/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/220127.mbx T R O U B L E D C O M P A N Y R E P O R T E R Thursday, January 27, 2022, Vol. 26, No. 26 Headlines 37 CALUMET: Updates Administrative Claims Pay Details 6200 NE 2ND AVENUE: Files Emergency Bid to Use Cash Collateral A.B.C. CARPET: Unsecureds Will Get 0.1% to 2.9% in Liquidating Plan ALIERA COS.: Chapter 11 Cases To Be Consolidation in Delaware ALPHA LATAM: Chapter 11 Disclosure Inadequate, Says U.S. Trustee ALPHA LATAM: Court Okays Release Opt-Outs in Chapter 11 Plan Docs ALPHA LATAM: Unsecured Creditors to Recover 7.7% to 12.6% in Plan AMAZING ENERGY: Secured Creditors Want to Credit Bid in Assets Sale AMIGO CONSTRUCTION: Wins Cash Collateral Access Thru Feb 22 BHCOSMETICS HOLDINGS: U.S. Trustee Appoints Creditors' Committee BOY SCOUTS: Claimant Atty. Knosnoff Tweeted Confidential Ch.11 Info BOY SCOUTS: Insurers Can Depose Claimant Attorneys in Chapter 11 CHESAPEAKE ENERGY: Moody's Alters Outlook on Ba3 CFR to Positive CHISOM HOUSING: S&P Upgrades 2012A Long-Term Bonds Rating to 'BB' DENNIS RAY JOHNSON: Suit vs Peoples Bank Referred to Bankr. Court DODGE DATA: S&P Assigns 'B-' Issuer Credit Rating, Outlook Stable EL SERVICES: Wins Cash Collateral Access ENDLESS POSSIBILITIES: Files Emergency Bid to Use Cash Collateral GIRARDI & KEESE: Court Orders Erika to Turn Over AMEX Records GIRARDI & KEESE: Tom Denied Discharge in Bankruptcy Court GREG & ALICE: Seeks to Employ L. Laramie Henry as Legal Counsel HERTZ CORP: Settles Clawback Suit, Ex-CEO Still on Hook HORIZON GLOBAL: Royce & Associates Has 6.1% Stake as of Dec. 31 IM SERVICES: Two More Creditors Appointed to Committee JINZHENG GROUP: U.S. Trustee Appoints Creditors' Committee KENNETH A. BERDICK: Peer Buying Interest in Alva Property for $325K KENNETH A. BERDICK: Selling Interest in Fort Myers Asset for $230K KISMET ROCK HILL: Seeks to Employ Skufca Law as Special Counsel LATAM AIRLINES: Parent Unsecureds Will Get 16.3% to 19.3% LEWIS E. WILKERSON, JR.: Dalton Offers $235K for Keysville Property MALLINCKRODT PLC: Asks Court to Okay Frenesius Supply Claims Deal MERCURITY FINTECH: Jianming Jing, Wei Zhu Hold 8.8% Ordinary Shares MERCURITY FINTECH: Xiaojian Xu Reports 6.27% Equity Stake MTPC LLC: Gets Court Approval for $87 Million Bankruptcy Sales MYOMO INC: Rosalind Advisors, et al., Own 8.1% Equity Stake NAVEX TOPCO: Moody's Upgrades CFR to B2 & First Lien Loans to B1 NICE SERVICES: Taps NOC Legal Services as Bankruptcy Counsel OCCIDENTAL PETROLEUM: S&P Upgrades ICR to 'BB+', Outlook Stable PATH MEDICAL: Seeks to Hire Crowe LLP as Record Keeper PG&E CORP: Judge Alsup Lambasts 'Crime Spree' as Probation Ends PHENOMENON MARKETING: Taps Michael Jay Berger as Bankruptcy Counsel PHILADELPHIA ENERGY: Trial Begins With Ch.11 Property Damage Claims PIERSON LAKES: Owns Causeway, Bankruptcy Court Rules PRINCETON ALTERNATIVE: N.D. Ill. Court Dismisses RICO Suit vs. RBC PRO-DEMOLITION INC: Case Summary & 20 Largest Unsecured Creditors PUERTO RICO: U.S. Court Imposes Debt Plan Despite Protests REDWOOD EMPIRE: Seeks to Employ Dorsey & Whitney as Legal Counsel SARATOGA & NORTH CREEK RAILWAY: Train Tracks Up for Auction SCHULDNER LLC: Trustee Selling Duluth Property to Ruuskas for $70K SEBSEN ELECTRIC: Wins Cash Collateral Access on Final Basis SNAP ONE: Moody's Assigns 'B2' CFR Following Debt Refinancing SPL PARTNERS: Unsecured Creditors to be Paid in Full in Plan SPRUCE POWER: S&P Assigns 'B' Issuer Credit Rating, Outlook Stable STEINWAY MUSICAL: Moody's Withdraws 'B2' CFR on Debt Repayment SYMPLR SOFTWARE: Moody's Affirms B3 CFR Amid Midas Transaction SYMPLR SOFTWARE: S&P Alters Outlook to Stable, Affirms 'B-' ICR TALEN ENERGY: S&P Rates Secured Credit Facility 'B', Outlook Stable TECT AEROSPACE: Gets Court Okay to Send Liquidation Plan for Vote TON REAL: Case Summary & Three Unsecured Creditors TRENT RIVER: Flamengos Buying River Bend Property for $1 Million US AIR FORCE: S&P Assigns 'BB' Rating on 2022A Sr. Secured Notes VERTEX ENERGY: Convertible Note Share Issuance Proposal Approved VIPER PRODUCTS: Seeks to Employ Charles Darter as Accountant WAYNE BARTON: Seeks to Hire Wernick Law as Bankruptcy Counsel WC MANHATTAN PLACE: Voluntary Chapter 11 Case Summary WH INTERMEDIATE: Moody's Assigns First Time B2 Corp. Family Rating WH INTERMEDIATE: S&P Assigns 'B-' ICR, Outlook Stable WJA ASSET: April 6 TD REO's Plan Confirmation Hearing Set [*] Companies That Went Bankrupt Due to Bad Decisions [*] Roth IRAs Protected in Ga. Bankruptcies, 11th Circuit Finds [*] Top Lawyers' Fees Could Hit $2,000 an Hour in 2022 [^] Recent Small-Dollar & Individual Chapter 11 Filings ********* 37 CALUMET: Updates Administrative Claims Pay Details ----------------------------------------------------- 37 Calumet Street, LLC, submitted an Amended Disclosure Statement and Amended Plan of Reorganization dated Jan. 24, 2022. All claims for administrative expenses shall be paid in full in cash on the Effective Date or such other time as may be agreed upon by the Debtor and the individual administrative claimant. The administrative expenses to be paid will be fees and expenses awarded to Counsel to the Debtor. There are unpaid postpetition real estate taxes totaling approximately $20,238 through Nov. 30, 2021. The City of Boston has filed a proof of claim in the amount of $43,893. The DOR has filed a proof of claim, the priority portion for which is $1,525.51. Each priority claim will be paid in 48 equal monthly payments beginning in May of 2022. The Lender's Objection to Disclosure Statement, the Lender indicates information is required regarding potential capital gains consequences of a sale of the Real Estate. Since a sale of the Real Estate is not contemplated, hiring an accountant to perform this analysis appears to be unnecessary and has not been done. The principal of the Debtor has informed that one of the tenants at 41 Calumet Street, which she owns individually, will be receiving on or about February 1, 2022, a check for approximately $8,000.00 and that check will be delivered to the City of Boston to pay some of the post-petition real estate taxes due to the City of Boston. The Amended Disclosure Statement does not alter the proposed treatment for unsecured creditors and the equity holder: * The Class III unsecured creditors will be impaired and paid a dividend of 1% upon confirmation. * Patricia Hounsell will retain her 100% membership interest in the Debtor and will not be impaired The Debtor will retain the Real Estate and will pay the obligations due under this Plan from the present and future rental income. A full-text copy of the Amended Disclosure Statement dated Jan. 24, 2022, is available at https://bit.ly/3IGTisj from PacerMonitor.com at no charge. Debtor's Counsel: Gary W. Cruickshank, Esq. 21 Custom House Street Suite 920 Boston, MA 02110 Tel: (617) 330-1960 E-mail: gwc@cruickshank-law.com About 37 Calumet Street 37 Calumet Street LLC filed a voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. D. Mass. Case No. 20-12253) on Nov. 19, 2020. The petition was signed by Patricia Hounsell, its manager. At the time of filing, the Debtor disclosed $1 million to $10 million in both assets and liabilities. Judge Frank J. Bailey oversees the case. Gary W. Cruickshank, Esq., serves as the Debtor's counsel. 6200 NE 2ND AVENUE: Files Emergency Bid to Use Cash Collateral -------------------------------------------------------------- 6200 NE 2ND Avenue, LLC and affiliates ask the U.S. Bankruptcy Court for the Southern District of Florida, Miami Division, for authority to use cash collateral in accordance with the proposed budget, with a 10% variance and provide adequate protection. The Debtors requires the use of cash collateral to pay their ordinary course expenses, including insurance, utilities, sales tax, maintenance, lawn care and other necessary and ordinary expenses. Each of the Debtors owns at least one Property that currently or historically generated income, but several of the properties are not generating income today, largely as a result of two factors: (i) the COVID-19 pandemic, which caused the failure of several small business tenants that had leased space in several of the Properties; and (ii) after certain Properties were gutted in anticipation of renovation, the failure of an investor to raise and invest sufficient funds to complete the renovations. The loss of rental income which directly and indirectly resulted from these two events caused the Debtors to default on their obligation to their primary secured creditor, Chemtov Mortgage Group Corp. Chemtov is a private mortgage lender who has syndicated the loan to Debtors with about 20 investors. Chemtov's mortgage was recorded against each of the Debtor Properties to secure a single loan for $8 Million facilitated in July 31, 2018. The Debtors' efforts to restructure the loan with Chemtov prior to the bankruptcy filings were unsuccessful. The Debtors have provided Chemtov with full disclosure of rental income, and the decrease in rental income, resulting from the pandemic. The Debtors defaulted on the Chemtov Loan in November 2020. At that time, the outstanding principal balance owed was approximately $6 million. All of the Debtors are owned by the same owner, Little Haiti Development Partners, LP, which is largely owned and controlled by a family partnership that is controlled by Mallory Kauderer as the general partner. All Debtor LLCs have the same manager as well, Lit tle HaitiDevelopment Management, LLC, which is largely owned and controlled by a different family partnership that also is controlled by Mr. Kauderer as the general partner. Chemtov filed a Verified Complaint for Foreclosure of the Properties on March 16, 2021 in Miami-Dade County Circuit Court, Case No. 2021-006347-CA-01. A Final Judgment of Foreclosure was entered on October 21, 2021 against all Debtors, Mr. Kauderer and Little Haiti Development Partners, LP for $7,492,009. A foreclosure sale scheduled for January 19, 2022 was stayed by the Chapter 11 filings. As adequate protection for the Debtors' use of cash collateral, the Debtors will provide periodic monthly payments of $5,000 to Chemtov commencing on February 15, 2022 and paid on the 15th of each month thereafter. The Debtors will grant Chemtov a running replacement lien on all cash generated by the Debtors from and after the Petition Date. The Debtors also request an expedited hearing on the matter. A copy of the motion and the Debtors' budget for the period from February to May 2021, is available at https://bit.ly/345xsjk from PacerMonitor.com. The Debtors project $23,008.33 in total income and $22,258.60 in total expenses for February 2022. About 6200 NE 2nd Avenue, LLC 6200 NE 2nd Avenue, LLC and its affiliates sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D. Fla. Case No. 22-10385) on January 18, 2022. In the petition signed by Mallory Kauderer, manager, the Debtor disclosed up to $50,000 in assets and up to $10 million in liabilities. 6200 NE 2nd Avenue, LLC and its affiliates are Florida limited liability companies which together own 14 parcels of real property in the Little Haiti/Upper East Side neighborhood largely on the Northeast 2nd Avenue corridor of Miami. Each of the Debtors owns at least one Property that currently or historically generated income, but several of the properties are not generating income today, largely as a result of the COVID-19 pandemic and after certain properties were gutted in anticipation of renovation, the failure of an investor to raise and invest sufficient funds to complete the renovations. Judge Robert A. Mark oversees the case. Steven Beiley, Esq. at Aaronson Schantz Beiley P.A. is the Debtor's counsel. A.B.C. CARPET: Unsecureds Will Get 0.1% to 2.9% in Liquidating Plan ------------------------------------------------------------------- A.B.C. Carpet Co., Inc., et al., filed with the U.S. Bankruptcy Court for the Southern District of New York a Disclosure Statement for the Amended Joint Chapter 11 Plan of Liquidation dated Jan. 20, 2022. The Plan is a plan of liquidation. In general, a chapter 11 plan of liquidation (i) divides claims and equity interests into separate classes, (ii) specifies the property that each class is to receive under the plan, if any, and (iii) contains other provisions necessary to implement the plan. The plan establishes a mechanism by which assets of the estates will be distributed to holders of claims and interests, in the order set forth in the plan. The Plan contemplates the transfer of the Debtors' remaining assets into a Liquidating Trust followed by the formal dissolution of the Debtors' corporate existence; the Liquidating Trust is to be governed by a Liquidating Trust Agreement with its terms carried out by a Liquidating Trustee. The Debtors commenced the Chapter 11 Cases in order to run a process to sell all or substantially all of their assets pursuant to section 363 of the Bankruptcy Code in order to maximize value of the Estates for the benefit of the Debtors' stakeholders having entered into the Purchase Agreement and DIP Credit Agreement with 888 Capital Partners, LLC. On October 27, 2021, the Bankruptcy Court entered an order (the "Sale Order") approving the Sale Motion for a sale of substantially all of the Debtors' assets to 888 Capital Partners, LLC. The Sale was consummated on October 31, 2021. In connection with the Sale, 888 Capital Partners, LLC and Ms. Cole credit bid all of their Claims on account of or relating to the DIP Facility, DIP Loan Documents, the Prepetition Loan, and the Prepetition Loan Documents (inclusive of the Participation Interest). The Plan provides for a waterfall payment structure in compliance with section 1129 of the Bankruptcy Code, whereby (i) Holders of Administrative Claims, Priority Tax Claims and Other Priority Claims are entitled to distribution ahead of Holders of General Unsecured Claims, (ii) Holders of General Unsecured Claims are entitled to distribution ahead of Holders of Subordinated Claims, and (iii) Holders of Secured Claims are entitled to their collateral or the proceeds of their collateral ahead of unsecured creditors. More specifically, pursuant to the terms of the Plan: * Holders of Allowed Administrative Claims shall be paid in full in Cash. * Holders of Allowed Priority Tax Claims shall be treated in accordance with section 1129(a)(9)(C) of the Bankruptcy Code. * Holders of Allowed Secured Claims (to the extent any are determined to exist) and Allowed Other Priority Claims shall be paid in full in cash or receive such other treatment that renders such Claims Unimpaired. * Holders of Allowed Class 3 General Unsecured Claims shall receive a pro rata share (calculated based on the proportion that such Holder's Allowed General Unsecured Claim bears to the aggregate amount of Allowed General Unsecured Claims) of the Liquidating Trust Primary Recovery Units. * Holders of Allowed Class 4 Subordinated Claims shall receive a pro rata share (calculated based on the proportion that such Holder's Allowed Subordinated Claim bears to the aggregate amount of Allowed Subordinated Claims) of the Liquidating Trust Secondary Recovery Units. Class 3 consists of all General Unsecured Claims against (i) ABC Carpet, (ii) ABC Home and (iii) ABC OC. Each Holder of an Allowed General Unsecured Claim shall receive its pro rata share (calculated based on the proportion that such Holder's Allowed General Unsecured Claim bears to the aggregate amount of Allowed General Unsecured Claims) of the Liquidating Trust Primary Recovery Units. Class 3 is Impaired. The allowed unsecured claims total $12.1 – $15.3 million. This Class will receive a distribution of 0.1 – 2.9% of their allowed claims. Class 6 consists of all Interests in (i) ABC Carpet, (ii) ABC Home and (iii) ABC OC. No Holder of an Interest shall be entitled to a distribution under the Plan on account of such Interest. On the Effective Date, all Interests shall be retired, cancelled, and/or extinguished. Class 6 is Impaired. Subject to the provisions of the Plan concerning the Professional Fee Escrow Account, the Debtors and the Liquidating Trustee shall fund distributions under the Plan with Cash on hand on the Effective Date and all other Liquidating Trust Assets. A full-text copy of the Disclosure Statement dated Jan. 20, 2022, is available at