Debtor:
John H. Bauer, Esq.
Financial Relief Legal Advocates, Inc.
56925 Yucca Trail, #512
Yucca Valley, CA 92284
Telephone (714) 319-3446
Email: Johnbhud@aol.com
A copy of the Disclosure Statement dated October 27, 2021, is
available at https://bit.ly/2Zxzh6e from PacerMonitor.com.
About DEA Brothers Sisters
DEA Brothers Sisters, LLC, is a Laguna Hills, Calif.-based company
that owns a strip shopping center located at 16502 S. Main St.,
Carson, California.
DEA Brothers Sisters sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. Cal. Case No. 21-10608) on March 10,
2021. In the petition signed by Enayat Ali Jiwani, the sole
managing member, the Debtor disclosed between $1 million and $10
million in both assets and liabilities. Judge Erithe A. Smith
oversees the case. Financial Relief Legal Advocates, Inc. and
Osborn Plasse serve as the Debtor's legal counsel.
DELPHI CORP: Lawmakers Support Retirees' High Court Review Bid
--------------------------------------------------------------
Rachel Stone, writing for Law360, reports that a mostly Republican
group of federal lawmakers urged the U.S. Supreme Court to hear
Delphi Corp. retirees' challenge to the Pension Benefit Guaranty
Corp.'s decision to shutter their pension plan after the auto parts
maker filed for bankruptcy, arguing the move undermined trust in
government regulators.
Fourteen Republican lawmakers and two Democrats, led by Rep.
Michael R. Turner, R-Ohio, filed an amicus brief Thursday, asking
the nation's highest court to grant the retirees' October 2021
petition for high court review. The lawmakers, 15 from the House
and one from the Senate, threw their weight behind the retirees'
push for Supreme Court review.
About Delphi Corp.
Based in Troy, Michigan, Delphi Corporation --
http://www.delphi.com/-- is a global supplier of electronics and
technologies for automotive, commercial vehicle and other market
segments. Delphi operates major technical centers, manufacturing
sites and customer support facilities in 30 countries.
The Company filed for Chapter 11 protection (Bankr. S.D.N.Y. Lead
Case No. 05-44481) on Oct. 8, 2005. Skadden, Arps, Slate, Meagher &
Flom LLP, represented the Debtors in their restructuring efforts.
Latham & Watkins LLP, represented the Official Committee of
Unsecured Creditors. As of June 30, 2008, the Debtors' balance
sheet showed $9.16 billion in assets and $23.7 billion in debt.
The Court confirmed Delphi's plan on Jan. 25, 2008. The Plan was
not consummated after a group led by Appaloosa Management, L.P.,
backed out from their proposal to provide $2.55 billion in equity
financing to Delphi. At the end of July 2009, Delphi obtained
confirmation of a revised plan, build upon a sale of the assets to
a entity formed by some of the lenders who provided $4 billion of
debtor-in-possession financing, and General Motors Company.
On Oct. 6, 2009, Delphi's Chapter 11 plan of reorganization became
effective. A Master Disposition Agreement executed among Delphi
Corporation, Motors Liquidation Company, General Motors Company, GM
Components Holdings LLC, and DIP Holdco 3, LLC, divides Delphi's
business among three separate parties -- DPH Holdings LLC, GM
Components, and DIP Holdco 3.
Delphi emerged from Chapter 11 as DPH Holdings. DPH Holdings is
responsible for the post-Effective Date administration and eventual
closing of the Chapter 11 cases as well as the disposition of
certain retained assets and payment of certain retained liabilities
as provided under the Modified Plan.
Delphi Automotive PLC is a UK-based company formed in May 2011 as a
holding company for US-based automotive parts manufacturer Delphi
Automotive LLP. Delphi Automotive LLP is the successor to the
former Delphi Corporation. At the time of its formation, Delphi
Automotive PLC filed an initial public offering seeking to raise at
least $100 million.
DELTA COUNTY MEMORIAL: S&P Cuts Revenue Bonds Rating to 'CCC+'
--------------------------------------------------------------
S&P Global Ratings lowered its long-term rating to 'CCC+' from 'BB'
on Delta County Memorial Hospital District (doing business as Delta
County Memorial Hospital, or DCMH), Colo.'s $10.4 million series
2010 revenue bonds. The outlook is negative.
"The lower rating and negative outlook reflect our view of DCMH's
unsustainable financial trajectory due to its rapidly declining
cash, the filing of two waivers due to debt service coverage
covenant violations in 2019 and 2020, as well as operating losses
and underlying cash declines continuing through interim 2021," said
S&P Global Ratings credit analyst Blake Fundingsland. "The negative
rating action is also driven by our view of DCMH's increased
governance risks under our environmental, social, and
governance--or ESG--factors assessment due to its poor risk
mitigation culture related to management as well as the board's
unwillingness and/or lack of progress in resolving the waivers to
eliminate debt acceleration risk," Mr. Fundingsland added.
S&P said, "Also under our ESG assessment, we view DCMH's social
risk to be elevated compared with its peers, given that the
hospital's operations are situated in a very limited-service area,
with a population well below 100,000. The area remains challenged
by population and employment growth that is below national
averages; therefore, we do not expect this to change during the
outlook period. In addition, we view DCMH's social risk to be
further elevated related to the pandemic and low vaccination rates,
which could lead to additional future surges as well as rising care
costs and additional pandemic-related expenses. We view DCMH's
environmental risk as in line with peers but note there have
historically been wildfires in the region, though the hospital has
had no issues with wildfires in recent years."
Delta County Memorial Hospital is a 49-staffed-bed acute care
hospital located in Delta, Colo., approximately 275 miles southwest
of Denver.
DIXIE CENTERS: Seeks to Hire Frank & De La Guardia as Counsel
-------------------------------------------------------------
Dixie Centers, LLC seeks approval from the U.S. Bankruptcy Court
for the Southern District of Florida to hire Michael A. Frank, Esq.
and the Law Office of Frank & De La Guardia as its counsel.
The firm will render these services:
a. advise the Debtor with respect of its rights, powers and
duties as Debtor in possession;
b. prepare all necessary applications, motions, draft orders,
other pleadings, notices, schedules and other documents, and review
all financial and other reports;
c. advise and prepare response to applications, motions, other
pleadings, notices and other papers that may be filed and served in
this Chapter 11 case, including complying with the U.S. Trustee's
Operating Guidelines and Reporting Requirements and with the rules
of the Court;
d. advise the Debtor with respect to and assist in the
negotiation and documentation of, financing agreements, debt and
cash collateral orders and related transactions;
e. review the nature and validity of any liens asserted
against the Debtor's property and advise the Debtor concerning the
enforceability of such liens;
f. counsel the Debtor in connection with the formulation,
negotiation and promulgation of a plan of reorganization and
related documents;
g. advise and assist the Debtor in connection with any
potential property dispositions;
h. advise on executory contract and unexpired lease
assumptions, assignments and rejections and lease restructuring and
recharacterizations;
i. assist the Debtor in reviewing, estimated and resolving
claims asserted against the Debtor's estate;
j. commence and conduct any and all litigation necessary or
appropriate to assert rights held by the Debtor, protect assets of
the Debtor's Chapter 11 estate or otherwise further the goal of
completing the Debtor;s successful reorganization;
k. provide general corporate, litigation and other
non-bankruptcy services for the Debtor as requested by the Debtor;
and
l. perform all other necessary or appropriate legal services
in connection with this chapter 11 case for ot on behalf of the
Debtor.
The firm will bill $550 per hour for counsel's time and paralegal
rate is $175 per hour.
Michael Frank, Esq., a partner at Frank & De La Guardia, disclosed
in a court filing that he is a disinterested person as defined by
Section 101(14) of the Bankruptcy Code.
The firm can be reached through:
Michael A. Frank, Esq.
LAW OFFICES OF FRANK & DE LA GUARDIA
10 NW Le Jeune Rd, Suite 620
Miami, FL 33126
Tel: (305) 443-4217
Email: Pleadings@bkclawmiami.com
About Dixie Centers, LLC
Dixie Centers, LLC is a Single Asset Real Estate debtor (as defined
in 11 U.S.C. Section 101(51B)).
Dixie Centers, LLC filed its voluntary petition for relief under
Chapter 11 of the Bankruptcy Code (Bankr. S.D. Fla. Case No.
21-19343) on Sept. 28, 2021. The petition was signed by Henri Hage
as manager. At the time of filing, the Debtor estimated $4,200,008
in assets and $1,857,120 in liabilities.
Judge Peter D. Russin presides over the case.
Michael A. Frank, Esq. at the LAW OFFICES OF FRANK & DE LA GUARDIA
represents the Debtor as counsel.
DLR EXPRESS: $104K Unsecured Claims to Recover 100% in 6 Months
---------------------------------------------------------------
DLR Express Inc. filed with the U.S. Bankruptcy Court for the
Central District of California a Disclosure Statement describing
Chapter 11 Plan of Reorganization dated October 28, 2021.
Fatima Del Carmen De La Rosa is the owner and 100% shareholder of
the Debtor. Debtor is in the business of providing Class 8
transportation services utilizing Truck and Dry Van Trailers (which
is a combination of 48 and 53-foot box trailers). The Debtor's
trucking business is the Debtor's primary asset. The asset is well
managed and is generating positive cash flow.
Ronald E. Foster Jr. sued the Debtor in the state court case
entitled Ronald E. Foster Jr., 17 et al., v. DLR Express, Inc.,
LASC Case No.: BC652708. The judgment was obtained in May 18 2020.
Debtor's inability to settle this lawsuit precipitated the filing
of this bankruptcy case.
In summary, this is a reorganizing plan that provides for payment
to holders of allowed claims over time. The timing of plan payments
to particular creditor groups will depend upon 16 their
classification under the Plan. Debtor filed this case in order to
reduce its obligations and to reorganize.
The general unsecured claims as of the Petition Date totaled
$6,612,854 which included obligations owed to various vendors,
paycheck protection loan, lines of credit, and a personal injury
claim for $6,094,702 by Ronald E. Foster, Jr, et al., arising from
the Los Angeles Superior Court Case entitled Ronald E. Foster Jr.,
et al v. DLR Express, Inc., LASC Case No.: BC652708. The judgment
was obtained in May 2020.
Since the filing of the case, the Debtor was able to resolve
Foster's claim through its insurance carrier, as a result of which
Foster withdrew its claim. The general unsecured claims as ofthe
date of this Disclosure Statement is $351,361.11. This amount
includes 2 Union Bank claims for which the Debtor's principal, as a
guarantor, reached a settlement agreement with Union Bank and is
currently making payments pursuant to the settlement agreement. The
total general unsecured claims that will receive a 100%
distribution through Debtor's Plan within six months from the
Effective Date is $103,724.33.
Class 2 General Unsecured Claims
Class 2(A): Class 2(A) includes the pre-petition claim of Pilot
Travel Centers, LLC which was 12 deemed a critical vendor and paid
in full by the Debtor.
Class 2(B): General unsecured claims are unsecured claims treated
in Class 2B which are not entitled to priority under Code §507(a).
In the present case, the Debtor estimates that there are
approximately $103,724 in general unsecured debts which will be
receiving a 100% distribution through Debtor's plan within six
months from the Effective Date.
Holders of General Unsecured Claims will receive their pro-rata
share of $17,287 per month for a total of $103,724 over six months
of the Plan. The payments will start on the Effective Date and
will continue for five consecutive months until paid in full.
The Debtor will fund the Plan from the continued operation of its
trucking business.
Management of the Reorganized Debtor will remain with its
President, Fatima Del Carmen De La Rosa. Ms. Rosa, as the President
and CEO of the Debtor, handles the majority of the business
operation, including the marketing, customer service, order
fulfillment, and sales. She works approximately 60 hours per week
and her monthly authorized compensation is $6,400.00 per month
(paid weekly at $1,600).
A full-text copy of the Disclosure Statement dated October 28,
2021, is available at https://bit.ly/3CzVxuR from PacerMonitor.com
at no charge.
Attorney for Debtor:
Michael Jay Berger, Esq.
Law Offices of Michael Jay Berger
9454 Wilshire Boulevard, 6th Floor
Beverly Hills, CA 90212-2929
Tel: (310) 271-6223
Fax: (310) 271-9805
E-mail: michael.berger@bankruptcypower.com
About DLR Express
DLR Express, Inc., based in Fontana, CA, filed a Chapter 11
petition (Bankr. C.D. Cal. Case No. 20-15258) on Aug. 1, 2020. The
petition was signed by Fatima Del Carmen De La Rosa, president. In
its petition, the Debtor was estimated to have $1 million to $10
million in both assets and liabilities. The Hon. Scott H. Yun
presides over the case. The LAW OFFICE OF MICHAEL JAY BERGER,
serves as bankruptcy counsel to the Debtor.
ENSEMBLE RCM: S&P Affirms 'B' ICR, Off CreditWatch Positive
-----------------------------------------------------------
S&P Global Ratings affirmed its 'B' issuer credit rating on
Ensemble RCM LLC and its 'B' issue-level rating on its first-lien
secured debt and removed the ratings from CreditWatch, where S&P
placed them with positive implications on Oct. 4, 2021. S&P '3'
recovery rating on the senior secured debt remains unchanged,
indicating its expectation for meaningful (50%-70%; rounded
estimate: 55%) recovery in the event of a default.
The affirmation follows Ensemble's announcement that it is
postponing its IPO, which it had planned to use the proceeds from
to repay debt. S&P said, "The rating incorporates our expectation
that it will maintain an aggressive financial policy, including
undertaking leveraging events such as debt-funded dividends (as it
did in February 2021), due to its financial-sponsor ownership. We
believe Ensemble's leverage will remain in the 5x-6x range after
2021 based on its growth trajectory (expected EBITDA increases of
more than 20% in 2021 and in the mid-single digit percent area in
2022 and 2023) and financial policy."
S&P said, "We expect the company to maintain its strong growth
trajectory in 2021, though we anticipate its expansion will
moderate to more traditional levels in 2022 due to its addition of
new contracts. Ensemble outperformed our expectations in 2021 due
to a strong rise in its end-to-end contracts, as well as a recovery
in its patient volume following a steep drop off in 2020 due to the
pandemic. While the company's EBITDA margins are slightly
compressed due to the elevated operating expenses associated with
adding the new end-to-end contracts, we expect its margins to
recover and anticipate each new contract will have a more muted
effect on its margins as it expands.
"We continue to believe Ensemble's high customer concentration,
with Bon Secours Mercy Health (BSMH) accounting for more than 50%
of its revenue, leaves it vulnerable to events that reduce its top
customer's revenue, including divestitures or closures." This
concentration risk is partly mitigated by its 10-year contract and
the customer's significant minority equity ownership in Ensemble.
The company also faces risks related to the consolidation of the
hospital industry, given that the remainder of its customer base
includes smaller health systems that may become the target of
consolidators, which could lead to client losses.
The RCM industry is highly competitive and fragmented and many
hospital systems use in-house resources and multiple vendors to
manage their revenue cycle operations. The complex and
ever-changing dynamics of the health care industry, such as
declining reimbursement rates and evolving payment models, continue
to create challenges for health systems. Health care providers that
cannot effectively manage these changes, and thus their
receivables, themselves often look to RCM providers to increase
their revenue yields, lower their collection costs, and improve
their working capital by reducing their days sales outstanding. RCM
relationships are generally durable and mutually beneficial, though
its clients do occasionally change providers.
Ensemble has a relatively short operating track record because most
of its key customer relationships are less than 10 years old. The
company competes against larger competitors with greater resources,
including subsidiaries of hospital systems such as Conifer Health
(subsidiary of Tenet Healthcare Corp.) and Optum360 (subsidiary of
United Healthcare), as well as other large companies such as R1
RCM. It also faces the risk of elevated competition from RCM
software-only providers that do not assume the full suite of
collection functions for their customers. However, Ensemble's
long-term contracts, full outsourcing services, and ability to
reduce its collection costs creates a level of stickiness that
reduces the risk of a client bringing their RCM operations in-house
or switching to a pure software as a service (SaaS) provider.
S&P said, "The stable outlook on Ensemble reflects our expectation
that its S&P Global Ratings-adjusted debt to EBITDA will remain in
the 5x-6x range, with periods of deleveraging followed by
debt-funded dividends and acquisitions. The outlook also reflects
our expectation that the company will continue to increase its
EBITDA by adding new clients.
"We could consider lowering our rating on Ensemble if we expect it
to sustain S&P Global Ratings-adjusted debt to EBITDA of more than
7x and free cash flow to debt of less than 3%. This could occur due
to the loss of several customers or because it undertakes a
significant debt-funded dividend or acquisition.
"We could consider raising our rating on Ensemble if it further
establishes a track record of attracting and retaining a more
diversified client base and we expect its S&P Global
Ratings-adjusted debt to EBITDA to generally remain in the 5x area
or below. However, we view this scenario as unlikely due to its
financial-sponsor ownership."
EXPRESS GRAIN TERMINALS: Farmers Could Lose Big from Bankruptcy
---------------------------------------------------------------
Mark H. Stowers of The Enterprise-Tocsin reports that Express Grain
Terminals, a family-owned business in Greenwood, filed for
bankruptcy on Sept. 30, 2021, leaving many Delta farmers, at least
for now, empty-handed for crops they've toiled over all season.
Some local farmers are saying they're being told they'll be the
last to get paid if they get paid at all.
In a previously published story in the Greenwood Commonwealth, John
Coleman, the company's president, said in a statement that Express
Grain had filed for bankruptcy in order to "Reorganize its business
and continue its operation as normal."
He declined to elaborate further, the paper said.
Coleman, a Greenwood native, has an engineering degree from
Vanderbilt and formerly worked for Dell Computer as a programmer in
Austin, Texas.
Express Grain operatesgrain storage elevators in Greenwood,
Sidon and Minter City. In recent years, the company invested $3
million into the production of biodiesel, using much of the soybean
oil it processes as the feedstock for the alternative fuel,
according to the Commonwealth.
Sunflower County farmer, Strider McCrory, took a portion of his
crop to Express Grain. Now, he says he could be out all of that
money.
This was about the fourth crop I've done business with them,"
McCrory said. "They took Chapter 11 originally and said they did
that so they could pay farmers first."
According to McCrory, he was informed farmers are unsecured
creditors in the case and may not get any payments.
Two public meetings have been held regarding the situation.
The first one was hosted by bankruptcy lawyers looking to represent
local farmers and try to explain the process.
A second meeting was held this past Monday at Pillow Academy and
hosted by CR3, a national turnaround and performance improvement
firm. They have been brought in to help Express Grain through the
bankruptcy process.
The Enterprise-Tocsin was not in attendance, but we were told by
those who were that an estimated 75 farmers attended the meeting.
Farmers are used to timing the market, finding ways to cooperate
with Mother Nature and trying to break even to do it all again the
next season.
But when the prices have been settled and grain has been delivered,
that's normally a time to take a breath.
McCrory admits he's been overwrought by the situation.
"It's been a lot of sleepless nights and a lot of worry at no fault
of my own," he said. "I've worked more acreage and had less
workers due to COVID and made a really good crop, and market prices
were good, and we had the rug pulled out from underneath us on this
deal. I have enough crop at the other place where I'll pay out and
be able to live and farm again next year. But there are others
involved who won't. There are farmers who had 100 percent of their
crop there and they haven't been paid a penny yet. It may put them
out of business. For most, this is all they know, and it's been
their life. This will take them out of that life."
According to the Commonwealth, Coleman had previously told the
newspaper that Express Grain employs about 180 people, two-thirds
of whom work in Greenwood.
At that time, the mill was processing about 25,000 gallons of
soybean oil a day. It also processes soybean products, such as meal
and hulls for animal feed, that are the offshoots after the beans
are crushed for their oil, the story said.
The case is under the jurisdiction of former Indianola resident,
Selene Dunn Maddox in the U.S. Bankruptcy Court Northern District
of Mississippi.
She began practicing law in the late 1980s after graduating from
Delta State University and Ole Miss. Maddox practiced bankruptcy
law in Jackson and Greenwood before opening her private practice in
Tupelo in 1991.
About Express Grains Terminals
Greenwood, Mississippi-based Express Grain Terminals, LLC, produces
soy products such as oil and biodiesel.
Express Grains Terminals sought Chapter 11 protection (Bankr. N.D.
Miss. Case No. 21- 11832) on Sept. 29, 2021. In the petition signed
by John Coleman as member, Express Grains Terminals estimated
assets of between $10 million and $50 million and estimated
liabilities of between $50 million and $100 million. The Law
Offices of Craig M. Geno, PLLC, is the Debtor's counsel.
EXPRESS GRAIN: Wins Cash Collateral Access Thru Nov 6
-----------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Mississippi
has authorized Express Grain Terminals, LLC and affiliates to,
among other things, use cash collateral on an interim basis and
provide adequate protection.
The Debtors assert that an immediate need exists for the Business
Debtors to use Cash Collateral in order to continue essential
operations, acquire goods and services, and pay other necessary and
essential business expenses.
UMB Bank, N.A., the Debtors' principal secured lender, asserts
various interests in substantially all of the Business Debtors'
personal and real property including, without limitation,
inventory, farm products, and accounts receivable. Further, the
Bank asserts interests in Cash Collateral including, without
limitation, the cash constitutes proceeds of the Collateral and,
therefore, constitutes cash collateral within the meaning of
Bankruptcy Code section 363(a). The Bank has not agreed to the
Debtor's request but negotiations with the Bank are continuing.
StoneX Commodity Solutions LLC f/k/a FC Stone Merchant Services
LLC, Macquarie Commodities (USA) Inc., UMB, and several other
interested parties (including production lenders) assert lien
and/or ownership interests in certain pre-petition soybeans and
corn stored by one or more of the Business Debtors.
The Pre-Petition Grain was generally held in common storage and not
segregated by the party asserting ownership and/or lien rights in
such Pre-Petition Grain. Accordingly, the proceeds from the use and
sale of the Pre-Petition Grain may also be considered, at least in
part, Cash Collateral.
In the ordinary course of the Business Debtors’ business
operations, the Business Debtors maintain certain bank accounts
with UMB, which provide established mechanisms for the collection,
management, and disbursement of funds used in the Business Debtors'
operations. The Business Debtors also maintain bank accounts with
BankPlus. After the Petition Date, Express Grain Terminals, LLC
received sale proceeds for the sale of soybeans in the amount of
$4,614,293 which, pursuant to previous Order of the Court, are
currently being held in DIP Accounts maintained by UMB.
The Business Debtors are also permitted to continue to manage
collection and disbursement of its cash utilizing its Cash
Management System in the ordinary
course of business consistent with its prepetition practices, and
to collect and disburse cash in accordance with the Cash Management
System.
The Business Debtors will continue their Cash Management System
with UMB.
The Business Debtors also will continue to take steps to close all
existing banking accounts at other financial institutions and
centralize their depository accounts with UMB, including, but not
limited to any debtor-in-possession accounts that the Business
Debtors may open and will not open any additional accounts at any
other financial institutions without (i) giving adequate notice to
the United States Trustee, UMB, and such other parties as the Court
may direct, and (ii) receiving the express written consent from
UMB, or Court approval.
The Business Debtors will continue to maintain a separate DIP
Account at UMB holding the $4,614,293 in sale proceeds from the
sale of soybeans, which were received after the Petition Date.
The Business Debtors and UMB are authorized to continue to perform
pursuant to the terms of any prepetition agreement that exists
between them relating to any Bank Account, or other cash management
service relating to the Cash Management System, except to the
extent expressly prohibited by the Order, and the parties to such
agreements will continue to enjoy the rights, benefits, liens,
offset rights, privileges and remedies afforded them under such
agreements except to the extent expressly modified by the terms of
the Order.
As adequate protection for the Debtors' use of cash collateral, the
Bank is granted replacement security interests in, and liens on,
all post-Petition Date acquired property of the Business Debtors
and the Business Debtors' bankruptcy estates to the extent of the
validity and priority of such interests, liens, or security
interests, if any.
To the extent the Replacement Liens prove inadequate to protect the
Bank from a demonstrated diminution in the value of the Bank's
collateral position from the Petition Date, the Bank is granted an
administrative expense claim under section 503(b) of the Bankruptcy
Code with priority in payment under section 507(b).
The Debtor's authority to use cash collateral and the Pre-Petition
Grain will expire, unless extended by further Court order or by
express written consent of UMB and the other PrePetition Grain
Interest Holders, on the earlier of (i) November 6, 2021; (ii) the
first business day after the date of the final hearing on the
Debtor's use of Cash Collateral and Pre-Petition Grain (and
proceeds therefrom); (iii) the failure of the Debtors to comply
with any provision of the Order; (iv) the entry of an order
authorizing, or if there will occur, a conversion or dismissal of
this case under Code section 1112; (v) the entry of an order
appointing a trustee, or appointing an examiner with powers
exceeding those set forth in Code section 1106(b); (vi) the closing
of a sale of all or a substantial portion of the assets of the
Business Debtors; (vii) the cessation of day-to-day operations of
the Business Debtors; (viii) any loss of accreditation or licensing
of the Business Debtors that would materially impede or impair the
Business Debtors' ability to operate as a going concern; (ix) the
termination of the Interim CRO or the failure to obtain an order of
the Court approving the appointment of the Interim CRO on a final
basis within 30 days from the date of entry of this Order; (x) the
failure of the Business Debtors to receive PrePetition Beam
Proceeds sufficient to cover the Third Party Proceeds attributable
to the use and/or sale of Pre-Petition Grain; and (xi) any material
provision of the Order for any reason ceases to be enforceable,
valid, or binding upon the Debtors.
A further interim hearing on the matter is scheduled for November 5
at 9 a.m.
A copy of the order and the Debtors' budget through the week ending
November 12 is available at https://bit.ly/3bzQ5N0 from
PacerMonitor.com.
The budget provided for $2,947,715 in total operating disbursements
for the week ending November 5 and $2,544,530 for the week ending
November 12.
About Express Grains Terminals
Greenwood, Mississippi-based Express Grain Terminals, LLC, produces
soy products such as oil and biodiesel.
Express Grains Terminals sought Chapter 11 protection (Bankr. N.D.
Miss. Case No. 21- 11832) on Sept. 29, 2021. In the petition
signed by John Coleman as member, Express Grains Terminals
estimated assets of between $10 million and $50 million and
estimated liabilities of between $50 million and $100 million.
Judge Selene D. Maddox oversees the case.
The Law Offices of Craig M. Geno, PLLC, is the Debtor's counsel.
UMB Bank, N.A., as lender, is represented by:
Eric L. Johnson, Esq.
Peter R. Riggs, Esq.
Andrea M. Chase, Esq.
1000 Walnut St., Suite 1400
Kansas City MO 64106
Tel: (816) 474-8100
Fax: (816) 474-3216
Email: ejohnson@spencerfane.com
priggs@spencerfane.com
achase@spencerfane.com
FANNIE MAE: Reports Net Income of $4.8 Billion for Third Quarter
----------------------------------------------------------------
Federal National Mortgage Association filed filed with the
Securities and Exchange Commission its Quarterly Report on Form
10-Q disclosing net income of $4.84 billion on $24.98 billion of
total interest income for the three months ended Sept. 30, 2021,
compared to net income of $4.23 billion on $26.05 billion of total
interest income for the three months ended Sept. 30, 2020.
For the nine months ended Sept. 30, 2021, the Company reported net
income of $16.99 billion on $73.65 billion of total interest income
compared to net income of $7.24 billion on $82.77 billion of total
interest income for the nine months ended Sept. 30, 2020.
As of Sept. 30, 2021, the Company had $4.21 trillion in total
assets, $4.17 trillion in total liabilities, and $42.17 billion in
total stockholders' equity.
"It was another strong quarter for the housing market and for
Fannie Mae. Our results reflect the credit quality of our guaranty
book, a growing economy, strong home price growth, and low interest
rates. However, rising home prices, while good for homeowners and
others involved with selling a home, can negatively impact
affordability for first-time homebuyers. For too many lower- and
middle-income families, affordable housing options are scarce and
inequities persist in the housing economy. We look forward to
continuing to work with FHFA and others to advance equitable and
sustainable access to homeownership and affordable, quality rental
housing for communities across America," said Hugh R. Frater, chief
executive officer.
A full-text copy of the Form 10-Q is available for free at:
https://www.sec.gov/ix?doc=/Archives/edgar/data/310522/000031052221000557/fnm-20210930.htm
About Fannie Mae and Freddie Mac
Federal National Mortgage Association (OTCQB: FNMA), commonly known
as Fannie Mae, is a government-sponsored enterprise (GSE) that was
chartered by U.S. Congress in 1938 to support liquidity, stability
and affordability in the secondary mortgage market, where existing
mortgage-related assets are purchased and sold. Fannie Mae helps
make the 30-year fixed-rate mortgage and affordable rental housing
possible for millions of Americans. The Company partners with
lenders to create housing opportunities for families across the
country. Visit -- http://www.FannieMae.com
Fannie Mae has been under conservatorship, with the Federal Housing
Finance Agency ("FHFA") acting as conservator, since Sept. 6, 2008.
As conservator, FHFA succeeded to all rights, titles, powers and
privileges of the company, and of any shareholder, officer or
director of the company with respect to the company and its assets.
The conservator has since provided for the exercise of certain
authorities by the Company's Board of Directors. The Company's
directors do not have any fiduciary duties to any person or entity
except to the conservator and, accordingly, are not obligated to
consider the interests of the company, the holders of the Company's
equity or debt securities, or the holders of Fannie Mae MBS unless
specifically directed to do so by the conservator.
A brother organization of Fannie Mae is the Federal Home Loan
Mortgage Corporation (FHLMC), better known as Freddie Mac Freddie
Mac (OTCBB: FMCC) -- http://www.FreddieMac.com-- was established
by Congress in 1970 to provide liquidity, stability and
affordability to the nation's residential mortgage markets. Freddie
Mac supports communities across the nation by providing mortgage
capital to lenders.
As of June 30, 2021, Fannie Mae had $4.15 trillion in total assets,
$4.12 trillion in total liabilities, and $37.34 billion in total
stockholders' equity.
FIRSTCASH INC: Moody's Puts Ba1 CFR Under Review for Downgrade
--------------------------------------------------------------
Moody's Investors Service has placed on review for downgrade
FirstCash Inc.'s Ba1 long-term senior unsecured and corporate
family ratings. The rating action followed FirstCash's
announcement[1] that it had entered into an agreement to acquire
lease-to-own and retail finance provider American First Finance,
Inc. (AFF).
On Review for Downgrade:
Issuer: FirstCash Inc.
Corporate Family Rating,Placed on Review for Downgrade, currently
Ba1
Senior Unsecured Regular Bond/Debenture, Placed on Review for
Downgrade, currently Ba1
Outlook Actions:
Issuer: FirstCash Inc.