https://bit.ly/32t4AkC from Stretto, the claims agent. Counsel for the Debtors: Leo Muchnik Oscar N. Pinkas, Esq. Sara A. Hoffman, Esq. Greenberg Traurig, LLP MetLife Building 200 Park Avenue New York, NY 10166 Tel: (212) 801-9214 Fax: (212) 801-6400 Email: pinkaso@gtlaw.com hoffmans@gtlaw.com Ari Newman GREENBERG TRAURIG, PA 333 S.E. 2nd Avenue, Suite 4400 Miami, Florida 33131 Telephone: (305) 579-0500 Facsimile: (305) 579-0717 Counsel to the Creditors' Committee: John R. Ashmead, Esq. Robert J. Gayda, Esq. Catherine V. LoTempio, Esq. Seward & Kissel LLP One Battery Park Plaza New York, NY 10004 Phone: (212) 574-1200 Fax: (212) 480-8421 Email: ashmead@sewkis.com gayda@sewkis.com lotempio@sewkis.com About A.B.C. Carpet Co. Inc. New York-based A.B.C. Carpet Co., Inc. owns and operates ABC Carpet & Home, an iconic lifestyle brand and home furnishing retailer with stores in Manhattan and Brooklyn. A.B.C. Carpet Co. and its affiliates filed their voluntary petitions for Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 21-11591) on Sept. 8, 2021. In the petition signed by Aaron Rose, chief executive officer, A.B.C. Carpet Co. listed up to $50 million in assets and up to $100 million in liabilities. Judge David S. Jones oversees the cases. The Debtors tapped Greenberg Traurig, LLP, as bankruptcy counsel; ASK, LLP as special counsel; and B. Riley Securities, Inc. as investment banker and financial advisor. Stretto is the claims, noticing and administrative agent. The U.S. Trustee for Region 2 appointed an official committee of unsecured creditors in the Debtors' bankruptcy cases on Sept. 22, 2021. Seward & Kissel, LLP and Province, LLC serve as the committee's legal counsel and financial advisor, respectively. ALIERA COS.: Chapter 11 Cases To Be Consolidation in Delaware ------------------------------------------------------------- Vince Sullivan of Law360 reports that the voluntary Chapter 11 case of health insurance provider the Aliera Cos. will be transferred from Georgia after a Delaware bankruptcy judge ordered the case to his court Tuesday, January 25, 2022, to be consolidated with an earlier involuntary Chapter 11 filed by the company's creditors. U.S. Bankruptcy Judge John T. Dorsey signed the order denying Aliera's own motion to join the involuntary bankruptcy case with its own voluntary proceeding in Atlanta court and granting the petitioning creditors' motion to bring all the cases under Judge Dorsey's purview. About Aliera Companies Aliera Companies Inc. is focused on providing a full spectrum of revolutionary options and services to a multitude of industries that fit every need and budget. The company provides services to support its subsidiaries which focus on the unique aspects of the health care industry. Plaintiffs in a case -- docketed as Hanna Albina and Austin Willard, individually and on behalf of others similarly situated, Plaintiffs, v. The Aliera Companies, Inc., Trinity Healthshare, Inc. and Oneshare Health, LLC Unity Healthshare, LLC, Case No. 20-CV-00496, (E.D. Ky., Dec. 11, 2020) -- filed an involuntary petition under Chapter 11 of the Bankruptcy Code against Aliera Cos. (Bankr. D. Del. Case No. 21-11548) on Dec. 5, 2021. Joseph H. Huston, Jr., Esq., of STEVENS & LEE, P.C., is the petitioners/plaintiffs' counsel. Aliera Companies Inc. sought Chapter 11 bankruptcy petition (Bankr. N.D. Ga. Case No. 21-59493) on Dec. 21, 2021. In the petition signed by Katie Goodman as authorized officer, Aliera Companies Inc. estimated assets between $1 million and $10 million and estimated liabilities of $500 million and $1 billion. J. Robert Williamson, Esq., of SCROGGINS & WILLIAMSON, P.C., is the Debtor's counsel. ALPHA LATAM: Chapter 11 Disclosure Inadequate, Says U.S. Trustee ---------------------------------------------------------------- Rick Archer of Law360 reports that the U.S. Trustee's Office Monday, January 24, 2022, urged a Delaware bankruptcy judge to reject Colombian payday lender Alpha Latam Management's Chapter 11 plan disclosure, saying it contains an inadequately explained settlement and excessively broad liability releases. In an objection to Alpha Latam's plan disclosure, the U.S. Trustee's Office said the latest version of the plan disclosure statement adds a detail-poor settlement with an unnamed group of creditors to a plan that would release the legal claims of parties who will never receive notice the plan exists. About LATAM Airlines Group LATAM Airlines Group S.A. -- http://www.latam.com/-- is a pan-Latin American airline holding company involved in the transportation of passengers and cargo and operates as one unified business enterprise. It is the largest passenger airline in South America. Before the onset of the COVID-19 pandemic, LATAM offered passenger transport services to 145 different destinations in 26 countries, including domestic flights in Argentina, Brazil, Chile, Colombia, Ecuador and Peru, and international services within Latin America as well as to Europe, the United States, the Caribbean, Oceania, Asia and Africa. LATAM and its 28 affiliates sought Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 20-11254) on May 25, 2020. Affiliates in Chile, Peru, Colombia, Ecuador and the United States are part of the Chapter 11 filing. The Debtors disclosed $21,087,806,000 in total assets and $17,958,629,000 in total liabilities as of Dec. 31, 2019. The Hon. James L. Garrity, Jr., is the case judge. The Debtors tapped Cleary Gottlieb Steen & Hamilton LLP as bankruptcy counsel, FTI Consulting as restructuring advisor, Lee Brock Camargo Advogados as local Brazilian litigation counsel, and Togut, Segal & Segal LLP and Claro & Cia in Chile as special counsel. The Boston Consulting Group, Inc. and The Boston Consulting Group UK LLP are the Debtors' strategic advisors while PJT Partners LP serve as their investment banker. Prime Clerk, LLC is the claims agent. The official committee of unsecured creditors formed in the case tapped Dechert LLP as its bankruptcy counsel, Klestadt Winters Jureller Southard & Stevens, LLP as conflicts counsel, UBS Securities LLC as investment banker, and Conway MacKenzie, LLC as financial advisor. Ferro Castro Neves Daltro & Gomide Advogados is the committee's Brazilian counsel. The ad hoc group of LATAM bondholders tapped White & Case LLP as counsel. Glenn Agre Bergman & Fuentes, LLP, led by managing partner Andrew Glenn and partner Shai Schmidt, has been retained as counsel for the ad hoc committee of shareholders. ALPHA LATAM: Court Okays Release Opt-Outs in Chapter 11 Plan Docs ----------------------------------------------------------------- Vince Sullivan of Law360 reports that a Delaware bankruptcy judge approved the Chapter 11 plan disclosure statement of Colombian payday lender Alpha Latam Management on Tuesday, January 22, 2022, saying provisions for creditors to opt out of granting releases under the Plan were acceptable. During a hearing conducted virtually, U.S. Bankruptcy Judge J. Kate Stickles heard from the Office of the U.S. Trustee about its opposition to the Debtor's proposal to include the opt-out provision in its plan solicitation package, but said that creditors are required to voice their opposition to parts of the Plan they find objectionable. About Alpha Latam Management Wilmington, Del.-based Alpha Latam Management, LLC, and its affiliates operate a specialty finance business that offers consumer and small business lending services to underserved communities in Mexico and Colombia. Alpha Latam Management and certain of its affiliates sought Chapter 11 protection (Bankr. D. Del. Case No. 21-11109) on Aug. 1, 2021, disclosing assets of between $100 million and $500 million and liabilities of between $500 million and $1 billion. Judge J. Kate Stickles oversees the cases. The Debtors tapped Richards, Layton & Finger, P.A., and White & Case, LLP as legal counsel; Rothschild & Co US Inc. and Rothschild& Co Mexico S.A. de C.V. as investment bankers; and AlixPartners, LLP, as financial advisor. Prime Clerk, LLC, is the claims and noticing agent and administrative advisor. On Aug. 11, 2021, Alpha Holding, S.A. de C.V. and AlphaCredit Capital, S.A. de C.V. SOFOM, ENR commenced in Mexico City a jointly administered voluntarily filed proceeding pursuant to the Ley de Concursos Mercantiles. Through this proceeding, the MexicanDebtors intend to pursue a controlled restructuring and possible sale of their assets. ALPHA LATAM: Unsecured Creditors to Recover 7.7% to 12.6% in Plan ----------------------------------------------------------------- Alpha Latam Management, LLC, and its Debtor Affiliates filed with the U.S. Bankruptcy Court for the District of Delaware a Disclosure Statement for Chapter 11 Plan dated Jan. 24, 2022. The Plan contemplates the liquidation and dissolution of the Debtors (except for ALM) and the resolution of all outstanding Claims against and Equity Interests in such Debtors. After an exhaustive marketing and sale process, the Bankruptcy Court entered an Order Authorizing and Approving the Sale of Substantially all of the Assets of Certain of the Debtors Free and Clear of all Liens, Claims, Encumbrances, and Interests (the "Sale Order") approving a sale of the majority of the loan portfolio and operational assets of Alpha Capital S.A.S. and Vive Creditos Kusida S.A.S. (collectively, the "Colombian Sellers") to CFG Partners Colombia SAS in accordance with the terms and conditions contained in that certain Asset Purchase Agreement ("APA") between the parties, dated as of November 4, 2021. The Debtors expect to close the Sale Transaction at or prior to the Effective Date of the Plan. The Plan contemplates that the Preserved Noteholder Claims of Consenting Holders shall be transferred to a separate Alpha Noteholder Claims Trust. The Successful Bid contemplates a value for the Purchased Assets of $149.5 million, including the assumption of certain liabilities. The APA executed by CFG contemplates the purchase and sale of the majority of the Colombian Sellers' assets, including: (a) substantially all of the Colombian loan portfolio ("Purchased Loans") and related records, agreements, servicing rights, and rights to receive interest, principal, penalties, fees, charges and other collections; (b) life insurance policies that provide coverage to obligors under the Purchased Loans and rights to insurance proceeds; (c) the Sellers' contractual position as settlors and all beneficiary rights of the trusts created with Fiduciaria Coomeva S.A. and Fiduciaria Colpatria S.A (the "Trust Agreements"); (d) certain Assumed Contracts, including the Debtors' Bogota office lease; and (e) certain office equipment and furniture located at the Debtors' Bogota headquarters. The Debtors expect to close the Sale in early 2022, prior to or contemporaneous with the Effective Date. On December 17, 2021, the Colombian Superintendence issued its written approval of the Sale. The Sellers estimate the Purchase Price, which is based on the October loan tape for the Purchased Loans, will be in the range of $100 to $120 million, as it is subject to certain adjustment under the terms of the APA with CFG. The final Purchase Price may vary materially depending on a number of factors set forth in the APA. Class 4a shall consist of all Other Unsecured Claims. Each holder of an Allowed Other Unsecured Claim against the Debtors shall receive on the Plan Distribution Date, in full satisfaction of its Allowed Other Unsecured Claim, its Pro Rata Share of the beneficial interest in the Liquidating Trust, entitling such holder to receive proceeds on account of such interests. Claims in Class 4a are Impaired and are entitled to vote on the Plan. The allowed unsecured claims total $2,151,695. This Class will receive a distribution of 7.7% to 12.6% of their allowed claims. Class 4b shall consist of all Notes Claims. Each holder of an Allowed Notes Claim against the applicable Debtors shall, subject to the Notes Indenture Trustee's Charging Lien and the funding of the Notes Indenture Trustee Mexican Proceeding Reserve, receive on the Plan Distribution Date, in full satisfaction of its Allowed Notes Claim, its Pro Rata Share of the beneficial interest in the Liquidating Trust, entitling such holder to receive proceeds on account of such interests. This Class will receive a distribution of 7.7% - 12.6% of their allowed claims. Class 4c shall consist of all Funded Debt Claims. Each holder of an Allowed Funded Debt Claim against the applicable Debtors shall receive on the Plan Distribution Date, in full satisfaction of its Allowed Funded Debt Claim, its Pro Rata Share of the beneficial interest in the Liquidating Trust, entitling such holder to receive proceeds on account of such interests. This Class will receive a distribution of 7.7% to 12.6% of their allowed claims. Class 4d shall consist of the Credit Suisse Claim. On the Effective Date, each holder of a Credit Suisse Claim shall receive, in full satisfaction of its Credit Suisse Claim, no distribution under the Plan on account of such Claim. Claims in Class 4d shall receive no recovery and are deemed to reject the Plan. Class 6 shall consist of all Equity Interests in the Debtors (other than ALM). On the Effective Date, all Equity Interests in the Debtors (other than ALM) shall be Reinstated for administrative purposes only and, in any instance, shall receive no distribution under the Plan. Equity Interests in Class 6 shall receive no recovery and are deemed to reject the Plan. Class 7 shall consist of all the Equity Interests in ALM. On the Effective Date, all Equity Interests in ALM will be Reinstated. Equity Interests in Class 7 are Unimpaired under the Plan and are deemed to accept the Plan. On or before the Effective Date, the Debtors intend to effectuate and consummate the Sale. If not already fully satisfied by the Effective Date, the Debtors shall pay any DIP Claims from the Sale Consideration. The Debtors shall also use Cash on hand, if any, and then use the Cash from the Sale Consideration to fund the Applicable Reserves, the Professional Fee Escrow, and the Wind Down Reserve. On the Effective Date, the Debtors (other than ALM or AlphaDebit) shall transfer one hundred percent (100%) of the Liquidating Trust Assets to the Liquidating Trust for the benefit of the Liquidating Trust Beneficiaries, which Liquidating Trust Assets shall vest in the Liquidating Trust. On the Effective Date, subject to applicable local law, the Liquidating Trust shall be authorized to make distributions to the Liquidating Trust Beneficiaries in accordance with the Plan, the Confirmation Order, and the Liquidating Trust Agreement. Co-Counsel to the Debtors: Mark D. Collins John H. Knight Brendan J. Schlauch J. Zachary Noble RICHARDS, LAYTON & FINGER, P.A. One Rodney Square 920 North King Street Wilmington, DE 19801 Telephone: (302) 651-7700 Facsimile: (302) 651-7701 Email: collins@rlf.com knight@rlf.com schlauch@rlf.com noble@rlf.com - and - John K. Cunningham Richard S. Kebrdle Amanda A. Parra Criste WHITE & CASE LLP 200 South Biscayne Boulevard, Suite 4900 Miami, FL 33131 Telephone: (305) 371-2700 Email: jcunningham@whitecase.com rkebrdle@whitecase.com aparracriste@whitecase.com Philip M. Abelson John J. Ramirez Brett L. Bakemeyer 1221 Avenue of the Americas New York, NY 10020 Telephone: (212) 819-8200 Email: philip.abelson@whitecase.com john.ramirez@whitecase.com brett.bakemeyer@whitecase.com About Alpha Latam Management Wilmington, Del.