Outlook, Changed To Rating Under Review From Stable
RATINGS RATIONALE/FACTORS THAT COULD LEAD TO AN UPGRADE OR
DOWNGRADE OF THE RATINGS
Moody's said its review for downgrade would focus on assessing the
impact of the acquisition on FirstCash's credit profile, including
the combined entity's leverage, profitability, liquidity, asset
quality, capital, risk appetite and operating environment. Moody's
said FirstCash has disclosed that the transaction is valued at
approximately $1.17 billion at closing, with up to an additional
$300 million of consideration payable if AFF achieves certain
performance targets. FirstCash said it would fund the acquisition
through a combination of common stock and cash, with the cash
portion of the transaction being funded through a combination of
cash on hand and debt financing.
Moody's considers the planned acquisition to be transformative for
FirstCash, given the magnitude of the purchase price, the relative
size of the entities, and because lease-to-own is a new business
segment for the company whose focus has been pawn lending and
retail merchandise sales.
Given the review for downgrade, a ratings upgrade is unlikely over
the next 12-18 months. However, the ratings could be confirmed upon
conclusion of the review if Moody's assesses that FirstCash would
maintain strong profitability, capitalization and liquidity, and
would likely be able to quickly delever following the acquisition.
In the longer-term, the ratings could be upgraded should the
acquisition significantly enhance FirstCash's credit profile.
The ratings could be downgraded if Moody's determines that
FirstCash's profitability, leverage or liquidity will meaningfully
and sustainably deteriorate as a result of the acquisition, or if
Moody's assesses that AFF's financial profile or operating
environment is significantly weaker than FirstCash's. Moody's could
also downgrade the ratings if it concludes that the acquisition
represents a significant shift in strategic policy or risk
appetite.
The principal methodology used in these ratings was Finance
Companies Methodology published in November 2019.
FLORIDA TILT: Says Amended Plan Product of Negotiations
-------------------------------------------------------
Florida Tilt, Inc., submitted a First Amended Chapter 11 Small
Business Plan of Reorganization and a corresponding Disclosure
Statement.
According to the Debtor, after much negotiation, a confirmable
first amended chapter 11 plan and approvable first amended
disclosure statement were filed on October 27, 2021. Creditors in
the plan accept plan treatment, according to the Debtor.
General unsecured creditors are classified in Class 4, and will
receive an approximate distribution of 1.4% of their allowed
claims.
Class 4 Allowed General Unsecured Claims total $732,474. The Class
3 creditors shall share pro rata in a total distribution in the
approximate amount of $10,987 which shall be paid in installments
of $1,098.71 bi-annual (every 6 months) over 5 years, i.e. 10
bi-annual payments totaling $10,987.10, with the first payment
beginning the 30th day of the month following the Effective Date of
this Plan.
At plan confirmation, Debtor's Principal Raymond Cartaya agrees to
forego all of his salary and wages due and owing from the Debtor
until the date of Plan confirmation as new value to the Debtor.
The means necessary for the execution of the Plan include the
Debtor's income from its business operations. The Debtor shall,
and believes it can, generate and receive sufficient income to the
amount necessary to enable it to make all payments due under the
Plan.
Attorney for the Debtor:
Ariel Sagre, Esq.
SAGRE LAW FIRM, P.A.
5201 Blue Lagoon Drive, Suite 892
Miami, Florida 33126
Tel: (305) 266-5999
Fax: (305) 265-6223
E-mail: law@sagrelawfirm.com
A copy of the Disclosure Statement dated October 27, 2021, is
available at https://bit.ly/3bl0zPU from PacerMonitor.com.
About Florida Tilt
Florida Tilt, Inc., is in the tilt concrete construction business.
The Debtor sought relief under the Bankruptcy Code to, among other
things, seek confirmation of a plan which modified its secured
obligations and dedicated his anticipated profits towards the
repayment of creditors.
Florida Tilt, Inc., sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. S.D. Fla. Case No. 20-20779) on Oct. 1,
2020, listing under $1 million in both assets and liabilities.
Judge Robert A. Mark oversees the case. Ariel Sagre, Esq., at
Sagre Law Firm, P.A., serves as the Debtor's legal counsel.
FOSSIL GROUP: S&P Rates New $125MM Senior Unsecured Notes 'B'
-------------------------------------------------------------
S&P Global Ratings assigned its 'B' issue-level rating and '4'
recovery rating to Fossil Group Inc.'s proposed $125 million senior
unsecured notes due 2026. The '4' recovery rating indicates its
expectation for average (30%-50%; rounded estimate: 40%) recovery
in the event of a payment default. The company intends to use the
net proceeds from this transaction to repay its $200 million ($122
million outstanding) first-lien term loan facility due September
2024. S&P bases its ratings on the preliminary terms of the
proposed issuance and they are subject to review upon its receipt
of final documentation.
S&P said, "Our 'B' issuer credit rating on Fossil is unaffected by
this transaction, which we expect will be net leverage neutral. We
will withdraw our ratings on the company's existing first-lien term
loan facility once it is repaid.
"Our ratings on Fossil reflect its participation in the highly
fragmented and competitive traditional watches and smartwatch
categories with a portfolio of well-known brands--such as Fossil,
Michael Kors, and Armani Exchange--as well as our expectation that
its operating and financial performance will continue to improve in
the second half of 2021 supported by increased sales during the
holiday season. We expect the company to maintain EBITDA interest
coverage in the high-2x area. We also continue to expect that
consumer demand for Fossil's portfolio of fashion accessories will
remain healthy in 2021. We expect the company to benefit from its
New World Fossil program, along with additional cost-savings
initiatives, which will improve its profitability. We believe this
will counterbalance the sustained reduction in its topline as
traditional watches become less relevant with consumers."
FRESH ACQUISITIONS: Creditors' Bankruptcy Plan Okayed for Vote
--------------------------------------------------------------
Alex Wolf of Law360 reports that Fresh Acquisitions LLC's creditors
won bankruptcy court approval to vote on their plan to liquidate
the former Old Country Buffet owner's estate and preserve legal
claims against the company’s previous managers and related
affiliates.
The bankrupt restaurant chain operator has opposed the creditors'
plan, pushing instead to convert its case to Chapter 7 and have a
court-appointed trustee oversee proceedings.
But Fresh Acquisitions' unsecured creditors committee said its
proposed Chapter 11 plan to wind down the company's estate presents
the only opportunity to receive "any monetary recovery." The
committee already successfully challenged a proposed sale and
investigated potential legal claims.
About Fresh Acquisitions
Fresh Acquisitions LLC and Buffets, LLC, operate independent
restaurant brands and are based in San Antonio, Texas. Prior to the
COVID-19 pandemic, the Debtors were a significant operator of
buffet-style restaurants in the United States with approximately 90
stores operating in 27 states. The Debtors' concepts include six
buffet restaurant chains and a full service steakhouse, operating
under the names Furr's Fresh Buffet, Old Country Buffet, Country
Buffet, HomeTown Buffet, Ryan's, Fire Mountain, and Tahoe Joe's
Famous Steakhouse, respectively.
Buffets Holdings, Inc., filed for Chapter 11 relief in January 2008
and won confirmation of a reorganization plan in April 2009. In
January 2012, Buffets again sought Chapter 11 protection and
emerged from bankruptcy in July 2012.
On Aug. 19, 2015, Alamo Ovation, LLC, acquired Buffets Restaurants
Holdings, Inc., and as a result of the merger, Buffets operated
over 300 restaurants in 35 states. Down to 150 restaurants in 25
states after closing unprofitable locations, Buffets LLC and its
affiliated entities sought Chapter 11 protection (Bankr. W.D. Tex.
Case No. Lead Case No. 16-50557) in San Antonio, Texas, on March 7,
2016. On April 27, 2017, the Court confirmed the Debtors' Second
Amended Joint Plan of Reorganization. The Effective Date of the
Plan was May 18, 2017.
Fresh Acquisitions, LLC and 14 affiliates, including Buffets LLC
(a/k/a Ovation Brands), sought Chapter 11 protection (Bankr. N.D.
Tex. Lead Case No. 21-30721) on April 20, 2021. Fresh Acquisitions
was estimated to have $1 million to $10 million in assets and $10
million to $50 million in liabilities. The Hon. Harlin Dewayne Hale
is the case judge.
In the recent cases, the Debtors tapped GRAY REED as counsel; and
B. RILEY ADVISORY SERVICES as financial advisor. KATTEN MUCHIN
ROSENMAN LLP is special counsel. BMC GROUP, INC., is the claims and
noticing agent. HILCO REAL ESTATE, LLC, is the real estate
consultant.
GENOCEA BIOSCIENCES: Incurs $3.6 Million Net Loss in Third Quarter
------------------------------------------------------------------
Genocea Biosciences, Inc. filed with the Securities and Exchange
Commission its Quarterly Report on Form 10-Q disclosing a net loss
of $3.62 million on $1.64 million of license revenue for the three
months ended Sept. 30, 2021, compared to a net loss of $4.56
million on $453,000 of license revenue for the three months ended
Sept. 30, 2020.
For the nine months ended Sept. 30, 2021, the Company reported a
net loss of $19.92 million on $1.64 million of license revenue
compared to a net loss of $28.73 million on $1.36 million of
license of revenue for the same period during the prior year.
As of Sept. 30, 2021, the Company had $64.92 million in total
assets, $27.09 million in total liabilities, and $37.83 million in
total stockholders' equity.
As of Sept. 30, 2021, cash and cash equivalents were $48.9 million
compared to $79.8 million as of Dec. 31, 2020.
"We continue to make significant progress. Most notably, we are
very excited about our TiTAN clinical trial for GEN-011, our
neoantigen-targeted peripheral T cell therapy (NPT) candidate, from
which we expect to have initial data from a small subset of
patients in the first quarter or early in the second quarter next
year," said Chip Clark, Genocea's president and chief executive
officer. "We are also pleased that our SITC presentations will
continue to showcase the neoantigen selection capabilities of our
ATLAS platform, through differentiated long-term immunogenicity and
clinical response data for GEN-009, our neoantigen-targeted vaccine
candidate, and through its potential application to novel
autoimmune disease treatments."
A full-text copy of the Form 10-Q is available for free at:
https://www.sec.gov/ix?doc=/Archives/edgar/data/1457612/000145761221000102/gnca-20210930.htm
About Genocea Biosciences
Headquartered in Cambridge, Massachusetts, Genocea --
http://www.genocea.com-- is a biopharmaceutical company developing
personalized cancer immunotherapies. The Company uses its
proprietary discovery platform, ATLAS, to profile CD4+ and CD8+T
cell (or cellular) immune responses to tumor antigens.
Genocea reported a net loss of $43.71 million for the year ended
Dec. 31, 2020, compared to a net loss of $38.95 million for the
year ended Dec. 31, 2019. As of June 30, 2021, the Company had
$77.38 million in total assets, $73.33 million in total liabilities
and $4.06 million in total stockholders' equity.
GLOBAL WINDREST I: Gets Access to Cash Collateral
-------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of California
has authorized Global Windcrest I, LLC to use cash collateral on an
interim basis, subject to the terms and conditions of the Cash
Collateral Stipulation.
GW1 is permitted to use cash collateral in accordance with the
budget through December 9, 2021, the date of the final hearing.
No insider compensation or reimbursement to insiders of expenses
will be paid absent further Court order.
The final hearing is scheduled for 10 a.m.
A copy of the Court's order is available at https://bit.ly/3ECQFpK
from PacerMonitor.com.
About Global Windcrest I
Global Windcrest I, LLC and Global Windcrest II, LLC filed
petitions for Chapter 11 protection (Bankr. S.D. Calif. Lead Case
No. 21-03935) on Oct. 1, 2021. At the time of the filing, Global
Windcrest I listed as much as $50 million in both assets and
liabilities while Global Windcrest II listed up to $10 million in
assets and up to $500,000 in liabilities.
Judge Laura S. Taylor oversees the cases.
The Debtors tapped Ron Bender, Esq., at Levene, Neale, Bender, Yoo
& Brill, LLP as bankruptcy counsel and the Law Offices of Vaughn &
Vaughn as special counsel.
GRUPO AEROMEXICO: Milbank Represents BSPO Investors
---------------------------------------------------
In the Chapter 11 cases of GRUPO Aeromexico, S.A.B. de C.V., et
al., the law firm of Milbank LLP submitted a verified statement
under Rule 2019 of the Federal Rules of Bankruptcy Procedure, to
disclose that it is representing the The Baupost Group, L.L.C.,
Invictus Global Management, LLC, Oaktree Capital Management, L.P.,
and Silver Point Capital, L.P.
Milbank represents the BSPO Investors and does not represent or
purport to represent any entities other than the BSPO Investors in
connection with the Debtors' chapter 11 cases. In addition,
neither Baupost, Invictus, Oaktree, nor Silver Point represent or
purport to represent any other entities in connection with the
Debtors' chapter 11 cases.
As of Oct. 27, 2021, each of the BSPO Investors and their
disclosable economic interests are:
The Baupost Group, L.L.C.
10 Saint James Avenue, Suite 1700
Boston, MA 02116
Invictus Global Management, LLC
310 Comal Street Building A, Suite 229
Austin, TX 78702
* Unsecured Claims: $48,537,744.21
Oaktree Capital Management, L.P.
333 South Grand Ave., 28th Floor
Los Angeles, CA 90071
Silver Point Capital, L.P.
2 Greenwich Plaza
Greenwich, CT 06830
* Unsecured Claims: $58,500,000.00
The information contained herein is provided only for the purpose
of complying with Bankruptcy Rule 2019 and is not intended for any
other use or purpose.
Milbank reserves the right to amend this Verified Statement as may
be necessary in accordance with the requirements set forth in
Bankruptcy Rule 2019.
Counsel to The Baupost Group, L.L.C., Invictus Global Management,
LLC, Oaktree Capital Management, L.P., and Silver Point Capital,
L.P. can be reached at:
MILBANK LLP
Dennis F. Dunne, Esq.
Matthew L. Brod, Esq.
55 Hudson Yards
New York, NY 10003
Tel: (212) 530-5000
Fax: (212) 530-5219
- and –
Andrew M. Leblanc, Esq.
1850 K Street, NW, Suite 1100
Washington, DC US 20006
Tel: (202) 835-7500
Fax: (202) 263-7586
A copy of the Rule 2019 filing is available at
https://bit.ly/3mATiC7 at no extra charge.
About Grupo Aeromexico
Grupo Aeromexico, S.A.B. de C.V. (BMV: AEROMEX) --
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.
The Debtors tapped Davis Polk and Wardell LLP as their bankruptcy
counsel, KPMG Cardenas Dosal S.C. as auditor, and Rothschild & Co
US Inc. and Rothschild & Co Mexico S.A. de C.V. as financial
advisor and investment banker. White & Case LLP, Cervantes Sainz
S.C. and De la Vega & Martinez Rojas, S.C., serve as the Debtors'
special counsel. Epiq Corporate Restructuring, LLC, is the claims
and administrative agent.
The U.S. Trustee for Region 2 appointed a committee to represent
unsecured creditors on July 13, 2020. The committee is represented
by Willkie Farr & Gallagher, LLP and Morrison & Foerster, LLP.
GTT COMMUNICATIONS: In Chapter 11 to Cut Debt by $1.16 Billion
--------------------------------------------------------------
GTT Communications, Inc., and certain of its subsidiaries have
commenced prepackaged chapter 11 cases.
GTT Communications has entered into a Restructuring Support
Agreement that provides for a consensual restructuring of the
Company's funded debt obligations to be implemented in two phases:
* The first phase was the consummation of the $2.13 billion sale
of certain of hard assets and related businesses a company
controlled by I Squared Capital Advisors (US) LLC, which closed on
September 16, 2021 and, following which, approximately $1.673
billion in sale proceeds were used to reduce the Company's then
outstanding indebtedness, which resulted in the repayment of the
Priming Term Facility in full and paying down $1.393 billion in
debt under the Credit Agreement.
* The second phase of the Company's restructuring is to be
implemented through the Chapter 11 cases and prosecution of the
Debtors' Joint Prepackaged Chapter 11 Plan of Reorganization.
The restructuring transactions contemplated by the Plan will leave
the Company's business intact while substantially de-leveraging the
Company's balance sheet by reducing its post-I Squared
Infrastructure Sale funded debt burden from approximately $2.015
billion to a projected $854 million upon emergence from these
Chapter 11 cases.
Importantly, the Plan will not impair the allowed claims of any
customer, vendor or employee, and the Debtors are seeking authority
to pay such claims in full when due in the ordinary course of
business.
The Debtors will continue to operate their businesses as "debtors
in possession" under the jurisdiction of the Bankruptcy Court and
in accordance with the applicable provisions of the Bankruptcy Code
and orders of the Bankruptcy Court.
The Company said in a regulatory filing that to assure ordinary
course operations during the pendency of the Chapter 11 cases, the
Debtors are seeking approval from the Bankruptcy Court for a
variety of "first day" motions seeking customary relief and
authorizing the Debtors to maintain their operations in the
ordinary course. The Company has also filed a motion (the "NOL
Motion") seeking entry of an order establishing procedures relating
to transfers of Common Stock in order to preserve certain of the
Company's tax attributes.
Creditors Vote in Favor of Plan
In an SEC filing, GTT said it entered into a Restructuring Support
Agreement on Sept. 1, 2021, with certain consenting stakeholders to
support a restructuring of the indebtedness and capitalization of
the Company and certain of its direct and indirect subsidiaries
pursuant to the terms of the Joint Prepackaged Chapter 11 Plan of
Reorganization of GTT, et al.
On Sept. 24, 2021, the Company commenced solicitation for the
Prepackaged Plan by causing the Prepackaged Plan, a related
disclosure statement and ballots to be distributed to lenders under
a Credit Agreement, dated as of May 31, 2018, by and among the
Company and GTT Communications B.V. ("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, and beneficial owners (or
nominees, investment managers, advisors or subadvisors for the
beneficial owners) of the Company's outstanding 7.875% Senior Notes
due 2024 that are "accredited investors".
As contemplated by the RSA, on Oct. 31, 2021, the Company and its
direct and indirect subsidiaries Communication Decisions -- SNVC,
LLC, Core180, LLC, Electra Ltd., GC Pivotal, LLC, GTT Americas,
LLC, GTT Global Telecom Government Services, LLC, GTT RemainCo,
LLC, GTT Apollo, LLC, and GTT Apollo Holdings, LLC filed voluntary
petitions for relief under Chapter 11 of the Bankruptcy Code in the
United States Bankruptcy Court for the Southern District of New
York to pursue the Prepackaged Plan.
Lenders holding over 88% of the aggregate outstanding principal
amount of loans under the Credit Agreement, and Noteholders holding
over 88% of the aggregate outstanding principal amount of the
Notes, including all Lenders and Noteholders that voted on the
Prepackaged Plan, voted to accept.
EMEA Forbearance
In connection with entering into the RSA, on Sept. 1, 2021, GTT
B.V. and certain other non-U.S. credit parties party thereto --
Non-U.S. EMEA Credit Parties -- entered into a Non-U.S. EMEA Credit
Party Forbearance Agreement -- EMEA Forbearance Agreement -- with
certain Lenders and the Agent. Pursuant to the EMEA Forbearance
Agreement, the Consenting Lenders have agreed to, among other
things, forbear from exercising any and all rights and remedies
under the Loan Documents (as defined in the Credit Agreement) and
applicable law against the Non-U.S. EMEA Credit Parties, including
not directing the Agent to take any such action, with respect to
any defaults and events of default under the Credit Agreement that
have occurred, or that may occur during the forbearance period.
The forbearance period under the EMEA Forbearance Agreement will
continue until the effective date of the Prepackaged Plan, unless
such period is otherwise terminated in accordance with the terms of
the EMEA Forbearance Agreement.
CFO Appointment, Retention Bonuses
The Company disclosed in a filing with the Securities and Exchange
Commission that on Oct. 30, 2021, it appointed Donna Granato as the
Company's Chief Financial Officer. Ms. Granato previously served
as the Company's interim Chief Financial Officer. On Oct. 30,
2021, the Company also entered into an amendment to the employment
agreement, which (i) reflects Ms. Granato's change in title and
(ii) increases Ms. Granato's base salary to $500,000.
The Company previously entered into retention bonus letter
agreements with Ms. Granato, Ernest Ortega, the current Chief
Executive Officer of the Company, and certain other executives of
the Company. On Oct. 27, 2021, the Company entered into second
retention bonus letter agreements with each of the Executives that
is currently employed by the Company. The Second Retention
Agreements provide for the remaining amounts due under each of the
Original Retention Agreements, which were $518,333 for Ms. Granato
and $1,637,867 for Mr. Ortega -- Remaining Bonus Payments -- to be
paid to each applicable Executive on October 28, 2021.
About GTT Communications
Headquartered in McLean, Virginia, GTT Communications, Inc. --
http://www.gtt.net/-- owns and operates a global Tier 1 internet
network and provides a comprehensive suite of cloud networking
services. GTT connects people across organizations, around the
world, and to every application in the cloud.
GTT Communications, Inc., and its affiliates sought Chapter 11
protection (Bankr. S.D.N.Y. Lead Case No. 21-11880) on Oct. 31,
2021, to implement a prepackaged Chapter 11 plan.
GTT had total assets of $2.8 billion and total debt of $4.1 billion
as of June 30, 2201. As of the Petition Date, the Debtors had
prepetition funded indebtedness totaling $2.015 billion.
The Debtors tapped Akin Gump Strauss Hauer & Feld LLP as counsel;
TRS Advisors as investment banker; and Alvarez & Marsal, LLC as
restructuring advisor. Prime Clerk, LLC, is the claims agent.
HARDY ALLOYS: Seeks Access to SBA's Cash Collateral
---------------------------------------------------
Hardy Alloys Inc. asks the U.S. Bankruptcy Court for the Western
District of Texas, San Antonio Division, for authority to use the
cash collateral of the US Small Business Administration.
The Debtor requires the use of cash collateral to sustain ongoing
operations. The Debtor requires the continued use of cash
collateral to make payments on, among other things, fuel, taxes,
rental payments, insurance, payroll, payroll expenses, utility
charges, and the costs of supplies used in the operation of the
business. The expenses are encountered by the Debtor in the
ordinary course of business, and payment of the expenses is
critical to the continued existence of the Debtor and the
administration of the case and bankruptcy estate. The Debtor also
requires the use of cash collateral to pay pre-petition wages and
salaries.
The SBA has a blanket security interest in all of the Debtor's
assets including but not limited to equipment and account
receivables. The amount of the debt owed by the Debtor to SBA is
approximately $41,300.
The balance of the Debtor's bank account was approximately
$7,194.73. The Debtor's accounts receivables were in the
approximate amount of $3,878. The book value of the Debtor's
equipment and other personal property is approximately $31,129.
The Debtor would show at the hearing that the SBA is adequately
protected by its pre-petition liens on the various items of
collateral.
The Debtor proposes to provide the SBA, to the extent required by
the Court, in the form of:
a. Replacement liens on all post-petition inventory and
accounts receivable acquired by the Debtor since the filing of the
petition generated by the use of cash collateral; and
b. The Debtor will remain current on all of its tax
obligations, including but not limited to deposit of employee
withholding for income, Social Security taxes and hospital
insurance (Medicare) and employer's contribution for Social
Security taxes and deposit excise tax, if applicable. The Debtor
will file all present and future returns as they become due.
The Debtor does not propose making monthly adequate protection
payments to the SBA. Payments on the SBA debt had not yet begun as
of the Petition Date.
A copy of the Debtor's request is available at
https://bit.ly/3jZPhW2 from PacerMonitor.com.
About Hardy Alloys Inc.
Hardy Alloys, Inc. filed a petition for Chapter 11 protection
(Bankr. W.D. Texas Case No. 21-51184) on Sept. 30, 2021, listing
under $1 million in both assets and liabilities. Morris E. White
III, Esq., at Villa & White, LLP represents the Debtor as its legal
counsel.
HBL SNF LLC: Nursing Facility in Chapter 11 Amid Landlord Dispute
-----------------------------------------------------------------
HBL SNF, LLC, which runs the 160-bed Epic Rehabilitation and
Nursing at White Plains facility in White Plains, New York, has
sought Chapter 11 protection amid a dispute with landlord White
Plains Healthcare Properties I, LLC.
The Debtor is a 160-bedroom skilled nursing and rehabilitation
facility located at 120 Church Street, White Plains, New York,
which opened in late 2019. As of the Petition Date, the facility
is approximately 75% occupied. The Debtor maintains a staff of
over 250 employees, including registered nurses, therapists and
other healthcare professionals, and offers both short-term and
long-term care to its patients and residents. The Debtor provides
an array of healthcare services, including neurological,
respiratory, orthopedic, occupational, psychiatric, and many other
medical and rehabilitative services. The annual gross revenue of
the Debtor for fiscal year 2020 was over $10 million.
The members of the Company are Westchester Health Care Properties
I, LLC (51%), HHH Liquidation Trust (successor to Hebrew Hospital
Home of Westchester, Inc.) (39%), and Bethel Nursing Home Company,
Inc. (10%).
Dispute with WPHCP
The Debtor's financial obligations and debt structure are
intertwined with its development and leasing arrangements with
White Plains Healthcare Properties I, LLC ("WPHCP"), the owner of
the Debtor's operating premises located at 116-120 Church Street,
White Plains, New York.
In or around November 2015, the Debtor entered into certain
agreements with WPHCP for the construction and finance of the
Debtor's care facility.
WPHCP agreed to provide the necessary financing and construction
management, and obtain the necessary NYSDOH authorizations and
approvals, in order to deliver to the Debtor a "turn-key" facility
for operation by the Debtor as a skilled nursing and rehabilitation
facility. The Debtor, as tenant and operator of the completed
facility, agreed to pay, among other things, monthly fixed rent in
the amount of $506,096.50 for an annual amount of fixed rent of
$6,073,158, to WPHCP, as landlord, over the 30-year term of the
Lease.
In furtherance of its obligation to secure financing for the
project, WPHCP entered into a Construction Loan Agreement, dated as
of Aug. 18, 2017, by and among WPHCP, as borrower, Security Benefit
Life Insurance Company, as lender, and Security Benefit
Corporation, as agent, whereby Security Benefit Lender would make
loans to WPHCP in an aggregate amount of up to $38,500,000, to be
used to refinance an existing mortgage on the Real Property, and
pay the costs of construction and development of the facility.
After developmental and financing delays necessitating additional
capital infusions, WPHCP obtained approval from the New York State
Department of Health for the opening of the facility on December 2,
2019, two years later than contemplated under the Development
Agreement. Despite this and other disputes concerning the
Development and Lease Agreements, the Debtor made all rent payments
of over $506,000 per month as required under the Lease, commencing
on Oct. 30, 2019 (even before the opening of the facility and
commencement of the Lease), totaling over $10,500,000 as of the
Petition Date, which WPHCP accepted.
Security Benefit issued multiple notices of default to WPHCP,
commencing on Oct. 16, 2019, for defaults including failures to
establish a cash management account, make monthly interest
payments, forward payments received from the Debtor, provide
financial statements, and other defaults. Security Benefit
commenced litigation against WPHCP attempting to foreclose against
the Real Property, but these actions were discontinued as a result
of a New York State moratoriums on such actions, which has been
extended through January 2022. See Security Benefit Life Insurance
Company, Security Benefit Corporation v. White Plains Healthcare
Properties I, LLC, et al., Index No. 55883/2021 (Sup. Ct. N.Y.
2021); Security Benefit Life Insurance Company, Security Benefit
Corporation v. White Plains Healthcare Properties I, LLC, et al.,
Index No. 621099/2021 (Sup. Ct. N.Y. 2021).
On Sept. 18, 2020, WPHCP filed a complaint against the Debtor, CEO
Lizer Jozefovic and Mr. Neuman in the Supreme Court of the State of
New York, County of Westchester, captioned as White Plains
Healthcare Properties I, LLC v. HBL SNF, LLC, et al., Index No.
60278-20 (N.Y. Sup. Ct. 2020), containing various frivolous
allegations regarding purported defaults by the Debtor under the
Lease, seeking termination of the Lease and seeking recovery of
over $84 million in alleged damages. The Debtor and co-defendants
filed an answer to the Complaint and asserted counterclaims and
third-party claims against WPHCP, among others, seeking a
declaratory judgment as well as an accounting, and money damages
based upon fraud, fraud in the inducement, breach of contract, bad
faith.
Chapter 11 Filing
According to CEO Jozefovic, the Debtor is generally financially and
operationally sound but has been forced to file the Chapter 11 case
as a result of the excessive damages sought by WPHCP in the pending
litigation and to prevent the threatened abrupt termination of its
Lease and ability to provide care and services to its patients.
The Debtor believes that filing the case will allow it the
opportunity to resolve its disputes with WPHCP, while minimizing
disruption to its business and patients, by assuming and exercising
its purchase rights under its Lease. The Lease provides the Debtor
with an option to purchase the Real Property within the first 15
years of the Lease term for a purchase price of $65,055,000 by
delivery of written notice to WPHCP, as further set forth in and
pursuant to the terms and conditions of the Lease.
In furtherance of these goals, during the Chapter 11 case the
Debtor intends to (i) seek to resolve its disputes and fix its
liability, if any, in connection with the development and lease
transactions, including by seeking to remove its pending litigation
to the Bankruptcy Court, (ii) obtain third-party
debtor-in-possession financing needed to pay its general
obligations as they come due during this Case, (iii) obtain
third-party exit financing that will allow the Debtor to exercise
its Purchase Option under the Lease, and (iv) formulate a plan of
reorganization that will provide for payment of all legitimate
creditors in full and emergence from bankruptcy within the time
prescribed by Subchapter V of the Bankruptcy Code.
About HBL SNF
HBL SNF, LLC, runs Epic Rehabilitation and Nursing at White Plains,
a 160-bedroom skilled nursing and rehabilitation facility located
at 120 Church Street, White Plains, New York, which opened in late
2019. The facility provides an array of healthcare services,
including neurological, respiratory, orthopedic, occupational,
psychiatric, and many other medical and rehabilitative services.
HBL SNF, LLC, sought Chapter 11 protection (Bankr. S.D.N.Y. Case
No. 21-22623) on Nov. 1, 2021.
As of Sept. 30, 2021, the Debtor disclosed total assets of
$9,131,311 and total liabilities of $20,128,876.
The Hon. Sean H. Lane is the case judge.
The Debtor tapped Klestadt Winters Jureller Southard & Stevens,
LLP, as counsel; and Omni Agent Solutions as claims agent.
HOLLEY INC: Moody's Gives B2 CFR & Rates New Credit Facilities B2
-----------------------------------------------------------------
Moody's Investors Service assigned Holley Inc. a B2 corporate
family rating, a B2-PD probability of default rating and a B2
senior secured rating to the company's proposed first lien credit
facilities, which are to consist of a $125 million revolver, a $600
million term loan, and a $100 million delayed draw term loan. The
outlook is positive. Moody's also assigned a SGL-2 speculative
grade liquidity rating.