-based Alpha Latam Management, LLC, and its affiliates operate a specialty finance business that offers consumer and small business lending services to underserved communities in Mexico and Colombia. Alpha Latam Management and certain of its affiliates sought Chapter 11 protection (Bankr. D. Del. Case No. 21-11109) on Aug. 1, 2021, disclosing assets of between $100 million and $500 million and liabilities of between $500 million and $1 billion. Judge J. Kate Stickles oversees the cases. The Debtors tapped Richards, Layton & Finger, P.A., and White & Case, LLP as legal counsel; Rothschild & Co US Inc. and Rothschild& Co Mexico S.A. de C.V. as investment bankers; and AlixPartners, LLP, as financial advisor. Prime Clerk, LLC is the claims and noticing agent and administrative advisor. On Aug. 11, 2021, Alpha Holding, S.A. de C.V. and AlphaCredit Capital, S.A. de C.V. SOFOM, ENR commenced in Mexico City a jointly administered voluntarily filed proceeding pursuant to the Ley de Concursos Mercantiles. Through this proceeding, the Mexican Debtors intend to pursue a controlled restructuring and possible sale of their assets. AMAZING ENERGY: Secured Creditors Want to Credit Bid in Assets Sale ------------------------------------------------------------------- Arnold Jed Miesner, Lesa Renee Miesner, Petro Pro, Ltd., and JLM Strategic Investments, LP, the Secured Creditors of Amazing Energy MS, LLC, and affiliates, ask the U.S. Bankruptcy Court for the Southern District of Mississippi to authorize them to credit bid to the full amount of their secured claims in connection with the sale of assets contemplated by the First Amended Joint Plan of Liquidation and/or Debtors Motion to Sell. The Secured Creditors' claims arise out of three Promissory Notes and three Deeds of Trust executed by Defendant Amazing Energy in favor of the Secured Creditors after the same were discussed and approved on Feb. 11, 2011 at the First Annual Meeting of the Board of Directors and Shareholders for Amazing Energy Group, Inc. Amazing Energy Group was the owner of Defendant Amazing Energy, LLC at that time. The applicable statute of limitations for avoidance of the Notes and Deeds of Trust based on fraud and/or breach of fiduciary duty and/or rescission and/or cancellation is four years. Amazing Energy LLC did not seek to avoid the Notes and Deeds of Trust until 2020. To the contrary, Amazing Energy LLC and its owner, Amazing Energy Oil and Gas, repeatedly admitted in writings signed by them that the Notes and Deeds of Trust are valid and that Amazing Energy LLC owed the indebtedness and was, in fact, in material default at least as of September 2018. In other words, there is no bona fide dispute because all of the applicable statutes of limitation have long expired -- years before these bankruptcy cases were filed. On Dec. 24, 2021, Amazing Energy LLC finally produced executed minutes of the First Annual Meeting which specifically reflect approval of the Notes and Deeds of Trust byAmazing Energy Group. In other words, there is no bona fide dispute over the actual authority of Amazing Energy LLC to execute the Notes and Deeds of Trust. The Promissory Notes and Deeds of Trust recite that adequate consideration was given and received. The Debtors are not entitled to go behind this recitation and challenge whether adequate consideration was or was not provided. Amazing Energy LLC has failed and refused to tender back benefits received by it, to wit, the oil and gas leases and all income derived from them since title passed to it. This is a required element of the rescission claim. In other words, there is no bona fide dispute over consideration to uphold the Notes and Deeds of Trust. The Secured Creditors would show the Court that Amazing Energy LLC cannot carry its burden as to any of the elements of fraud regarding the Notes and Deeds of Trust. In other words, there is no bona fide dispute over whether the Notes and Deeds of Trust can be avoided based on fraud. At the time of the original Notes and Deeds of Trust, Jed Miesner and/or Lesa Miesner were the majority owners of Amazing Energy Group, the owner of Amazing Energy LLC. They were governing persons, and knew about the transactions (since they were transacting with themselves, or entities owned by them). In other words, there is no bona fide dispute over whether the Notes and Deeds of Trust can be avoided because of the express provisions of the Texas Business Organizations Code. For these reasons, the Secured Creditors request the Court to enter its order that they have the right to credit bid up to the full amount of their respective secured claims with regard to the Debtors' sale of assets. About Amazing Energy Amazing Energy MS, LLC, Amazing Energy Holdings, LLC, and Amazing Energy, LLC, filed voluntary petitions for relief under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Miss. Case Nos. 20-01243, 201245 and 20-01244) on April 6, 2020. On July 13, 2020, the cases were transferred to the U.S. Bankruptcy Court for the Eastern District of Texas and were assigned new case numbers (20-41558 for Amazing Energy MS, 20 41563 for Amazing Energy Holdings and 20-41561 for Amazing Energy LLC). The cases are jointly administered under Case No. 20-41558. At the time of filing, Amazing Energy MS and Amazing Energy Holdings disclosed assets of between $1 million and $10 million and liabilities of the same range while Amazing Energy, LLC estimated $10 million to $50 million in assets and $1 million to $10 million in liabilities. Judge Brenda T. Rhoades oversees the cases. The Debtors are represented by Heller, Draper, Patrick, Horn & Manthey, LLC and Wheeler & Wheeler, PLLC. Arnold Jed Miesner, Lesa Renee Miesner, and JLM Strategic Investments, LP, as secured creditors are represented by: Carol Lynn Wolfram, Esq. Rosa R. Orenstein, Esq. Nathan M. Nichols, Esq. LAW OFFICE OF CAROL LYNN WOLFRAM P.O. Box 1925 Denton, TX 76202-1925 Tel: (940) 321-0019 Fax: (940) 497-1143 E-mail: clwolframlegal@gmail.com AMIGO CONSTRUCTION: Wins Cash Collateral Access Thru Feb 22 ----------------------------------------------------------- The U.S. Bankruptcy Court for the District of Nevada has authorized Amigo Construction, LLC to use cash collateral on an interim basis and provide adequate protection, however no retroactive relief is granted. The Debtor is permitted to use cash collateral in accordance with the budget, with a 15% variance, pending a final hearing scheduled for February 22, 2022 at 9:30 a.m. As for adequate protection, all secured creditors are granted, pursuant to sections 361 and 363(e) of the Bankruptcy Code, a valid, perfected, and enforceable new priority replacement lien upon all property of the Debtor and its bankruptcy estate. A copy of the order is available at https://bit.ly/3KHg3OL from PacerMonitor.com. About Amigo Construction Amigo Construction, LLC provides services to several telecommunication companies like Verizon, Cox, and Mears to establish new lines or renew existing underground lines utilized for the Internet. It also provides asphalt paving and striping, commercial concrete foundations and residential concrete construction. Amigo Construction sought protection for relief under Chapter 11 of the Bankruptcy Code (Bankr. D. Nev. Case No. 21-15242) on Nov. 5, 2021, listing up to $500,000 in assets and up to $1 million in liabilities. Judge Natalie M. Cox oversees the case. Matthew C. Zirzow, Esq., and Zachariah Larson, Esq., at Larson & Zirzow, LLC represent the Debtor as bankruptcy attorneys. . BHCOSMETICS HOLDINGS: U.S. Trustee Appoints Creditors' Committee ---------------------------------------------------------------- The U.S. Trustee for Region 3 on Jan. 24 appointed an official committee to represent unsecured creditors in the Chapter 11 cases of BHCosmetics Holdings, LLC and its affiliates. The committee members are: 1. Dongguan Fay Cosmetic Brushes Co. Ltd Attn: Brian Mitteldorf, U.S. Agent 14226 Sherman Oaks, CA 91423 Phone: 818-990-4800 Fax: 818-990-3904 E-mail: blm@cabcollects.com 2. SAS Touche Attn: Sarra Messaoudi and Philippe Santini 1 Rue de Calais, 37100 Tours France Phone: 213-292-7164 E-mail: sarra@agence-touche.fr philippe@agence touche.fr 3. Beemak Plastics, LLC Attn: John Davies 16711 Knott Ave. La Mirada, CA 90638 Phone: 310-886-5880 (ext. 2147) 510-376-8104 E-mail: john.davies@beemak.com Official creditors' committees serve as fiduciaries to the general population of creditors they represent. They may investigate the debtor's business and financial affairs. Committees have the right to employ legal counsel, accountants and financial advisors at a debtor's expense. About BH Cosmetics Originally launched in 2009, BH Cosmetics is a beauty brand specializing in high quality, clean, vegan, and cruelty-free cosmetics and other beauty products. BH Cosmetics sells its products on its Shopify e-commerce platform directly to consumers and wholesale to various global retailers. On Jan. 14, 2022, BHCosmetics Holdings, LLC and three of its affiliates filed petitions seeking relief under Chapter 11 of the Bankruptcy Code (Bankr. D. Del. Lead Case No. 22-10050), to pursue a sale of the assets. BHCosmetics Holdings estimated assets and debt of $50 million to $100 million as of the bankruptcy filing. The Debtors tapped Young Conaway Stargatt & Taylor, LLP as bankruptcy counsel and Riveron Management Services, LLC as financial advisor. The Debtors also tapped the services of SB360 Capital Partners, LLC and Hilco IP Services, LLC, which act as sale and liquidation agents; and Traverse, LLC, which provides the controller and other accounting personnel. Epiq Corporate Restructuring, LLC is the claims agent. BOY SCOUTS: Claimant Atty. Knosnoff Tweeted Confidential Ch.11 Info ------------------------------------------------------------------- Rick Archer of Law360 reports that the Boy Scouts of America are again accusing sexual abuse claimant attorney Timothy Kosnoff of misconduct, claiming he was live-tweeting a deposition in the organization's Chapter 11 case in violation of a Delaware bankruptcy court judge's order. In a letter to U.S. Bankruptcy Judge Laurie Selber Silverstein filed Monday, January 24, 2022, Boy Scouts counsel Derek Abbott said Kosnoff — who is facing a suit filed by Boy Scout insurance carriers last week seeking to stop what they say are Kosnoff's "disruptive" tweets — violated a protective order by posting to Twitter the substance of a deposition held Friday, January 21, 2022. About Boy Scouts of America The Boy Scouts of America -- https://www.scouting.org/ -- is a federally chartered non-profit corporation under title 36 of the United States Code. Founded in 1910 and chartered by an act of Congress in 1916, the BSA's mission is to train youth in responsible citizenship, character development, and self-reliance through participation in a wide range of outdoor activities, educational programs, and, at older age levels, career-oriented programs in partnership with community organizations. Its national headquarters is located in Irving, Texas. The Boy Scouts of America and affiliate Delaware BSA, LLC, sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 20-10343) on Feb. 18, 2020, to deal with sexual abuse claims. Boy Scouts of America was estimated to have $1 billion to $10 billion in assets and at least $500 million in liabilities as of the bankruptcy filing. The Debtors have tapped Sidley Austin LLP as their bankruptcy counsel, Morris, Nichols, Arsht & Tunnell LLP as Delaware counsel, and Alvarez & Marsal North America, LLC as financial advisor. Omni Agent Solutions is the claims agent. The U.S. Trustee for Region 3 appointed a tort claimants' committee and an unsecured creditors' committee on March 5, 2020. The tort claimants' committee is represented by Pachulski Stang Ziehl & Jones, LLP, while the unsecured creditors' committee is represented by Kramer Levin Naftalis & Frankel, LLP. BOY SCOUTS: Insurers Can Depose Claimant Attorneys in Chapter 11 ---------------------------------------------------------------- Vince Sullivan of Law360 reports that the insurers of the bankrupt Boy Scouts of America can move forward this week with depositions of claimant attorneys about the genesis of thousands of attorney-signed proofs of claim after a Delaware bankruptcy judge said Monday, Jan. 24, 2022, she would have to deal with privilege issues case by case. During a virtual hearing, U.S. Bankruptcy Judge Laurie Selber Silverstein said that context was critical in addressing questions of privilege around sensitive communications between sex abuse claimants and their attorneys, and that any decision challenging that privilege would have to wait until there was a specific challenge before the court. About Boy Scouts of America The Boy Scouts of America -- https://www.scouting.org/ -- is a federally chartered non-profit corporation under title 36 of the United States Code. Founded in 1910 and chartered by an act of Congress in 1916, the BSA's mission is to train youth in responsible citizenship, character development, and self-reliance through participation in a wide range of outdoor activities, educational programs, and, at older age levels, career-oriented programs in partnership with community organizations. Its national headquarters is located in Irving, Texas. The Boy Scouts of America and affiliate Delaware BSA, LLC, sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 20-10343) on Feb. 18, 2020, to deal with sexual abuse claims. Boy Scouts of America was estimated to have $1 billion to $10 billion in assets and at least $500 million in liabilities as of the bankruptcy filing. The Debtors have tapped Sidley Austin LLP as their bankruptcy counsel, Morris, Nichols, Arsht & Tunnell LLP as Delaware counsel, and Alvarez & Marsal North America, LLC as financial advisor. Omni Agent Solutions is the claims agent. The U.S. Trustee for Region 3 appointed a tort claimants' committee and an unsecured creditors' committee on March 5, 2020. The tort claimants' committee is represented by Pachulski Stang Ziehl & Jones, LLP, while the unsecured creditors' committee is represented by Kramer Levin Naftalis & Frankel, LLP. CHESAPEAKE ENERGY: Moody's Alters Outlook on Ba3 CFR to Positive ---------------------------------------------------------------- Moody's Investors Service affirmed Chesapeake Energy Corporation's Ba3 Corporate Family Rating, Ba3-PD Probability of Default Rating and B1 senior unsecured notes rating. The SGL-2 Speculative Grade Liquidity Rating remains unchanged. The rating outlook was changed to positive from stable. This rating action follows Chesapeake's announcement that it has agreed to acquire Chief E&D Holdings, LP (Chief) and associated non-operated interests held by affiliates of Tug Hill, Inc. (Tug Hill, and together with Chief, the Chief acquisition) for roughly $2.6 billion in total consideration including $2 billion in cash[1]. The transaction, which is expected to close by the end of first quarter 2022, is subject to customary closing conditions including certain regulatory approvals. Chesapeake has also agreed to sell its Powder River Basin assets for about $450 million in cash, which together with revolver borrowings and balance sheet cash should help pay for the cash portion of the Chief acquisition. "Chesapeake's Chief acquisition is credit positive, consolidating its Marcellus Shale assets in Northeast Pennsylvania and enhancing its size and scale," commented Amol Joshi, Moody's Vice President and Senior Credit Officer. Affirmations: Issuer: Chesapeake Energy Corporation Corporate Family Rating, Affirmed Ba3 Probability of Default Rating, Affirmed Ba3-PD Senior Unsecured Regular Bond/Debenture, Affirmed B1 ( LGD5) Issuer: Vine Energy Holdings LLC (Assumed by Chesapeake Energy Corporation) Senior Unsecured Regular Bond/Debenture, Affirmed B1 (to LGD5 from LGD4) Outlook Actions: Issuer: Chesapeake Energy Corporation Outlook, Changed To Positive From Stable RATINGS RATIONALE The positive outlook reflects Moody's expectation that the announced Chief acquisition will further enhance Chesapeake's size and scale, combining its existing Marcellus assets with additional largely contiguous acreage. This follows the acquisition of Vine Energy Holdings LLC (Vine) in fourth quarter 2021, which meaningfully added to Chesapeake's existing Haynesville assets. With the announced exit from the non-core Powder River Basin, Chesapeake is sharpening its focus on core high-return natural gas assets. While the company is adding some debt to fund the Chief acquisition, the company should continue to maintain robust cash flow-based leverage metrics as industry conditions remain supportive. Chesapeake's Ba3 Corporate Family Rating (CFR) reflects its large, low-cost natural gas positions in the Marcellus and Haynesville shale plays, relatively low financial leverage and the ability to generate significant cash flow even at modest natural gas prices. The company's annual interest burden is low relative to cash flow following its emergence from bankruptcy in early 2021, boosting available cash flow. Chesapeake's emphasis on natural gas marks a strategic reversal following many years of attempting to transition to a more oil and liquids-heavy production mix. Chesapeake's South Texas and Brazos Valley assets still provide some oil optionality in an environment of supportive oil prices. Moody's has historically viewed Chesapeake's financial policy as aggressive, though many of the actions it took in recent years were necessitated by its then burdensome debt load. Post-bankruptcy, Chesapeake's ability to generate free cash flow through its natural gas-focused approach provides the opportunity to balance its capital allocation goals. Management has stated its commitment to balance sheet strength through targeting long-term leverage of less than 1x net debt to EBITDA, while pursuing shareholder returns including funding its dividend strategy. The company's variable dividend strategy, in addition to its fixed dividend and a potential for opportunistic share repurchases, will cut cash flow available for capital spending or significant credit improvement. Chesapeake's senior unsecured notes are rated B1, one notch beneath the company's Ba3 CFR, reflecting the notes' junior priority claim on assets to borrowings under the secured revolving credit facility. Chesapeake has legally assumed Vine's senior unsecured notes due 2029 and provided subsidiary guarantees making the Vine notes pari passu with Chesapeake's outstanding notes. Chesapeake's good liquidity is reflected by its SGL-2 rating and is supported by its ability to generate positive free cash flow. At September 30, Chesapeake had $849 million of cash. Chesapeake completed the Vine acquisition and assumed its $950 million of notes in the fourth quarter 2021. Chesapeake's post-emergence credit facility has a borrowing base of $2.5 billion and includes a reserve-based revolving credit facility and a non-revolving loan facility. The elected commitments are $1.75 billion of Tranche A Loans and $221 million of fully funded Tranche B Loans. The revolver was undrawn at September 30 and expires in 2024. The credit facility is subject to financial covenants including a maximum total leverage ratio covenant of 3.5x, maximum first lien leverage ratio of 2.75x and minimum current ratio of 1x. Moody's expects Chesapeake to comfortably comply with these covenants into 2023. Chesapeake's cash flow is supported by the company's meaningful commodity hedge position in 2022. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS The ratings could be upgraded if the company generates consistent free cash flow after sufficiently reinvesting in the business and distributing to shareholders while following conservative financial policies and maintaining a leveraged full-cycle ratio (LFCR) above 1.5x. Ratings could be downgraded if the company generates meaningful negative free cash flow, LFCR falls below 1x or retained cash flow to debt falls below 20%. Oklahoma City, OK-based Chesapeake Energy Corporation is a large and diversified independent exploration and production company. The company's daily production averaged 436 mboe/d in the quarter ended September 30, 2021, of which roughly 80% was natural gas. The principal methodology used in these ratings was Independent Exploration and Production published in August 2021. CHISOM HOUSING: S&P Upgrades 2012A Long-Term Bonds Rating to 'BB' ----------------------------------------------------------------- S&P Global Ratings raised its long-term rating four notches to 'BB' from 'B-' on Public Finance Authority, Wis.' series 2012A multifamily housing revenue bonds, issued for Chisom Housing Group (CHG), Wash.'s Section 8 assisted-housing pool project. The outlook is positive. "The upgrade follows the sale of one of the 11 properties in the portfolio--the Pines at Garden City--in December 2021 and the subsequent defeasance of $10.36 million in bonds, representing 45% of then bonds outstanding," said S&P Global Ratings credit analyst Dan Pulter. On Jan. 13, 2022, $2.58 million of the defeased bonds were redeemed, and the remaining $7.78 million are scheduled to be redeemed on July 1, 2022. S&P said, "In conjunction with the defeasance, we expect maximum annual debt service (MADS) will similarly decrease by as much as 45%, and MADS coverage is therefore expected to increase substantially in the near term, potentially above 2.0x. This projected improvement materially strengthens our view of the project's coverage and liquidity. Evidence that coverage can reach and be maintained at this much higher level could lead to further improvements in our assessment of coverage liquidity and it could result in a further positive rating action in the near term." The rating reflects S&P's opinion of the following: -- Coverage and liquidity that, despite expected near-term improvement, S&P still regards as weak; -- Management and governance for the project that S&P considers weak to very weak; and -- Market position that S&P considers weak to very weak. "The positive outlook reflects our expectation that the pool's MADS coverage will likely substantially improve to levels that we regard as very strong in the near term following the recent defeasance," Mr. Pulter added. All else equal, if MADS coverage increases to levels consistently above 2.0x, S&P could raise the rating multiple notches. The positive outlook reflects a one-in-three likelihood of an upgrade within the one-year outlook period. The authority issued the 2012A bonds to facilitate CHG's--a Texas 501(c)3 nonprofit corporation--acquisition and rehabilitation of 11 Section 8-enhanced apartment projects, with 782 units spread out throughout the southeast U.S. DENNIS RAY JOHNSON: Suit vs Peoples Bank Referred to Bankr. Court ----------------------------------------------------------------- Plaintiff Dennis Ray Johnson II on May 9, 2016, filed a voluntary petition in bankruptcy with the United States Bankruptcy Court for the Southern District of West Virginia, Huntington Division, Case No. 3:16-BK-30227. On December 30, 2016, Peoples Bank, National Association initiated an adversary proceeding against Johnson to ask that certain debts owed by Johnson be determined nondischargeable. The Bank and the Trustee of the bankruptcy case agreed to resolve disputes via a settlement agreement, whereby in consideration of various payments, waivers, and releases, the Bank was granted a release of all claims by the Debtors, the Estates, and the Trustee. In its Motion, the Trustee sought approval of an Asset Sale and Purchase Agreement ("ASPA") between the Chapter 11 Trustee, as seller, and the Bank and Denise Johnson, as Buyers, whereby the Bank would acquire certain causes of action and related rights described in the Sale Motion. The Motion expressly referenced the settlement of the AP, and closing the ASPA was contingent on the entry of a consent judgment in the AP. On March 31, 2019, the Bankruptcy Court approved the Settlement Agreement. Pursuant to this agreement, the Bank and the Trustee also entered into a "Stipulation to Resolve Adversary Proceeding and Consent Judgment" to resolve the AP case. The Stipulation granted a nondischargeable $4,000,000 judgment to Peoples Bank against Johnson. It also stated that if Johnson provided "complete cooperation" in the Bank's proceedings against others including Vitol Americas Corp. (Case No. 3:18-AP-3006), the judgment would be reduced to $2,000,000. It also provides for a "dollar for dollar reduction of the Judgment for money or other consideration actually received by the Bank from the Litigation." "Complete cooperation" was defined within the agreement, and whether Johnson provided complete cooperation was to be determined by a three-person panel who would vote fourteen days after the conclusion of the litigation (or four years from the date of record for the judgment). The Stipulation also notes "the Bank agrees to a forbearance against Johnson from initiating or otherwise pursuing collection of the Judgment so long as Litigation is pending in any capacity whereby a recovery could be made to reduce the Judgment." The final paragraph of the Stipulation provides that "[t]he Bankruptcy Court shall retain jurisdiction to determine any dispute over the interpretation or enforcement of the provisions of this order." The Consent Judgment entered by the Bankruptcy Court on September 30, 2019, awarded a $4,000,000 judgment against Johnson in favor of the Bank, pursuant to the Stipulation which was incorporated by reference. Johnson claims that after entering into the Stipulation, he provided complete cooperation to the Bank. The litigation between the Bank and others, including Vitol Americas, Corp., was concluded by Stipulated Order of Dismissal on April 13, 2020. The Bank did not notify Johnson of the conclusion of the litigation; nor did it notify the panel so that it could vote on Johnson's cooperation within 14 days. Instead, the Bank's attorney sent Johnson a threat letter, disclosing that the litigation had resulted in a settlement of $3,210,000 and notifying Johnson that the Bank did not believe he had provided complete cooperation. The Bank explained that the allocation of the settlement and expenses resulted in a $1,067,004.74 credit to Johnson against the Consent Judgment, and that it intended to pursue the remaining $2,932,995.26 balance of the judgment against him. The Bank also sent Mr. Johnson another letter in February 2021, requesting Johnson's cooperation on two additional matters, and requesting that he meet with the Bank's counsel and turn over documents. Johnson contends that the first letter was a definitive declaration of the Bank's position that the litigation was concluded and no further assistance from him was required. As a result, Mr. Johnson initiated an action before the United States District Court for the Southern District of West Virginia, Huntington Division, based on his belief that the Bank was no longer seeking his cooperation. The Complaint, in various unnamed counts, asks this Court for relief, including a declaratory judgment that the Bankruptcy Court has no jurisdiction to interpret and enforce the Stipulation; declaratory judgment that the Bank's failure to notify Johnson or the panel within 14 days of conclusion of the litigation estops or precludes the Bank from contesting Johnson's complete cooperation; declaratory judgment that Johnson receive a dollar for dollar credit against the Judgment in the amount of $2,270,754.74; declaratory judgment that the Bank has or will actually receive more than $2,000,000 in the litigation, thereby reducing the judgment to $0; declaratory judgment that the Bank is estopped from asking Johnson for his cooperation; and for an evidentiary hearing to determine whether the Bank acted in bad faith. Pending before the Court is Defendant Peoples Bank's Motion to Dismiss Second Amended Complaint or Alternatively Refer to Bankruptcy Court. Judge Robert C. Chambers grants the Motion, insofar as it seeks to refer the case to Bankruptcy Court. The parties fundamentally disagree over whether the retention of jurisdiction by the Bankruptcy Court is part of an "order" and thus whether the Bankruptcy Court has any jurisdiction over the matter. Judge Chambers pointed out that, by the express terms of the Consent Judgment, the Stipulation's terms were "incorporated by reference." The parties stipulated that the "Bankruptcy Court shall retain jurisdiction to determine any dispute over the interpretation or the enforcement of the provisions of this Order." This situation is one where jurisdiction is appropriate because the parties "obligation to comply with the terms of the settlement agreement had been made part of the order of dismissal -- either by separate provision (such as a provision "retaining jurisdiction" over the settlement agreement) or by incorporating the terms of the settlement agreement in the order." In that event, a breach of the agreement would be a violation of the order, and ancillary jurisdiction to enforce the agreement would therefore exist." This is exactly the case here. Here, the Court even signed the Stipulation. Plaintiff's counsel urges the Court to consider that "the form of the Judgment was prepared by attorneys for the parties" and was not an enforceable court order but simply a settlement agreement. The Court will take into consideration that attorneys prepared the documents. Those attorneys specifically provided that the agreement would be subject to the Bankruptcy Court's jurisdiction, a provision which they could have foreseen would be included by the Court in its Consent Order referencing the Stipulation. Given that the Bankruptcy Court can appropriately exercise jurisdiction and has expressly retained it, this Court must decide whether to refer this action to the Bankruptcy Court. The parties have been in extensive bankruptcy proceedings as evidenced by the hundreds of pages attached to this litigation. Further, the outcome of this case may affect proceedings in another, related case currently before the Bankruptcy Court. The Bankruptcy Case has more experience and investment in the case and will be well-equipped to manage Plaintiffs' claims. Further, the claims almost entirely involve interpretation of the Bankruptcy Court's own order, which is inherently an issue more appropriate for it to decide. The Court is accordingly inclined to exercise its discretion to refer this action to the bankruptcy court for further proceedings. For these reasons, Judge Chambers refers the action to the United States Bankruptcy Court for the Southern District of West Virginia for further proceedings. A full-text copy of Judge Chamber's Memorandum Opinion and Order dated January 14, 2022, is available at https://tinyurl.com/mr3dbdce from Leagle.com. The case is DENNIS RAY JOHNSON, II, Plaintiff, v. PEOPLES BANK, National Association, Defendant, Civil Action No. 3:20-0781 (S.D. Va.). About Dennis Ray Johnson Dennis Ray Johnson, II, filed a Chapter 11 petition (Bankr. S.D. W.Va. Case No. 16-30227) on May 9, 2016, and was represented by Christopher S. Smith, Esq., at Hoyer, Hoyer & Smith, PLLC. In January 2017, Mr. Johnson tapped Lewis Glasser Casey & Rollins PLLC as new counsel. Mr. Johnson is a businessman with ownership interests in at least 10 entities. He operates various rental real estate entities and coal associated operations. Mr. Johnson is a member of each of the following debtor companies -- Appalachian Mining and Reclamation, LLC, DJWV1, LLC, DJWV2, LLC, Elkview Reclamation and Processing, LLC, Green Coal, LLC, Joint Venture Development, LLC, Little Kentucky Elk, LLC, Moussie Processing, LLC, Producer's Coal, Inc., Producer's Land, LLC, Redbud Dock, LLC, Southern Marine Services, LLC, Southern Marine Terminal, LLC, and The Silo Golf Course, LLC -- and has filed a motion asking the Bankruptcy Court to jointly administer the bankruptcy cases. Mr. Johnson is also a guarantor of the debt for most of the companies. Mr. Johnson operated as a debtor-in-possession until Thomas Fluharty was appointed Chapter 11 trustee on Nov. 7, 2016. Counsel for the Trustee: Joe M. Supple, Esq. SUPPLE LAW OFFICE PLLC 801 Viand Street Point Pleasant, WV 25550 304-675-6249 E-mail: Joe.supple@supplelaw.net DODGE DATA: S&P Assigns 'B-' Issuer Credit Rating, Outlook Stable ----------------------------------------------------------------- S&P Global Ratings assigned its 'B-' issuer credit rating to Dodge Data & Analytics LLC (d/b/a Dodge Construction Network), 'B-' issue-level and '3' recovery rating to the company's proposed first-lien credit facilities, and 'CCC' issue-level and '6' recovery rating to the company's proposed second-lien term loan. The stable outlook reflects S&P's expectation for low-single-digit organic revenue growth, and steady S&P Global Ratings-adjusted EBITDA margins of about 40% with the successful realization of most targeted integration cost savings synergies. This should result in leverage of between 7x-7.5x over the next 18 months and solid free operating cash flow and liquidity. High starting leverage and financial sponsor ownership limit the company's margin for merger integration miscues. Following the recapitalization, the company's S&P Global Ratings-adjusted gross leverage will increase to over 9x as of the trailing-12-month period to Sept. 30, 2021, and to 7.4x pro forma for merger integration cost synergies. S&P's ratings reflect the risk that its private equity financial sponsors maintain an