Proceeds from the proposed credit facilities will be used to repay
the company's existing $540 million first lien term loan, $45
million second lien term loan and related transaction fees in a
leverage neutral transaction. The existing credit facilities are
issued at Holley Purchaser, Inc., a subsidiary of Holley Inc. All
ratings at Holley Purchaser will be withdrawn following the
completion of the refinancing transaction.
Assignments:
Issuer: Holley Inc.
Corporate Family Rating, Assigned B2
Probability of Default Rating, Assigned B2-PD
Speculative Grade Liquidity Rating, Assigned SGL-2
Senior Secured Revolving Credit Facility, Assigned B2 (LGD4)
Senior Secured 1st Lien Term Loan, Assigned B2 (LGD4)
Senior Secured Delayed Draw Term Loan, Assigned B2 (LGD4)
RATINGS RATIONALE
Holley's ratings reflect the company's strong competitive position
in the niche market for performance automotive aftermarket
products, moderate financial leverage and good liquidity. Holley
became a publicly-traded company in July 2021 following the
completion of its business combination with Empower, Ltd., a
special purpose acquisition company ("SPAC"). As part of the SPAC
transaction, Holley paid down $100 million of debt, resulting in
pro forma debt/EBITDA of 3.9x at the end of June 2021. The company
has also provided a more transparent financial policy with publicly
communicated target leverage ratios. However, Holley's former
private equity ownership maintains a 57% equity stake in the
company, and Moody's expects Holley to remain active in pursuing
acquisitions. Nonetheless, Moody's expects debt/EBITDA to remain
around 4x through 2022 with strong earnings on moderate organic
revenue growth.
Holley's revenue scale is modest and focused on high-priced,
discretionary products, which poses a risk of volatile revenue
swings should consumer confidence weaken. Following substantial
growth during the pandemic as people stayed at home, Moody's
maintains the view that Holley's organic growth rate will moderate
to about 5% in 2022 as greater options for consumer's discretionary
income return. Holley maintains a leading market position across
its core products and competition in the performance automotive
aftermarket space is very fragmented. Therefore, Moody's expects
Holley to pursue acquisitions to expand its product suite to be
complimentary with its current offerings across popular vehicle
platforms.
The positive outlook reflects the potential for Holley to
demonstrate a track record of executing on its stated financial
policy goals as a public company, which if executed could support
debt/EBITDA being maintained below 4x on a Moody's adjusted-basis.
Holley's SGL-2 speculative grade liquidity rating reflects its good
liquidity supported by Moody's expectation for strong free cash
flow to debt of about 10% in 2022. Holley's good free cash flow
reflects the company's high margin, efficient working capital
management and modest capital expenditures. The company's liquidity
is further supported by full availability of its proposed $125
million 5-year revolving credit facility, which is upsized from its
existing $50 million revolver.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The ratings could be upgraded if Holley demonstrates a supportive
financial policy around acquisitions and/or shareholder returns
such that debt/EBITDA is expected to be sustained below 4x.
Consistently strong organic revenue growth and maintaining good
liquidity with free cash flow to debt sustained above 10% could
also support an upgrade.
The ratings could be downgraded if Holley engages in an aggressive
financial policy of debt funded acquisitions and/or shareholder
returns that result in debt/EBITDA above 5.5x. Deteriorating
operating results, including organic revenue declines and material
EBITA margin compression, could also pressure the ratings. In
addition, a weaking of liquidity with free cash flow trending
toward breakeven could result in a downgrade.
Holley Inc. (Holley), headquartered in Bowling Green, KY, designs
and manufactures performance engine products for the enthusiast
focused automotive aftermarket. The company's product offerings
include electronic fuel injection and tuner systems, ignition
controls, carburetors, superchargers, exhaust systems and other
products designed to enhance the performance of the car. Revenue
for the twelve months ended June 2021 was $625 million.
The principal methodology used in these ratings was Automotive
Suppliers published in May 2021.
HOLLEY INC: S&P Assigns 'B' ICR on Refinancing, Outlook Positive
----------------------------------------------------------------
S&P Global Ratings assigned its 'B' issuer credit rating with a
positive outlook on Holley Inc., consistent with its rating on
Holley Purchaser Inc. Upon close, S&P will discontinue its ratings
on Holley Purchaser.
S&P said, "We also assigned our 'B' issue-level rating and '3'
recovery rating to the proposed first-lien credit facilities,
including the revolver. The '3' recovery rating indicates our
expectation for meaningful recovery (50%-70%; rounded estimate:
50%) in the event of payment default.
"Parent borrower Holley's refinancing does not substantially change
the company's leverage. Our credit metric expectations are largely
unchanged since our last research update on Holley, published Sept.
10, 2021. Holley increased its ability to fund acquisitions with
the additional $100 million delayed-draw term loan and larger
revolver. We view this as consistent with its strategy to expand
its aftermarket products through acquisitions. Holley will maintain
substantially lower leverage as it transitions to a public company.
As such, Holley said it wants to maintain leverage below 4x even as
it continues to aggressively acquire other aftermarket auto parts
companies.
"However, former owner Sentinel Capital Partners maintains a 57%
stake. We view this as significant and look for Holley to establish
a track record of lower leverage consistent with its stated less
aggressive financial policy."
The positive outlook reflects the potential for a higher rating
over the next 12 months if Holley maintains leverage near 4x and
free operating cash flow (FOCF) to debt above 10%, even as the
company continues to aggressively acquire other aftermarket auto
parts companies.
S&P could raise the rating if Holley's:
-- Leverage sustainably falls near 4x; and
-- FOCF to debt remains above 10%.
This could occur if demand for Holley's products remains strong and
the company continues to efficiently integrate its acquisitions.
S&P would also monitor its track record as a public company and how
it manages leverage with acquisitions.
S&P could revise its outlook to stable if:
-- Debt to EBITDA returns above 5x; or
-- FOCF to debt consistently falls below 5%.
This could occur if demand for Holley's products drops
significantly due to a longer and more protracted economic
downturn.
IDEANOMICS INC: Secures $75M Convertible Debenture Financing
------------------------------------------------------------
Ideanomics, Inc. entered into a convertible debenture, dated Oct.
25, 2021 with YA II PN, Ltd. with a principal amount of
$75,000,000.
The Note has a fixed conversion price of $1.88. The Conversion
Price is not subject to adjustment except for subdivisions or
combinations of common stock. The Principal and the interest
payable under the Note will mature on Oct. 24, 2022, unless earlier
converted or redeemed by the Company. Interest shall accrue on the
outstanding Principal at an annual rate equal to 4%; provided that
such interest rate shall be increased to 18% upon an Event of
Default (as defined in the Note). At any time before the Maturity
Date, YA II PN may convert the Note at its option into up to
39,893,617 shares (excluding additional shares issuable upon
accrued interest) of the Company's common stock at a fixed
conversion price of $1.88. YA II PN shall not have the right to
convert any portion of the Note to the extent that after giving
effect to such conversion, YA II PN, would beneficially own in
excess of 4.99% of the number of shares of common stock outstanding
immediately after giving effect to such conversion. Since YA II PN
will not be obligated to report to the Company the number of shares
of common stock it may hold at the time of conversion, unless the
conversion at issue would result in the issuance of shares of
common stock in excess of 4.99% of the then outstanding shares of
common stock without regard to any other shares which may be
beneficially owned by YA II PN, this investor shall have the
authority, responsibility and obligation to determine whether the
beneficial ownership restriction contained in the Note will limit
any particular conversion thereunder and to the extent that the
investor determines that the beneficial ownership limitation
contained in the Note applies, the determination of which portion
of the Principal amount of the Note is convertible shall be the
responsibility and obligation of the investor. The Company shall
redeem in cash $8,333,333.33 in Principal, plus accrued and unpaid
Interest on the outstanding Principal each month during the term of
the Note beginning on Feb. 1, 2022 and continuing on each
successive calendar month. The amounts of any conversions made by
YA II PN or any Optional Redemption made by the Company
contemporaneous with or prior to any Redemption Date shall have the
effect of reducing the Mandatory Redemption Amount of payments
coming due (in chronological order beginning with the nearest
Redemption Date). The Company has the right, but not the
obligation, to redeem a portion or all amounts outstanding under
this Note prior to the Maturity Date at a cash redemption price
equal to the Principal to be redeemed, plus accrued and unpaid
interest, if any; provided that the Company provides YA II PN with
at least 15 business days' prior written notice of its desire to
exercise an Optional Redemption and the volume weighted average
price of the Company's common stock over the 10 business days'
immediately prior to such redemption notice is less than the
Conversion Price. YA II PN may convert all or any part of the Note
after receiving a redemption notice, in which case the redemption
amount shall be reduced by the amount so converted. No public
market currently exists for the Note, and the Company does not
intend to apply to list the Note on any securities exchange or for
quotation on any inter-dealer quotation system. The Note contains
customary events of default, indemnification obligations of the
Company, and other obligations and rights of the parties.
The Note was offered pursuant to the Company's effective
registration statement on Form S-3ASR (Registration Statement No.
333-252230) previously filed with the SEC and a prospectus
supplement thereunder. A prospectus supplement relating to the
offering of the securities has been filed with the SEC and is
available on the SEC's website at http://www.sec.gov. The
prospectus supplement also covers the resale of shares issuable to
YA II PN upon the conversion of the Note. Prior to the Effective
Date, YA II PN did not own any shares of the Company's common
stock. After the Effective Date, and assuming it converts the
Note, YA II PN will own up to 39,893,617 shares (excluding
additional shares issuable upon accrued interest) of the Company's
common stock, or 7.63 % of the Company's common stock outstanding,
subject to the beneficial ownership limitation. Immediately after
the consummation of the secondary offering by YA II PN, this
investor will own zero shares of the Company's common stock. YA II
PN is a fund managed by Yorkville Advisors Global, LP. Yorkville
Advisors Global II, LLC is the General Partner of Yorkville LP.
All investment decisions for YA II PN are made by Yorkville LLC's
President and Managing Member, Mr. Mark Angelo. YA II PN's business
address is 1012 Springfield Avenue, Mountainside, NJ 07092.
About Ideanomics
Ideanomics is a diversified solutions provider for electric
mobility. The company provides turn-key vehicle, finance and
leasing, and energy management services for commercial fleet
operators. The Company is headquartered in New York, NY, with
operations in the U.S., China, Ukraine, and Malaysia.
Ideanomics reported a net loss of $106.04 million for the year
ended Dec. 31, 2020, compared to a net loss of $96.83 million for
the year ended Dec. 31, 2019. As of June 30, 2021, the Company had
$698.05 million in total assets, $145.39 million in total
liabilities, $1.26 million in convertible redeemable preferred
stock, $7.72 million in redeemable non-controlling interest, and
$543.68 million in total equity.
IN-SHAPE HOLDINGS: San Joaquin County Eyes Building, Parking Lot
----------------------------------------------------------------
Aaron Leathley of The Record reports that the San Joaquin County
Board of Supervisors passed an order on Oct. 26, 2021, announcing
the county's intent to buy the seven-story In-Shape building and an
adjacent parking structure.
San Joaquin County officials are in negotiations to purchase the
former In-Shape Health Clubs tower in downtown Stockton.
The Board of Supervisors unanimously passed an order on Oct. 26,
2021 announcing the county's intent to buy the seven-story building
and an adjacent parking structure for no more than $11 million.
"There's infrastructure needs in the county for new offices,"
Jolena Voorhis, a deputy county administrator, said.
For about a decade, In-Shape's corporate headquarters and gyms
occupied several floors of the tower at 6 South El Dorado Street.
But the gym's downtown branch was among three locations in the city
to close permanently early in the pandemic, and In-Shape declared
bankruptcy shortly thereafter.
If the deal is completed, the In-Shape building's future tenants
would most likely be one or a combination of the county's law and
justice departments, Jay Wilverding, the county administrator,
said.
"Law and justice tends to be the facilities that are outgrowing
their current office capacity," Wilverding said.
Moving law and justice departments into the building would make
sense because of its proximity to the courthouse, he said. But he
emphasized that "we haven’t landed on anything specific yet."
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.
INFORMATICA INC: Moody's Assigns 'B1' CFR Amid Recent IPO
---------------------------------------------------------
Moody's Investors Service assigned to Informatica Inc.
("Informatica")a B1 Corporate Family Rating, B1-PD Probability of
Default Rating and an SGL-1 Speculative Grade Liquidity rating, and
affirmed the B1 ratings on Informatica's new senior 1st lien
secured credit facilities comprising a $250 million revolving
credit facility and $1.875 billion of term loans. Moody's
concurrently withdrew the B2 CFR and B2-PD Probability of Default
Rating at Informatica LLC. Informatica Inc. is the indirect parent
of Informatica LLC. These rating actions conclude the review of
Informatica LLC.'s ratings that was initiated on October 6, 2021.
On October 26, 2021, Informatica completed the initial public
offering of shares of Class A common stock. The company used the
approximately $800 million in net proceeds from the IPO to reduce
outstanding debt
Assignments:
Issuer: Informatica Inc.
Corporate Family Rating, Assigned B1
Probability of Default Rating, Assigned B1-PD
Speculative Grade Liquidity Rating, Assigned SGL-1
Affirmations:
Issuer: Informatica LLC
Gtd Senior Secured 1st Lien Revolving Credit Facility, Affirmed B1
(LGD3)
Gtd Senior Secured 1st Lien Term Loan, Affirmed B1 (LGD3)
Withdrawals:
Issuer: Informatica LLC
Probability of Default Rating, Withdrawn , previously rated B2-PD
Corporate Family Rating, Withdrawn , previously rated B2
Outlook Actions:
Issuer: Informatica Inc.
Outlook, Assigned Positive
Issuer: Informatica LLC
Outlook, Changed To Positive From Rating Under Review
RATINGS RATIONALE
Moody's estimates that Informatica's total debt to EBITDA (Moody's
adjusted) will decline from about 7x before the IPO, to 5x. The B1
CFR reflects Informatica's enhanced financial flexibility after
substantial debt reduction and a more diversified capital base that
will allow the company to capitalize on the large growth
opportunities.
The positive ratings outlook reflects Moody's expectations for
further strengthening of Informatica's credit metrics after the IPO
driven by low teens percentage growth in recurring software
revenues and maintenance of conservative financial policies. A
rapid growth in investments in the near term will pressure
profitability and modestly offset the deleveraging after the IPO.
But Moody's expects Informatica's free cash flow to increase to
about 12% of total adjusted debt and total debt to EBITDA (Moody's
adjusted) to be maintained at or below 5x in FY '22. Moody's
further expects deleveraging to accelerate after FY '22 driven by
growth in recurring software revenues, operating leverage, and
Moody's expectations for a balance between growth and
profitability.
Informatica's credit profile is further supported by its good
operating scale, high proportion of recurring revenues, and leading
products in multiple segments of data management software market.
The company's transition from perpetual software license and
maintenance revenues to primarily a subscription-based business is
largely complete. It has made substantial progress in modernizing
and broadening its portfolio for data management offerings for
hybrid cloud environments. Moody's expects revenue growth of 10% or
higher led by the 20% to 25% growth in subscription revenues.
Governance considerations, specifically, the meaningful debt
reduction from IPO proceeds positively influences the rating. At
the same time, the company's financial sponsors continue to own
over 87% of the voting power of common stock after the IPO and
Informatica will have three classes of common stock. Management has
indicated it will target a 2x net leverage (based on its definition
of EBITDA) over the long-term. The sponsors' voting control and
potential conflicts with creditors' interest constrain
Informatica's credit profile. Moody's does not expect Informatica
to initiate large share repurchases or pay common dividends.
The SGL-1 rating reflects Informatica's very good liquidity profile
that includes approximately $434 million of unrestricted cash
balances before the IPO, availability under an undrawn $250 million
revolving credit facility, and Moody's estimates of at least $220
million in free cash flow over the next 12 months.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Moody's could upgrade Informatica's ratings if the company
maintains revenue growth above 10% and increases operating margins,
and Moody's expects total debt to EBITDA (Moody's adjusted) below
mid 4x and free cash flow relative to total adjusted debt of 15% or
higher on a sustained basis. In addition, a track record of
conservative financial policies or meaningful declines in voting
control would support upward rating movement.
Although not anticipated, the ratings could be downgraded if
revenue growth decelerates, liquidity becomes weak, or Moody's
expects Informatica's free cash flow to fall below 8% of total debt
for an extended period of time.
Informatica is a leading independent provider of enterprise data
management software and services in on-premise and cloud
environments. The company is controlled by affiliates of Permira
Advisers and Canada Pension Plan Investment Board.
The principal methodology used in these ratings was Software
Industry published in August 2018.
INPIXON: Receives Noncompliance Notice From Nasdaq
--------------------------------------------------
Inpixon received a letter from the Listing Qualifications Staff of
The Nasdaq Stock Market LLC on Oct. 25, 2021, indicating that,
based upon the closing bid price of the Company's common stock for
the last 30 consecutive business days beginning on Sept. 13, 2021,
and ending on Oct. 22, 2021, the Company no longer meets the
requirement to maintain a minimum bid price of $1 per share, as set
forth in Nasdaq Listing Rule 5550(a)(2).
In accordance with Nasdaq Listing Rule 5810(c)(3)(A), the Company
has been provided a period of 180 calendar days, or until April 25,
2022, in which to regain compliance. In order to regain compliance
with the minimum bid price requirement, the closing bid price of
the Company's Common Stock must be at least $1 per share for a
minimum of ten consecutive business days during this 180-day
period. In the event that the Company does not regain compliance
within this 180-day period, the Company may be eligible to seek an
additional compliance period of 180 calendar days if it meets the
continued listing requirement for market value of publicly held
shares and all other initial listing standards for the Nasdaq
Capital Market, with the exception of the bid price requirement,
and provides written notice to Nasdaq of its intent to cure the
deficiency during this second compliance period, by effecting a
reverse stock split, if necessary. However, if it appears to the
Nasdaq staff that the Company will not be able to cure the
deficiency, or if the Company is otherwise not eligible, Nasdaq
will provide notice to the Company that its Common Stock will be
subject to delisting.
The letter does not result in the immediate delisting of the
Company's Common Stock from the Nasdaq Capital Market. The Company
intends to monitor the closing bid price of its Common Stock and
consider its available options in the event that the closing bid
price of the Company's Common Stock remains below $1 per share.
About Inpixon
Headquartered in Palo Alto, Calif., Inpixon (Nasdaq: INPX) is an
indoor data company and specializes in indoor intelligence. The
Company's indoor location data platform and patented technologies
ingest and integrate data with indoor maps enabling users to
harness the power of indoor data to create actionable
intelligence.
Inpixon reported a net loss of $29.21 million for the year ended
Dec. 31, 2020, compared to a net loss of $33.98 million for the
year ended Dec. 31, 2019. As of June 30, 2021, the Company had
$174.41 million in total assets, $28.93 million in total
liabilities, and $145.49 million in total stockholders' equity.
INSYS THERAPEUTICS: Quinn Emanuel Can't Escape Suit Over Payments
-----------------------------------------------------------------
Rose Krebs of Law360 reports that Quinn Emanuel Urquhart & Sullivan
LLP can't dodge a suit filed in Insys Therapeutics Inc.'s Ch. 11
case over $90,000 paid to the firm just before the bankruptcy
filing, a Delaware bankruptcy judge has ruled, allowing a claim
that the transactions may have been improper transfers to proceed.
In a nine-page opinion filed Thursday, October 28, 2021, U.S.
Bankruptcy Judge John T. Dorsey tossed another claim in the
adversary suit filed by the Insys liquidating trustee, William
Henrich, rejecting an assertion that the trustee had "adequately
pled the requirements for constructive fraud.
About Insys Therapeutics
Headquartered in Chandler, Ariz., Insys Therapeutics Inc. --
http://www.insysrx.com/-- is a specialty pharmaceutical company
that develops and commercializes innovative drugs and novel drug
delivery systems of therapeutic molecules that improve patients'
quality of life. Using proprietary spray technology and
capabilities to develop pharmaceutical cannabinoids, Insys is
developing a pipeline of products intended to address unmet medical
needs and the clinical shortcomings of existing commercial
products. Insys is committed to developing medications for
potentially treating anaphylaxis, epilepsy, Prader-Willi syndrome,
opioid addiction and overdose, and other disease areas with a
significant unmet need.
As of March 31, 2019, Insys had $172.6 million in total assets,
$336.3 million in total liabilities, and a total stockholders'
deficit of $163.7 million.
On June 10, 2019, Insys Therapeutics and six affiliated companies
filed petitions seeking relief under Chapter 11 of the Baintends to
conduct the asset sales in accordance with Section 363 of the
U.S.nkruptcy Code (D. Del. Lead Case No. 19-11292). Insys
Bankruptcy Code.
The Debtors' cases are assigned to Judge Kevin Gross.
The Debtors tapped Weil, Gotshal & Manges LLP and Richards, Layton
& Finger, P.A., as legal counsel; Lazard Freres & Co. LLC as
investment banker; FTI Consulting, Inc. as financial advisor; and
Epiq Corporate Restructuring, LLC as claims agent.
Andrew Vara, acting U.S. trustee for Region 3, on June 20, 2019,
appointed nine creditors to serve on an official committee of
unsecured creditors in the Chapter 11 cases. Akin Gump Strauss
Hauer & Feld LLP, and Bayard, P.A., serve as the Committee's
attorneys; and Province, Inc., is the financial advisor.
After selling substantially all of their assets, the Debtors filed
a Chapter 11 Plan and Disclosure Statement.
JANE STREET: Moody's Affirms Ba1 CFR & Rates $500MM Sec. Notes Ba2
------------------------------------------------------------------
Moody's Investors Service affirmed Jane Street Group, LLC's Ba1
Corporate Family Rating and Ba2 senior secured first lien term loan
rating. Moody's also assigned a Ba2 rating to Jane Street's
proposed $500 million senior secured notes due 2029. Jane Street's
outlook is stable.
Affirmations:
Issuer: Jane Street Group, LLC
Corporate Family Rating, Affirmed Ba1
Senior Secured 1st Lien Term Loan, Affirmed Ba2
Assignment:
Senior Secured Regular Bond/Debenture, Assigned Ba2
Outlook Actions:
Issuer: Jane Street Group, LLC
Outlook, Remains Stable
RATINGS RATIONALE
Moody's said its affirmation of Jane Street's ratings with stable
outlook reflects the firm's strong levels of retained capital, on
the back of elevated profitability and sound liquidity over the
past two years, and with relatively favorable balance sheet
leverage. The rating action also reflects Jane Street's strong risk
management and controls' framework which have proven to be scalable
along with the firm's expanding operations and overall growth.
Jane Street's ratings incorporate the inherently high level of
operational and market risks emanating from the firm's
market-making activities, particularly with respect to trading in
less liquid markets, that could result in severe losses and a
deterioration in liquidity and funding in the event of a
significant risk management failure. However, the firm's
partnership-like culture, operational risk management framework and
key executives' high level of involvement in control and management
oversight provide an effective counterbalance to these risks, said
Moody's. Jane Street's rating level also incorporates Moody's
consideration that it partially relies on prime brokers to finance
its activities. Unless structured with long-term lockups and other
protections, such relationships typically allow the prime broker to
increase margin requirements in its favor in certain circumstances,
with possible adverse repercussions for the counterparty's
liquidity.
Moody's said the proposed notes will be secured by a first-priority
security interest in the same collateral that is pledged for the
benefit of the lenders under Jane Street's existing credit
facility. Jane Street's proposed senior secured notes will
therefore be pari passu with its existing credit facility and
accordingly its assigned Ba2 rating is in line with its Ba2 senior
secured loan rating. Moody's said that in addition to Jane Street,
JSG Finance, Inc. - a wholly owned subsidiary of Jane Street - will
be the co-issuer of the proposed notes.
The Ba2 ratings on Jane Street's senior secured loan and proposed
senior secured notes are a notch below its Ba1 CFR because of the
structural subordination of Jane Street's rated-debt-issuing group
holding company and its operating companies, where the
preponderance of the group's debt and debt-like obligations
reside.
The stable outlook is based on Moody's expectation that Jane
Street's credit profile will continue to benefit from the firm's
strong profitability and high level of retained capital. Moody's
also expects that Jane Street's leaders will continue to place a
suitable emphasis on maintaining an effective risk management and
controls framework.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Jane Street's ratings could be upgraded should it significantly
expand its market share while diversifying its revenue through the
development of lower risk and profitable business activities;
substantially reduce its trading capital mix in less-liquid and
higher risk assets; and further bolster its capital and liquidity,
with a reduced reliance or change to more favorable terms in key
prime brokerage relationships resulting in a more durable liquidity
profile.
Jane Street's ratings could be downgraded should it increase its
risk appetite or suffer from a risk management or operational
failure; experience adverse changes in corporate culture or
management quality; sustain reduced profitability from changes in
the market or regulatory environment; increase its capital
distributions in a manner that is not commensurate with its
historic trends; or change its funding mix to a significantly
heavier weighting towards long-term debt and away from equity.
The principal methodology used in these ratings was Securities
Industry Market Makers Methodology published in November 2019.
JSM CONSULTING: Wins Cash Collateral Access Thru Nov 19
-------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York has
authorized JSM Consulting Inc. to use cash collateral in an
aggregate amount not to exceed $399,130 on an interim basis through
November 19, 2021, in accordance with the budget, with a 10%
variance.
A need exists for the Debtor to use the Cash Collateral in order to
pay necessary administrative expenses and administer and preserve
the value of its estate for the benefit of all creditors.
The Small Business Administration, TD Bank, N.A. and the Debtor
entered into loan agreements prior to the bankruptcy filing date.
The Debtor's obligations to the Lenders are secured by liens and
security interests on substantially all of the Debtor's assets,
including its cash, contracts, and accounts receivable. The Lenders
appear to have perfected their security interests by filing UCC-1
Financing Statements and Continuation Statements in the appropriate
jurisdiction.
As of the Petition Date, the Debtor owed TD Bank $325,417 under the
TD Loan Documents plus subsequently accruing interest, and other
charges, including legal expenses recoverable under the TD Loan
Documents.
As adequate protection to the Lenders solely and limited to any
diminution of the value of the Lenders' interest in Cash Collateral
on account of the Debtor's interim use of Cash Collateral, the
Lenders will receive additional and replacement liens and security
interests of the same kind, nature and scope of their pre-petition
liens and security interests to the extent that said pre-petition
liens and security interests were valid, perfected and enforceable
as of the Petition Date on personal property of the Debtor, subject
to the Carve-Out.
The Carve-Out consists of (i) subject to a final order, an
aggregate amount equal to $25,000, which amount may be used to pay
allowed and unpaid professional fees and expenses of the Debtor's
professionals retained by final Order of the Court (which order has
not been reversed, vacated, or stayed unless such stay is no longer
effective); (ii) subject to a final order, the sum of $7,500 for
any trustee appointed under Subchapter V of Chapter 11 of the
Bankruptcy Code and, in addition, the sum of $3,500 for any trustee
appointed pursuant to Chapter 7 of the Bankruptcy Code; and, (iii)
any Clerk's filing fees.
The Debtor will make periodic cash payments -- without an admission
as to how such payments are to be applied to the debt with the
manner of such application to be determined by the Bankruptcy Court
at a later date -- to the Lenders as provided in the Budget.
The Lenders will have allowed superpriority administrative claims
and all the rights and benefits accorded pursuant to Section 507(b)
of the Bankruptcy Code solely limited to the extent of any
diminution in value resulting from the use of Cash Collateral in
which the Lenders claim an interest from the Petition Date through
the hearing and determination of any final hearing on the use of
Cash Collateral which Superpriorty Claims will be subordinate to
the Carveout.
These events constitute an "Event of Default":
a. The failure by the Debtor to perform, in any respect, any
of the terms, provisions, conditions, covenants, or obligations
under the Interim Order or the TD Loan Documents, excluding any (i)
defaults existing prior to the Petition Date and (ii) covenant
defaults;
b. The entry of any order, not including an order of the Court
to modify or lift the stay in order to provide for the enforcement
of the arbitration entitled "JAMS Arbitration – Ref. No.:
1425029125", by the Court granting relief from or modifying the
automatic stay of Bankruptcy Code section 362(a);
c. Dismissal of the chapter 11 case or conversion of the
chapter 11 case to a chapter 7 case, or appointment of a chapter 11
trustee or examiner with expanded powers or other responsible
person (other than the Subchapter V Trustee);
d. Entry of an order of the Court terminating the Interim
Order; and/or
e. Except as may be authorized by Interim Order of the Court,
the Debtor granting, creating, incurring or suffering to exist any
post-petition liens, security interests or super-priority claims
which are senior to or pari passu with those granted pursuant to
the Interim Order.
A final hearing on the matter is scheduled for November 15 at 10
a.m. Objections are due November 8.
A copy of the order and the Debtor's 13-week budget through January
14, 2022 is available at https://bit.ly/2ZEz55o from
PacerMonitor.com.
The budget provided for $2,779,255 in total receipts and $1,850,947
in total expenses.
About JSM Consulting Inc.
JSM Consulting Inc. is a management consulting company that
specializes in staff augmentation. It specializes in providing
clients with experienced information technology professionals and
other professionals.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. S.D. N.Y. Case No. 21-11791) on October 18,
2021. In the petition signed by Mukesh Somani, chief executive
officer, the Debtor disclosed up to $10 million in estimated assets
and liabilities.
Jonathan I. Rabinowitz, Esq., at Rabinowitz, Lubetkin & Tully, LLC
is the Debtor's counsel.
KKR REAL ESTATE: $50MM Loan Upsize No Impact on Moody's Ba3 CFR
---------------------------------------------------------------
Moody's Investors Service said that KKR Real Estate Finance Trust
Inc.'s (KREF) Ba3 corporate family rating and KREF Holdings X LLC's
backed Ba2 senior secured rating were unaffected by the company's
decision to increase its existing term loan B by $50 million. The
outlook for both entities is stable.
KREF Holdings X LLC's backed Ba2 senior secured rating reflects the
term loan B's senior secured position in KREF's overall capital
structure, the guarantees provided by the issuer's immediate parent
holding company and certain affiliates, as well as the collateral
pledge of equity interests in certain KREF asset-owning
subsidiaries and other assets. Moody's expects that the collateral
provides sufficient coverage of the term loan B to reduce its risk
of loss compared to more subordinate forms of debt capital. The
proposed upsize of the term loan B does not affect the existing
ratings. Terms of the add-on are consistent with those of the
existing term loan B.
KREF's Ba3 CFR reflects the company's history of profitable
operations, high quality loan portfolio, effective liquidity and
capital management, and the strength of its competitive positioning
resulting from its affiliation with KKR & Co. Inc. KREF's
commercial real estate portfolio composition is oriented towards
senior secured loans on multifamily and office properties owned by
institutional sponsors with low exposure to the weakened hotel and
retail sectors, which mitigated performance volatility during the
coronavirus pandemic. Credit challenges include KREF's business
concentration in the commercial real estate sector, short
seven-year operating history, and high reliance on secured funding
that encumbers its earning assets.