aggressive financial policy with elevated leverage, and any organic EBITDA growth and deleveraging could be offset by debt-financed acquisitions or dividends. S&P said, "Under our base-case forecast, we expect leverage will decline to the low-7x area in 2022, as the company realizes the vast majority of its targeted cost savings synergies following the April 2021 merger with The Blue Book. Due to the company's weak organic revenue growth trajectory and its absorption of the lower margin The Blue Book business, we view leverage reduction as heavily dependent upon successful execution against the targeted $20 million in cost savings synergies, which as of Sept. 30, 2021, remain almost entirely unrealized. "Most savings are tied to headcount optimization initiatives and commission plan restructuring which we view as having lower risk to achievement in the near term. Of the $20 million of net synergies identified, by December 2021, over $18 million of run-rate net savings, or approximately 92% of total net synergies, have been actioned. We expect realization of these savings in 2022 will drive adjusted leverage to the low-7x area and support free operating cash flow generation of about $30 million; however, the uncertain longer-term impact of the large-scale headcount reduction program to future sales growth weighs on our ratings. "The company's narrow focus and its modest addressable market limits our assessment of the business. Dodge generates all of its revenues within the $1.6 billion U.S. commercial construction analytics industry across the $900 million serviceable addressable market for project information and the $700 million serviceable addressable market for construction advertising. Furthermore, the company has a limited record operating at its current scale as the merger with The Blue Book roughly doubled the company's revenue base. We expect Dodge's addressable market will expand over time as industry participants increasingly adopt digital solutions and recognize the low cost-to-value of early-stage and private project insights." Partially offsetting its high service concentration is the company's good customer diversity. It serves over 38,000 customers with the top five customers comprising only 2% of annual revenues. Larger national building products manufacturers and general contractors typically purchase the core data and analytics platform to support sales and market intelligence, and regional subcontractors and suppliers typically utilize the company's network and advertising solutions to discover other companies to perform work with. Annual contract renewal terms among Dodge's small to midsize (SMB) customer base reduce long-term revenue visibility. While the company benefits from longer-term contracts (67% multiyear term) with its enterprise customers (30% of annual revenues; 68% multiyear contracts), its annual contract renewals with its SMB customers (70% of annual revenues; 66% multiyear contracts) result in a weighted average customer contract term of only 1.8 years. This compares unfavorably with our higher rated technology software and services peers who benefit from longer term multiyear contracts. It creates a risk to revenues if the company's sales pipeline conversion declines and new customer wins do not adequately offset customer churn. The company's track record of organic revenue decline in a growing industry demonstrates the constant pressure to expand and convert its sales pipeline given SMB customer retention rates in the low-80% area. S&P said, "Nevertheless, we expect that customer account management initiatives implemented by the new management team hired in 2020 will help to extend recent improvement in SMB retention to a certain degree. This should support the combined company's reversion to low-single-digit percent area annual organic revenue expansion going forward. "Dodge's favorable market position supports our forecast for steady operating performance. We view favorably the company's good market share of about 13% across its niche end markets. The company is generally viewed as a premium service provider, and in our view its niche leadership and 12-month minimum term contracts support good visibility into our forecast for a solid performance over the next year. "Competition currently consists of smaller regional players and divisions of larger technology companies like ConstructConnect (Roper), and we expect that over time competition will increase given the low competitive entry barriers and minimal capital investment requirements. Dodge aggregates its data on construction projects primarily through public sources and manual outreach methods that source 70% of projects that are privately financed. As a result, we believe it has limited technological advantage over its competitors which could potentially result in market share erosion over time. However, the company has good brand recognition due to its long operating history of accurately providing project information to the market for over 100 years. In our view this is a key competitive advantage reinforcing the positive network effects of its marketplace and analytics platform." Strong profit margins, and limited working capital and capital expenditure intensity will support the company's cash flow generation and liquidity. S&P expects Dodge will continue to generate solid free operating cash flow (FOCF). Despite its modest organic revenue growth, the company should achieve S&P Global Ratings-adjusted EBITDA margins of about 40% annually going forward as its integration costs decline through 2022. Dodge's cash conversion profile also benefits from its limited capital expenditure needs which are largely limited to software development investment. Additionally, the deferred revenue from its subscription-based revenue model supports its working capital cash needs. This is expected to drive FOCF of at least $30 million annually, which should adequately fund business reinvestment needs, and could support leverage reduction if deployed towards debt repayment or accretive acquisitions. S&P said, "We expect the most likely use of excess cash is for acquisitions that broaden platform capabilities to support retention rates and expand share of wallet with existing clients. However, given its highly concentrated financial sponsor ownership we believe shareholder returns are also likely. "The stable outlook reflects our expectation for low-single-digit organic revenue growth, and steady S&P Global Ratings-adjusted EBITDA margins of about 40% with the successful realization of most targeted integration cost savings synergies. This should result in leverage of between 7x-7.5x over the next 18 months and solid free operating cash flow and liquidity." S&P could lower its ratings if it expects earnings deterioration to result in sustained FOCF declines that constrain liquidity or render its debt burden unsustainable. In this case S&P would expect: -- Ongoing organic revenue declines due to increased churn rates and declining new business wins and market share erosion; -- Ongoing merger integration costs that persistently exceed expectations; or -- The adoption of an increasingly aggressive financial policy consisting of leveraging shareholder returns or high-priced debt funded acquisitions. In S&P's upside scenario, it expects the company to sustain adjusted leverage beneath 6.5x while maintaining FOCF to debt in at least the high-single-digit percent area. In this scenario the company will: -- Execute successfully against the merger integration such that all targeted cost savings synergies are fully realized; -- Exceed S&P's base-case low single-digit organic annual revenue growth expectations through improved SMB retention, strong cross-sell effort and cost discipline; and -- Demonstrate a conservative financial policy with respect to leveraging acquisitions or shareholder returns. ESG credit indicators: To: E-2 S-2 G-3; Governance is a moderately negative consideration, as is the case for most rated entities owned by private-equity sponsors. S&P believes Dodge's highly leveraged financial risk profile points to corporate decision-making that prioritizes the interests of the controlling owners. This also reflects the generally finite holding periods and a focus on maximizing shareholder returns. EL SERVICES: Wins Cash Collateral Access ---------------------------------------- The U.S. Bankruptcy Court for the Northern District of California has approved the Stipulation for Interim Order Re Use of Cash Collateral and Provisions for Adequate Protection and Retroactive Relief filed on October 29, 2021 by E.L. Services, Inc. and the U.S. Small Business Administration. The parties agree the Debtor may continue to use its cash collateral under the current cash collateral orders entered in the case and that this Stipulation will apply retroactively to the petition date. On June 18, 2020, SBA made a COVID 19 Economic Injury Disaster Loan to the Debtor as set forth in that Loan Authorization and Agreement dated June 18, 2020. In addition to executing the EIDL Loan, the Debtor executed a Promissory Note in the amount of $150,000 with an annual interest rate of 3.75%. The Debtor represents it has received this $150,000 and has used it to pay its expenses pursuant to the terms of the EIDL. The Promissory Note is subject to a Security Agreement whereby the Debtor granted a security interest in certain assets of the Debtor. The Debtor filed a Motion for Approval of Use of Cash Collateral, but inadvertently omitted the SBA from notice on that Motion. The Debtor inadvertence in not listing this loan was a mistake and was only learned of recently when counsel for the Debtor was searching the California Secretary of State for other filings and came upon this UCC-1 Financing Statement. Through counsel, the Debtor immediately reached out to counsel for the SBA, Christina L. Goebelsmann, to inform Ms. Goebelsmann of this inadvertent omission of the SBA loan. The Debtor acknowledges and agrees that the EIDL documents, including the Loan Authorization and Agreement, the Promissory Note, Security Agreement and UCC-1 Financing Statement are valid and enforceable agreements in accordance with the terms and constitute legal and valid binding obligation of the Debtor and enforceable in accordance with their terms. SBA is entitled, pursuant to 11 U.S.C. Sections 361, 362(c)(2) and 363(e), to adequate protection in its interest and its collateral, including the cash collateral, in an equal amount equal to the aggregate post-petition diminished value of SBA's interest in the collateral resulting from the sale, lease or use by the Debtor. It is further stipulated that the principal and interest payments on the EIDL are currently deferred until June 2022, therefore the Debtor is not required to make any such payments to SBA until that time. A copy of the order is available at https://bit.ly/3IzI8FN from PacerMonitor.com. A copy of the stipulation is available at https://bit.ly/3rPz3lr from PacerMonitor.com. About E.L. Services, Inc. E.L. Services, Inc., a landscape and maintenance company located in Dublin, California, filed a Chapter 11 petition (Bankr. N.D. Cal. Case No. 21-41087) on August 25, 2021. On the Petition Date, the Debtor estimated $50,000 to $100,000 in assets and $1 million to $10 million in liabilities. The petition was signed by Steven P. Baca, general manager. Judge William J. Lafferty oversees the case. The Debtor tapped Kornfield, Nyberg, Bendes, Kuhner & Little P.C. to serve as its counsel. ENDLESS POSSIBILITIES: Files Emergency Bid to Use Cash Collateral ----------------------------------------------------------------- Endless Possibilities, LLC d/b/a Regymen Fitness, asks the U.S. Bankruptcy Court for the Middle District of Florida, Tampa Division, for authority to use cash collateral in accordance with a budget to be furnished in advance of the interim hearing. The Debtor requires the use of cash collateral to pay operating expenses and the costs of administering the Chapter 11 case. Platinum Wealth Partners, Inc. has asserted that it has a blanket lien on the Debtor's assets. However, the State of Florida's records do not reflect a financing statement filed with the State of Florida. The Debtor's records reflect that Platinum Wealth is owed approximately $850,000. Regymen Fitness, LLC is the Debtor's franchisor. Regymen asserts a lien on specific pieces of equipment and proceeds thereof. The Debtor owes to Construction Services, Inc. of Tampa, its builder for the remaining amounts for construction services. CSI may assert an interest in cash collateral. The Debtor also owes the aggregate amount of approximately $163,000 to certain merchant cash advance funders: Reliant Funding, Unique Funding Solutions, Forward Financing, Fundbox, and Global Funding Experts (MCA Lenders). The MCA Lenders may assert an interest in cash collateral. Specifically, the Debtor intends to use Cash Collateral for payroll, insurance, purchase of necessary materials, payment of utilities, marketing expenses, other payments necessary to sustain continued business operations, care, maintenance, and preservation of the Debtor's assets, and costs of administration of the Chapter 11 case. The Debtor says there is insufficient time for a full hearing pursuant to Rule 4001(b)(2) of the Federal Rules of Bankruptcy Procedure to be held before the Debtor must use Cash Collateral. If the motion is not considered on an expedited basis and if the Debtor is denied the ability to immediately use Cash Collateral, there will be a direct and immediate material and adverse impact on the continuing operations of the Debtor's business and on the value of its assets. In exchange for the Debtor's ability to use Cash Collateral in the operation of its business, the Debtor proposes to grant to the Lenders, as adequate protection, replacement liens to the same extent, validity, and priority as existed on the Petition Date. The Debtor asserts that the interests of the Lenders will be adequately protected by the replacement liens. The Debtor also requests that the court schedule a preliminary hearing on the motion on or before January 28, 2022. A copy of the motion is available at https://bit.ly/3qYwy14 from PacerMonitor.com. About Endless Possibilities, LLC Endless Possibilities, LLC specializes in event planning of Themed Birthday Parties, Baby Showers, Bridal Showers, Brunches, Graduation Open Houses, Weddings, Anniversaries, Family Reunions and more. The Debtor sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. M.D. Fla. Case No. 22-00259) on January 21, 2022. In the petition signed by Gretchen Mitchell, managing member, the Debtor disclosed up to $500 in assets and up to $10 million in liabilities. Scott A. Stichter, Esq. at Stichter, Riedl, Blain and Poster, P.A. is the Debtor's counsel. GIRARDI & KEESE: Court Orders Erika to Turn Over AMEX Records ------------------------------------------------------------- News National USA reports that a bankruptcy judge has ordered Erika Jayne's AMEX records turned over in bankruptcy. Amid the once-famed attorney's ongoing bankruptcy cases, one of which is against his former law firm, Girardi Keese, and another aimed at him personally, a trustee made a motion to expose potential payments made for Thomas' now-estranged wife, Real Housewives of Beverly Hills star Erika, over the past 10 years. According to documents obtained by Radar Online on January 10, a judge recently granted a motion filed by the trustee assigned to Thomas' case, who is hoping to locate assets of Thomas' and repay his $101 million debt. As the outlet explained, the trustee wanted permission from the court that would allow them to request the American Express records because the statements provided by Thomas and his firm did not answer the questions they were hoping to answer in regard to whether or not Thomas committed fraud against his former clients. "While the Debtor’s bank statements contain general line item entries relating to the payments, no additional information was found in the Debtor's records that sheds any light on the nature of the payments made, or if the Debtor received reasonably equivalent value in exchange for the payments," the court documents read. "The trustee's review did reveal, however, substantial payments made by the Debtor to American Express,' they added. The filing also noted that Girardi Keese provided American Express cards not just to several of their employees but also to Erika, which will surely fuel the possibility of an impending confirmation that Thomas was, in fact, using his victims’ money to pay her bills. Over the years, Thomas has been accused of stealing millions from his former clients, including $2 million from widows and orphans of plane crash victims. And because it has been alleged that he used those reportedly stolen settlements to fund Erika's over-the-top lifestyle, she’s been dragged into a number of lawsuits against him. She's also been hit with a $25 million lawsuit, which accused the RHOBH cast member of receiving transfers from Thomas and his firm — and demanded she returns those funds. The Real Housewives of Beverly Hills season 12 is currently in production and expected to premiere on Bravo sometime later this 2022. About Girardi & Keese Girardi and Keese or Girardi & Keese was a Los Angeles-based law firm founded in 1965 by lawyers Thomas Girardi and Robert Keese. It served clients in California in a variety of legal areas. It was known for representing plaintiffs against major corporations. An involuntary Chapter 7 petition (Bankr. C.D. Cal. Case No. 20-21022) was filed in December 2020 against GIRARDI KEESE by alleged creditors Jill O'Callahan, Robert M. Keese, John Abassian, Erika Saldana, Virginia Antonio, and Kimberly Archie. The petitioners' attorneys: Andrew Goodman Goodman Law Offices, Apc Tel: 818-802-5044 E-mail: agoodman@andyglaw.com Elissa D. Miller, a member of the firm SulmeyerKupetz, has been appointed as Chapter 7 trustee for GIRARDI KEESE. The Chapter 7 trustee can be reached at: Elissa D. Miller 333 South Grand Ave., Suite 3400 Los Angeles, California 90071-1406 Telephone: (213) 626-2311 Facsimile: (213) 629-4520 E-mail: emiller@sulmeyerlaw.com An involuntary Chapter 7 petition was also filed against Thomas Vincent Girardi (Case No. 20-21020) on Dec. 18, 2020. The Chapter 7 trustee can be reached at: Jason M. Rund Email: trustee@srlawyers.com 840 Apollo Street, Suite 351 El Segundo, CA 90245 Telephone: (310) 640-1200 GIRARDI & KEESE: Tom Denied Discharge in Bankruptcy Court --------------------------------------------------------- Ryan Naumann of Radar Online reports that a federal judge has ruled the husband of Real Housewives of Beverly Hills star Erika Jayne will not have his debt wiped clean in his involuntary Chapter 7. According to court documents obtained by Radar, the judge presiding over the case issued a ruling earlier today denying Tom Girardi the right to a discharge in his personal bankruptcy. His law firm Girardi Keese is still in the middle of a pending Chapter 7 as well. The judge said in the bombshell ruling that his decision was based on two legal statues. The law statues cited state Girardi's bankruptcy is being dismissed due to him having "concealed, destroyed, mutilated, falsified, or failed to keep or preserve any recorded information, including books, documents, records, and papers, from which the debtor's financial condition or business transactions might be ascertained." Basically, the judge is saying Girardi's financial books are a mess and the trustee who was put in place to take control is unable to move properly administer the estate. The second law the judge noted in the ruling deals with debtor's failing to explain any "loss of assets of deficiency of assets to meet the debtor's liabilities." This meaning a lot of money that Girardi should have had in his possession is missing without an explanation. The decision means the creditors listed in Girardi's personal bankruptcy -- not the law firm case -- can now start going after the once-respected lawyer in court. They do not have to go through the federal court and can start trying to seize his assets via alternative routes. The decision comes days after Jayne rushed to court in the law firm bankruptcy demanding damages. She filed a claim in the case claiming her ex and his law firm caused her harm. The Bravo star complained about Girardi's victims starting to come after her for money and she whined about it being unfair. She also noted that she had no prenuptial agreement with Girardi. Her divorce was put on pause when the bankruptcy cases were filed to make sure the creditors were paid out first. Now, the RHOBH star is putting everyone on notice she wants her 1/2 cut of whatever is leftover after victims are paid out. Jayne is also fighting off a $25 million lawsuit filed as part of the law firm's bankruptcy. The trustee is demanding she return millions her ex's firm spent on bills for her company EJ Global. About Girardi & Keese Girardi and Keese or Girardi & Keese was a Los Angeles-based law firm founded in 1965 by lawyers Thomas Girardi and Robert Keese. It served clients in California in a variety of legal areas. It was known for representing plaintiffs against major corporations. An involuntary Chapter 7 petition (Bankr. C.D. Cal. Case No. 20-21022) was filed in December 2020 against GIRARDI KEESE by alleged creditors Jill O'Callahan, Robert M. Keese, John Abassian, Erika Saldana, Virginia Antonio, and Kimberly Archie. The petitioners' attorneys: Andrew Goodman Goodman Law Offices, Apc Tel: 818-802-5044 E-mail: agoodman@andyglaw.com Elissa D. Miller, a member of the firm SulmeyerKupetz, has been appointed as Chapter 7 trustee for GIRARDI KEESE. The Chapter 7 trustee can be reached at: Elissa D. Miller 333 South Grand Ave., Suite 3400 Los Angeles, California 90071-1406 Telephone: (213) 626-2311 Facsimile: (213) 629-4520 E-mail: emiller@sulmeyerlaw.com An involuntary Chapter 7 petition was also filed against Thomas Vincent Girardi (Case No. 20-21020) on Dec. 18, 2020. The Chapter 7 trustee can be reached at: Jason M. Rund Email: trustee@srlawyers.com 840 Apollo Street, Suite 351 El Segundo, CA 90245 Telephone: (310) 640-1200 GREG & ALICE: Seeks to Employ L. Laramie Henry as Legal Counsel --------------------------------------------------------------- Greg & Alice, Inc. seeks approval from the U.S. Bankruptcy Court for the Western District of Louisiana to hire L. Laramie Henry, Esq., a practicing attorney in Alexandria, La., to handle its Chapter 11 case. Mr. Henry's services include: (a) giving legal advice with respect to the Debtor's business; (b) managing the Debtor's property; and (c) performing all legal services for the Debtor, which may be necessary in the case. The rate to be charged is $350 per hour for attorney time and $75 per hour for paralegal time. Mr. Henry disclosed in a court filing that he is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code. Mr. Henry can be reached at: L. Laramie Henry, Esq. 1227 MacArthur Drive Alexandria, LA 71301 Tel: (318) 445-6000 Email: Info@Henry-Law.com About Greg & Alice Greg & Alice, Inc. filed a petition for Chapter 11 protection (Bankr. W.D. La. Case No. 22-10026) on Jan. 11, 2022, listing up to $500,000 in assets and liabilities. Gregory Williams, member, signed the petition. Judge John S Hodge oversees the case. The Debtor tapped L. Laramie Henry, Esq., a practicing attorney in Alexandria, La., to handle its Chapter 11 case. HERTZ CORP: Settles Clawback Suit, Ex-CEO Still on Hook ------------------------------------------------------- Abby Wargo of Law360 reports that Hertz Corp. and its former general counsel came to an agreement resolving the company's claims looking to take back $56 million in incentive and severance pay due to what it considered misconduct, but claims against the company's ex-CEO are ongoing. Hertz filed a stipulation of dismissal in New Jersey federal court Monday, January 24, 2022, stating the company agreed to resolve the clawback claims against former general counsel John Zimmerman that were brought after he was accused of breaching company business practices leading up to an accounting scandal. The dismissal did not describe a settlement or mention former CEO Mark Frissora. About Hertz Corp. Hertz Corp. and its subsidiaries -- http://www.hertz.com/-- operate a worldwide vehicle rental business under the Hertz, Dollar, and Thrifty brands, with car rental locations in North America, Europe, Latin America, Africa, Asia, Australia, the Caribbean, the Middle East, and New Zealand. They also operate a vehicle leasing and fleet management solutions business. On May 22, 2020, The Hertz Corporation and certain of its U.S. and Canadian subsidiaries and affiliates filed voluntary petitions for reorganization under Chapter 11 in the U.S. Bankruptcy Court for the District of Delaware (Bankr. D. Del. Case No. 20-11218). Judge Mary F. Walrath oversees the cases. The Debtors have tapped White & Case LLP as their bankruptcy counsel, Richards, Layton & Finger, P.A., as local counsel, Moelis & Co. as investment banker, and FTI Consulting as financial advisor. The Debtors also retained the services of Boston Consulting Group to assist the Debtors in the development of their business plan. Prime Clerk LLC is the claims agent. The U.S. Trustee for Regions 3 and 9 appointed a Committee to represent unsecured creditors in Debtors' Chapter 11 cases. The Committee has tapped Kramer Levin Naftalis & Frankel LLP as its bankruptcy counsel, Benesch Friedlander Coplan & Aronoff LLP as Delaware counsel, UBS Securities LLC as investment banker, and Berkeley Research Group, LLC, as financial advisor. Ernst & Young LLP provides audit and tax services to the Committee. HORIZON GLOBAL: Royce & Associates Has 6.1% Stake as of Dec. 31 --------------------------------------------------------------- Royce & Associates, LP disclosed in an amended Schedule 13G filed with the Securities and Exchange Commission that as of Dec. 31, 2021, it beneficially owns 1,663,957 shares of common stock of Horizon Global Corporation, representing 6.1 percent of the shares outstanding. A full-text copy of the regulatory filing is available for free at: https://www.sec.gov/Archives/edgar/data/906304/000090630422000023/hzn2.txt About Horizon Global Horizon Global -- http://www.horizonglobal.com-- is a designer, manufacturer, and distributor of a wide variety of custom-engineered towing, trailering, cargo management and other related accessory products in North America, Australia and Europe. The Company serves OEMs, retailers, dealer networks and the end consumer. Horizon Global reported a net loss attributable to the Company of $36.56 million for the 12 months ended Dec. 31, 2020, compared to net income attributable to the company of $80.75 million for the 12 months ended Dec. 31, 2019. As of Sept. 30, 2021, the Company had $468.33 million in total assets, $494.26 million in total liabilities, and a total shareholders' deficit of $25.93 million. IM SERVICES: Two More Creditors Appointed to Committee ------------------------------------------------------ Gregory Garvin, acting U.S. Trustee for Region 18, appointed Power Engineering Services and DKD Electric, LLC as new members of the official committee of unsecured creditors in the Chapter 11 case of IM Services Group, LLC. As of Jan. 21, the members of the committee are: 1. Nelson Mullins c/o Gary M. Freeman 2 South Biscayne Blvd., 21st Floor Miami, FL 33131 2. Equipmentshare.com Inc. c/o Paul Mason 5710 Bull Run Drive Columbia, MO 65201 3. Splicers, Inc. c/o Danny Standefer 9575 Lake Conroe Dr. Conroe, TX 77304 4. Power Engineering Services c/o Humberto Vega 9179 Shadow Creek Lane Converse, TX 78109 5. DKD Electric, LLC c/o Brian Dusenbery 6801 Academy Parkway West NE Albuquerque, NM 87109 About IM Services Group IM Services Group, LLC is an engineering company that provides turn-key engineering, design and construction management services to clients in a range of industries, including the pipeline construction industry. The company is based in Boise, Idaho. IM Services Group filed its voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. D. Idaho Case No. 21-00737) on Dec. 28, 2021, listing $20,479,785 in assets and $21,829,475 in liabilities. Judge Noah G. Hillen presides over the case. Matthew T. Christensen, Esq., at Johnson May represents the Debtor as legal counsel. Gregory Garvin, acting U.S. Trustee for Region 18, appointed an official committee of unsecured creditors in the Debtor's Chapter 11 on Jan. 19, 2022. JINZHENG GROUP: U.S. Trustee Appoints Creditors' Committee ---------------------------------------------------------- The U.S. Trustee for Region 16 on Jan. 25 appointed an official committee to represent unsecured creditors in the Chapter 11 case of Jinzheng Group (USA) LLC. The committee members are: 1. Betula Lenta, Inc. David Park 800 West 6th Street, Suite 1250 Los Angeles, CA 90017 Phone: (213) 537-0158 E-mail: david@thecodesolution.com 2. Pennington Construction Advisors, Inc. Todd Pennington 79 Bell Pasture Rd. Ladera Ranch, CA 92694 Phone: (949) 637-6210 E-mail: todd@penncoinc.com 3. The Phalanx Group, Inc. Anthony Rodriguez 424 E. 1st Street, Unit #10 Los Angeles, CA 90015 Phone: (213) 494-8542 E-mail: anthony@phalanx.group Official creditors' committees serve as fiduciaries to the general population of creditors they represent. They may investigate the debtor's business and financial affairs. Committees have the right to employ legal counsel, accountants and financial advisors at a debtor's expense. About Jinzheng Group (USA) Jinzheng Group (USA) LLC, owner of multiple properties in Los Angeles County, Calif., sought protection under Chapter 11 of the Bankruptcy Code (Bankr. C.D. Calif. Case No. 21-16674) on Aug. 24, 2021, listing up to $50 million in both assets and liabilities. Judge Ernest M. Robles oversees the case. Shioda, Langley & Chang LLP serves as the Debtor's legal counsel. KENNETH A. BERDICK: Peer Buying Interest in Alva Property for $325K ------------------------------------------------------------------- Kenneth Allen Berdick asks the U.S. Bankruptcy Court for the Middle District of Florida to authorize the sale of his interest in 15830 N River Rd., Alva, FL 33920, to Bailey James Peer for a total of $325,000, subject to higher and better offers. Objections, if any, must be filed within 21 days from the date of service, plus an additional three days for service if any party was served by U.S. Mail. The Debtor proposes to sell the Property free and clear of all other liens, claims, encumbrances and other interests and other related relief, with the liens to attach to proceeds. The Debtor believes that several entities may have lien rights as to the Asset, including the following: Lee County Tax Collector (CS)(bankruptcyecfdocs@leetc.com); Luis E Rivera, II on behalf of Creditor Lee County Tax Collector (CS) (luis.rivera@gray-robinson.com, jodi.payne@gray-robinson.com); Michael Brian Cheffer on behalf of Creditor Connie Elaine Casto (bcheffer@dsdhlaw.com, cmoore@dsdhlaw.com); Michael Brian Cheffer on behalf of Creditor Geroge Richard Casto (bcheffer@dsdhlaw.com, cmoore@dsdhlaw.com); and Michael Brian Cheffer on behalf of Creditor Wayne Corbett (bcheffer@dsdhlaw.com, cmoore@dsdhlaw.com). The Debtor believes that the following entities will be asserting liens in the following approximate amounts and believes that the order of priority is as indicated: Claimant Estimated Amount Proposed Amount to be Claimed paid at Closing Less Lee Property Taxes 2019 $3,072.30 $3,072.30 Less Lee Property Taxes 202 $3,126.10 $3,126.10 Less Lee Property Taxes 2021 $3,631.18 $3,631.18 Less Corbett/Casto $124,421.27 $124,421.27 Less Attorney Fees Corbett/Casto $7,755.00 $7,755.00 Central Bank 0 0 Susan Salemeh based on judgment lien $155,000.00 $50,000.00 Internal Revenue Service $260,740.56 $50,000.00 State of Florida unknown 0 Davis Trust $180,431.91 $19,000.00 The Debtor proposes to pay at closing the amounts indicated. The amounts being proposed to be paid to the Internal Revenue Service, the Davis Trust and Susan Salemeh are proposed to be in full satisfaction of their claims in the bankruptcy. The Debtor is in default as to its plan payments, and believes that the consideration being proposed to be paid to these lien claimants is greater than they would receive under any other scenario. Furthermore, Debtor may apply $21,000 ofthe proceeds to pay the anticipated tax obligation attributable to the Sale by the Debtor. The remaining proceeds would be used to fund plan payments to the remaining