KREF's outlook is stable, reflecting the strength of the company's
portfolio composition and its manageable exposure to mark-to-credit
provisions in its funding structure that position the company to
endure potential deterioration in asset performance and real estate
values, profitability and capital position relating to the
coronavirus pandemic.
Moody's could upgrade KREF's ratings if the company: 1) reduces its
reliance on secured debt financing and increases unencumbered
assets; 2) maintains strong asset quality; 3) reduces
debt-to-tangible net worth leverage; and 4) demonstrates a further
track-record of earnings and profitability that compares well with
peers, considering differences in investment strategies.
Moody's could downgrade KREF's ratings if the company: 1)
experiences a deterioration in asset quality and profitability
exceeding Moody's expectations; 2) increases its leverage
(debt/tangible net worth) above 4.5x given the current portfolio
mix; or 3) materially reduces it liquidity position.
LIMETREE BAY: Judge Grants Request to Delay Auction to Nov. 12
--------------------------------------------------------------
Sara Kirkpatrick of The Virgin Islands Daily News reports that
Limetree Bay Refining is still on the auction block for now, after
a Texas bankruptcy court granted the company's request for an
extension of the deadline for the bidding process.
Bidders for the company were given additional time to prepare,
following the request filed on Thursday, Oct. 28, 2021, a day prior
to the scheduled auction.
Attorney Elizabeth Green, representing Limetree Bay, filed a notice
of milestone extensions, and presented new dates for the bidding
process to the U.S. Bankruptcy Court for the Southern District of
Texas. Judge David Jones granted her request after a brief hearing
Friday morning.
The auction is now scheduled for 10 a.m. Nov. 12, 2021 and bidders
have been asked to make a cash deposit by Nov. 10, 2021.
"This gives us more time to get these bids together so we can have
an auction," Green said during the Friday hearing.
Green also noted during the hearing that Limetree Bay indeed has
interested bidders.
"We are working through the details on those bids, some of them are
non-conforming, but could become conforming," she said.
Limetree Bay, which filed for bankruptcy in July 2021, is hoping to
sell its remaining assets to help pay off creditors. A bankruptcy
court subsequently issued an initial order establishing bidding and
sale procedures on Aug. 11, 2021 which included several deadlines.
Under that order, bids were due by Sept. 17, 2021, an auction
scheduled for Sept. 22, 2021 and a sale hearing set for Oct. 14,
with Nov. 1. 2021 as the deadline for the winning bidder to close
the sale transaction.
The bankruptcy court also approved a final order on Aug. 22, 2021
which included a 16-week budget that runs through Sunday.
Based on court proceedings Friday, J. Aron and Company and BP
Products North America have been identified as two major creditors
that Limetree Bay still owes money to, and an emergency motion was
discussed on approval of stipulations for their repayment. J. Aron
and Company is a subsidiary of New York-based investment bank
Goldman Sachs.
Green, in court documents, explained that the motion is
"essentially the culmination of dealing with 30 different documents
that have been transaction documents," between the two creditors
and the debtor. The stipulations "effectively and efficiently
resolve complex disputes and issues pertaining to a significant
source of funding."
Another court hearing is scheduled Wednesday for final approval of
the stipulations document.
In September 2021, the U.S. Justice Department and Limetree Bay's
attorneys filed a joint status report in U.S. District Court,
detailing current plans and timelines for shutdown of the troubled
refinery.
Attorneys representing the United States, which is the plaintiff in
the suit against defendants Limetree Bay Refining and Limetree Bay
Terminals filed the report to update the court on shutdown efforts
after attempts to restart production at the facility repeatedly
failed, spewing noxious chemicals over neighborhoods, farms and
contaminating cisterns residents use for drinking water.
The Justice Department filed the complaint against Limetree on
behalf of the Environmental Protection Agency on July 12, 2021
claiming the refinery's operations have repeatedly violated the
Clean Air Act.
About Limetree Bay
Limetree Bay Energy is a large-scale energy complex strategically
located in St. Croix, U.S. Virgin Islands. The complex consists of
Limetree Bay Refining, a refinery with peak processing capacity of
650 thousand barrels of petroleum feedstock per day, and Limetree
Bay Terminal, a 34-million-barrel crude and petroleum products
storage and marine terminal facility serving the refinery and
third-party customers.
Limetree Bay Refining, LLC, restarted operations in February 2021,
and is capable of processing around 200,000 barrels per day. Key
restart work at the site began in 2018, including the 62,000
barrels per day modern, delayed Coker unit, extensive
desulfurization capacity, and a reformer unit to produce clean,
low-sulfur transportation fuels. The restart project provided much
needed economic development in the U.S.V.I. and created more than
4,000 construction jobs at its peak.
Limetree Bay Refining, LLC and its affiliates sought Chapter 11
protection on July 12, 2021. The lead case is In re Limetree Bay
Services, LLC (Bankr. S.D. Texas Case No. 21-32351).
Limetree Bay Terminals, LLC did not file for bankruptcy.
In the petitions signed by Mark Shapiro, chief restructuring
officer, Limetree Bay Services disclosed up to $10 million in
assets and up to $50,000 in liabilities. Limetree Bay Refining,
LLC, estimated up to $10 billion in assets and up to $1 billion in
liabilities.
The Debtors tapped Baker Hostetler as legal counsel and B. Riley
Financial Inc. as restructuring advisor.
The U.S. Trustee for Region 7 appointed an official committee of
unsecured creditors in the Debtors' cases on July 26, 2021. The
committee is represented by Pachulski Stang Ziehl & Jones, LLP.
405 Sentinel, LLC serves as administrative and collateral agent for
the DIP lenders.
LIMETREE BAY: Reaches Deal With J. Aron, Lenders Skeptical
----------------------------------------------------------
Maria Chutchian of Reuters reports that bankrupt Limetree Bay
refinery has reached a deal with Goldman Sachs' energy trader, J.
Aron & Company, to resolve disputes over certain pre-bankruptcy
transactions, but the lenders that provided Limetree's bankruptcy
financing may not yet be on board with the accord.
The company, represented by BakerHostetler, said in court papers
that J. Aron has agreed to pay approximately $8.4 million to
resolve the matters. But a lawyer for Sentinel LLC, the agent for
the lenders that provided the $25 million bankruptcy financing,
said during a virtual hearing before U.S. Bankruptcy Judge David
Jones in Houston on Friday that they have issues with certain terms
of the accord.
Limetree filed for bankruptcy protection in July, looking to
restructure nearly $2 billion in debt. Lenders led by Arena
Investors provided the $25 million loan to finance operations
during the bankruptcy.
Sentinel had said in court papers that the U.S. Virgin Islands
refinery tripped an event of default on the bankruptcy loan earlier
this month when it missed a $5 million payment. Sentinel alleged
that J. Aron was supposed to transfer $18 million to Limetree as it
liquidated certain Limetree assets, though J. Aron disputes that it
was under any such obligation.
J. Aron and Limetree were parties to supply agreements and J. Aron
provided inventory financing to Limetree before the bankruptcy. The
settlement amount resolves obligations Limetree still owed J. Aron
under the financing arrangement.
Sentinel said that Limetree failed to make the bankruptcy loan
payment because J. Aron didn't turn over certain proceeds following
its liquidation of certain products related to the supply
agreements.
But J. Aron said in court papers that Limetree's failure to make a
payment on its bankruptcy loan was its own fault, saying it
overestimated how much it would collect from J. Aron by the week of
Oct. 15, 2021, when the payment was due.
A hearing on the deal is set for Nov. 3 before Jones.
Jason Brookner of Gray Reed, representing the bankruptcy lenders,
said during Friday's hearing that his clients believe there are
"some inappropriate" aspects to the J. Aron deal and that the
lenders may file an objection. He also called related legal fees
"unreasonable and exorbitant."
In addition to the J. Aron agreement, Limetree has been working to
refine bids that have come during the bankruptcy. Limetree attorney
Elizabeth Green said on Friday, October 29, 2021, that the company
has received "a number of" bids. Reuters reported on Friday that
potential bidders may be on the hook for newly discovered
groundwater contamination.
Limetree sought bankruptcy protection after investors spent $4.1
billion on an unsuccessful effort to revive the aging facility,
which was shuttered in May 2021 by U.S. environmental regulators.
An initial restart was abandoned after its stacks spewed oil on
homes and contaminated drinking water.
About Limetree Bay
Limetree Bay Energy is a large-scale energy complex strategically
located in St. Croix, U.S. Virgin Islands. The complex consists of
Limetree Bay Refining, a refinery with peak processing capacity of
650 thousand barrels of petroleum feedstock per day, and Limetree
Bay Terminal, a 34-million-barrel crude and petroleum products
storage and marine terminal facility serving the refinery and
third-party customers.
Limetree Bay Refining, LLC, restarted operations in February 2021,
and is capable of processing around 200,000 barrels per day. Key
restart work at the site began in 2018, including the 62,000
barrels per day modern, delayed Coker unit, extensive
desulfurization capacity, and a reformer unit to produce clean,
low-sulfur transportation fuels. The restart project provided much
needed economic development in the U.S.V.I. and created more than
4,000 construction jobs at its peak.
Limetree Bay Refining, LLC and its affiliates sought Chapter 11
protection on July 12, 2021. The lead case is In re Limetree Bay
Services, LLC (Bankr. S.D. Texas Case No. 21-32351).
Limetree Bay Terminals, LLC did not file for bankruptcy.
In the petitions signed by Mark Shapiro, chief restructuring
officer, Limetree Bay Services disclosed up to $10 million in
assets and up to $50,000 in liabilities. Limetree Bay Refining,
LLC, estimated up to $10 billion in assets and up to $1 billion in
liabilities.
The Debtors tapped Baker Hostetler as legal counsel and B. Riley
Financial Inc. as restructuring advisor.
The U.S. Trustee for Region 7 appointed an official committee of
unsecured creditors in the Debtors' cases on July 26, 2021. The
committee is represented by Pachulski Stang Ziehl & Jones, LLP.
405 Sentinel, LLC, serves as administrative and collateral agent
for the DIP lenders.
LW RETAIL: Wins Cash Collateral Access Thru Dec 2
-------------------------------------------------
The U.S. Bankruptcy Court for the Eastern District of New York has
authorized LW Retail Associates LLC to use cash collateral on an
interim basis in accordance with the budget, in the ordinary course
of business through and including December 2, 2021.
National Bank of New York City and Loft Space Condominium assert
perfected security interests in the cash collateral.
On October 2, 2015, the Debtor entered into an Amended and Restated
Mortgage Note with NBNYC pursuant to which NBNYC extended credit
to the Debtor in the amount of $6,250,000 at a variable interest
rate of 3.5%. The loan required monthly payments of $28,247, with
said payments having been established using a 30-year amortization
schedule, with a maturity date of November 1, 2020. The current
unpaid balance is approximately $5,612,949.21. While the Note
expired by its own terms, NBNYC extended the Note's term for an
additional 12 months -- the new maturity date is November 1, 2021.
To secure the Debtor's obligations under the Note, on October 2,
2015, the Debtor and NBNYC entered into an Agreement of Assumption
of Note and Mortgage Consolidation of Notes and Mortgages and
Modification of the Consolidated Mortgage which grants NBNYC a
mortgage and security interest in the Debtor's assets, as defined
more fully therein.
The Debtor states the grant of security to NBNYC pursuant to the
Note was perfected by virtue of the filing of a UCC-1 financing
statement which was filed on October 5, 2015.
Also to secure the Debtor's obligations under the Note, on October
2, 2015, the Debtor and NBNYC entered into an Assignment of Leases
and Rents pursuant to which the Debtor assigned to NBNYC its rights
in all existing and future leases, rents, claims arising from any
rejection of any lease in bankruptcy, lease guaranties, proceeds
from the sale of the foregoing.
As of the Petition Date, the Board of Managers of Loft Space
Condominium filed certain Assessment Liens on the Debtor's four
commercial condominium units, pursuant to which the Board has
asserted additional disputed assessments against the Debtor.
The Debtor acknowledges that NBNYC has a lien and security interest
in the Collateral by virtue of the filing of its UCC-1 financing
statement. The Debtor, however, disputes the Board's lien in all
regards and disputes that the Board has any interest in the Cash
Collateral.
As adequate protection for the Debtor's use of cash collateral,
NBNYC and the Board are granted replacement liens in all of the
Debtor's assets and proceeds (to the extent it is later determined
that the Board has an interest in the Cash Collateral) in the
amount of Collateral Diminution, in the continuing order of
priority of its pre-petition lien, to the extent that such prior
liens were valid, perfected and enforceable as of the Petition
Date.
The replacement liens are subject to (i) the claims of Chapter 11
professionals duly retained in the Chapter 11 case to the extent
awarded; (ii) United States Trustee fees and any clerk's filing
fees; and (iii) the fees and commissions of a hypothetical Chapter
7 trustee for up to $10,000.
As further adequate protection, the Debtor will make monthly
adequate protection payments to NBNYC in the amount provided for in
the underlying loan documents, at the non-default contract rate of
interest, plus such additional amounts authorized for the payment
of post-petition real estate taxes, which payments shall be applied
to NBNYC's allowed secured claim, and to the Debtor's postpetition
real estate tax obligations, as applicable.
The Debtor will make monthly adequate protection payments to the
New York City Department of Tax and Finance's (NYCDTF) for $1,285
per month and such payment in satisfaction of Section 362(d)(3)(B)
of the Bankruptcy Code.
A copy of the order is available for free at https://bit.ly/3GC20bn
from PacerMonitor.com.
A further interim hearing on the matter is scheduled for December 2
at 10:30 a.m.
About LW Retail Associates
Brooklyn, N.Y.-based LW Retail Associates, LLC owns a fee-simple
interest in four condominium units in New York, valued by the
company at $12.20 million in the aggregate.
LW Retail Associates filed a Chapter 11 petition (Bankr. E.D.N.Y.
Case No. 17-45189) on Oct. 5, 2017. In the petition signed by Louis
Greco, manager, the Debtor disclosed $12.64 million in assets and
$6.25 million in liabilities. Judge Elizabeth S. Stong oversees
the case.
The Debtor tapped DelBello Donnellan Weingarten Wise & Wiederkehr,
LLP as bankruptcy counsel, and Goldberg Weprin Finkel Goldstein LLP
and Sills Cummis & Gross P.C. as special counsel.
MAIN STREET INVESTMENTS III: Taps Goldsmith & Guymon as Counsel
---------------------------------------------------------------
Main Street Investments III, LLC seeks approval from the U.S.
Bankruptcy Court for the District of Nevada to employ Goldsmith &
Guymon, P.C. as its legal counsel.
The firm will render these services:
a. prepare all necessary and appropriate motions, orders,
answers, and other papers in connection with the administration of
the bankruptcy case;
b. defend, prosecute or initiate any proceedings and/or
matters arising out of the bankruptcy case;
c. negotiate with various creditors related to the Debtor's
case;
d. protect and preserve the Debtor's estate; and
e. perform all necessary legal services.
The firm will be paid at these rates:
Partners $475 - $500
Associates $300 - $425
Paralegals $175
Legal Assistants $90
The firm received an initial retainer in the amount of $15,000.
Marjorie Guymon, Esq. attests that her firm represents no interest
adverse to the bankruptcy estate.
The counsel can be reached through:
Marjorie A. Guymon, Esq.
Erin M. Houston, Esq.
GOLDSMITH & GUYMON, P.C.
2055 Village Center Circle
Las Vegas, NV 89134
Tel: (702) 873-9500
Fax: (702) 873-9600
E-mail: bankruptcy@goldguylaw.com
About Main Street Investments III
Main Street Investments III, LLC, a Las Vegas-based company, sought
protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Nev.
Case No. 21-14042) on Aug. 16, 2021, listing $1,570,226 in assets
and $1,141,858 in liabilities. David LeGrand, the Debtor's manager,
signed the petition. Judge Mike K. Nakagawa presides over the
case. David Mincin, Esq., at Mincin Law PLLC, represents the Debtor
as legal counsel.
MALLINKRODT PLC: Chapter 11 Hearing Opens With Valuation Questions
------------------------------------------------------------------
Rick Archer of Law360 reports that the confirmation hearing for
Mallinckrodt's Chapter 11 plan opened in a Delaware bankruptcy
court Monday with testimony and questions regarding the drugmaker's
worth and how much cash could be raised if the case switched from
reorganization to liquidation.
Mallinckrodt's value came under fire during the virtual hearing
when an antitrust tort group questioned if the valuation report was
too optimistic about the company's future performance and if the
liquidation report was too pessimistic about the price it could get
for its non-opioid drugs.
About Mallinckrodt 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.
On Oct. 12, 2020, Mallinckrodt plc and certain of its affiliates
sought Chapter 11 protection in Delaware (Bankr. D. Del. Lead Case
No. 20-12522) to seek approval of a restructuring that would reduce
total debt by $1.3 billion and resolve opioid-related claims
against them.
Mallinckrodt plc disclosed $9,584,626,122 in assets and
$8,647,811,427 in liabilities as of Sept. 25, 2020.
Judge John T. Dorsey oversees the cases.
The Debtors tapped Latham & Watkins LLP and Richards, Layton &
Finger P.A. as their bankruptcy counsel; Arthur Cox and Wachtell,
Lipton, Rosen & Katz as corporate and finance counsel; Ropes & Gray
LLP as litigation counsel; Torys LLP as CCAA counsel; Guggenheim
Securities LLC as investment banker; and AlixPartners LLP as
restructuring advisor. Prime Clerk, LLC, is the claims agent.
The official committee of unsecured creditors retained Cooley LLP
as its legal counsel, Robinson & Cole LLP as co-counsel, and Dundon
Advisers LLC as its financial advisor.
On Oct. 27, 2020, the U.S. Trustee for Region 3 appointed an
official committee of opioid related claimants. The OCC tapped Akin
Gump Strauss Hauer & Feld LLP as its lead counsel, Cole Schotz as
Delaware co-counsel, Province Inc. as financial advisor, and
Jefferies LLC as investment banker.
A confirmation trial for the Debtors' First Amended Joint Plan of
Reorganization is set to begin Nov. 1, 2021. The Confirmation
Hearing will be bifurcated into two phases. Phase 1 will commence
the week of Nov. 1. The Confirmation Hearing will continue with
Phase 2 on or around the week of Nov. 15, when the Acthar
Administrative Claims Hearing proceedings concludes.
MICROVISION INC: Incurs $9.4 Million Net Loss in Third Quarter
--------------------------------------------------------------
MicroVision, Inc. reported a net loss of $9.38 million on $718,000
of total revenue for the three months ended Sept. 30, 2021,
compared to a net loss of $2.83 million on $639,000 of total
revenue for the three months ended Sept. 30, 2020.
For the nine months ended Sept. 30, 2021, the Company reported a
net loss of $30.58 million on $1.94 million of total revenue
compared to a net loss of $10.06 million on $2.70 million of total
revenue for the same period during the prior year.
As of Sept. 30, 2021, the Company had $134.07 million in total
assets, $11.72 million in total liabilities, and $122.35 million in
total shareholders' equity.
Cash used in operations in the third quarter of 2021 was $10.0
million, compared to cash used in operations in the third quarter
of 2020 of $3.5 million. The Company ended the third quarter of
2021 with $125.1 million in cash and cash equivalents, compared to
$16.9 million at the end of the fourth quarter of 2020.
"Following our participation in the IAA Mobility Show in Munich,
Germany last month, I remain confident that we are on the right
path," said Sumit Sharma, MicroVision's chief executive officer.
"We've received very encouraging feedback from potential customers
citing, in particular, the low cost and compact size of our
automotive lidar sensor, the maturity of MicroVision's core
technology, and our software capabilities, leading to a number of
requests for additional information and proposals from OEMs. With
this positive response, combined with our healthy balance sheet and
talented team, I remain bullish on MicroVision's ability to succeed
in the evolving ADAS and autonomous driving market."
A full-text copy of the press release is available for free at:
https://www.sec.gov/Archives/edgar/data/65770/000119312521311343/d204065dex991.htm
About MicroVision
MicroVision -- http://www.microvision.com-- is a pioneering
company in MEMS based laser beam scanning technology that
integrates MEMS, lasers, optics, hardware, algorithms and machine
learning software into its proprietary technology to address
existing and emerging markets. The Company's integrated approach
uses its proprietary technology to provide solutions for automotive
lidar sensors, augmented reality micro-display engines, interactive
display modules and consumer lidar modules.
MicroVision reported a net loss of $13.63 million for the year
ended Dec. 31, 2020, compared to a net loss of $26.48 million for
the year ended Dec. 31, 2019. As of June 30, 2021, the Company had
$140.42 million in total assets, $11.52 million in total
liabilities, and $128.90 million in total shareholders' equity.
MID ATLANTIC PRINTERS: Seeks Access to BOTJ Cash Collateral
-----------------------------------------------------------
Mid Atlantic Printers, Ltd. asks the U.S. Bankruptcy Court for the
Western District of Virginia, Lynchburgh Division, for authority to
use cash collateral.
The Debtor's primary operating account is held at Bank of the
James, although the Debtor is in the process of establishing a
debtor-in-possession depository account. Additionally, BOTJ is a
creditor of the Debtor holding a blanket lien on substantially all
of the Debtor's personal property assets. The Debtor's assets,
including its accounts receivable, are collateral for the debt owed
to BOTJ.
Prior to the bankruptcy filing, the Debtor deposited all of its
liquidated accounts receivable into its account at BOTJ. Upon
opening a debtor-in-possession bank account, the Debtor will
deposit its liquidated accounts receivable into its DIP account. It
will use those funds in the DIP account to pay its ordinary course
of business expenses and other administrative expenses in the
case.
BOTJ has authorized the Debtor to use the accounts receivable in
the operation of its business.
In exchange, the Debtor proposes to provide BOTJ with a replacement
lien on the Debtor's postpetition accounts receivable. The
replacement lien will be deemed perfected and enforceable without
the requirement that BOTJ or the Debtor file any perfection
documents.
The Debtor is in the process of preparing a cash flow projection,
reflecting its anticipated revenue and expenses. It will provide
that projection with BOTJ, the Court, the U.S. Trustee and
Subchapter V Trustee upon its completion.
A copy of the motion is available at https://bit.ly/3bw45qK from
PacerMonitor.com.
About Mid Atlantic Printers, Ltd.
Mid Atlantic Printers, Ltd. is a full service commercial sheet fed
printer, with two production facilities and multiple sales offices.
The Company offers commercial printing services that range from
promotional materials, flyers, saddle stitch, binding and more.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. W.D. Va. Case No. 21-61173) on October 27,
2021. In the petition signed by Nancy Edwards, president, the
Debtor disclosed up to $10 million in assets and up to $1 million
in liabilities.
MKS GROUP: Case Summary & 11 Unsecured Creditors
------------------------------------------------
Debtor: MKS Group, LLC
9202 Stoney Point Parkway
Richmond, VA 23235
Business Description: MKS Group, LLC is a privately held
company that operates a restaurant
business.
Chapter 11 Petition Date: November 2, 2021
Court: United States Bankruptcy Court
Eastern District of Virginia
Case No.: 21-33288
Debtor's Counsel: John M. Barrett, Esq.
ALLEGIANT LAW, P.C.
200 Kellam Road
Virginia Beach, VA 23462
Tel: (757) 456-5297
E-mail: johnbarrett@lawyer.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $100,000 to $500,000
The petition was signed by Vishal Patel as manager & CEO.
A copy of the Debtor's list of 20 largest unsecured creditors is
available for free at PacerMonitor.com at:
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/YCQ5WCY/MKS_Group_LLC__vaebke-21-33288__0001.0.pdf?mcid=tGE4TAMA
MOLINA HEALTHCARE: Moody's Rates New $750MM Unsecured Notes 'Ba3'
-----------------------------------------------------------------
Moody's Investors Service has assigned a Ba3 rating to the planned
issuance of $750 million in new Molina Healthcare, Inc. senior
unsecured notes with a 10.5-year tenor. The proceeds will be used
to pre-pay $700 million in senior unsecured notes due in 2022 and
for related fees and expenses. The outlook on Molina and its
affiliates is unchanged at stable.
RATINGS RATIONALE
According to Moody's, Molina's Ba3 debt rating reflects the
company's vastly improved earnings in recent years, driven in part
by its successful growth strategy, along with competitive margins
and strong position in the Medicaid segment. Molina has closed on
four acquisitions since implementing its growth strategy in late
2019 and has two pending. Moody's estimates that these closed and
pending tuck-in deals bolster annual revenue by $8 billion (last
twelve months revenue as of September 30 was $25.6 billion) and add
850 thousand members (total membership is 4.8 million). Molina's
strengths are partly offset by its concentration in Medicaid, which
entails contract re-procurement risk, high leverage as measured by
debt-to-capital as well as poorer performance in the individual
market in 2021 amid an influx of new members related to the special
enrollment period along with elevated COVID-19 costs resulting from
the Delta variant.
This planned debt refinancing increases pro-forma debt with Moody's
adjustments as of September 30 by $50 million to $2.49 billion but
will have minimal impact on pro-forma leverage. Following the debt
issuance, pro forma adjusted debt-to-capital with Moody's
adjustments would increase to 49.7% from 49.2%, which would still
be below the level of 50.7% at June 30, 2021. Pro-forma
debt-to-EBITDA would increase modestly to 2.4 from 2.3x but remains
at a solid level.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATING
Factors that could lead to a rating upgrade include: (i) Improved
diversification beyond the company's concentration in Medicaid and
the individual full-risk business and (ii) adjusted debt to capital
sustained below 45%, with a well-laddered debt structure, and
adjusted debt to EBITDA remains below 2.5x; (iii)) steady
profitable organic growth of medical membership.
Factors that could lead to a rating downgrade include: (i) a
material decline in profitability, with an EBITDA margin (with
Moody's adjustments) below 3.5%; or (ii) no improvement in adjusted
debt-to-capital from current levels and/or debt/EBITDA increasing
to above 3.0x; or (iii) a 10% decline in membership in a given
year, or the unexpected loss of a major Medicaid contract.
The following rating was assigned:
Issuer: Molina Healthcare, Inc.
senior unsecured notes maturing in 2032 assigned at Ba3
The outlook on Molina and its affiliates is unchanged at stable.
Molina Healthcare, Inc. is headquartered in Long Beach, California.
Through September 30, 2021 total revenue was $20.4 billion with net
income of 556 million. As of September 30, the company reported
total equity of approximately $2.5 billion and medical membership
was approximately 4.8 million members.
The principal methodology used in this rating was US Health
Insurance Companies Methodology published in November 2019.
MOLINA HEALTHCARE: S&P Rates $750MM Senior Unsecured Notes 'BB-'
----------------------------------------------------------------
S&P Global Ratings assigned its 'BB-' debt rating to U.S. health
insurer Molina Healthcare Inc.'s $750 million of 10-year senior
unsecured notes. Molina will use proceeds from the notes to redeem
its $700 million 5.375% senior unsecured notes due 2022, add cash
to balance sheet as well as pay related fees and expenses.
S&P said, "This issuance does not affect our 'BB-' issuer credit
rating on Molina. Molina's debt issuance will be essentially
leverage neutral. As of the third quarter, Molina's financial
leverage was 49% (including our operating lease adjustments and no
parent cash credit). We forecast financial leverage will remain at
the high end of 45%-50% at year-end 2021 before decreasing through
earnings growth to about 45% in 2022. Molina's debt repayment and
coverage metrics are relatively strong. We expect financial
obligations-to-EBITDA of 1.5x-2.5x in 2021-2022 and EBITDA
fixed-charge coverage of 9x-12x.
"Molina reported solid financial results for the first nine months
of 2021. Reported revenues grew by 43.5% to $20.4 billion, compared
with the nine months ended Sept. 30, 2020. We expect full-year
revenue will rise by close to 50% to reach $27 billion-$28 billion
in 2021 based on organic membership growth in all segments:
Medicaid, Medicare, and the Affordable Care Act (ACA) marketplace
and prior year acquisitions (Magellan Complete Care and Passport
Health). The company's medical loss ratio (88.1%) for the first
nine months of 2021 was running close to its full-year expectation
(about 88%), though with elevated medical cost pressure in the ACA
marketplace business. We expect Molina's adjusted EBIT will be
about $1.0-$1.1 billion in 2021, with a return on revenue of
3.5%-4.0% (at the low-end of our original expectation of 4%-6%).
"In 2022, we expect Molina's revenues will expand by 10%-12% to $30
billion-$31 billion based on organic membership growth, including
the Ohio and Nevada Medicaid contract wins, recently closed
acquisitions (Affinity Health Plan), and pending acquisitions
(business purchases from Cigna and AgeWell New York). 2022 revenue
growth will be offset by the return of Medicaid redeterminations (a
$500 million headwind) and Medicaid pharmacy carve-outs in
California and Ohio. We expect improved ACA marketplace performance
in 2022 as premium rate and product design adjustments, as well as
special enrollment period changes, will alleviate profitability
pressures. Overall, we expect adjusted EBIT of $1.3 billion-$1.5
billion in 2022, with an ROR of 4%-6%. (The company has not
provided earnings guidance for 2022.)"
NANO MAGIC: Incurs $473,597 Net Loss in Second Quarter
------------------------------------------------------
Nano Magic Holdings Inc. filed with the Securities and Exchange
Commission its Quarterly Report on Form 10-Q disclosing a net loss
of $473,597 on $1.37 million of total revenues for the three months
ended June 30, 2021, compared to a net loss off $282,277 on $1.15
million of total revenues for the three months ended June 30,
2020.
For the six months ended June 30, 2021, the Company reported a net
loss of $103,200 on $3.68 million of total revenues compared to a
net loss of $660,093 on $1.60 million of total revenues for the
same period during the prior year.
As of June 30, 2021, the Company had $6.04 million in total assets,
$2.94 million in total liabilities, and $3.10 million in total
stockholders' equity.
The Company had working capital of $2,197,673 and $1,694,347 of
unrestricted cash as of June 30, 2021 and working capital of
$633,572 and $288,134 of unrestricted cash as of Dec. 31, 2020.
Net cash used by operating activities was $(42,736) for the six
months ended June 30, 2021 as compared to net cash used in
operating activities of $(944,751) for the six months ended June
30, 2020, a net change of $902,015 or 95%. Net cash used by
operating activities for the six months ended June 30, 2021
primarily resulted from net loss of $(103,200) adjusted for
add-backs of $427,126 and changes in operating assets and
liabilities of $(366,662).
Net cash flow used by investing activities was $(62,883) for the
six months ended June 30, 2021 and $(316,551) for the six months
ended June 30, 2020.
Net cash provided by financing activities was $1,511,832 for the
six months ended June 30, 2021 reflecting $1,500,800 in proceeds
from sales of common stock and warrants, as compared to net cash
provided of $1,268,240 for the same period in 2020.
A full-text copy of the Form 10-Q is available for free at:
https://www.sec.gov/ix?doc=/Archives/edgar/data/891417/000149315221026645/form10-q.htm
About Nano Magic
Headquartered in Madison Heights, Michigan Nano Magic --
www.nanomagic.com -- develops, commercializes and markets consumer
and industrial products powered by nanotechnology that solve
everyday problems for customers in the optical, transportation,
military, sports and safety industries.
Nano Magic reported a net loss of $781,055 for the year ended Dec.
31, 2020, compared to a net loss of $964,987 for the year ended
Dec. 31, 2019.
NATIONSTAR MORTGAGE: Moody's Rates New $600MM Unsecured Notes 'B2'
------------------------------------------------------------------
Moody's Investors Service has assigned a B2 rating to Nationstar
Mortgage Holdings Inc.'s proposed $600.0 million senior unsecured
notes due in 2031. The rating outlook is positive.
Assignments:
Issuer: Nationstar Mortgage Holdings Inc.
Gtd Senior Unsecured Regular Bond/Debenture, Assigned B2
RATINGS RATIONALE
Moody's has rated the senior unsecured notes B2 based on
Nationstar's b2 standalone assessment and B2 corporate family
rating, the notes' ranking and terms, and the strength of the
notes' asset coverage. The key terms of the notes are largely
consistent with Nationstar's existing senior unsecured notes. The
company has indicated that the proceeds of the notes will be used
for general corporate purposes, including investment in its
mortgage servicing rights (MSR) portfolio.
Nationstar's b2 standalone assessment and B2 corporate family
rating reflect the company's strong position in the US residential
mortgage servicing market, which will allow it to continue to
benefit from elevated mortgage origination volumes in the current
low interest rate environment. It also reflects the risks
associated with the firm's growth of its servicing portfolio, which
are however mitigated by its solid track record of acquiring and
integrating residential mortgage servicing assets.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATING
The ratings could be upgraded if the company continues to
demonstrate sustainable improvement in its financial performance,
such as achieving and maintaining capitalization as measured by
TCE/TMA of 15% or higher and maintaining core pretax income to
total assets of more than 1.5%, while preserving its servicing
performance and franchise value.
The ratings could be downgraded if the company's financial
performance materially deteriorates, for example, if capitalization
decreases to 7.5% or lower as measured by TCE/TMA or if core pretax
income to assets falls to less than 0.75% for an extended period of
time or if the company's liquidity position deteriorates beyond an
adequate buffer to its debt covenants. In addition, the ratings
could be downgraded in the event of material negative regulatory
actions that would impair its franchise and therefore its ability
to remain profitable.
The principal methodology used in this rating was Finance Companies
Methodology published in November 2019.
NATURE COAST: Hires Fitch & Associates as Financial Consultant
--------------------------------------------------------------
Nature Coast Emergency Medical Foundation, Inc. seeks approval from
the U.S. Bankruptcy Court for the Middle District of Florida to
hire Fitch & Associates, LLC as its financial and operational
consultant.
The firm will provide personnel resources and services to support
the financial, operation, administration and human resource
functions on the Debtor.
The Debtor has agreed to pay the firm Monthly Base Implementation
Support Services Fees for the first six month of the Agreement of
$14,988.52 and Monthly Base Implementation Support Services Fees
for the second six months of $11,500.
Roxanne Peek, president of Fitch & Associates, assured the court
that the firm does not represent an interest adverse to the Debtor
or its estate.
The firm can be reached through:
Roxanne Peek
Fitch & Associates, LLC
2901 Williamsburg Terrace, Suite G
Platte City, MO 64079
Phone: +1 816-431-2600
About Nature Coast Emergency
Medical Foundation
Nature Coast Emergency Medical Foundation, Inc. --
https://naturecoastems.org/ -- is Citrus County's exclusive,
not-for-profit (501(c)3), Advanced Life Support 9-1-1 emergency
responder and medical transportation provider. The organization
was established on Oct. 1, 2000.
Nature Coast filed a petition for Chapter 11 protection (Bankr.
M.D. Fla. Case No. 21-02357) on Oct. 2, 2021, listing $7,016,218 in
assets and $4,730,723 in liabilities. Judge Roberta A. Colton
oversees the case.
David S. Jennis, Esq., at David Jennis, PA, doing business as
Jennis Morse Etlinger, is the Debtor's legal counsel.
NATURE COAST: Seeks Approval to Hire Hogan Law as Business Counsel
------------------------------------------------------------------
Nature Coast Emergency Medical Foundation, Inc. seeks approval from
the U.S. Bankruptcy Court for the Middle District of Florida to
hire The Hogan Law Firm as its general business counsel.
The firm assist the Debtor in finalizing the transition agreement
with Citrus County, Florida and provide general business counsel
advice to the Debtor.
Hogan will bill at $250 an hour for all non litigation,
transactional matters and $325 per hour for all litigation matters.
Fees for paralegal are bill at $100 an hour.
Jennifer Rey, Esq., manager at Hogan Law, assured the court that
the firm does not hold an interest adverse to the Debtor and its
estate.
The firm can be reached through:
Jennifer C. Rey, Esq.
The Hogan Law Firm
20 S. Broad Street
Post Office Box 485
Brooksville, FL 34605-0485
Phone: (352) 799-8423
About Nature Coast Emergency
Medical Foundation
Nature Coast Emergency Medical Foundation, Inc. --
https://naturecoastems.org/ -- is Citrus County's exclusive,
not-for-profit (501(c)3), Advanced Life Support 9-1-1 emergency
responder and medical transportation provider. The organization
was established on Oct. 1, 2000.
Nature Coast filed a petition for Chapter 11 protection (Bankr.
M.D. Fla. Case No. 21-02357) on Oct. 2, 2021, listing $7,016,218 in
assets and $4,730,723 in liabilities. Judge Roberta A. Colton
oversees the case.
David S. Jennis, Esq., at David Jennis, PA, doing business as
Jennis Morse Etlinger, is the Debtor's legal counsel.
NEUTRAL POSTURE: Case Summary & 20 Largest Unsecured Creditors
--------------------------------------------------------------
Debtor: Neutral Posture, Inc.
3904 N. Texas Avenue
Bryan, TX 77803
Business Description: Neutral Posture, Inc. manufactures,
markets, and distributes ergonomic chairs.
Chapter 11 Petition Date: November 1, 2021
Court: United States Bankruptcy Court
Southern District of Texas
Case No.: 21-60086
Judge: Hon. Christopher M. Lopez
Debtor's Counsel: Tom A. Howley, Esq.
HOWLEY LAW, PLLC
Pennzoil Place - South Tower
711 Louisiana Street, Ste. 1850
Houston, TX 77002
Tel: (713) 333-9125
E-mail: tom@howley-law.com
Total Assets: $4,677,850
Total Liabilities: $5,891,221
The petition was signed by Rebecca E. Boenigk as president and
CEO.
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/3GJUP6A/Neutral_Posture_Inc__txsbke-21-60086__0001.0.pdf?mcid=tGE4TAMA
NEW YORK CLASSIC: Wins Cash Collateral Access Thru Nov. 18
----------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York has
authorized New York Classic Motors LLC to use, on an interim basis,
an additional $152,062 of the cash collateral of HIL Holdings I LLC
(HH1) and the U.S. Small Business Administration, pursuant to the
budget, pending final hearing on the cash collateral motion.
After due deliberation, the Court has deemed it reasonable and in
the best interest of the Debtor, its estate, creditors and equity
holders to further extend the Debtor's authority to use the cash
collateral through the final hearing, which is scheduled for
November 18, 2021, pursuant to the Sixth Interim Order.
A copy of the Sixth Interim (Bridge) Order is available for free at
https://bit.ly/3BEsQfb from PacerMonitor.com.
The November 18 final hearing will be held at 2 p.m., via Zoom.
About New York Classic Motors
New York Classic Motors LLC, a classic car dealer in New York,
filed for Chapter 11 bankruptcy protection (Bankr. S.D.N.Y. Case
No. 21-10670) on April 9, 2021. At the time of the filing, the
Debtor had between $10 million and $50 million in both assets and
liabilities. The Debtor is represented by Kirby Aisner & Curley,
LLP.
Judge Martin Glenn oversees the case.
The U.S. Trustee for Region 2 appointed an official committee of
unsecured creditors on April 29, 2021. Arent Fox, LLP and CBIZ
Accounting, Tax and Advisory of New York, LLC serve as the
committee's legal counsel and financial advisor, respectively.
OPTION CARE: Issues $500 Million Senior Notes Due 2029
------------------------------------------------------
Option Care Health, Inc. issued $500 million in aggregate principal
amount of 4 3⁄8% senior notes due 2029 at an issue price of
100.000%, under an indenture dated as of Oct. 27, 2021, among the
company, the guarantors party thereto and Ankura Trust Company,
LLC, as trustee, registrar and paying agent.
On Oct. 27, 2021, Option Care Health also entered into (i) an
agreement to amend and restate its existing first lien term loan B
facility to, among other things, provide for $600 million aggregate
principal amount of refinancing term loans and extend its maturity
to 2028, and (ii) an agreement to amend its existing asset-based
lending revolving credit facility to, among other things, extend
its maturity to 2026, decrease the applicable margin and align with
the changes to the New First Lien Term Loan Facility.
Option Care Health used the proceeds from the Offering, together
with the New First Lien Term Loan Facility and cash on hand, to
refinance borrowings outstanding under its existing first lien term
loan B facility, and to pay fees and expenses in connection
therewith and with the Offering.
The Notes and related guarantees were offered and sold only to
persons reasonably believed to be qualified institutional buyers in
reliance on Rule 144A under the Securities Act of 1933, as amended,
and outside the United States, only to non-U.S. persons pursuant to
Regulation S under the Securities Act.
About Option Care Health
Option Care Health -- OptionCareHealth.com -- is an independent
provider of home and alternate site infusion services. With over
5,000 teammates, including approximately 2,900 clinicians, the
Comopany works to elevate standards of care for patients with acute
and chronic conditions in all 50 states.
Option Care reported a net loss of $8.07 million for the year ended
Dec. 31, 2020, compared to a net loss of $75.92 million for the
year ended Dec. 31, 2019. As of June 30, 2021, the Company had
$2.72 billion in total assets, $1.66 billion in total liabilities,
and $1.06 billion in total stockholders' equity.
PACIFIC PANORAMA: Unsec. Creditors Will Recover 6% in Plan
----------------------------------------------------------
Debtor Pacific Panorama LLC, and Creditor VCM Global Asset
Management, Inc., (the "Plan Proponents") submitted a Disclosure
Statement describing Chapter 11 Plan of Reorganization dated
October 28, 2021.
The Debtor is a limited liability company formed in Nevada on
September 16, 2003. The Debtor is managed by its managing members,
Shlomy Weingarten, Revital Weingarten and Bruce Dalen. The Debtor
owns the real property located at 17000 W. Sunset Blvd., Pacific
Palisades, CA 90272 (the "Property").
There are three liens on the Property at this time: Wells Fargo
Bank has first priority lien of approximately $8 million,
Amalgamated Bank a second priority lien of approximately $2 million
and VCM Global a third priority lien of approximately $300,000.
The Property is currently subject to litigation, encroachment, and
easement issues. If the Property was free of such litigation,
encroachment, and easement issues, the Plan Proponents believes
that the Property would be worth approximately $8.5 million. The
Plan Proponents believe that the Property, in its current condition
without the resolution of all outstanding litigation, encroachment,
and easement issues, is worth $3 million.
The Plan proposes to pay Wells Fargo Bank $4 million and
Amalgamated Bank $500,000 on the Effective Date in full settlement
of their claims, if those lenders vote to accept the Plan. If those
lenders vote to reject the Plan, Wells Fargo Bank and Amalgamated
Bank will be paid their respective allowed secured claims, as
determined by the Bankruptcy Court, either in full on the Effective
Date or in payments, and a portion of their respective unsecured
claims in cash on the Effective Date.
The Plan proposes to pay nothing to VCM Global. Instead, VCM
Global will receive a membership interest in the Reorganized
Debtor. General unsecured creditors will receive a portion of
their respective unsecured claims in cash on the Effective Date.
All existing membership interests in the Debtor will be
extinguished.
Class 4 shall consist of all general unsecured claims other than
deficiency claims held by Wells Fargo Bank, Amalgamated Bank, and
VCM Global. The Debtor estimates that general unsecured debts
total approximately $300,000. Each holder of an Allowed Class 4
Claim will be paid on the Effective Date 6% of its Allowed Claim,
in full satisfaction of the Allowed Claim.
The Debtor will continue to exist after the Effective Date as a
legal entity, with all the powers of such an entity under the laws
of the State of Nevada and pursuant to the Debtor's operating
agreement and other organizational documents in effect as of the
Effective Date. On the Effective Date, all property comprising the
Estate will vest in the Reorganized Debtor. The sole member of the
Reorganized Debtor will be a newly-created subsidiary of VCM Global
(the "New Member"). Pursuant to agreement between VCM Global and
existing owners of the Debtor, VCM Global will be granting the
existing owners of the Debtor an interest in the New Member in
accordance with the terms of a joint venture agreement.
The funds to make the payments on the Effective Date will be
provided by Plan CoProponent VCM Global. VCM Global is backed by
its founder and Chief Executive Officer, Tom Vukota. Mr. Vukota
formed VCM Global in 2010. Tom Vukota possesses 25-years of
institutional real estate investment and asset management
experience. Previously he was a Managing Director at Manulife
Financials' alternative asset management division where he was also
head of Real Estate Private Equity.
A full-text copy of the Disclosure Statement dated Oct. 28, 2021,
is available at https://bit.ly/3pX4tac from PacerMonitor.com at no
charge.
Attorneys for Debtor:
M. Jonathan Hayes
Matthew D. Resnik
Resnik Hayes Moradi LLP
17609 Ventura Boulevard, Suite 314
Encino, CA 91316
Tel: (213) 572-0800
Fax: (818) 855-7013
Attorneys for Creditor:
David B. Shemano
SHEMANOLAW
1801 Century Park East, Suite 1600
Los Angeles, CA 90067
Tel: (310) 492-5033
E-mail: dshemano@shemanolaw.com
About Pacific Panorama
Pacific Panorama, LLC, a company based in Pacific Palisades,
Calif., filed a Chapter 11 petition (Bankr. C.D. Cal. Case No.
21-15239) on June 18, 2021. At the time of the filing, the Debtor
had between $1 million and $10 million in assets and between $10
million and $50 million in liabilities. Shlomy Weingarten,
managing member, signed the petition. Judge Barry Russell oversees
the case. The Debtor's legal counsel is Resnik Hayes Moradi, LLP.
PACKAGING COORDINATORS: Moody's Affirms B3 CFR on LSNE Transaction
------------------------------------------------------------------
Moody's Investors Service affirmed the ratings of Packaging
Coordinators Midco, Inc. ("PCI"), including its B3 Corporate Family
Rating, B3-PD Probability of Default Rating, as well as B2
first-lien credit facilities ratings. The outlook remains stable.
The rating affirmation follows PCI's announcement to acquire
Lyophilization Services of New England ("LSNE"), a global
pharmaceutical contract development and manufacturing organization
("CDMO") delivering aseptic fill, finish and lyophilization
services, for approximately $1.5 billion. The acquisition is to be
financed with a $510 million incremental first-lien term loan, $140
million incremental second-lien term loan (unrated) and $939
million in cash equity. Both incremental term loans are to be
fungible with existing credit facilities that were issued in
November 2020 as part of the leveraged buyout ("LBO") of PCI by
private equity firm Kohlberg & Company, along with minority stakes
by equity sponsor Partners Group, and Mubadala, and the management
team.
PCI's acquisition of LSNE is at a very rich multiple, which will
result in a meaningful incremental debt and interest burden, with
Moody's adjusted debt-to-EBITDA financial leverage increasing to
8.4x (up from 6.2x). However, Moody's views the acquisitions as
strategically sensible. LSNE will provide PCI with sterile
injectables manufacturing capabilities, which will dovetail with
PCI's packaging, storage and distribution service offerings both in
commercial and clinical spaces. Furthermore, Moody's expects PCI's
credit metrics to improve, supported by high single-digit earnings
growth, with financial leverage approaching 6.5 times, over the
next 12-18 months.
Affirmations:
Issuer: Packaging Coordinators Midco, Inc.
Corporate Family Rating, Affirmed at B3
Probability of Default Rating, Affirmed at B3-PD
Senior Secured First Lien Revolver due 2025, Affirmed at B2
(LGD3)
Senior Secured First Lien Term Loan due 2027, Affirmed at B2
(LGD3)
Outlook Actions:
Issuer: Packaging Coordinators Midco, Inc.
Outlook, Remains Stable
RATINGS RATIONALE
Packaging Coordinator Midco, Inc.'s B3 Corporate Family Rating
(CFR) reflects its very high pro forma financial leverage following
the acquisition of LSNE, with debt-to-EBITDA of approximately 8.4
times (on a Moody's adjusted basis) for the twelve months ended
September 30, 2021. The rating also reflects PCI's moderate, albeit
growing scale, both on an absolute basis and relative to several
much larger competitors, as well as the risk of revenue losses due
to selective in-sourcing by customers. The rating also incorporates
event and financial policy risk due to private equity ownership
reflected in the company's acquisitive nature and associated
integration risks. PCI benefits from its leading position among
contract packaging services companies, and a relatively well
diversified customer base consisting largely of blue-chip
pharmaceutical clients. Moody's expects the company's growth will
continue to be supported by favorable industry tailwinds, as the
pharmaceutical industry will continue to increase its reliance on
outsourced service providers.
The company's good liquidity profile reflects Moody's expectation
of break-even to modestly positive free cash flow over the next 12
months, a sizable cash balance, as well as full availability under
its upsized $150 million revolving credit facility. However,
Moody's expects capital expenditures to considerably increase over
the next year, as the company integrates acquisition of LSNE.
The stable outlook reflects Moody's expectation that PCI will
benefit from high single-digit earnings growth, which will support
the company's ability to reduce leverage. However, even with
expected EBITDA growth, leverage is expected to remain very high
due to the company's aggressive financial policies. There is
limited capacity for further acquisition while leverage remains
elevated following the LSNE acquisition.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Ratings could be downgraded if the company were to experience
operating disruptions or loss of a major contract or if financial
policies became more aggressive. A downgrade could also occur if
the company's liquidity profile were to erode, such that free cash
flow were to turn negative on a sustained basis, or interest
coverage falls below one times.
Ratings could be upgraded if the company can profitably grow in
scale and maintain good product and customer diversity.
Additionally, the company will need to maintain good liquidity,
reflected in consistently positive free cash flow, and debt/EBITDA
will need to be sustained below 6 times, for ratings to be
upgraded.
Social and governance considerations are material to PCI's credit
profile. The rating reflects social risk associated with operating
specialized facilities and equipment for products that require cold
chain handling, high potency and non-potent drug manufacturing, and
commercial and clinical packaging, and distribution services that
are heavily regulated by multiple government agencies. However,
growth in outsourcing of various pharmaceutical services to third
party providers, will benefit companies like PCI. Within PCI's
businesses, this is particularly true as pharmaceutical companies'
own facilities become outdated or require significant investment to
keep up with newly developed regulatory requirements.
Among governance considerations, PCI's financial policies under
private equity ownership are aggressive, reflected in very high
initial debt levels following the sponsor to sponsor LBO, as well
as a strategy to supplement organic growth with the leveraging
acquisition of LSNE occurring less than one year after the
acquisition of the company by its current owners. Further, the LBO
completed in November 2020 was funded with $300 million of
preferred equity, which is pay in kind. Although Moody's does not
include this in leverage calculations, the rating agency believes
that over time this instrument will be refinanced with debt,
leading to sustained high levels of leverage.
The principal methodology used in these ratings was Business and
Consumer Service Industry published in October 2016.
Packaging Coordinators Midco, Inc. ("PCI Pharma") is a global
provider of outsourced pharmaceutical services that include
commercial and clinical packaging, clinical storage and
distribution services, high potency and non-potent drug
manufacturing, and selected drug development and analytical
services. Pro forma for the acquisition, PCI generated revenues of
approximately $919 million for the LTM period ending September 30,
2021. PCI's parent firm and issuer of the audited financial
statements, Pioneer UK Midco 1 Limited (guarantor of the rated
debt) is majority owned by private equity firm Kohlberg & Company,
along with minority stakes by equity sponsor Partners Group, and
Mubadala, and the management team.
PAI HOLDCO: Moody's Affirms B2 CFR & Alters Outlook to Negative
---------------------------------------------------------------
Moody's Investors Service affirmed PAI Holdco, Inc.'s (Parts
Authority) Corporate Family Rating at B2, the Probability of
Default Rating at B2-PD and the senior secured 1st lien term loan
rating at B1. The outlook was changed to negative from stable.
The rating affirmations and change in outlook to negative reflect
the company's plan to upsize its existing term loan by $100 million
and draw on its asset-based lending facility (ABL) to fund a
dividend to shareholders. This distribution, in addition to a
growth strategy expected to include debt funded acquisitions and
steady investment in inventory, increases the likelihood that Parts
Authority will operate with higher leverage than anticipated at the
time of the rating assignment in October 2020.
Financial policy considerations acknowledge private equity
ownership and the risk that aggressive policies constrain financial
flexibility, as highlighted by this transaction. Accordingly,
governance was a key consideration in this rating action.
Moody's took the following actions on PAI Holdco, Inc.:
Corporate Family Rating, affirmed at B2
Probability of Default Rating, affirmed at B2-PD
Senior Secured 1st Lien Term Loan, affirmed at B1 (LGD3)
Rating outlook changed to Negative from Stable
RATINGS RATIONALE
The ratings reflect Parts Authority's good scale and
diversification as an aftermarket parts distributor serving a large
and aging North American car parc. Parts Authority benefits from
the favorable dynamics of the automotive aftermarket parts sector,
including limited flexibility to defer critical replacement parts,
which has allowed it to generate relatively consistent organic
revenue growth. Acquisitions have supplemented organic growth,
illustrating the large and fragmented nature of the automotive
aftermarket. The business model is highlighted by maintaining a
large inventory of product SKUs distributed through a hub and spoke
system capable of delivering parts quickly. This enables Parts
Authority to capitalize on the increasing trend of do-it-for-me
demand as car repairs have become increasingly more complex and
challenging.
The ratings also consider Parts Authority's weak track record of
free cash flow generation (cash flow from operations less capital
expenditures less dividends) primarily due to the need to maintain
robust inventory levels through all seasons and economic cycles.
With this transaction, Moody's adjusted debt-to-EBITDA is now
expected to be around 6.8x at year-end 2021 with free cash flow,
excluding this debt funded dividend, to be around $10 million.
Despite lingering cost headwinds that will challenge margin
expansion, e-commerce revenues will contribute to stronger free
cash flow that should exceed $20 million next year. However, with
expectations for the majority of free cash flow to be used for
acquisitions, debt-to-EBITDA could remain above 6x for 2022.
The rating outlook is negative, indicative of the very high
leverage and expectations for modest but improving free cash flow
as the company focuses on expansion. Moody's believes the increase
in debt for a return to shareholders only a year out from the LBO
reduces the company's ability to absorb a negative shock or invest
more heavily in growth while maintaining the current rating.
Ongoing investment in inventory and acquisition spending and
integration will limit cash available for debt repayment, placing
greater reliance on earnings growth to materially de-lever.
Parts Authority has adequate liquidity with Moody's expectations
for a minimal cash balance and for free cash flow to be modest for
2021, steadily increasing in 2022 despite higher growth spending.
The ABL facility is expected to be upsized to $225 million (from
$150 million) to help accommodate growth investments and will be
set to expire in 2026. The facility is subject to a springing fixed
charge covenant tested when availability is less than the greater
of 10% of current availability or $22.5 million - the term loans do
not have financial maintenance covenants.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The ratings could be upgraded with expectations for sustained
positive free cash flow that enables accelerated debt repayment to
complement strengthening earnings. Improving margins would also be
viewed favorably. Debt-to-EBITDA approaching 5x and
EBITA-to-interest maintained near 2.5x would be critical elements
for an upgrade. The ratings could be downgraded if revenue growth
continues to result in rising inventory levels and negative free
cash flow for an extended period. Weaker liquidity (e.g.
maintenance of a negligible cash balance and/or limited
availability under the ABL) or debt-to-EBITDA remaining above 6x
could also place downward pressure on ratings. Further evidence of
aggressive financial policies could also be a precursor for a
downgrade.
Parts Authority, Inc. is a leading automotive aftermarket
replacement parts distributor serving the do-it-for-me (DIFM) and
do-it-yourself (DIY) e-commerce channels of the automotive
aftermarket. Parts Authority purchases parts from manufacturers for
resale (all branded parts, no private label) and distributes
--600,000 SKUs to customers across the US through a national
footprint of 230+ locations. Revenue for the latest twelve-month
period ended September 30, 2021 was nearly $1.7 billion.
Parts Authority is majority-owned by private equity sponsor
Kohlberg & Company following a LBO in October 2020.
The principal methodology used in these ratings was Distribution &
Supply Chain Services Industry published in June 2018.
PG&E CORP: Faces Federal Inquiry, $1.15-Bil. Losses Over Dixie Fire
-------------------------------------------------------------------
PG&E Corporation and utility Pacific Gas and Electric Company said
in a Form 10-Q filing with the Securities and Exchange Commission
that they are facing a federal inquiry and $1.15 billion in losses
over the 2021 Dixie fire.
On July 13, 2021, at approximately 4:40 p.m. Pacific Time, a
wildfire was observed in the Feather River Canyon near Cresta Dam,
located in the service territory of the Utility. The 2021 Dixie
fire had consumed 963,309 acres in areas of Butte County, Plumas
County, Tehama County, Lassen County, and Shasta County; with
1,329 structures destroyed (including 717 residential structures),
95 structures damaged, and one fatality, a fire fighter who passed
away due to COVID-19 after returning home from the 2021 Dixie fire.
The cause of the 2021 Dixie fire remains under investigation by Cal
Fire, and PG&E Corporation and the Utility are cooperating with its
investigation. The Butte County, Plumas County, Shasta County,
Lassen County and Tehama County District Attorneys' Offices are
investigating the fire; various other entities, which may include
other state and federal law enforcement agencies, may also be
investigating the fire. On Oct. 7, 2021, the United States
Attorney's Office for the Eastern District of California served
PG&E Corporation and the Utility with a subpoena for the production
of documents.
As of Oct. 27, 2021, PG&E Corporation and the Utility are aware of
approximately 10 complaints on behalf of at least 676 plaintiffs
related to the 2021 Dixie fire and expect that they may receive
further such complaints. The complaints were filed in the
California Superior Court for the County of Plumas, the California
Superior Court for the County of Shasta, and the California
Superior Court for the County of San Francisco, and include claims
based on multiple theories of liability, including inverse
condemnation, negligence, violations of the Public Utilities Code,
violations of the Health & Safety Code, premises liability,
trespass, public nuisance and private nuisance. The plaintiffs in
each action principally assert that PG&E Corporation's and the
Utility’s alleged failure to properly maintain, inspect, and
de-energize their distribution lines was the cause of the 2021
Dixie fire.
Based on the current state of the law concerning inverse
condemnation in California and the facts and circumstances
available to PG&E Corporation and the Utility as of the date of
this filing, including the information contained in the Dixie EIR
and other information gathered as part of PG&E Corporation's and
the Utility's investigation, PG&E Corporation and the Utility
believe it is probable that they will incur a loss in connection
with the 2021 Dixie fire. PG&E Corporation and the Utility
recorded a liability in the aggregate amount of $1.15 billion for
the quarter ended September 30, 2021 (before available
recoveries).
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 serves as special regulatory counsel. Munger Tolles &
Olson LLP is also special counsel.
The Office of the U.S. Trustee appointed an official committee of
creditors on Feb. 12, 2019. The Committee retained Milbank LLP as
counsel; FTI Consulting, Inc., as financial advisor; Centerview
Partners LLC as investment banker; and Epiq Corporate
Restructuring, LLC as claims and noticing agent.
On Feb. 15, 2019, the U.S. trustee appointed an official committee
of tort claimants. The tort claimants' committee is represented by
Baker & Hostetler LLP.
PG&E CORP: To Challenge Criminal Charges in 2020 Zogg Fire
----------------------------------------------------------
Dale Kasler of The Sacramento Bee reports that PG&E Corp., facing
criminal charges in another fatal Northern California wildfire,
told a judge Friday, October 29, 2021, that it plans to challenge
the legality of a portion of the indictment.
California's largest utility, haunted by criminal and monetary
claims over a string of major wildfires in recent years, didn't
enter a plea during an arraignment on the charges filed in last
year's Zogg Fire in Shasta County Superior Court.
However, PG&E's lawyers next month will file a formal legal
challenge, called a demurrer, contesting the validity of a portion
of the criminal case -- specifically, the allegation that it's
responsible for smoke and ash spewed into the air when the Zogg
Fire erupted in September 2020.
Four people died in the Zogg Fire, which burned 56,388 acres in a
rural area west of Redding. Last month the Shasta County district
attorney filed 31 felony and misdemeanor charges against PG&E,
saying the fire started when a tree came into contact with a power
line. District Attorney Stephanie Bridgett said the tree had been
marked for removal by PG&E two years earlier. PG&E said it doesn't
dispute that its equipment sparked the fire but insisted it didn't
do anything criminal.
"We've previously stated we accept Cal Fire's finding that a tree
falling into our equipment started the fire, but we do not believe
there was any criminal activity," utility spokesman James Noonan
said by email. "Today, we informed the court that we will file a
motion next month challenging the legal basis of certain charges in
the government's complaint."
CHARGES FOR 'NEGLIGENT EMISSION OF AIR POLLUTION'
The criminal indictment wouldn't land anyone at PG&E in prison but
would further tar the company's reputation.
The charges include four felony counts of manslaughter in
connection with the Zogg Fire deaths, as well as three felony
counts of recklessness over three smaller fires in Shasta County in
the past 2020.
In addition, the district attorney charged PG&E with 10 misdemeanor
counts of "negligent emission of air pollution," referring to the
smoke and ash caused by the Zogg Fire.
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 serves as special regulatory counsel. Munger Tolles &
Olson LLP is also 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.
POLK AZ: Wins Cash Collateral Access Thru Jan 2022
--------------------------------------------------
The U.S. Bankruptcy Court for the District of Arizona has
authorized Polk AZ LLC to use cash collateral on an interim basis
according to the Debtor's agreement with Haymarket Insurance
Company, the secured lender, through January 31, 2022.
The Debtor is permitted to use the Cash Collateral to pay the
ordinary, necessary, and essential post-petition operating expenses
as reflected in the Budget.
On August 28, 2019, the Debtor obtained a loan from Haymarket in
the amount of $1.8 million. In connection with the Loan, the
parties entered into a Term Loan Agreement, and the Debtor
delivered to Haymarket, in addition to other items, a promissory
note and a deed of trust which contained an assignment of rents
provision.