creditors after customary closing costs. It appears that there would be approximately $23,494.15 after the payment of a 6% customary broker's commission to Miloff Aubuchon Realty Group, Inc. and the anticipated tax consequences upon the Sale. creditors after customary closing costs. It appears that there would be approximately $23,494.15 after the payment of a 6% customary broker's commission to Miloff Aubuchon Realty Group, Inc. and the anticipated tax consequences upon the Sale. By the Motion, the Debtor seeks authority to sell the Asset to the Purchaser free and clear of liens, claims, encumbrances and other interests with liens to attach to proceeds. He further requests that the Court waives the 14-day automatic stay of the sale, imposed under Bankruptcy Rule 6004(g). A copy of the Contract is available at https://tinyurl.com/yckppkh6 from PacerMonitor.com free of charge. Kenneth Allen Berdick sought Chapter 11 protection (Bankr. M.D. Fla. Case No. 20-01107) on Feb. 10, 2020. The Debtor tapped Charles Phoenix, Esq., as counsel. KENNETH A. BERDICK: Selling Interest in Fort Myers Asset for $230K ------------------------------------------------------------------ Kenneth Allen Berdick asks the U.S. Bankruptcy Court for the Middle District of Florida to authorize the sale of his interest in the real property located at 7148 Estero Boulevard, Unit 122, in Fort Myers Beach, Florida, to Joseph Allen and Victoria Allen for $230,000, subject to higher and better offers. Objections, if any, must be filed within 21 days from the date of service, plus an additional three days for service if any party was served by U.S. Mail. The Property is legally described as The legal description for the Asset is "7148 ESTERO BOULEVARD, UNIT 122, Fort Myers Beach, FL, Apartment No. 122, of THE CRECIENTE CONDOMINIUM EAST, according to the Condominium Declaration thereof on file and recorded in Official Records Book 1242, page 101, Public Records of Lee County, Florida, together with all appurtenances thereunto appertaining and specified in said Condominium Declaration." The Debtor proposes to sell the Property free and clear of all other liens, claims, encumbrances and other interests and other related relief, with the liens to attach to proceeds. The Debtor believes that several entities may have lien rights as to the Asset, including the following: Lee County Tax Collector (CS)(bankruptcyecfdocs@leetc.com); Luis E Rivera, II on behalf of Creditor Lee County Tax Collector (CS)(luis.rivera@gray-robinson.com, jodi.payne@gray-robinson.com); Seth J Greenhill on behalf of Creditor NewRez LLC d/b/a Shellpoint Mortgage Servicing (Seth.Greenhill@padgettlawgroup.com); United States of America based on Federal Tax Liens, represented by Sullivan, David (USAFLM) (David.Sullivan3@usdoj.gov); and Internal Revenue Service, PO Box 7346, Philadelphia, PA 19101-7346. The Debtor believes that the following entities will be asserting liens in the following approximate amounts and believes that the order of priority is as indicated: Claimant Estimated Amount Proposed Amount to be Claimed paid at Closing Ad Valorem Taxes if $2,657.84 $2,657.84 paid in February 2022 Creciente Condominium Assoc. $22,000 $22,000 NewRez LLC $184,762.25 as of $184,762.25 as of 2/19/2021 with a 2/19/2021 with a per diem charge of per diem charge of $28.86 $28.86 Susan Salemeh based $155,000 0 on judgment lien IRS 260,740.56V 0 State of Florida unknown 0 Davis Trust $180,431.91 0 The current offer for $230,000 is the highest offer for the Asset after extensive marketing. By the Motion, the Debtor seeks authority to sell the Asset to the Purchaser free and clear of liens, claims, encumbrances and other interests with liens to attach to proceeds as indicated. He further requests that the Court waives the 14-day automatic stay of the sale, imposed under Bankruptcy Rule 6004(g). Kenneth Allen Berdick sought Chapter 11 protection (Bankr. M.D. Fla. Case No. 20-01107) on Feb. 10, 2020. The Debtor tapped Charles Phoenix, Esq., as counsel. KISMET ROCK HILL: Seeks to Employ Skufca Law as Special Counsel --------------------------------------------------------------- Kismet Rock Hill, LLC seeks approval from the U.S. Bankruptcy Court for the District of South Carolina to hire Skufca Law, PLLC to represent it in litigation pending in the Common Pleas Court of York County, SC. The firm's hourly rates are as follows: Kerry L. Traynum, Esq. $350 per hour Associate attorneys $255 per hour Paralegal $175 per hour Kerry Traynum, Esq., the firm's attorney who will be providing the services, disclosed in a court filing that he is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code. The firm can be reached at: Kerry L. Traynum, Esq. Skufca Law, PLLC 1514 South Chruch Street, Suite 101 Charlotte, NC 28203 Tel: (704) 962-9558 Email: kerry@skufcalaw.com About Kismet Rock Hill Kismet Rock Hill, LLC operates Holiday Inn, a hotel located at 503 Galleria Boulevard, in Rock Hill, S.C. Kismet Rock Hill filed its voluntary petition for Chapter 11 protection (Bankr. D. S.C. Case No. 21-01926) on July 23, 2021, listing as much as $50 million in assets and as much as $10 million in liabilities. Judge Helen E. Burris presides over the case. The Debtor tapped Christine E. Brimm, Esq., at Barton Brimm, PA, as legal counsel; Newpoint Advisors Corporation as accountant; and Skufca Law, PLLC as special counsel. LATAM AIRLINES: Parent Unsecureds Will Get 16.3% to 19.3% --------------------------------------------------------- LATAM Airlines Group S.A. ("LATAM Parent") and certain of its debtor affiliates submitted a Second Revised Disclosure Statement with respect to the Joint Plan of Reorganization dated Jan. 24, 2022. The Second Revised Disclosure Statement discusses the position of the Creditors' Committee regarding the Plan. The Creditors' Committee has grave concerns about the Plan, which it believes unlawfully favors the Commitment Creditors and the Backstop Shareholders at the expense of the Debtors' other similarly situated impaired unsecured creditors, who hold more than $1.5 billion in claims against the Debtors' parent company. The Creditors' Committee views the Plan as the result of a flawed process that has not maximized the value of the Debtors' estates which transfers inappropriately high consideration to the preferred Commitment Creditors in the form of an excessive 20% backstop fee (more than $743 million in cash) and a disproportionate allocation of the Plan's new money issuance at a favorable price, without a meaningful market test. It is the Creditors' Committee's view that the Plan is structured to provide outsized returns to the Commitment Creditors on account of their unsecured claims—returns not available to other general unsecured creditors of LATAM Parent. The Creditors' Committee asserts that the Commitment Creditors are entitled to obtain more than 85% of the New Convertible Notes Class C which, at the Debtors' assumed $14 billion plan value, effectively allows them to acquire shares in the reorganized business at a 20.7% discount. The Creditors' Committee believes that under the Plan, LATAM Parent's general unsecured creditors bear the cost of the allegedly outsized benefits conferred on the Commitment Creditors and the Backstop Shareholders and are substantially prejudiced, receiving restricted securities in the form of New Convertible Notes Class A that convert to stock in the reorganized Debtors for a recovery of only 19.3 cents on the dollar based on the assumed plan value. The Creditors' Committee believes that a superior process and real testing of market alternatives would have yielded value-maximizing alternatives for the Debtors' estates and general unsecured creditors. The Creditors' Committee also has concerns about the release of more than $200 million (in the Creditors' Committee's estimate) of fraudulent transfer claims held against Delta and Qatar, two of the Debtors' largest shareholders, which the Creditors' Committee contends are being provided for no apparent consideration. In the Creditors' Committee's view, these releases are not in the best interests of the Debtors' estates and will eliminate valuable claims for fraudulent transfers that occurred in the days and weeks before the Debtors' bankruptcy filing. Debtors' Response to the Position of the Creditors' Committee The Debtors disagree with the position of the Creditors' Committee. The Plan and the various favorable settlements of material issues, result from an extended process undertaken by the Debtors to explore alternatives with the major parties in interest in these Chapter 11 Cases to develop a plan that may be confirmed in the Chapter 11 Cases and implemented in the various jurisdictions where the Debtors operate. The Plan is supported by creditors of LATAM Parent holding the large majority of Claims against it, and shareholders holding a majority of the equity of LATAM Parent, each of whom have provided substantial and long-term backstop commitments with respect to the Plan, providing LATAM Parent creditors the opportunity to participate in new money opportunities, and pays the Debtors' remaining creditors other than the Claims in Classes 5 and 7 in full in cash. The Debtors disagree with the various objections and assertions raised by the Creditors' Committee, including the Creditors' Committee's legal arguments, likelihood of success, and estimates of value and/or recoveries, and intend to address them in connection with confirmation of the Plan. Class 5 consists of General Unsecured Claims against LATAM Parent. Each Holder of an Allowed General Unsecured Claim against LATAM Parent shall receive in full satisfaction, settlement, discharge and release of its Allowed Class 5 Claim a distribution pursuant to Class 5a Treatment, unless such Holder (excluding any Ineligible Holders) opts into Class 5b Treatment. For the avoidance of doubt, such election into Class 5a Treatment or Class 5b Treatment shall apply to all of such Holder's General Unsecured Allowed Claims against LATAM Parent. This Class will receive a distribution of 16.3 – 19.3% of their allowed claims. Class 6 consists of General Unsecured Claims against Debtors other than LATAM Parent, Piquero Leasing Limited and LATAM Finance Ltd. Each Holder of an Allowed General Unsecured Claim against a Debtor other than LATAM Parent, Piquero Leasing Limited or LATAM Finance shall receive, in full satisfaction, settlement, discharge and release of its Allowed Class 6 Claim (x) Cash equal to the amount of such Allowed Class 6 Claim; (y) such other less favorable treatment as to which the Debtors and the Holder of such Allowed Class 6 Claim shall have agreed upon in writing or (z) such other treatment such that the applicable Allowed Class 6 Claim will be rendered Unimpaired pursuant to section 1124 of the Bankruptcy Code. This Class will receive a distribution of 100% of their allowed claims. Class 7 consists of the General Unsecured Claim against Piquero Leasing Limited. The Holder of the Allowed General Unsecured Claim against Piquero shall receive, in full satisfaction, settlement, discharge and release of such Claim, (x) the Piquero Consideration or (y) such other less favorable treatment as to which the Debtors and the Holder of such Allowed Class 7 Claim shall have agreed upon in writing. This Class will receive a distribution of 16.3 – 19.3% of their allowed claims. The projected recoveries to Class 5 under the Plan were prepared using an assumed range of the LATAM Parent General Unsecured Claims pool to be $5,014,034,258, at the low end ("Low Claims Estimate"), and $5,931,974,136 billion at the high end (“High Claims Estimate”), according to a footnote in the Disclosure Statement. The Debtors and Reorganized Debtors, as applicable, shall fund distributions under the Plan with: (i) Cash on hand, including Cash from operations or asset dispositions; (ii) Cash proceeds from the subscription of ERO New Common Stock pursuant to the ERO Rights Offering Procedures, (iii) the New Convertible Notes Class A, (iv) the New Convertible Notes Class C, (v) the Cash proceeds from the subscription of the New Convertible Notes (including any Cash proceeds from the subscription of the New Convertible Notes Class A and New Convertible Notes Class C by Eligible Equity Holders during the New Convertible Notes Preemptive Rights Offering Period above the Allowed Class 5a Treatment Cash Amount), and (vi) the proceeds of the Exit Financing. Counsel for the Debtors: CLEARY GOTTLIEB STEEN & HAMILTON LLP Richard J. Cooper Lisa M. Schweitzer Luke A. Barefoot Thomas S. Kessler One Liberty Plaza New York, New York 10006 Telephone: (212) 225-2000 Facsimile: (212) 225-3999 About LATAM Airlines Group LATAM Airlines Group S.A. -- http://www.latam.com/-- is a pan-Latin American airline holding company involved in the transportation of passengers and cargo and operates as one unified business enterprise. It is the largest passenger airline in South America. Before the onset of the COVID-19 pandemic, LATAM offered passenger transport services to 145 different destinations in 26 countries, including domestic flights in Argentina, Brazil, Chile, Colombia, Ecuador and Peru, and international services within Latin America as well as to Europe, the United States, the Caribbean, Oceania, Asia and Africa. LATAM and its 28 affiliates sought Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 20-11254) on May 25, 2020. Affiliates in Chile, Peru, Colombia, Ecuador and the United States are part of the Chapter 11 filing. The Debtors disclosed $21,087,806,000 in total assets and $17,958,629,000 in total liabilities as of Dec. 31, 2019. The Hon. James L. Garrity, Jr., is the case judge. The Debtors tapped Cleary Gottlieb Steen & Hamilton LLP as bankruptcy counsel, FTI Consulting as restructuring advisor, Lee Brock Camargo Advogados as local Brazilian litigation counsel, and Togut, Segal & Segal LLP and Claro & Cia in Chile as special counsel. The Boston Consulting Group, Inc. and The Boston Consulting Group UK LLP serve as the Debtors' strategic advisors. Prime Clerk LLC is the claims agent. The official committee of unsecured creditors formed in the case tapped Dechert LLP as its bankruptcy counsel, Klestadt Winters Jureller Southard & Stevens, LLP as conflicts counsel, UBS Securities LLC as investment banker, and Conway MacKenzie, LLC as financial advisor. Ferro Castro Neves Daltro & Gomide Advogados is the committee's Brazilian counsel. The Ad Hoc Group of LATAM Bondholders tapped White & Case LLP as counsel. Glenn Agre Bergman & Fuentes, LLP, led by managing partner Andrew Glenn and partner Shai Schmidt, has been retained as counsel to the Ad Hoc Committee of Shareholders. LEWIS E. WILKERSON, JR.: Dalton Offers $235K for Keysville Property ------------------------------------------------------------------- Lewis E. Wilkerson, Jr., asks the U.S. Bankruptcy Court for the Eastern District of Virginia to authorize the sale of the land, all improvements thereon, and appurtenances thereto belonging, located in Keysville, Charlotte County, Virginia, and described as 40-A-89-B, 40-A-89-D, 40-A-89, 40-A-89-A, to Randy D. Dalton for $235,000. The Property is more particularly described as: Tax Map No. 40-A-89D: All that certain piece or parcel of real estate, with all improvements thereon and appurtenances thereunto belonging, lying and being in Walton Magisterial District, Charlotte County, Virginia, fronting on State Route 652, containing 2.41 acres, as shown on plat of survey made by William W, Dickerson, Jr., L.S., bearing date of the 24th day of July, 1992, which is recorded in the Clerk's Office, Circuit Court, Charlotte County, Virginia, in Deed Book 265, Page 235. Reference to said plat is hereby made for a more particular description by metes and bounds. Said plat is incorporated herein as if same were herein textually contained. Tax Map No. 40-A-89A: All that certain tract or parcel of land situate in the Walton Magisterial District, Charlotte County, Virginia, consisting of 20 acres, more or less, as shown as Tract A on plat by Ralph P. Hines, C.L.S., dated August 28, 1978, revised Aug. 31, 1978, which said plat is recorded in Plat Book No, 4 at Page 75. Reference to said plat is hereby made for a more particular description by metes and bounds. Said plat is incorporated herein as if