Haymarket has consented to the Debtor's use of the Cash Collateral
generated from its apartments.
Haymarket is granted permission to irrevocably set off -- from
funds being held in a suspense account for Haymarket's Loan --
$225,000 upon entry of the Agreed Order, and to apply the funds to
the accumulated but unpaid pre-petition, contract-rate interest
under the Haymarket Loan.
In the event that any unforeseen, additional, or emergency costs or
expense will arise, the Debtor may make payment thereof from Cash
Collateral only upon the express written consent of Haymarket or
further order of the Court. If funds for such unforeseen,
additional or emergency expenses are advanced to Debtor by an
insider of Debtor, reimbursement of sums so advanced may be made by
the Cash Collateral only with the prior written consent of
Haymarket or a Court order.
Haymarket and the Debtor may agree to extend the Debtor's use of
Cash Collateral pursuant to the Order past the Interim Period, as
well as additional budgets approved by Haymarket, without further
notice to any parties or further Court orders.
The hearing on the matter scheduled for November 2, 2021 at 11 a.m.
has been vacated.
A copy of the order and the Debtor's budget for October 2021 to
January 2022 is available at https://bit.ly/31mXf5j from
PacerMonitor.com.
About Polk AZ LLC
Polk AZ LLC sought protection under Chapter 11 of the Bankruptcy
Code (Bankr. D. Ariz. Case No. 21-07693) on Oct. 13, 2021. Jean
Gonzvar, designated representative, signed the petition. Judge
Eddward P. Ballinger, Jr. oversees the case. Engelman Berger, PC,
serves as the Debtor's counsel.
Haymarket Insurance Company, as lender, is represented by Patrick
F. Keery, Esq., at Kerry McCue.
The Debtor provided for $22,338 in total projected receipts and
$14,536 in total projected disbursements.
POST OAK TX: U.S. Trustee Unable to Appoint Committee
-----------------------------------------------------
The U.S. Trustee for Region 21, until further notice, will not
appoint an official committee of unsecured creditors in the Chapter
11 case of Post Oak TX, LLC, according to court dockets.
About Post Oak TX
Post Oak TX, LLC, a West Palm Beach, Fla.-based company in the
traveler accommodation industry, filed a petition for Chapter 11
protection (Bankr. S.D. Fla. Case No. 21-18563) on Aug. 31, 2021,
listing as much as $100 million in both assets and liabilities.
Judge Erik P. Kimball oversees the case.
Andrew Zaron, Esq., at Leon Cosgrove, LLP and Morris, Nichols,
Arsht & Tunnell, LLP serve as the Debtor's legal counsel.
KapilaMukamal, LLP is the financial advisor.
PURE BIOSCIENCE: Incurs $2.3 Million Net Loss in FY Ended July 31
-----------------------------------------------------------------
PURE Bioscience, Inc. filed with the Securities and Exchange
Commission its Annual Report on Form 10-K disclosing a net loss of
$2.32 million on $3.93 million of total revenue for the year ended
July 31, 2021, compared to net income of $4,000 on $6.92 million of
total revenue for the year ended July 31, 2020.
Tom Y. Lee, chief executive officer, said that, "As noted in our
fiscal third quarter press release, the uncertainty related to
chemistry supply during the initial phase of the pandemic caused a
significant increase in revenues during the late third and fourth
quarter of last year. This over-supply took many of our large
end-users and distributors months to work through and sell into the
market. During the latter stage of fiscal 2021, the reorder
process began to normalize as our fiscal fourth quarter product
revenue was $857,000. We are continuing to work alongside our
customers as the industries we are focused on return to normalcy,"
concluded Lee.
As of July 31, 2021, the Company had $4.30 million in total assets,
$970,000 in total liabilities, and $3.33 million in total
stockholders' equity.
Los Angeles, California-based Weinberg and Company, P.A., the
Company's auditor since 2019, issued a "going concern"
qualification in its report dated Oct. 28, 2021, citing that the
Company has suffered recurring losses from operations and negative
cash flows from operating activities that raise substantial doubt
about its ability to continue as a going concern.
A full-text copy of the Form 10-K is available for free at:
https://www.sec.gov/Archives/edgar/data/1006028/000149315221026623/form10-k.htm
About PURE Bioscience Inc.
PURE Bioscience, Inc. -- www.purebio.com -- is focused on
developing and commercializing its proprietary antimicrobial
products primarily in the food safety arena. The Company provides
solutions to combat the health and environmental challenges of
pathogen and hygienic control. Its technology platform is based on
patented, stabilized ionic silver, and its initial products contain
silver dihydrogen citrate, better known as SDC. PURE is
headquartered in Rancho Cucamonga, California (San Bernardino
metropolitan area).
PWM PROPERTY: HNA-Linked Manhattan Skyscraper in Chapter 11
-----------------------------------------------------------
Luzi Ann Javier, writing for Bloomberg News, reports that entities
linked to 245 Park Avenue, a Manhattan skyscraper tied to China's
HNA Group Co., filed for Chapter 11 bankruptcy in Delaware, court
papers showed.
The listed assets and liabilities are between $1 billion to $10
billion, the filing showed. Tax authorities in Chicago and New
York City were listed as the two biggest creditors, where it owes
more than $23 million in property taxes.
The filing showed the company has enough funds for distribution to
unsecured creditors.
Three years ago, HNA listed the Manhattan property among the assets
that it was putting up for sale.
About PWM Property Management
PWM Property Management LLC, et al., are primarily engaged in
renting and leasing real estate properties. They own two premium
office buildings, namely 245 Park Avenue in New York City, a
prominent commercial real estate assets in Manhattan's prestigious
Park Avenue office corridor, and 181 West Madison Street in
Chicago, Illinois.
On Oct. 31, 2021, PWM Property Management LLC and its affiliates
sought Chapter 11 protection (Bankr. D. Del. Lead Case No.
21-11445). PWM estimated assets and liabilities of $1 billion to
$10 billion as of the bankruptcy filing.
The cases are pending before the Honorable Judge Mary F. Walrath
and are being jointly administered for procedural purposes under
Case No. 21-11445.
The Debtors tapped White & Case LLP as restructuring counsel; YOUNG
CONAWAY STARGATT & TAYLOR, LLP as local counsel; and M3 ADVISORY
PARTNERS, LP as restructuring advisor. OMNI AGENT SOLUTIONS is the
claims agent.
REDSTONE BUYER: Moody's Lowers CFR to B3, Outlook Stable
--------------------------------------------------------
Moody's Investors Service downgraded Redstone Buyer LLC's (RSA
Security) ratings including the Corporate Family Rating to B3 from
B2, the first lien debt to B2 from B1 and the second lien debt to
Caa2 from Caa1. The downgrade was driven by recent performance
declines, ongoing challenges related to separating from Dell,
setting up as a standalone company and restructuring operations.
The outlook is stable.
Although some year over year declines were expected in fiscal 1st
half 2022 (six months ended July 31, 2021) due to the unusually
strong prior year periods, overall revenues declined 26%, well in
excess of plan. While one-time work-from-home related SecureID
sales in the prior year period were not anticipated to be
replicated, revenues were significantly below expected levels.
Sales were down in nearly all business units partially driven by
disruption to the sales force and other areas from the large
restructuring actions as well as challenges setting up the company
as a stand-alone entity.
RATINGS RATIONALE
RSA's B3 CFR reflects the company's high financial leverage,
challenges and costs of setting up as a stand-alone company and
ongoing restructuring program. Leverage pro forma for the Clearlake
recapitalization is around 8x based on estimated trailing July 2021
results, excluding one-time transaction and restructuring costs and
giving full-year credit for synergies underway. Without the credit
for cost synergies, proforma leverage is over 10x and actual
leverage is far higher. The rating benefits from RSA's leading
positions across various enterprise cybersecurity and risk
management software markets as well as favorable demand drivers in
the security software industry. RSA has been updating and
modernizing its platforms including its cloud security capabilities
over the past several years after falling behind several of its
competitors. Though the company has made significant progress in
new product development, the competitive environment remains
challenging and continued investment is likely required to further
drive growth.
Restructuring and stand-alone build out costs (including capital
expenditures) will likely continue into fiscal 2023 although
Moody's expects they will start to decline in the 2nd half of
fiscal 2022. RSA should conclude its TSA with Dell by fiscal year
end 2022 (January 31, 2022) but some stand up costs will continue
into fiscal year 2023. As a result free cash flow will be negative
in the 2nd half of fiscal 2022 and possibly into the 1st half of
fiscal 2023. Despite the challenges, RSA is setting up its
different business units to be readily separable and sale of any
unit would likely contribute to de-leveraging.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The stable outlook reflects the assumption of a stabilization of
revenues in 2nd half of fiscal 2022 and modest increases
thereafter. The ratings could be downgraded if revenues continue to
decline, restructuring and standup costs continue for an extended
period or free cash flow is not on track to be positive in fiscal
year 2023. The ratings could be upgraded if revenues rebound, stand
up actions and restructurings are completed with limited
disruption, leverage is below 7x and free cash flow to debt above
5%.
Liquidity is adequate based on $69 million of cash as of July 31,
2021 and an undrawn $175 million revolver. Free cash flow is
expected to be negative in 2nd half of fiscal 2022 before turning
positive in fiscal year 2023. There is some potential that the
company will need to draw on the revolver over the next several
quarters to fund stand up and restructuring costs. The company has
a financial covenant that is only measured when the revolver is
more than 35% drawn. The financial covenant could become
challenging to meet if recent performance declines continue.
Similar to most security software companies, RSA has limited
environmental risks. 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 RSA and could
arise from breaches on installed customer software, as well as
internal RSA systems. The company is controlled by private equity
firms Clearlake Capital Group and Symphony Technology Group (STG)
and is not expected to have an independent Board of Directors.
Moody's expect RSA will have aggressive financial practices as
demonstrated by its April 2021 recapitalization.
The following ratings were affected:
Downgrades:
Issuer: Redstone Buyer LLC (RSA Security)
Corporate Family Rating, Downgraded to B3 from B2
Probability of Default Rating, Downgraded to B3-PD from B2-PD
Gtd Senior Secured 1st Lien Delayed Draw Term Loan, Downgraded to
B2 (LGD3) from B1 (LGD3)
Gtd Senior Secured 1st Lien Term Loan, Downgraded to B2 (LGD3)
from B1 (LGD3)
Gtd Senior Secured 1st Lien Revolving Credit Facility, Downgraded
to B2 (LGD3) from B1 (LGD3)
Gtd Senior Secured 2nd Lien Delayed Draw Term Loan, Downgraded to
Caa2 (LGD5) from Caa1 (LGD6)
Gtd Senior Secured 2nd Lien Term Loan, Downgraded to Caa2 (LGD5)
from Caa1 (LGD6)
Gtd Senior Secured 2nd Lien Term Loan, Downgraded to Caa2 (LGD5)
from Caa1 (LGD5)
Outlook Actions:
Issuer: Redstone Buyer LLC (RSA Security)
Outlook, Changed To Stable From Negative
Redstone Buyer LLC (RSA Security) is an enterprise security
software company with approximately $877 million of revenue for the
fiscal year ended January 31, 2021. RSA was acquired from Dell in
September 2020 by a group of funds led by private equity firm
Symphony Technology Group.
The principal methodology used in these ratings was Software
Industry published in Augsut 2018.
ROCKWORX INC: Seeks Cash Collateral Access Thru Feb 2022
--------------------------------------------------------
Rockworx, Inc. asks the U.S. Bankruptcy Court for the District of
Colorado for authority to use cash collateral and provide adequate
protection in accordance with the budgets, with a 15% or 20%
variance.
The Debtor requires the use of cash collateral to meet its ongoing
working capital and general business needs, which include costs of
goods sold payroll and payroll taxes, repairs, maintenance and fuel
for its machinery, equipment and vehicles in order to operate its
business and to help it transition into its new business model.
The Debtor had considerable financial difficulties in the past few
years and then the impact of COVID-19 hitting hard. Beginning in
July 2021, the Debtor began changing its business model and
business practices and, as a result, its business operation has
been improving. The Debtor has analyzed its financial and operating
difficulties, identified potential changes to its business model,
and intends to make these changes as part of its reorganization.
The Debtor seeks authorization to spend $274,647 or, if certain
remote work is awarded to the Debtor, then $314,997. The projected
period is the week ending November 27, 2021, to the week ending
February 26, 2022. During this period, the Debtor expects the value
of its cash collateral assets will increase.
The Debtor's secured creditors are Midwest Regional Bank, Amur
Equipment Finance, Inc., CSC Corporation Service Company, and Mr.
Advance LLC. The secured creditors may allege that the Debtor is
in default under their loan agreements. By referring to these
creditors as secured creditors, the Debtor is not admitting that
the secured creditors are, in fact, secured. The Debtor reserves
the right to challenge the extent, validity and priority of any
asserted secured claim.
While Midwest Regional Bank and Amur Equipment are adequately
protected by the value of the Debtor's assets, the Bank is also
secured by a second deed of trust in Debtor's principal's residence
with equity of $39,000. The equity available to the Bank could be
$75,000 higher, the homestead exemption, if the Bank's security
documents subordinate the exemption to its security.
Overall, the Debtor's net losses have been declining. For the
fiscal year ending June 30, 2021, the Debtor lost $392,903 or
$110,001.
The Debtor has earned a positive net income during the case. It
believes that the Court will consider its motion to sell equipment
late November and, following the conducting of an auction, the Bank
will likely be paid a considerable sum and substantially lower the
amount of its claim. While the Bank may claim that selling the
equipment would imperil its position, instead, given that the
Debtor is getting out of the large crushing business due to its
large overhead costs and the low margins, the best result for the
Bank is to sell the equipment now.
Winters typically are slower times for the Debtor. Given the
cessation of heavy crushing work, the Debtor's costs of goods sold,
for machinery, for repairs and maintenance and for labor, will
drop. Also, the Debtor has bid on a crushing job in Eastern
Colorado to be conducted in January through early March, and for an
estimated $126,000 gross. The Debtor appears to be the only bidder
able to meet the required schedule. If the Debtor is awarded the
bid, then it will rent crushing equipment. After costs are
calculated, the Debtor anticipates net income, after costs of goods
sold and expenses of about 50%. This job, along with the Debtor's
lowered wintertime revenues in Pueblo, could bring the Debtor a
profitable winter season.
The Debtor requests that the Court grant adequate protection for
any diminution in value of the Prepetition Collateral resulting
from the use of Cash Collateral and the imposition of the automatic
stay. The Court may order adequate protection payments but the
Debtor does not offer to make payments for at least for a few
months. It has relatively little money on hand. It intends to sell
through Ritchie Bros. a large quantity of machinery and equipment
with proceeds to be paid to the Bank and to Amur. The Debtor also
needs time to change its business model before starting to make
payments to any secured creditor.
A copy of the Debtor's request is available at
https://bit.ly/3CFBJX2 from PacerMonitor.com.
About Rockworx Inc.
Rockworx, Inc., an aggregate supplier in Pueblo, Colo., filed its
voluntary petition for Chapter 11 protection (Bankr. D. Colo. Case
No. 21-14527) on Aug. 31, 2021, listing $1,310,706 in assets and
$1,310,706 in liabilities. Rockworx President Sean Dudley signed
the petition.
Judge Kimberley H. Tyson oversees the case.
The Fox Law Corporation, Inc. and Kutner Brinen Dickey Riley, P.C.
serve as the Debtor's lead bankruptcy counsel and local counsel,
respectively.
SCP COLDWORKS: Seeks Cash Collateral Access, $200,000 DIP Loan
--------------------------------------------------------------
SCP Coldworks, LLC d/b/a Steel City Pops asks the U.S. Bankruptcy
Court for the Northern District of Alabama, Southern Division, for
authority to, among other things, use cash collateral and obtain
postpetition financing.
The Debtor seeks to obtain secured postpetition financing in an
aggregate principal amount of up to $200,000 under the terms and
conditions of a Senior Secured, Super-Priority Debtor-in-Possession
Credit and Security Agreement among the Debtor, and Redmont Private
Debt Fund III, LP as DIP Lender. The DIP loan is a revolving
credit line.
The Debtor urgently needs funds to make payroll, vendor payments
and other expenditures, all as set forth in the first day motions
filed concurrently with this Motion, that are critical to their
continued viability and ability to reorganize their capital
structure. The DIP Facility will provide the Debtor with
incremental liquidity necessary not only to operate in the ordinary
course in Chapter 11.
As of the Petition Date, the Debtor has funded debt outstanding of
$7,958,677 consisting of the principal balance under that Credit
Agreement by and among ServisFirst Bank and NobleBank & Trust, SCP
Coldworks, LLC, as Borrower. The Debtor also incurs unsecured debt
in the ordinary course of their operations. Through the
Pre-Petition Credit Agreement, the Pre-Petition Secured Parties are
largely secured by first-priority liens against substantially all
of the Debtor's assets.
The Debtor's bankruptcy filing is principally driven by the fall in
retail sales demand. This global issue has constrained the Debtor's
liquidity and significantly impaired the Debtor's ability to pay
its obligations in the ordinary course of business. In the face of
these negative conditions, the Debtor, like some of its
competitors, have been hard hit by declining revenues, which has
greatly impeded the Debtor's refinancing efforts. As a result of
the decline in earnings, the Debtor has been unable to comply with
the financial covenants contained in the Pre-Petition Credit
Agreement. A combination of factors, however, including uncertainty
about future retail sales, prevented the Debtor from achieving an
out-of-court refinancing.
Faced with severe liquidity constraints, the Debtor has concluded
in its business judgment that the course of action that will
maximize recoveries to its creditors is to avail itself of
bankruptcy protection. While the Debtor's operations continue, the
Debtor intends to pursue strategic alternatives to continue the
core business as a going concern. The specific type of core
business transaction the Debtor pursues will depend on numerous
factors. The Debtor and their advisors are currently considering
several alternatives.
The Debtor further requests that the Court authorize (i) the
granting of the DIP Liens, (ii) the use of the Pre-Petition Secured
Parties' Cash Collateral, (iii) the priming of the Pre-Petition
Secured Parties' Liens in favor of the DIP Liens and (iv) the
further relief, including, without limitation, the approval of the
Interim Hearing and entry of the Interim Order, and the scheduling
of the Final Hearing at which to consider the entry of the Final
Order.
The DIP Lender will also be entitled to have priority over all
other administrative claims and expenses, as provided in Section
364(c)(1) of the Bankruptcy Code. The DIP Lender will also be
entitled to a general administrative claim with respect to
Borrower's obligations under the Facility.
A copy of the motion and the Debtor's 13-week budget is available
at https://bit.ly/3EyNBLa from PacerMonitor.com.
The proposed budget provided for total anticipated outflows, on a
weekly basis, as follows:
$118,257 for the week from November 1 to 7, 2021;
$26,450 for the week from November 8 to 14, 2021;
$26,750 for the week from November 15 to 21, 2021;
$600 for the week from November 22 to 28, 2021;
$38,278 for the week from November 29 to December 5, 2021;
$600 for the week from December 6 to December 12, 2021;
$26,500 for the week from December 13 to December 19, 2021;
$600 for the week from December 20 to December 16, 2021;
$25,208 for the week from December 27 to January 2, 2021;
$7,420 for the week from January 3 to 9, 2022;
$18,500 for the week from January 10 to 16, 2022;
$8,600 for the week from January 17 to 23, 2022; and
$26,627 for the week from January 24 to 30, 2022.
About SCP Coldworks, LLC
SCP Coldworks, LLC d/b/a Steel City Pops sells family-recipe pops
in more than a dozen stores. The Debtor sought protection under
Chapter 11 of the U.S. Bankruptcy Code (Bankr. N.D. Ala. Case No.
21-02564) on October 29, 2021. In the petition signed by Philip L.
Hodges, manager, the Debtor disclosed up to $10 million in both
assets and liabilities.
Jeffery J. Hartley, Esq., at Helmsing Leach Herlong Newman and
Rouse is the Debtor's counsel.
SEQUENTIAL BRANDS: Jessica Simpson Has No Rival Bidder
------------------------------------------------------
Steven Church of Bloomberg News reports that Jessica Simpson's
company is set to buy back the singer-turned-fashion entrepreneur's
name from bankrupt Sequential Brands Group Inc. after no other
qualified bids emerged.
A court-supervised auction for the branding rights was canceled,
according to court documents, leaving Simpson's firm, With You
Inc., as the sole bidder at $65 million. Simpson previously agreed
to be the so-called stalking horse that sets the minimum price in
the auction, and under bankruptcy rules, she's required to complete
the purchase if no better offer comes in.
About Sequential Brands Group
Sequential Brands Group, Inc. (NASDAQ:SQBG), together with its
subsidiaries, owns various consumer brands. The New York-based
company licenses its brands for a range of product categories,
including apparel, footwear, fashion accessories, and home goods.
Sequential Brands Group and its affiliates sought Chapter 11
protection (Bankr. D. Del. Lead Case No. 21-11194) on Aug. 31,
2021. The company disclosed total assets of $442,774,937 and debt
of $435,073,539 as of Aug. 30, 2021.
Judge John T. Dorsey oversees the cases.
The Debtors tapped Gibson, Dunn & Crutcher, LLP and Pachulski Stang
Ziehl & Jones, LLP as legal counsel. Miller Buckfire & Co. and its
affiliate, Stifel Nicolaus & Co., Inc., serve as financial advisor
and investment banker. Kurtzman Carson Consultants, LLC, is the
claims agent and administrative advisor.
King & Spalding, LLP, is counsel to the debtor-in-possession
lenders (and the consenting lenders under the restructuring support
agreement) while Morris, Nichols, Arsht & Tunnell, LLP serve as the
DIP lenders' local counsel.
SHEKINAH OILFIELD: Voluntary Chapter 11 Case Summary
----------------------------------------------------
Debtor: Shekinah Oilfield Services, Inc.
315 Northeast Lane
Albany, TX 76430
Chapter 11 Petition Date: November 2, 2021
Court: United States Bankruptcy Court
Northern District of Texas
Case No.: 21-10152
Debtor's Counsel: Jeff Carruth, Esq.
WEYCER, KAPLAN, PULASKI & ZUBER, P.C.
3030 Matlock Rd.
Suite 201
Arlington, TX 76015
Tel: (713) 341-1158
Fax: (866) 666-5322
Email: jcarruth@wkpz.com
Estimated Assets: $500,000 to $1 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by James L. Knight as 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/TONG3AI/Shekinah_Oilfield_Services_Inc__txnbke-21-10152__0001.0.pdf?mcid=tGE4TAMA
SOUTHEASTERN GROCERS: Pulls Off Plan to Go Public
-------------------------------------------------
Heather Schatz of WJCT News reports that Southeastern Grocers, the
Jacksonville-based parent company of the Winn-Dixie and Harveys
supermarket chains, is officially pulling the plug on its plans to
take the company public == at least for the time being.
The company filed notice with the Securities and Exchange
Commission late Friday, October 29, 2021, asking to withdraw its
registration statement on Form S-1. This form is the initial
registration that must be filed by a U.S. company in advance of an
initial public offering (IPO).
The letter states: "The Company is applying for withdrawal of the
Registration Statement because the Company has determined not to
pursue the contemplated offering at this time. The Company hereby
confirms that no securities have been or will be sold pursuant to
the Registration Statement."
The letter also asks that "all fees paid to the Commission in
connection with the filing of the Registration Statement be
credited for future use," so the door isn't completely shut on the
possibility of an IPO in the future.
WJCT News reached out to Southeastern Grocers through a
spokeswoman, but did not hear back by the time of publication. This
article will be updated with any response.
The grocer, which also operates Fresco Y Más supermarkets in other
areas, initially announced the launch of the IPO on Jan. 21, 2021.
It planned to sell 8.9 million shares of its common stock at an
anticipated $14 to $16 per share.
Southeastern Grocers had applied to be listed on the New York Stock
Exchange under the symbol "SEGR."
Several days later, on Jan. 28, the company announced it had
decided to postpone its initial public offering. While it did not
cite a specific reason, it noted that “the Company will continue
to evaluate the timing for the proposed offering as market
conditions develop.”
Reuters news service reported in January that Southeastern Grocers
was pulling the IPO because investors were not willing to meet its
targeted price range.
According to the trade publication Grocery Dive, SEG previously
filed for an IPO in 2013 but withdrew that plan in 2014.
SEG was formed in 2012 after Winn-Dixie Stores Inc. merged with
BI-LO LLC. Both Winn-Dixie and Bi-Lo went through Chapter 11
restructurings before their merger. And SEG itself also filed for a
Chapter 11 bankruptcy reorganization in 2018.
After selling off more than 80 BI-LO stores in 2020, Southeastern
Grocers now operates stores in Alabama, Florida, Georgia, Louisiana
and Mississippi.
About Southeastern Grocers
Southeastern Grocers, LLC, (SEG), the parent company and home of
BI-LO, Fresco y Mas, Harveys Supermarket and Winn-Dixie grocery
stores, is one of the largest conventional supermarket companies in
the U.S. SEG grocery stores, liquor stores and in-store pharmacies
serve communities throughout the seven southeastern states of
Alabama, Florida, Georgia, Louisiana, Mississippi, North Carolina
and South Carolina. BI-LO, Fresco y Mas, Harveys Supermarket and
Winn-Dixie are well known and well-respected regional brands with
deep heritages, strong neighborhood ties, proud histories of giving
back, talented and caring associates and strong commitments to
providing the best possible quality and value to customers. Their
Web sites are http://www.bi-lo.com/,http://www.frescoymas.com/,
http://www.harveyssupermarkets.com/and http://www.winndixie.com/
BI-LO and its affiliates filed for Chapter 11 bankruptcy protection
on March 23, 2009 (Bankr. D. S.C. Case No. 09-02140). BI-LO emerged
from bankruptcy in May 2010 with Lone Star Funds remaining as
majority owner.
Winn-Dixie Stores, Inc., sought Chapter 11 protection (Bankr.
S.D.N.Y. Case No. 05-11063, transferred April 14, 2005, to Bankr.
M.D. Fla. Case Nos. 05-03817 through 05-03840) on Feb. 21, 2005.
In December 2011, BI-LO Holdings signed a deal to acquire all of
the outstanding shares of Winn-Dixie Stores stock in a merger.
Holdings was later renamed Southeastern Grocers.
On March 27, 2018, Southeastern Grocers, LLC, and 26 affiliated
debtors sought Chapter 11 protection (Bankr. D. Del. Lead Case No.
18-10700). SEG commenced Chapter 11 cases to seek confirmation of
a prepackaged chapter 11 plan that will cancel their unsecured
notes in exchange for 100% of the equity of the reorganized
company.
In the 2018 case, the Debtors tapped Weil, Gotshal & Manges LLP as
legal counsel; Evercore as investment banker, and FTI Consulting
Inc. as restructuring advisor. Morrison & Foerster LLP is serving
as legal counsel and Moelis & Company LLC advised the ad hoc group
of holders of Unsecured Notes and 9.25% Senior Secured Notes due
2019.
TIANJIN JAHO: Taps Salish Sea & Christopher L. Young as Co-Counsel
------------------------------------------------------------------
Tianjin Jaho Investment, Inc. seeks approval from the U.S.
Bankruptcy Court for the Western District of Washington to employ
Salish Sea Legal PLLC and the Law Office of Christopher L. Young to
serve as its co-counsel for the Chapter 11 Bankruptcy proceedings.
The firm will be paid at these rates:
Benjamin Ellison $400 per hour
Christopher Young $350 per hour
Brandy Smith $125 per hour
Salish Sea and the Law Office of Christopher L. Young hold no
interest and do not represent any interest, adverse to the estate
and are disinterested persons within the meaning of 11 U.S.C. Sec.
101(14), according to court filings.
The firms can be reached through:
Christopher L. Young, Esq.
THE LAW OFFICES OF CHRISTOPHER L. YOUNG PLLC
2600 W Plymouth St
Seattle, WA 98199
Phone: (206) 407-5829
Benjamin Ellison, Esq.
SALISH SEA LEGAL PLLC
2212 Queen Anne Ave N., No. 719
Seattle, WA 98199
Phone: (206) 257-9547
About Tianjin Jaho Investment
Houston-based Tianjin Jaho Investment, Inc. filed its voluntary
petition for relief under Chapter 11 of the Bankruptcy Code (Bankr.
W.D. Wash. Case No. 21-11047) on May 26, 2021. Charles Xi,
president, signed the petition. At the time of the filing, the
Debtor had between $10 million and $50 million in both assets and
liabilities.
Judge Christopher M. Alston presides over the case.
The Law Office of Marc S. Stern and Paul Taggart serve as the
Debtor's legal counsel and accountant, respectively. The Rental
Connection Inc. is the property manager and leasing agent.
TLG CAPITAL: Case Summary & 11 Unsecured Creditors
--------------------------------------------------
Debtor: TLG Capital Development, LLC
824 Masonic Ave.
San Francisco, CA 94117
Business Description: TLG Capital Development, LLC is engaged
in activities related to real estate.
The Debtor is the owner (fee simple or
tenants in common) of three real properties
in San Francisco, CA having a total current
value of $2.1 million.
Chapter 11 Petition Date: November 2, 2021
Court: United States Bankruptcy Court
Northern District of California
Case No.: 21-30740
Judge: Hon. William J. Lafferty
Debtor's Counsel: James V. Sansone, Esq.
CARLE, MACKIE, POWER & ROSS LLP
100 B Street
Suite 400
Santa Rosa, CA 95401
Tel: 707-526-4200
Fax: 707-526-4707
E-mail: jsansone@cmprlaw.com
Total Assets: $2,187,760
Total Liabilities: $6,428,450
The petition was signed by Kevin Lee as managing member.
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/2R2FOUQ/TLG_Capital_Development_LLC__canbke-21-30740__0001.0.pdf?mcid=tGE4TAMA
TRANSMONTAIGNE PARTNERS: Fitch Lowers LongTerm IDR to 'B+'
----------------------------------------------------------
Fitch Ratings has downgraded TransMontaigne Partners LLC's
(Partners) Long-Term Issuer Default Rating (IDR) to 'B+' from 'BB'
and the senior unsecured notes to 'B-'/'RR6' from 'BB'/'RR4'. Fitch
has also assigned a 'B+' IDR to TransMontaigne Operating Company
L.P. (TLP or OpCo) and 'BB'/'RR2' ratings to the proposed senior
secured term loan and revolver. The Rating Outlook for both
entities is Stable.
The downgrade reflects elevated leverage expected following an
announced transaction. The ratings reflect the business and
financial profile pro forma for the transaction. Leverage at
Partners (which consolidates OpCo) is forecast to rise to nearly
6.5x by YE 2022, well above the prior 4.8x negative leverage
sensitivity. The Stable Outlook is supported by TLP's fixed-fee
contracted business, with approximately 80% of pro forma revenues
supported by firm contracts, strong utilization rates, and a
diversified geographic footprint and customer base.
KEY RATING DRIVERS
Aggressive Transaction Drives Downgrades: Leverage that is expected
to be around two turns higher than previously forecast, due to the
proposed recapitalization transaction, is the main driver for the
downgrade of Partner's IDR. While the announced transaction adds
complimentary assets with a similar contract and customer quality
profile, relative to TLP, as well as adds to the size/scale of the
business, pro forma leverage is more in line with an IDR in the 'B'
category.
OpCo is issuing a new $1 billion senior secured term loan B, and is
refinancing its existing $850 million senior secured revolving
credit facility with a $150 million revolver, ranked pari passu
with the new term loan. Proceeds from this transaction will be used
to repay existing debt at SeaPort Financing LLC (SeaPort), reduce
TLP revolver borrowings (to nil), partially repay the debt at TLP
Finance Holdings LLC (Holdings; an entity above Partners) and fund
a distribution to the private equity sponsor, Arclight, as
compensation for the contribution of SeaPort.
Fitch expects leverage at Partners to be around 6.5x at YE 2022,
before declining to 6.2x over the forecast period. Including the
remaining debt balance at Holdings, which only owns an equity
interest in Partners, consolidated leverage is expected to jump to
around 8.0x by YE 2022 and decline closer to 7.8x over the
forecast, in Fitch's view.
The addition of $1 billion of secured debt at OpCo significantly
subordinates the senior unsecured notes due in 2026 at Partners.
The resulting reduced recovery prospects in the event of a default
and the assessment of an 'RR6' recovery rating, drive the
four-notch downgrade to the unsecured instrument rating at
Partners.
SeaPort Contribution Increases Size/Scale: The integration of
SeaPort's assets is expected to increase TLP's EBITDA to over $200
million and provide expanded opportunities to service the Pacific
Northwest's (PNW) growing renewables market. SeaPort's assets
include the wholly owned Sound Terminal, a 51% JV interest in
SeaPort Midstream Partners (SMP) and a 30% JV interest in the
Olympic Pipeline (Olympic). These assets serve the PNW region and
provide TLP with four incremental terminals, adding shell capacity
of 3.3 million barrels. Each of these terminals are connected to
Olympic, which in turn connects to the five refineries in the
region.
SeaPort's assets, which are already operated by TLP, fit well with
TLP's existing business profile. Approximately 93% of SeaPort's
capacity is contracted. Pro Forma for transaction close, TLP will
generate approximately 80% of terminaling services revenue from
firm commitments. These include take-or-pay contracts for leased
tank volumes, or throughput commitments. The remaining 20% of
revenues are derived from fixed-fee agreements.
TLP and SeaPort have an overlapping customer mix that includes blue
chip oil majors, as well as some unrated customers. TLP's weighted
average contract life of approximately 2.3 years is relatively
short compared with peers in the Midstream sector. However, Fitch
views positively that from inception to today, the weighted (by
revenue) average customer life for contracts of one year in
duration or less is roughly 6.9 years, as of 2Q21. Fitch does not
expect this statistic to materially change with the addition of
SeaPort.
LTM Performance Solid: Operationally TLP has continued to perform
well despite the macro disruptions from the ongoing pandemic. TLP's
revenues are largely insulated from commodity price fluctuations,
with essentially 100% of revenues coming from fixed-fee sources. As
expansion projects have come into service TLP has generated EBITDA
in line with Fitch's expectations. The largest contributing region
to EBITDA is the Southeast region, in which TLP has key terminals
that connect to both the Colonial and Plantation pipelines that
provide cost efficient routes to transport refined products up the
east coast.
Rating Linkage: Two parent-subsidiary relationships have been
analyzed as part of the assessment of TransMontaigne. In both
instances, Partners-to-OpCo and Holdings-to-Partners, the
relationship is deemed to a weak parent/strong subsidiary. For
Partners-to-OpCo, the conclusion to use the consolidated credit
profile is based on both open legal ring-fencing and open access
and control. This assessment stems from the existence of
cross-guarantees between the entities, as well as a common board of
directors and management team.
For Holdings-to-Partners, Fitch is unlikely to rate Partners more
than two notches above the consolidated credit profile, which Fitch
believes is in line with a 'b-' standalone credit profile, given
the determination of porous (the middle condition between open and
insulated) legal ring-fencing and porous access & control. This
assessment is based on the presence of limitations on dividends,
although those limitations are judged to have limited efficacy, and
the combination of 100% ownership, as well as common
management/board of directors, and Fitch's assessment that Partners
will separately manage its cash and funding needs over the
long-term.
DERIVATION SUMMARY
Fitch views Partner's financial profile as meaningfully weakened by
the proposed transaction. Leverage is now forecast to be in the
6.0x-6.5x range, compared to trending towards 4.0x previously. This
positions Partners relatively weakly in the 'B+' rating category.
However, Fitch views Partner's business profile, pro forma for the
SeaPort acquisition, as improved, relative to pre-transaction. The
company operates diversified petroleum liquids storage assets with
approximately 43.4 million barrels of total capacity across 23 U.S.
states, including assets that distribute product to northern
Mexico.
With the addition of Seaport, TLP has an enhanced presence in the
PNW. SeaPort assets make up critical portions of the regional
petroleum value chain, adds greater geographic diversity and
maintains a similar customer mix, relative to the existing TLP
profile. In terms of size, TLP is not expected to generate more
than $300 million in terms of EBITDA over the forecast period, an
important threshold between the 'B' and 'BB' rating categories.
Buckeye Partners LP, rated 'BB', is significantly larger than TLP
in terms of both size/scale and diversity of operations. Buckeye is
a large liquid petroleum products pipeline operator with more than
117 liquid petroleum products terminals and aggregate tank capacity
of over 125 million barrels. Buckeye also has a presence in the
Caribbean. Similar to TLP, Buckeye is owned by a private equity
sponsor; however, Buckeye operates with leverage expected to range
between 5.0x-5.5x through YE 2022. These factors justify the two
notch difference between the IDRs of TLP and Buckeye.
Rockpoint Gas Storage Partners LP (ROCGAS), rated at 'B-', is
somewhat unique in Fitch's rated midstream universe in that it is
the only pure play natural gas storage business. ROCGAS is smaller
in size (as measured by EBITDA), compared to TLP. The company's
activities are in the volatile midstream subsegment of natural gas
storage (including the use of matched-booked proprietary storage
positions) with a geographical concentration in the province of
Alberta. TLP in comparison has lower business risk with essentially
all revenue coming from fee-based sources, and a longer termed
contract portfolio. Leverage at ROCGAS is forecast to be below 5.0x
by fiscal 2023, which compares favorably to TLP.
KEY ASSUMPTIONS
Fitch's key assumptions within the rating case for the issuer
include:
-- Oil and refined product production consistent with the Fitch
price deck for West Texas Intermediate (WTI) of $52/ bbl in
2022 and $50/ bbl thereafter;
-- Growth capex projects with fully contracted customer
commitments are completed and placed into service through
2022. Future capex spending does not meaningfully benefit
results within the forecast period;
-- The SeaPort acquisition and related financing transaction
close as announced;
-- Contracts of one year in duration or less continue to be
renewed at market rates though the forecast period;
-- Cash distributions insignificantly in excess of estimated
Holdings debt service and required amortization;
-- Holdings does not make other investments outside of its
current equity interest in Partners;
-- Fitch assumes that Partners and OpCo are reorganized as a
going-concern rather than liquidated. The going-concern EBITDA
of $165 million represents a mid-cycle estimate of sustainable
EBITDA for the partnership considering a full year run rate
post- bankruptcy emergence and reflecting a repricing of its
contracts and loss of some customers. Fitch used a 6x EBITDA
multiple to arrive at the going-concern enterprise value. The
multiple is in line with recent reorganization multiples in
the energy sector;
-- There have been a limited number of bankruptcies and
reorganizations within the midstream space but in the limited
sample, such as bankruptcies of Azure Midstream and Southcross
Holdco, the reorganization multiples were between 5x and 7x by
Fitch's best estimates. In Fitch's bankruptcy case study
report "Energy, Power and Commodities Bankruptcies Enterprise
Value and Creditor Recoveries," published in April 2019, the
median enterprise valuation exit multiplies for 35 energy
cases for which this was available was 6.1x, with a wide range
of multiples observed.
RATING SENSITIVITIES
Factor that could, individually or collectively, lead to positive
rating action/upgrade:
-- A positive rating action could occur if leverage at Partners,
defined as total Partners debt with equity credit to operating
EBITDA, is expected to be sustained below 5.5x, while
consolidated leverage, defined as total debt inclusive of
Holdings debt with equity credit to operating EBITDA, is
expected to be sustained below approximately 7x, given that
Fitch is unlikely to rate Partners more than two notches above
the consolidated credit profile.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
-- Partners leverage, defined previously, greater than 6.5x for a
sustained period of time or consolidated leverage, defined
previously, expected to be sustained above 8.0x, given that
Fitch is unlikely to rate Partners more than two notches above
the consolidated credit profile;
-- A significant reduction in the percent of revenues from take
or-pay contract terms, or the adoption of a strategy to sign
new contracts that are two years or less;
-- Impairments to liquidity;
-- Further cash distributions significantly in excess of
estimated Holdings debt service obligations and mandatory
amortization.
BEST/WORST CASE RATING SCENARIO
International scale credit ratings of Non-Financial Corporate
issuers have a best-case rating upgrade scenario (defined as the
99th percentile of rating transitions, measured in a positive
direction) of three notches over a three-year rating horizon; and a
worst-case rating downgrade scenario (defined as the 99th
percentile of rating transitions, measured in a negative direction)
of four notches over three years. The complete span of best- and
worst-case scenario credit ratings for all rating categories ranges
from 'AAA' to 'D'. Best- and worst-case scenario credit ratings are
based on historical performance.
LIQUIDITY AND DEBT STRUCTURE
Reduced Liquidity Expected: As of June 30, 2021, Partners had
around $502 million of available liquidity. The company had just
over $503 million available on its $850 million senior secured
revolving credit facility, and approximately $1.3 million in
letters of credit outstanding. Cash on the balance sheet was
$242,000.
The proposed new $150 million senior secured revolving credit
facility is smaller than the existing $850 million revolver at
OpCo. Historically TLP has not borrowed near the fully committed
amount of the existing revolver. The existing revolver balance of
$346.4 million is being repaid as part of the transaction. This
level of outstanding borrowings is consistent with the borrowed
amounts over the past several years.
Combined, Partners and SeaPort had available cash as of June 30,
2021 of approximately $14 million. The new $1 billion term loan B
proposed at OpCo will be ranked pari passu with the new revolver.
Both the revolver and the term loan will be secured by a perfected
first priority lien on all assets of OpCo. Fitch expects the
covenants on the proposed credit facilities to be less restrictive,
compared to the existing revolver.
This new structure will not have any maturities prior to the senior
unsecured notes at Partners, which mature in February 2026. The
structurally subordinated term loan at Holdings also has a maturity
date in February 2026. The proposed term loan B and revolver at
OpCo are expected to have tenors of seven and five years,
respectively.
ISSUER PROFILE
TransMontaigne owns and operates diversified petroleum liquids
products storage, terminaling, and transportation assets across
several regions of the United States. TransMontaigne is wholly
owned by ArcLight Energy Partners Fund VI, L.P.
SUMMARY OF FINANCIAL ADJUSTMENTS
Fitch typically calculates EBITDA by removing equity earnings from
unconsolidated affiliates and adding back the distributions from
unconsolidated affiliates.
ESG CONSIDERATIONS
Unless otherwise disclosed in this section, the highest level of
ESG credit relevance is a score of '3'. This means ESG issues are
credit-neutral or have only a minimal credit impact on the entity,
either due to their nature or the way in which they are being
managed by the entity.
TRANSUNION: Moody's Assigns Ba2 CFR & Alters Outlook to Negative
----------------------------------------------------------------
Moody's Investors Service assigned to TransUnion a Ba2 corporate
family rating, a Ba2-PD probability of default rating, and a SGL-1
speculative grade liquidity rating. Moody's affirmed Trans Union,
LLC's existing senior secured 1st lien credit facilities at Ba2 and
assigned a Ba2 rating to its proposed senior secured 1st lien term
loan B-6 due 2028 and a B1 rating to its proposed senior secured
2nd lien term loan due 2029. The Ba2 CFR, Ba2-PD PDR, and SGL-1
ratings assigned at Trans Union, LLC were withdrawn. The outlook
was revised to negative from stable.
TransUnion announced that it plans to sell its non-core healthcare
revenue cycle management business for $1.4 billion (after-taxes)
and to purchase Sontiq, a provider of digital identify protection
and security solutions for $638 million in cash. On September 13th,
TransUnion announced that it had agreed to acquire Neustar, Inc.'s
("Neustar", B3 rating on review for upgrade) marketing, risk and
communications solutions businesses for $3.1 billion in cash.
TransUnion plans to issue the proposed $3.1 billion B-6 term loan
to source the cash needed to close the Neustar acquisition and the
proposed $640 million 2nd lien term loan to fund the Sontiq
purchase. Each acquisition is expected to close by the end of 2021.
The sale of the healthcare business is expected to close sometime
after the two acquisitions and remains subject to customary closing
conditions and regulatory approvals.
Moody's considers the two large, debt-funded acquisitions in rapid
succession and sale of the healthcare business evidence of an
increased tolerance for aggressive financial strategies. Although
TransUnion has stated that it intends to repay debt with the net
proceeds of the healthcare sale, there is no contractual
requirement that the company do so. As such, governance risk was a
key driver of the rating outcome. The assignment of the Ba2 CFR and
Ba2-PD PDR at publicly-traded TransUnion and simultaneous
withdrawal of the Ba2 CFR and Ba2-PD PDR at Trans Union, LLC places
these ratings at the issuer of the audited financial statements.
RATINGS RATIONALE
"The debt-funded Neustar and Sontiq acquisitions will double
TransUnion's debt to EBITDA, which could remain above 4.5 times for
up to 2 years, leading to the revision of the outlook to negative
from stable," said Edmond DeForest, Moody's Senior Vice President.
The Ba2 CFR reflects TransUnion's growing revenue size and earnings
diversity, as well as Moody's expectations for debt to EBITDA to
drop below 4.5 times by the end of 2023 through both profit
expansion and debt repayment and good organic growth in adjusted
EBITDA of about 15% over the next 12 to 18 months. TransUnion's
credit profile is supported by its sustainable market position as
one of the three principal consumer credit bureaus in the US with
high barriers to entry. The company's recent performance has
benefited from the strong consumer borrowing trends and a
significant portion of its revenues are driven by the demand for
information solutions by its customers related to new marketing and
customer acquisition activity. TransUnion's critical role in
consumer finance and its possession of large amounts of consumer
private data increase regulatory and information security risks.
All financial metrics cited reflect Moody's standard adjustments.
Moody's estimates that TransUnion's debt to EBITDA will increase
from 2.9 times as of September 30, 2021 to 5.8 times pro forma for
announced acquisitions, divestiture and new financing. Likewise,
free cash flow to debt will likely fall from around 15% as of
September 30, 2021 to no more than 5% to 7% over the next 12 to 18
months. The company should be able to reduce debt to EBITDA down
toward 4.5 times by the end of 2023 through both profit expansion
and debt repayment. While TransUnion has had a history of growing
via debt-funded acquisitions, the company has also shown an ability
to reduce financial leverage quickly. Should TransUnion become more
aggressive by using debt to fund additional acquisitions and pursue
shareholder friendly financial policies before financial leverage
returns to below 4.5 times, there could be downward ratings
pressure. Moody's notes that net debt to EBITDA as of the just
ended 12 month period and pro forma for the announced transactions
is only about 4.1 times.
The acquisition of Sontiq will allow TransUnion to expand its
consumer services into the ID protection market. The Neustar
acquisition will bolster TransUnion's product capabilities within
its marketing, fraud and communications business lines in the US.
However, integration risks from both purchases will be elevated
over the next 12 months. The divestiture of the healthcare business
will allow the company to focus on its core credit and identify
solutions businesses. The loss of the strong earnings from the
healthcare business leads Moody's to anticipate approximately 35%
EBITDA margins in 2022, down by about 500 basis points compared to
40% EBITDA margins for the LTM period ended September 30, 2021.
Although some of the proceeds from the healthcare business sale
could be used to repay debt, Moody's anticipates that the company
may use the cash to fund other investments, including future
acquisitions. TransUnion will have about $2 billion of cash once
the divestiture closes if it does not repay any debt with the
proceeds. Moody's considers the large debt-funded acquisitions and
lack of commitment to use cash raised from the sale to repay debt
immediately a sign of more aggressive financial strategies. Moody's
had considered TransUnion to have balanced, although opportunistic,
financial policies, with financial leverage typically maintained
between 3.5 and 4.5 times. TransUnion's critical role in
facilitating consumer lending and its possession of large amounts
of consumer private data expose the company to high regulatory and
cybersecurity risks. As such, significant governance risk also
surrounds maintaining appropriate levels of data security.
Trans Union, LLC is an indirect subsidiary of TransUnion and the
borrower of the rated debts, which include a $300 million senior
secured 1st lien revolving credit facility, approximately $6.4
billion of senior secured 1st lien term loans, including the
proposed B-6 loan, and $640 million of senior secured 2nd lien term
loan. TransUnion does not guarantee the rated debts and does not
have any material assets, liabilities, revenues, expenses or
operations of any kind other than its ownership investment in
TransUnion Intermediate Holdings, Inc., which is the direct parent
of Trans Union, LLC and does provide a secured guarantee of the
rated debt.
The Ba2 rating and LGD3 loss given default assessment for the
senior secured 1st lien credit facilities reflect the Ba2-PD PDR
and the expected loss given default for the 1st lien obligations.
The loans are secured by a first priority interest in substantially
all assets of Trans Union, LLC and its subsidiaries, and has
upstream guarantees secured on a 1st priority basis from its
primary subsidiaries. While the proposed 2nd lien term loan
provides first loss support to the 1st lien debt, the Ba2 1st lien
rating is the same as the Ba2 CFR, reflecting the small size of the
2nd lien obligations compared to the total amount of 1st lien
debt.
The B1 rating and LGD6 loss given default assessment for the senior
secured 2nd lien term loan reflect the Ba2-PD PDR and the expected
loss given default for the 2nd lien obligations. The rating is two
notches below the Ba2 CFR, reflecting the subordination of the 2nd
lien term loan to the large amount of 1st lien debt in Moody's
hierarchy of claims at default.
The SGL-1 liquidity rating reflects TransUnion's very good
liquidity profile over the next 12 to 15 months primarily
reflecting its cash balances of over $2 billion as of September 30,
2021, pro forma for the healthcare business sale proceeds, Moody's
expectations for $500 million of free cash flow (before
transaction-related expenses) and full availability under its $300
million revolving credit facility, which matures in December 2024.
Moody's expects TransUnion will have wide headroom under financial
covenants applicable to its revolver and series A term loan; the
financial covenants do not apply to the series B-5 term loan, the
new B-6 term loan and the 2nd lien term loan.
The negative outlook reflects Moody's concerns that without a
sustained commitment to debt reduction and success in achieving
profit expansion, financial leverage could remain above 4.5 times
beyond 2022. The outlook could be revised to stable if Moody's
expects debt to EBITDA to decline and be maintained around 4.0
times and free cash flow as a percentage of debt to grow and be
sustained above 8%.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Given the negative outlook, an upgrade is not likely in the near
term. Over the medium term, Moody's could upgrade TransUnion's
ratings if the company maintains solid revenue and earnings growth,
sustains debt to EBITDA below 3.5 times, maintains free cash flow
approaching the mid-teens percentages of debt, establishes a track
record of conservative financial policies and gains additional
financial flexibility by reducing the proportion of secured to
total debt.
The ratings could be downgraded if TransUnion does not repay a
substantial amount of debt, leading Moody's to expect that debt to
EBITDA will be sustained above 4.5 times and free cash flow will
remain below 8% of total debt.
The principal methodology used in these ratings was Business and
Consumer Service Industry published in October 2016.
The following ratings/assessments are affected by the action:
Issuer: TransUnion
Corporate Family Rating, Assigned Ba2
Probability of Default Rating, Assigned Ba2-PD
Speculative Grade Liquidity Rating, Assigned SGL-1
Outlook, is Negative
Issuer: Trans Union, LLC
Corporate Family Rating, Withdrawn, previously rated Ba2
Probability of Default Rating, Withdrawn, previously rated Ba2-PD
Speculative Grade Liquidity Rating, Withdrawn, previously rated
SGL-1
Senior Secured Bank Credit Facility, Affirmed Ba2 (LGD3)
Senior Secured 1st Lien Term Loan B-6, Assigned Ba2 (LGD3)
Senior Secured 2nd Lien Term Loan, Assigned B1 (LGD6)
Outlook, Changed To Negative From Stable
TransUnion, based in Chicago, IL, provides consumer credit reports
and information and risk management solutions and operates in over
30 countries. Moody's expects 2022 revenue of over $3.0 billion.
TRANSUNION: S&P Affirms 'BB+' Issuer Credit Rating, Outlook Stable
------------------------------------------------------------------
S&P Global Ratings affirmed its existing ratings on Chicago-based
consumer credit bureau and risk information services provider
TransUnion, including its 'BB+' issuer credit rating. At the same
time, S&P is assigning its 'BBB-' issue-level and '2' recovery
ratings to the new first-lien term loan and its 'BB' issue-level
and '5' recovery ratings to the new second-lien term loan.
S&P said, "The stable outlook on TransUnion reflects our view that
the company's S&P Global Ratings'-adjusted leverage will return to
the 4x area or lower in 2022. We expect sustained free operating
cash flow (FOCF) to debt above 10% as the company grows organic
revenues and EBITDA at a mid- to high-single-digit percent rate
while successfully integrating its Neustar and Sontiq
acquisitions.
"We expect adjusted leverage to fall below our 4x rating threshold
over the next 12 to 18 months. We expect TransUnion will continue
growing organically in the mid- to high-single-digit percent range
over the next two to three years through new business wins, product
innovation, and the ongoing pandemic-related recovery of its
international business. Absent additional high-priced acquisitions,
we expect EBITDA growth will cause adjusted leverage to fall to
around 4x in 2022 and below 3.5x in 2023. Key risks include
increasing regulatory scrutiny and cybersecurity risk, exposures to
cyclical transaction-based consumer credit report demand, and an
acquisitive growth strategy that could result in adjusted leverage
remaining above our 4x rating threshold.
"Despite our expectation that adjusted leverage will temporarily
rise above the threshold, the affirmation reflects TransUnion's
sustainable market position as one of the top three national credit
reporting agencies (NCRAs) due to high entry barriers, good
operating efficiency, and strong profitability."
The acquisitions sharply improve TransUnion's identity management
solutions capabilities. TransUnion's $3.1 billion purchase of
digital marketing services, fraud mitigation, and communications
company Neustar Inc. will enhance its identity management solutions
with access to a broader data set and enhanced machine learning and
artificial intelligence capabilities. While TransUnion had made a
series of smaller acquisitions and investments in similar offerings
over the past few years, S&P believes Neustar's OneID platform is
more advanced. If successfully integrated with TransUnion's large
pools of data, the acquisition could drive incremental revenue
growth over the next three to five years. However, incremental S&P
Global Ratings'-adjusted EBITDA from the transaction will be
limited in 2022 due to costs to achieve expected synergies. In
addition, S&P expects Neustar-related capital expenditures to
include a high percentage of capitalized software development
costs, which it treats as an operating expense. The digital
marketing and fraud mitigation services markets face significant
price-based competition, and margin improvement will require the
development and customer adoption of higher value-added solutions
(e.g., predictive analytics).
TransUnion also announced the $638 million acquisition of Sontiq,
which adds a profitable identity protection platform to
TransUnion's Consumer Interactive segment that provides solutions
through both direct to consumer and indirect channels like
insurance and employee benefits. While TransUnion had previously
been selling data to third-party identity solution offerings, the
addition of Sontiq will allow the company to go to market with a
product of its own. S&P expects Transunion well regarded service
reputation and capabilities will help Sontiq sustain recent double
digit percent growth trends.
TransUnion has limited flexibility at the current 'BB+' rating.
TransUnion has an active acquisition strategy to grow or diversify
into new verticals and geographies and gain a stronger foothold in
its existing verticals. The company maintains a financial policy
with target leverage below 3.5x (S&P Global Ratings'-adjusted
leverage calculation tends to be about 500 basis points higher
because of our capitalized software and lease adjustments).
However, the company has developed a history of temporarily
exceeding its policy target for acquisitions and the company
continuously evaluates acquisition opportunities.
The high-priced acquisitions of Neustar and Sontiq will again
increase leverage above the company's target leverage and our 4x
downgrade threshold for the rating. However, TransUnion has
established a deleveraging track record, and its decision to sell
its healthcare business will generate about $1.4 billion of net
proceeds. S&P expects a portion of the proceeds to repay the debt,
which partially reflects a commitment to its financial policy.
The major demand for credit information is cyclical. The company
generates a majority of its revenues from financial service
providers that depend on favorable macroeconomic conditions for
growth. TransUnion has diversified into other verticals like
insurance over the last few years, and its recent focus on building
out its identity verification and protection offerings reduces
potential volatility from macroeconomic factors. Still, S&P
believes its transaction-based revenues are strongly correlated to
macroeconomic trends as banks and other credit-providing
institutions continue to account for a significant portion of
revenue. For example, a strong U.S. mortgage market buoyed
operating performance in the back half of 2020 into 2021 and
accounted for 12% of total revenue over the last 12 months.
S&P said, "The stable outlook on TransUnion reflects our view that
the company's S&P Global Ratings'-adjusted leverage will return to
the 4x area or lower in 2022. We expect sustained FOCF to debt
above 10% as the company grows organic revenues and EBITDA at a
mid- to high-single-digit percent rate while successfully
integrating its Neustar and Sontiq acquisitions.
"We could lower our ratings if the company adopts a more aggressive
financial policy, including additional large debt-funded
acquisitions, causing leverage to remain well above the 4x area and
FOCF to debt to drop below 10% on a sustained basis. Less likely
factors that could trigger a downgrade include a significant
business downturn or an unforeseen loss in business stemming from a
cybersecurity breach or regulatory restrictions that would lead to
sharp revenue and EBITDA margin declines.
"We could raise the rating to 'BBB-' if the company continues to
scale its business and capabilities, improve its profit margins,
and diversify its revenues. In this scenario, we would feel more
confident about the company's ability to sustain revenue and profit
margins through an economic down cycle and believe it will maintain
its adjusted leverage comfortably below 4x despite short-term and
temporary increases to fund acquisitions."
TRIBUNE MEDIA: 2009 Disposition of Chicago Cubs a Disguised Sale
----------------------------------------------------------------
Tribune Co.'s 2009 disposition of the Chicago Cubs was a disguised
sale to the newly formed partnership, the United States Tax Court
has ruled.
Tribune Media Co. f.k.a. Tribune Co. & Affiliates formed Chicago
Baseball Holdings, LLC (CBH), with the Ricketts family, in 2009
with Tribune contributing the Chicago Cubs Major League Baseball
team and related assets and the Ricketts family contributing $150
million in cash. The deal closed October 27, 20090. At the time,
the Cubs assets had a fair market value of about $770 million. CBH
also assumed $35.2 million in Cubs liabilities, bringing the net
fair market value of the contribution to $734.7 million. On the
closing date, CBH made a special distribution to Tribune of $704.8
million as required by the formation agreement.
According to the Tax Court, this type of transaction is a
"disguised sale," which neither party disputes. Although the name
"disguised sale" might seem pejorative, disguised sales are well
recognized, and they are taxable, the Court said.
CBH entered into two tranches of debt: The Senior Debt, funded by a
commercial lender; and the Sub Debt, funded by the Ricketts family.
Tribune guaranteed collection of the debt. To the extent Tribune
is deemed ultimately responsible for the debt, the distribution
would be considered debt financed and would not be taxable, the Tax
Court said.
Several banks lent CBH a total of $425 million. Under the terms of
the senior credit agreement governing these loans, CBH could use
the senior debt only to (1) pay transaction costs, (2) fund a debt
service reserve account, and (3) make the special distribution to
Tribune.
On the closing date, CBH issued and sold $250 million of the senior
debt secured notes to third parties. The notes were issued in three
series, set to mature in 2018, 2020, and 2022. An agreement
executed by CBH and the buyers of the notes required CBH to use the
proceeds to pay down $250 million of the senior debt, bringing the
senior debt down to $175 million.
The parties to these cases stipulated that the senior debt is bona
fide debt for Federal income tax purposes. But they disagree as to
whether the senior debt should be characterized as recourse or
nonrecourse to Tribune.
Additionally, the Ricketts Family's Ricketts Acquisition LLC (RAC),
which was formed for the CBH deal, and Tribune chose to use sub
debt after a failing financial market left the parties with few
options. RAC pulled as much debt funding as possible from
third-party lenders as senior debt.
The largest source of the sub debt was Marlene Ricketts, mother of
Thomas Ricketts, through MMR Financing, LLC. Thomas Ricketts
considered the MMR Financing to be Marlene Ricketts' "private
funds." Marlene Ricketts was never asked to purchase an equity
interest. The family's strategy was to fund the equity part of its
investment only from the trust because it existed outside the
family's estate.
MMR Financing and RAC created a separate entity from which to fund
the sub debt and to hold the corresponding promissory note: RAC
Education Trust Finance, LLC (RAC Finance). MMR Financing
contributed $250,750,000 to RAC Finance, and RAC contributed $18
million. RAC was the sole manager of RAC Finance. Thomas Ricketts
was executive vice president of RAC and had the authority to make
decisions for RAC Finance. Neither MMR Financing nor RAC Finance
was a member of CBH, and neither entity had participation or voting
rights in CBH.
On the closing date, RAC Finance transferred $248,750,000 to CBH in
exchange for the subordinate promissory note (sub debt note).
Although the ultimate transfer came from RAC Finance, Marlene
Ricketts funded most of the sub debt with her private funds from
MMR Financing.
Tribune, RAC, CBH and the Internal Revenue dispute whether the sub
debt is debt or equity for Federal income tax purposes.
The Commissioner of Internal Revenue issued a notice of deficiency
to Tribune and a notice of final partnership administrative
adjustment (FPAA) as to CBH for 2009. In those notices, the
Commissioner determined that the series of transactions was
taxable. In support of those notices, the Commissioner argues that
the debt funded by the Ricketts family is not bona fide debt and
thus should be disregarded for purposes of the debt-financed
distribution rule. The Commissioner further argues that the
likelihood that Tribune would ever be called upon to satisfy its
guaranty is so remote that the guaranty should be disregarded.
The Tax Court said Tribune entered into a bona fide guaranty of the
debt, and the fact that having to fulfill that guaranty is remote
is not sufficient to disregard it. The debt funded by the Ricketts
family, however, is not bona fide debt for tax purposes and will be
disregarded, the Tax Court said.
The Tax Court also held that an advance characterized as sub debt
was equity for tax purposes, and the portion of the distribution
attributable to the sub debt cannot offset Tribune's recognized
gains from the disguised sale. The senior debt guaranty was bona
fide, and the portion of the distribution attributable to the
senior debt guaranty is a nontaxable debt-financed distribution.
In its ruling, the Tax Court also held that $2.5 million expenses
by Marc Utay, one of the potential bidders for the Cubs, must be
capitalized.
The case is TRIBUNE MEDIA COMPANY f.k.a. TRIBUNE COMPANY &
AFFILLIATES, Petitioner, v. COMMISSIONER OF INTERNAL REVENUE,
Respondent. CHICAGO BASEBALL HOLDINGS, LLC, NORTHSIDE ENTERTAINMENT
HOLDINGS, LLC, f.k.a. RICKETTS ACQUISITION, LLC, TAX MATTERS
PARTNER, Petitioner, v. COMMISSIONER OF INTERNAL REVENUE,
Respondent, Docket Nos. 20940-16, 20941-16 (Tax).
A full-text copy of the memorandum findings of fact and opinion
dated October 26, 2021, is available at
https://tinyurl.com/39a259wf from Leagle.com.
Joel V. Williamson, Esq. -- jwilliamson@mayerbrown.com -- Thomas
Lee Kittle-Kamp, Esq. -- tkittlekamp@mayerbrown.com -- Peter M.
Price, Esq. -- sprice@mayerbrown.com -- Anthony D. Pastore, Esq. --
apastore@mayerbrown.com -- Daniel S. Emas, Esq. --
demas@mayerbrown.com -- James B. Kelly, Esq. --
jkelly@mayerbrown.com -- Scott M. Stewart, Esq. --
sstewart@mayerbrown.com -- John W. Horne, Esq. --
JWHorne@mayerbrown.com -- Elizabeth P. Mazzocco, and Phillip M.
Goldberg, for petitioners.
Justin D. Scheid, Thomas F. Harriman, William Benjamin McClendon,
James M. Cascino, Grubert R. Markley, Rogelio A. Villageliu, and
Brandon S. Cline, for respondent.
Tribune Media Company, headquartered in Chicago, Ill., benefits
from television assets including 42 broadcast stations in 33
markets reaching 26% (with the reinstated UHF discount) of U.S.
households and the WGN America network with subscribers approaching
80 million. Tribune Media holds minority equity interests in
several media enterprises including TV Food Network which
contribute cash distributions. The company emerged from Chapter 11
bankruptcy protection at the end of 2012 and certain creditors
prior to Chapter 11 filing are now shareholders with funds of
Oaktree Capital Management LP (roughly 16%), Angelo, Gordon & Co.
LP (7%), and JPMorgan Chase (7%) representing three of the five
largest shareholders.
TRUE ENTERPRISE: Seeks to Hire David Marshall Brown as Counsel
--------------------------------------------------------------
True Enterprise, LLC seeks approval from the U.S. Bankruptcy Court
for the Southern District of Florida to employ David Marshall
Brown, P.A., as its counsel.
The firm will render these services:
(a) give advice to the Debtor in Possession with respect to its
powers and duties as a Debtor in Possession and the continued
management of the business operations;
(b) advise the Debtor in Possession with respect to its
responsibilities in complying with the U.S. Trustee's Operating
Guidelines and Reporting Requirements and with the rules of this
Court;
(c) prepare motions, pleadings, orders, applications,
adversary proceedings, and other legal documents necessary in the
administration of the case;
(d) protect the interest of the Debtor in Possession in all
matters pending before the Court;
(e) represent the Debtor in Possession in negotiation with its
creditors in the preparation of a plan.
David Marshall Brown will be paid based upon its normal and usual
hourly billing rates. The firm will also be reimbursed for
reasonable out-of-pocket expenses incurred.
David Marshall Brown, partner of David Marshall Brown, P.A.,
assured the Court that the firm is a "disinterested person" as the
term is defined in Section 101(14) of the Bankruptcy Code and does
not represent any interest adverse to the Debtor and its estates.
David Marshall Brown can be reached at:
David Marshall Brown, Esq.
DAVID MARSHALL BROWN, P.A.
413 S.W. 5th St.
Fort Lauderdale, FL 33315
Tel: (954) 770-3729
About True Enterprise, LLC
True Enterprise is a licensed compost facility in Broward County
that properly disposes of vegetative landscaping waste by recycling
it into composted soil.
True Enterprise, LLC filed its voluntary petition for relief under
Chapter 11 of the Bankruptcy Code (Bankr. S.D. Fla. Case No.
21-19977) on Oct. 18, 2021. The petition was signed by Ron Nigro,
trustee of The Ron Nigro Living Trust. At the time of filing, the
Debtor estimated $1 million to $10 million in assets and $500,000
to $1 million in liabilities.
Judge Scott M. Grossman oversees the case.
David Brown, Esq. at DAVID MARSHALL BROWN, P.A. represents the
Debtor as counsel.
TUKHI BUSINESS: Wins Cash Collateral Access Thru Dec 15
-------------------------------------------------------
The U.S. Bankruptcy Court for the Central District of California,
Santa Ana Division, has authorized Tukhi Business Group, LLC to
use cash collateral on an interim basis through and including
December 15, 2021.
The Debtor will make payments in the amount of $2,000 to the
secured lien holder as set forth in the Motion.
The Debtor is authorized to use cash collateral to pay utility
services only under the Debtor's name. However, the request for
insider compensation is denied.
As reported by the Troubled Company Reporter, the Debtor has a
single secured creditor as of the date of filing, Joseph S. Cerni,
who is owed $639,822. That obligation is secured by the Debtor's
Real Property located at 11332 N. Hewes Street, Orange, CA 92869
which is a Duplex Family Residential property. The Debtor
estimates that the subject property value is $1,000,000 based on
comparable sales and the Debtor's knowledge of area.
A continued hearing on the matter is scheduled for December 15 at
1:30 p.m.
About Tukhi Business Group, LLC
Tukhi Business Group, LLC sought protection under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. C.D. Cal. Case No. 21-12090) on August
27, 2021. In the petition filed by Ahmad J. Tukhi, manager/agent
for service of process, the Debtor disclosed up to $1 million in
both assets and liabilities.
Judge Scott C. Clarkson oversees the case.
Onyinye N. Anyama, Esq., at Anyama Law Firm, A Professional
Corporation, represents the Debtor as counsel.
U.S. SILICA: Reports Third Quarter Net Loss of $20.2 Million
------------------------------------------------------------
U.S. Silica Holdings, Inc. filed with the Securities and Exchange
Commission its Quarterly Report on Form 10-Q disclosing a net loss
of $20.17 million on $267.30 million of total sales for the three
months ended Sept. 30, 2021, compared to a net loss of $14.22
million on $176.47 million of total sales for the three months
ended Sept. 30, 2020.
For the nine months ended Sept. 30, 2021, the Company reported a
net loss of $15.21 million on $819.02 million of total sales
compared to a net loss of $119.44 million on $618.61 million of
total sales for the same period a year ago.
As of Sept. 30, 2021, the Company had $2.24 billion in total
assets, $1.61 billion in total liabilities, and $628.01 million in
total stockholders' equity.
Net cash provided by operating activities was $156.8 million for
the nine months ended Sept. 30, 2021. This was mainly due to a
$15.2 million net loss adjusted for non-cash items, including
$122.5 million in depreciation, depletion and amortization, $3.2
million in deferred income taxes, $13.4 million in equity-based
compensation, $14.3 million in deferred revenue, and $27.0 million
in other miscellaneous non-cash items. Also contributing to the
change was a $31.2 million decrease in accounts receivable, an
$11.7 million increase in inventories, a $1.2 million decrease in
prepaid expenses and other current assets, a $36.8 million increase
in accounts payable and accrued liabilities, a $19.7 million
decrease in lease liabilities, and an $11.1 million change in other
operating assets and liabilities.
Net cash used in investing activities was $15.0 million for the
nine months ended Sept. 30, 2021. This was mainly due to capital
expenditures of $15.4 million and capitalized intellectual property
costs of $0.2 million, offset by $0.6 million in proceeds from the
sale of property, plant and equipment. Capital expenditures for
the nine months ended Sept. 30, 2021 were primarily related to
improvements and expansions at our industrial facilities in Millen,
Georgia, facility improvement and maintenance projects, and other
environmental and health and safety projects.
Net cash used in financing activities was $42.2 million for the
nine months ended Sept. 30, 2021. This was mainly due to $4.2
million of short-term debt payments, $9.6 million of long-term debt
payments, $25.0 million payment on the Revolver, $0.8 million of
distributions to a non-controlling interest, $0.4 million of
principal payments on finance leases, and $2.2 million of tax
payments related to shares withheld for vested restricted stock and
stock units.
A full-text copy of the Form 10-Q is available for free at:
https://www.sec.gov/ix?doc=/Archives/edgar/data/1524741/000152474121000046/slca-20210930.htm
About U.S. Silica
Headquartered in Katy, Texas, U.S. Silica Holdings, Inc. --
http://www.ussilica.com-- is a global performance materials
company and a producer of commercial silica used in a wide range of
industrial applications and in the oil and gas industry. In
addition, through its subsidiary EP Minerals, LLC, the Company
produces products derived from diatomaceous earth, perlite,
engineered clays, and non-activated clays.
U.S. Silica reported a net loss of $115.12 million in 2020, a net
loss of $329.75 million in 2019, and a net loss of $200.82 million
in 2018. As of June 30, 2021, the Company had $2.26 billion in
total assets, $1.61 billion in total liabilities, and $648.74
million in total stockholders' equity.
ULTRA PETROLEUM: Investor Asks Court to Dismiss Securities Suit
---------------------------------------------------------------
McCord Pagan of Law360 reports that an Ultra Petroleum Corp.
investor asked a Colorado federal judge to dismiss it from an
amended class action securities suit alleging the energy company's
executives lied about its prospects after it emerged from
bankruptcy in 2018, saying as a minority shareholder it didn't
control the oil and gas producer.
Fir Tree Capital Management LP urged the court on Friday, Oct. 29,
2021, to dismiss it from the July 2021amended complaint, saying
that it owned at most 18.5% of Ultra's stock and only appointed one
person to the seven-member board of directors.
About Ultra Petroleum
Ultra Petroleum Corp., an independent oil and gas company, engages
in the acquisition, exploration, development, operation, and
production of oil and natural gas properties. Its principal
business activities are developing its natural gas reserves in the
Green River Basin of southwest Wyoming, the Pinedale and Jonah
fields. The company was founded in 1979 and is headquartered in
Englewood, Colorado.
Ultra Petroleum Corp. and its affiliates sought Chapter 11
protection (Bankr. S.D. Tex. Lead Case No. 20-32631) on May 14,
2020.
The Debtor disclosed total assets of $1,450,000,000 and total debt
of $2,560,000,000 as of March 31, 2020.
The Hon. Marvin Isgur is the case judge.
The Debtors tapped KIRKLAND & ELLIS LLP as general bankruptcy
counsel; JACKSON WALKER LLP as local bankruptcy counsel; CENTERVIEW
PARTNERS LLC as investment banker; and FTI CONSULTING, INC., as
financial advisor. Prime Clerk LLC is the claims agent.
UNIFIED SECURITY: Case Summary & 5 Unsecured Creditors
------------------------------------------------------
Debtor: Unified Security Services, Inc.
4431 W. Rosecrans Ave., Ste 200
Hawthorne, CA 90250
Chapter 11 Petition Date: November 2, 2021
Court: United States Bankruptcy Court
Central District of California
Case No.: 21-18392
Judge: Hon. Sandra R. Klein
Debtor's Counsel: Michael Jay Berger, Esq.
LAW OFFICES OF MICHAEL JAY BERGER
9454 Wilshire Boulevard, 6th Floor
Beverly Hills, CA 90212
Tel: (310) 271-6223
Fax: (310) 271-9805
E-mail: michael.berger@bankruptcypower.com
Estimated Assets: $0 to $50,000
Estimated Liabilities: $1 million to $10 million
The petition was signed by Sherif Antoon as president.
A full-text copy of the petition containing, among other items, a
list of the Debtor's five unsecured creditors is available for free
at PacerMonitor.com at:
https://www.pacermonitor.com/view/2RBY6OQ/Unified_Security_Services_Inc__cacbke-21-18392__0001.0.pdf?mcid=tGE4TAMA
VIZIV TECHNOLOGIES: Opposes Bid to Appoint Equity Committee
-----------------------------------------------------------
Viziv Technologies, LLC has criticized ACT Family Ltd.'s request
for the formation of an official committee of equity security
holders in the company's Chapter 11 case.
ACT Family, an investor in two funds that were formed to facilitate
investments in Viziv Technologies, wrote a letter to the U.S.
Trustee for Region 6 on Oct. 28, saying equity holders are not
adequately represented in the plan confirmation process, which
warrants the formation of an equity committee.
The investor also argued that Viziv Technologies is solvent and
that a return of value to equity holders is anticipated as the
competing Chapter 11 plans filed in the company's bankruptcy case
both propose to provide a distribution to equity holders, including
investors in the funds.
In court papers, Viziv Technologies' attorney, Charles Hendricks,
Esq., at Cavazos Hendricks Poirot, P.C., denied that the company's
equity security holders are not adequately represented. He pointed
out that the proponents of the competing plans are themselves
substantial equity holders and that the holders of approximately
72% of the issued and outstanding equity have been engaged in the
company's bankruptcy case since its filing.
Mr. Hendricks also argued that the appointment of an equity
committee would delay the entire confirmation process.
"Staying in bankruptcy is expensive and diverts the organization
from its business as a research and development company," Mr.
Hendricks said, adding that the company does not have operating
income and that it depends completely on the bankruptcy loan
provided by lenders.
Also there is a chance for the plans to be confirmed and
substantially consummated by the end of the year since the date for
the hearing to consider the disclosure statement describing the
plans is less than two weeks away, according to the attorney.
"The equity holders in this case are receiving a very good result,
and the additional cost and distraction of an equity committee is
not needed," Mr. Hendricks said.
ACT Family is represented by:
Michael P. Cooley, Esq.
Reed Smith, LLP
2850 N. Harwood Street, Suite 1500
Dallas, TX 75201
Office: +1 469 680 4200
Direct: +1 469 680 4213
Fax: +1 469 680 4299
Email: mpcooley@reedsmith.com
About Viziv Technologies
Viziv Technologies, LLC is an electronics company in Italy, Texas,
which specializes in the field of electromagnetic surface waves.
On Oct. 7, 2020, creditors Surface Energy Partners LP, Kendol C.
Everroad and Jamison Partners, LP, filed an involuntary petition
for relief under Chapter 11 of the Bankruptcy Code (Bankr. N.D.
Tex. Case No. 20-32554) against Viziv Technologies. The creditors
are represented by Kenneth Stohner Jr., Esq., at Jackson Walker,
LLP.
Judge Stacey G. Jernigan, who oversees the case, entered an order
for relief on Oct. 12.
Cavazos Hendricks Poirot, PC, is the Debtor's bankruptcy counsel.
The Debtor tapped Allred & Wilcox, PLLC, The Beckham Group and King
& Fisher Law Group, PLLC as special counsel; Stout Risius Ross, LLC
as investment banker; RSM US LLP as auditor; and Johnson McNamara,
LLC as accountant.
3:10 Capital WPF VII LLC, a post-petition lender, filed a Chapter
11 plan of reorganization for the Debtor on Sept. 3, 2021. KBST
Investments, LLC filed its proposed Chapter 11 plan of liquidation
for the Debtor on Sept. 6.
WESCO INT'L: Fitch Affirms 'BB-' LT IDRs & Alters Outlook to Pos.
-----------------------------------------------------------------
Fitch Ratings has affirmed the Long-Term Issuer Default Ratings
(IDRs) of WESCO International, Inc. and WESCO Distribution, Inc. at
'BB-'. The Rating Outlook is revised to Positive from Stable. Fitch
has also affirmed WESCO Distribution's ABL facility at 'BB+'/'RR1',
WESCO Distribution's senior unsecured notes at 'BB-'/'RR4', Anixter
Inc.'s senior unsecured notes at 'BB-'/'RR4', and WESCO
International's preferred stock at 'B'/'RR6'.
The revision of the Outlook to Positive is due to a steady pace of
deleveraging that exceeded Fitch's initial expectations. Fitch now
expects leverage (Total Debt with Equity Credit/Operating EBITDA)
to decline to 4x by year-end 2022 due to gross debt reduction and
EBITDA expansion. The company's significantly increased size and
scale, strong market position and stable free cash flow are
supporting factors of the rating.
KEY RATING DRIVERS
Leverage Reduction: Fitch calculated WESCO's leverage (Total Debt
with Equity Credit/Operating EBITDA) at approximately 7.7x at
year-end 2020, excluding full-year Anixter Inc. (Anixter) results.
Fitch expects leverage will decline to the mid-4x range by year-end
2021, driven by a full year of Anixter accretion, approximately
$500 million-$600 million of gross debt reduction, and stronger
than expected earnings. Fitch expects leverage to further decline
to approximately 4x by the end of 2022 as profitability continues
to rise and the company utilizes FCF to pay down revolver balances.
WESCO is likely to reach their net leverage target of less than
3.5x by the end of 2022, after which Fitch believes debt reduction
will be deprioritized.
Operating Trends: WESCO experienced a pro forma organic revenue
decline of approximately 7% in 2020 as the coronavirus pandemic led
to slowdown in industrial and construction end markets, with the
utilities end market providing some stabilization. End market
recovery and positive long-term trends in electrification,
automation and grid-hardening are expected to lead to pro forma
revenue growth in the high-single digits for 2021, with top-line
expansion in the low- to mid-single digits thereafter. WESCO could
realize additional upside if it is able to capture meaningful
revenue synergies.
Stable Cash Flow Generation: WESCO has consistently generated
strong FCF, which Fitch views as a positive credit driver. Cash
generation is typically counter-cyclical for distributors as they
have the flexibility to unload inventory while scaling back
purchases in periods of downturn. Fitch calculated $457 million of
FCF in 2020 and expects consolidated FCF will be modestly lower in
2021 and 2022 as the company spends cash on restructuring and capex
to integrate Anixter and achieve cost synergies. Fitch believes
long-term FCF margins will stabilize between 2.5% and 3.5% of
annual revenue.
Narrow Operating Margins: WESCO's EBITDA margins have averaged
about 5% over the last three years, which is relatively weak but in
line with industry peers. The merger with Anixter does not
fundamentally change the company's profitability profile; however,
management increased its cost synergy target from $200 million to
$300 million by the end of 2023, with $117 million realized by 2H
2021. Through the medium term this should drive EBITDA margins
above 6%, with potential additional upside.
Increased Diversification: The merger with Anixter International
increases the consolidated company's diversification, as legacy
WESCO was somewhat concentrated in the industrial and construction
end markets. Anixter's focus on data communications provides a
complementary and more stable business. Both companies are well
diversified by customer, with no customer totaling more than 2% of
revenue. The majority (over 70%) of the pro forma company's revenue
is generated in the U.S.; however, Anixter's larger international
presence expands legacy WESCO's geographic footprint which could
lead to cross selling opportunities.
Strong Market Position: Fitch believes WESCO's top market position
in the electrical distribution industry is a strong positive factor
of the credit profile. The combination with Anixter solidifies the
company as the number one electrical and data communication
distributor in North America with a market share of approximately
13%. The overall market remains highly fragmented, with few
competitors with meaningful market share. Fitch expects that WESCO
will resume its acquisitive posture once the integration with
Anixter is complete and the company achieves its leverage reduction
targets.
Significant Size and Scale: WESCO's purchase of Anixter effectively
doubles the company's size, which has beneficial impacts on the
operating profile. Fitch believes there are modest competitive
advantages provided by increased scale, including cost savings from
a consolidated supply chain and increased market position
defensibility through broad customer and supplier relationships.
Aside from the company's projected cost synergies, there could be
additional benefits from revenue synergies that accelerate growth.
DERIVATION SUMMARY
WESCO has an operating profile similar to IT focused distributors
such as Avnet, Inc. (BBB-/Stable), Ingram Micro Inc. (BB-/Stable)
and Arrow Electronics, Inc. (BBB-/Stable) with EBITDA margins in
the mid-single digits and counter-cyclical free cash flow. However,
leverage is materially higher post acquisition of Anixter, Inc.
Compared to more industrial focused distributors such as W.W.
Grainger, Inc. and HD Supply, Inc., WESCO has greater scale,
significantly slimmer profitability margins, higher leverage and
comparable end-market cyclicality.
KEY ASSUMPTIONS
Fitch's key assumptions within its rating case for the issuer
include:
-- Organic revenue increases in the high-single digits in 2021
due to recovery in industrial and construction end markets
along with modest growth in utilities and power end markets;
-- Medium-term revenue growth in the low- to mid-single digits
annually as a result of positive trends such as grid-hardening
and increased global electrification;
-- EBITDA margins expand to around 6% in 2021 and progress to the
high-6% range by 2024 due to realized cost synergies and
profitability initiatives;
-- Working capital is a use of cash as the company stocks
inventory to meet growth;
-- Capex is elevated to approximately $120 million in 2021 to
facilitate growth efforts, mostly centered around IT
investments. Capex returns to approximately 0.5% of annual
revenue in by 2023;
-- FCF margins total approximately 2% in 2021, and sustain
between 2.5% and 3.5% thereafter;
-- Excess cash flow is used to moderately repay AR and ABL
facility borrowings;
-- Total debt with equity credit at YE 2022 is approximately $4.6
billion.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
-- The company successfully executes on its deleveraging
strategy, with leverage (total debt with equity
credit/operating EBITDA) sustaining below 4.0x and FFO
leverage sustaining below 4.5x;
-- EBITDA margins sustain above 6%;
-- FCF margins sustain above 3.5%.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
-- Leverage sustains above 5.0x;
-- FFO Interest coverage sustains below 2.5x;
-- FCF margins are consistently below 2%;
-- Excess cash is used for share repurchases as opposed to debt
repayment.
BEST/WORST CASE RATING SCENARIO
International scale credit ratings of Non-Financial Corporate
issuers have a best-case rating upgrade scenario (defined as the
99th percentile of rating transitions, measured in a positive
direction) of three notches over a three-year rating horizon; and a
worst-case rating downgrade scenario (defined as the 99th
percentile of rating transitions, measured in a negative direction)
of four notches over three years. The complete span of best- and
worst-case scenario credit ratings for all rating categories ranges
from 'AAA' to 'D'. Best- and worst-case scenario credit ratings are
based on historical performance.
LIQUIDITY AND DEBT STRUCTURE
Liquidity: As of June 30, 2021, WESCO had sufficient liquidity of
approximately $1,125 million, comprised of $288 million of
available cash and $873 million of ABL revolver availability, net
of $295 million in borrowings, letters of credit and borrowing base
reserves. The company also had $120 million of capacity under its
AR securitization facility.
Debt Structure: WESCO's debt structure as of June 30, 2021
consisted of $295 million outstanding on a $1.2 billion revolving
ABL facility, $1,180 million outstanding on a $1.3 billion AR
securitization facility, and $3.24 billion of senior unsecured
notes.
The company's subsidiary, WESCO Distribution, Inc. is the issuer of
$350 million of 5.375% unsecured notes due 2024, $1.5 billion of
7.125% unsecured notes due 2025, and $1.325 billion of unsecured
notes due 2028. The company has $58.6 million of 5.5% unsecured
notes due 2023 and $4.2 million of 6% unsecured notes due 2025
issued by Anixter Inc. outstanding as of June 30, 2021.
Additionally, the company had approximately $18 million outstanding
on other international lines of credit.
WESCO redeemed the $350 million 2024 notes in July 2021 for
101.344% of par value utilizing revolver borrowings.
Fitch also assigns 50% equity credit to the $540.3 million
liquidation preference of WESCO's Series A Preferred Stock.
ISSUER PROFILE
WESCO International is a global distributor of electrical and
communications products and provider of logistics and supply chain
services. The company supplies approximately 1.5 million products
through 800 branches in over 50 countries.
ESG CONSIDERATIONS
Unless otherwise disclosed in this section, the highest level of
ESG credit relevance is a score of '3'. This means ESG issues are
credit-neutral or have only a minimal credit impact on the entity,
either due to their nature or the way in which they are being
managed by the entity.
WSCE CORP: Seeks to Hire Amsterdam Accounting as Accountant
-----------------------------------------------------------
WSCE Corp. seeks approval from the U.S. Bankruptcy Court for the
Middle District of Pennsylvania to employ Amsterdam Accounting
Services, LLC as its accountants.
The firm will prepare and file tax returns and future monthly
operating reports.
The firm will customarily charges $150 dollars for accounting
services and requires a $2,500 retainer for corporate clients.
The firm considers flat rate fees after becoming accustomed to a
client’s work requirements.
Amsterdam Accounting is a disinterested person as defined by 11
U.S.C. Sec. 101(14), according to court filings.
The firm can be reached through:
Iris Perez
Amsterdam Accounting Services, LLC
264 W. Fordham Road
Bronx, NY 10468
Tel: (718) 568-0014
Fax: (718) 733-3300
Email: iyolimar@aol.com
About WSCE Corp.
WSCE Corp. filed a petition for Chapter 11 protection (Bankr. M.D.
Pa. Case No. 21-01873) on Aug. 25, 2021, listing as much as
$500,000 in both assets and liabilities. Judge Mark J. Conway
oversees the case. J. Zac Christman, Esq., serves as the Debtor's
bankruptcy attorney.
YORK PARKING: Seeks Approval to Hire Macco Law as Legal Counsel
---------------------------------------------------------------
York Parking, LLC seeks approval from the U.S. Bankruptcy Court for
the Southern District of New York to hire Macco Law Group, LLP as
its attorneys.
The firm will provide the following legal services:
(a) advise the Debtor with respect to its rights and duties;
(b) negotiate with creditors to propose a Chapter 11 plan of
reorganization;
(c) prepare, file and serve all necessary court pleadings;
(d) protect the interest of the Debtor before the court and
the Office of the U.S. Trustee; and
(e) perform other legal services to the Debtor in connection
with its Chapter 11 case.
The firm's hourly rates are as follows:
Partners $550
Senior associates $500
Junior associates $425
Paralegals $150
The firm will receive from the Debtor the sum of $17,500 as an
initial retainer.
Peter Corey, Esq., an associate at Macco Law, disclosed in court
filings that the firm, its partners and employees are
"disinterested persons" as that term is defined in section 101(14)
of the Bankruptcy Code.
The firm can be reached through:
Peter Corey, Esq.
MACCO LAW GROUP, LLP
2950 Express Drive South, Suite 109
Islandia, NY 11749
Telephone: (631) 549-7900
About York Parking, LLC
York Parking, LLC sought protection for relief under Chapter 11 of
the Bankruptcy Code (Bankr. S.D.N.Y. Case No. 21-11636) on Sept.
17, 2021, listing under $1 million in both assets and liabilities.
Peter Corey, Esq. at MACCO LAW GROUP, LLP represents the Debtor as
counsel.
[*] New Hampshire Bankruptcy Rose Slightly in October 2021
----------------------------------------------------------
NH Business Review reports that 54 New Hampshire individuals and
businesses filed for bankruptcy protection in October 2021, six
more than the record-low 48 that filed in September.
Despite the slight monthly uptick, the number of filings for the
month of October 2021 was 18 percent lower than the 66 filed in
October 2020 and far fewer than the 466 filed in 2009, in the
middle of the last recession.
You would have to go back to 1986 to find an October with fewer
filings (51). Filings have now stayed below 100 -- and often well
below 100 – for 19 straight months. For 30 years before that,
they were above 100 each month.
Everybody expected bankruptcies to rise during the pandemic, but
instead their number dropped by over 40 percent compared to 2019,
when they averaged 88. This year, they are averaging 63.
However, the number of business filings did increase. Six personal
filings included business-related debt, compared to three in
September. And three businesses did file directly, compared to two
in September. However, two are affiliates (and its owner filed
personally with business-related debt as well).
*********
Monday's edition of the TCR delivers a list of indicative prices
for bond issues that reportedly trade well below par. Prices are
obtained by TCR editors from a variety of outside sources during
the prior week we think are reliable. Those sources may not,
however, be complete or accurate. The Monday Bond Pricing table
is compiled on the Friday prior to publication. Prices reported
are not intended to reflect actual trades. Prices for actual
trades are probably different. Our objective is to share
information, not make markets in publicly traded securities.
Nothing in the TCR constitutes an offer or solicitation to buy or
sell any security of any kind. It is likely that some entity
affiliated with a TCR editor holds some position in the issuers
public debt and equity securities about which we report.
Each Tuesday edition of the TCR contains a list of companies with
insolvent balance sheets whose shares trade higher than $3 per
share in public markets. At first glance, this list may look like
the definitive compilation of stocks that are ideal to sell short.
Don't be fooled. Assets, for example, reported at historical cost
net of depreciation may understate the true value of a firm's
assets. A company may establish reserves on its balance sheet for
liabilities that may never materialize. The prices at which
equity securities trade in public market are determined by more
than a balance sheet solvency test.
On Thursdays, the TCR delivers a list of recently filed
Chapter 11 cases involving less than $1,000,000 in assets and
liabilities delivered to nation's bankruptcy courts. The list
includes links to freely downloadable images of these small-dollar
petitions in Acrobat PDF format.
Each Friday's edition of the TCR includes a review about a book of
interest to troubled company professionals. All titles are
available at your local bookstore or through Amazon.com. Go to
http://www.bankrupt.com/books/to order any title today.
Monthly Operating Reports are summarized in every Saturday edition
of the TCR.
The Sunday TCR delivers securitization rating news from the week
then-ending.
TCR subscribers have free access to our on-line news archive.
Point your Web browser to http://TCRresources.bankrupt.com/and use
the e-mail address to which your TCR is delivered to login.
*********
S U B S C R I P T I O N I N F O R M A T I O N
Troubled Company Reporter is a daily newsletter co-published
by Bankruptcy Creditors Service, Inc., Fairless Hills,
Pennsylvania, USA, and Beard Group, Inc., Washington, D.C., USA.
Jhonas Dampog, Marites Claro, Joy Agravante, Rousel Elaine
Tumanda, Valerie Udtuhan, Howard C. Tolentino, Carmel Paderog,
Meriam Fernandez, Joel Anthony G. Lopez, Cecil R. Villacampa,
Sheryl Joy P. Olano, Psyche A. Castillon, Ivy B. Magdadaro, Carlo
Fernandez, Christopher G. Patalinghug, and Peter A. Chapman, Editors.
Copyright 2021. All rights reserved. ISSN: 1520-9474.
This material is copyrighted and any commercial use, resale or
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re-mailing and photocopying) is strictly prohibited without prior
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*** End of Transmission ***