same were herein textually contained. Tax Map No. 40-A—89: All that certain tract or parcel of land containing 31 acres, more or less, located in Walton Magisterial District, Charlotte County, Virginia, and more particularly described as Parcel B and D on plat of survey made by Ralph P. Hines, C.L.8., dated Aug. 28, 1978, and revised Aug. 31, 1978, a copy of which survey is duly recorded in the Clerk's Office of the Circuit Court of Charlotte County, Virginia, In Deed Book 184, at Page 80. Reference to said plat is hereby made for a more particular description by metes and bounds. Said plat is incorporated herein as if same were herein textually contained. LESS and except 3.55 acres conveyed to the Continental Group, Inc. by deed of exchange from Emily G. Clemmer. Tax Map No. 40-A-89B: All that certain lot or parcel of land situated in Walton Magisterial District, Charlotte County, Virginia, containing 1.40 acres and more particularly set forth on a plat of survey made by Ralph P. Hines, C.LS, dated Aug. 28, 1978, and revised Aug. 29,1979, a copy of which is recorded in the Clerk's Office of the Circuit Court of Charlotte County, Virginia, which said plat is recorded in Plat Book No, 4 at Page 75. Said Parcel of land adjoins State Rt. 652, other lands of Continental Forest Industries and the property heretofore owned by Emily G. Clemmer. Reference to said plat is hereby made for a more particular description by metes and bounds. Said plat is incorporated herein as if same were herein textually contained. BEING A PORTION OF the same real estate conveyed to Lewis E. Wilkerson, Jr., by deed from Prince Edward Investors, LLC, a Virginia limited liability company, dated Dec. 27, 2010, recorded January 3, 2011, Clerk's Office, Circuit Court, Charlotte County, Virginia, In Deed Book 405, Page 631. The Debtor has entered into a contract for the sale of the Property with a sales price of $235,000 with brokerage fees in the amount of 8% to be paid which, upon closing of the same, after normal closing costs and any accrued real estate taxes have been paid, the proceeds will be paid to Home Loan Investment Bank's lien in the approximate total amount of $4,245,545.00 and extinguishing Home Loan Investment Bank's lien against the Property being sold, with Home Loan Investment Bank retaining all of its lien rights against its other collateral. As may be practicable, the Debtor intends to sell its interest in the Property in accordance with the terms of the Contract. The Debtor asks that the Court enters an Order authorizing the sale of the Property in accordance with the terms of the contract. A copy of the Purchase Agreement is available at https://tinyurl.com/3p8zyb6z from PacerMonitor.com free of charge. Lewis E. Wilkerson, Jr. sought Chapter 11 protection (Bankr. E.D. Va. Case No. 20-34576) on Nov. 17, 2020. The Debtor tapped Robert Canfield, Esq., as counsel. MALLINCKRODT PLC: Asks Court to Okay Frenesius Supply Claims Deal ----------------------------------------------------------------- Rick Archer of Law360 reports that drugmaker Mallinckrodt PLC is asking a Delaware bankruptcy judge to approve a $13.9 million settlement with a subsidiary of German pharmaceutical company Fresenius Kabi to end a dispute over supply payments Mallinckrodt cut off when it entered Chapter 11. In a motion filed Monday, January 21, 2022, Mallinckrodt said the deal will resolve about $16.5 million in claims Fresenius had asserted in the case in return for less than $1 million in priority payments and a slice of the unsecured creditors' trust fund. 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 was set to begin Nov. 1, 2021. The Confirmation Hearing is slated to have two phases. Phase 1 commenced the week of Nov. 1. Phase 2 will begin on or around the week of Nov. 15, when the Acthar Administrative Claims Hearing proceedings conclude. MERCURITY FINTECH: Jianming Jing, Wei Zhu Hold 8.8% Ordinary Shares ------------------------------------------------------------------- Jianming Jing and Wei Zhu disclosed in a Schedule 13D filed with the Securities and Exchange Commission that as of Feb. 20, 2021, they beneficially own 453,998,870 ordinary shares of Mercurity Fintech Holding Inc., representing 8.83 percent of the shares outstanding. The percentage is based on 5,143,716,229 ordinary shares of Mercurity issued and outstanding as of Jan. 12, 2022. Jianming Jing and Wei Zhu are a married couple and Wei Zhu is the co-chairman of the board of directors of the issuer and co-chief executive officer and acting chief financial officer of the issuer. On Feb. 17, 2021, Jianming Jing entered into a share purchase agreement with Amazon Capital Inc., a shareholder of Mercurity, pursuant to which Jianming Jing acquired 453,998,870 ordinary shares of the issuer for US$3,529,412. A full-text copy of the regulatory filing is available for free at: https://www.sec.gov/Archives/edgar/data/0001527762/000110465922006128/tm224003d1_sc13d.htm About Mercurity Formerly known as JMU Limited, Mercurity Fintech Holding Inc.'s current principal business is to design and develop digital asset transaction platforms based on blockchain technologies for customers to facilitate asset trading, asset digitalization and cross-border payments and provide supplemental services for such platforms, such as customized software development services, maintenance services and compliance support services. The Company started this new business since its acquisition of Mercurity Limited (previously known as Unicorn Investment Limited) in May 2019. Mercurity reported a net loss of $1.65 million for the year ended Dec. 31, 2020, a net loss of $1.22 million for the year ended Dec. 31, 2019, a net loss of $123.24 million for the year ended Dec. 31, 2018, and a net loss of $161.90 million for the year ended Dec. 31, 2017. MERCURITY FINTECH: Xiaojian Xu Reports 6.27% Equity Stake --------------------------------------------------------- Xiaojian Xu disclosed in a Schedule 13G filed with the Securities and Exchange Commission that as of Feb. 20, 2021, he beneficially owns 322,345,938 ordinary shares of Mercurity Fintech Holding Inc., representing 6.27 percent based on 5,143,716,229 ordinary shares of the issuer, issued and outstanding as of Jan. 12, 2022. A full-text copy of the regulatory filing is available for free at: https://www.sec.gov/Archives/edgar/data/0001527762/000110465922006126/tm223889d1_sc13g.htm About Mercurity Formerly known as JMU Limited, Mercurity Fintech Holding Inc.'s current principal business is to design and develop digital asset transaction platforms based on blockchain technologies for customers to facilitate asset trading, asset digitalization and cross-border payments and provide supplemental services for such platforms, such as customized software development services, maintenance services and compliance support services. The Company started this new business since its acquisition of Mercurity Limited (previously known as Unicorn Investment Limited) in May 2019. Mercurity reported a net loss of $1.65 million for the year ended Dec. 31, 2020, a net loss of $1.22 million for the year ended Dec. 31, 2019, a net loss of $123.24 million for the year ended Dec. 31, 2018, and a net loss of $161.90 million for the year ended Dec. 31, 2017. MTPC LLC: Gets Court Approval for $87 Million Bankruptcy Sales -------------------------------------------------------------- Alex Wolf of Bloomberg Law reports that bankrupt proton cancer treatment center operator MTPC LLC won court approval for three separate asset sales worth a total of $87 million. Judge Randal S. Mashburn signed orders approving the deals Jan. 25, 2022, following weeks of negotiations among MTPC, creditors, and the purchasing parties over the transition of assets. Having sold substantially all its assets, the company is now positioned to wrap up its Chapter 11 proceedings. About MTPC LLC MTPC LLC is a proton-therapy cancer-treatment center that serves a multi-state area of the Southeastern United States and began operations in 2018. It is a freestanding center with three active treatment rooms including one fixed beam and two gantries. MTPC is located in a 43,500-square-foot building adjacent to the campus of the Williamson Medical Center, in Franklin, Tenn. MTPC's affiliate, The Proton Therapy Center, LLC, is a Tennessee limited liability company that was organized in 2010. It is a freestanding center with three active treatment rooms including one fixed beam and two gantries. Proton Therapy Center is located in an 88,000-square-foot building on the campus of the Provision Case CARES Cancer Center at Dowell Springs, in Knoxville, Tenn., a comprehensive healthcare campus focusing on cancer treatment, patient care, research, and education. PCPT Hamlin, another affiliate of MTPC, is a Florida limited liability company that was organized in 2018. It includes an approximately 36,700-square-foot building in the 900-acre Hamlin planned development in the "Town Center" of the 23,000-acre "Horizon West" planning area of West Orange County. MTPC and its affiliates sought Chapter 11 protection (Bankr. M.D. Tenn. Lead Case No. 20-05438) on Dec. 15, 2020. As of Aug. 31, 2020, MTPC's unaudited financial statements reflected total assets of approximately $105.6 million and total liabilities of approximately $131.2 million. Proton Therapy Center's unaudited financial statements reflected total assets of approximately $93.4 million and total liabilities of approximately $130.2 million. Meanwhile, PCPT Hamlin's unaudited financial statements reflected total assets of approximately $139.2 million and total liabilities of approximately $138.5 million. The Hon. Randal S. Mashburn is the case judge. The Debtors tapped McDermott Will & Emery LLP as lead bankruptcy counsel, Waller Lansden Dortch & Davis LLP as co-counsel with McDermott, Trinity River Advisors LLC as restructuring advisor, and CRS Capstone Partners LLC as financial advisor. Stretto is the claims agent. The U.S. Trustee for Region 8 appointed an official committee of unsecured creditors on Jan. 8, 2021. The committee is represented by Sills Cummis & Gross P.C. and Manier & Herod, P.C. MYOMO INC: Rosalind Advisors, et al., Own 8.1% Equity Stake ----------------------------------------------------------- Rosalind Advisors, Inc., Steven Salamon, and Rosalind Master Fund L.P. disclosed in an amended Schedule 13G/A filed with the Securities and Exchange Commission that as of Dec. 31, 2021, that they beneficially own 553,290 shares of common stock of Myomo, Inc., representing 8.1 percent based upon 6,859,803 shares of the issuer's common stock outstanding as of Nov. 3, 2021 in accordance with 10-Q filing. A full-text copy of the regulatory filing is available for free at: https://www.sec.gov/Archives/edgar/data/1369290/000101905622000063/myomo_13ga1.htm About Myomo Headquartered in Cambridge, Massachusetts, Myomo, Inc. -- http://www.myomo.com-- is a wearable medical robotics company that offers expanded mobility for those suffering from neurologicaldisorders and upper limb paralysis. Myomo develops and markets the MyoPro product line. MyoPro is a powered upper limb orthosis designed to support the arm and restore function to the weakened or paralyzed arms of patients suffering from CVA stroke, brachial plexus injury, traumatic brain or spinal cord injury, ALS or other neuromuscular disease or injury. Myomo reported a net loss of $11.56 million for the year ended Dec. 31, 2020, a net loss of $10.71 million for the year ended Dec. 31, 2019, and a net loss of $10.32 million for the year ended Dec. 31, 2018. As of Sept. 30, 2021, the Company had $17.46 million in total assets, $4.31 million in total liabilities, and $13.15 million in total stockholders' equity. NAVEX TOPCO: Moody's Upgrades CFR to B2 & First Lien Loans to B1 ---------------------------------------------------------------- Moody's Investors Service has upgraded NAVEX TopCo, Inc.'s corporate family rating to B2 from B3 and probability of default rating to B2-PD from B3-PD. Concurrently, Moody's also upgraded to B1 from B2 the company's ratings on the $510 million first lien term loan and $75 million first lien revolving credit facility. Moody's also upgraded the company's $154 million second lien senior secured term loan to Caa1 from Caa2. The ratings outlook is stable. The CFR upgrade to B2 from B3 recognizes the company's recent progress in decreasing Moody's adjusted Debt/EBITDA and its ability to generate strong free cash flow despite the recent volatility in customer spending resulting from COVID-19. The upgrade also takes into consideration Moody's expectations that over the next 12-18 months Navex will continue to expand scale while sustaining solid margins and liquidity. For the last twelve months ending September 30, 2021 Navex's Debt/EBITDA sits at 5.6x (Moody's adjusted for operating leases, capitalized software costs and deferred revenue). Upgrades: Issuer: NAVEX TopCo, Inc. Corporate Family Rating, Upgraded to B2 from B3 Probability of Default Rating, Upgraded to B2-PD from B3-PD Senior Secured Bank Credit Facility, Upgraded to B1 (LGD3) from B2 (LGD3) Senior Secured Bank Credit Facility, Upgraded to Caa1 (LGD6) from Caa2 (LGD5) Outlook Actions: Issuer: NAVEX TopCo, Inc. Outlook, Remains Stable RATINGS RATIONALE The B2 CFR reflects Navex's relatively high financial leverage, modest scale, and narrower product offerings than its larger competitors in the governance, risk and compliance ("GRC") segment. The credit profile is also constrained by Moody's expectations of aggressive financial policies, employed by the private equity owner, which may include debt-funded acquisitions or dividends. Concurrently, the credit profile benefits from the recurring subscription nature of revenues, high renewal rates, strong EBITDA margin, and low capital expenditures. Moody's also expects Navex to benefit from increasing demand for GRC and ethics and compliance ("E&C") solutions around the globe, specifically in North America and Europe. The company's very good liquidity is supported by Moody's expectations of ample cash reserves and strong free cash flow generation. Liquidity is also bolstered by the company's undrawn $75 million revolving credit facility, expiring in August 2023, with a 8.5x springing net first lien leverage ratio financial covenant (triggered at 35% drawn) which Moody's expect to have a sizeable cushion. The B1 rating on the first lien revolving credit facility and term loan are one notch above the CFR, reflecting the priority lien with respect to substantially all assets of the company relative to the second lien term loan, which is rated Caa1, two notches below the CFR. The B2-PD probability of default rating is in line with the B2 CFR, reflecting Moody's expectation for an average family recovery level. The stable outlook reflects Moody's expectations of sustained revenue and earnings growth, continued deleverage of the business, positive regulatory trends and footprint expansion while sustaining healthy credit metrics. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS The ratings could be upgraded if the company substantially increases scale, diversifies its revenue base, decreases leverage such that debt to EBITDA (adding the change in deferred revenue but net of capitalized software costs, Moody's adjusted) is sustained below 5.0x, and free cash flow-to-debt (Moody's adjusted) sustained in the teen percentages. Navex's ratings could be downgraded by declining revenue or EBITDA, or if the company's liquidity deteriorates with free cash flow-to-debt sustained below 5%. The ratings could also be downgraded if the company engages in debt-funded acquisitions or shareholder returns, with Debt/EBITDA sustained above 6.5x (Moody's adjusted). Navex is a provider of integrated software content services in the E&C market, providing governance, ethics, risk and compliance ("GRC") solutions to over 13,000 customers worldwide, including global enterprises and small and medium businesses. Navex was acquired in September 2018 by majority owner BC Partners Advisors, L.P. and some of its affiliates, with a minority stake maintained by the previous controlling owner Vista Equity Partners. The principal methodology used in these ratings was Software Industry published in August 2018. NICE SERVICES: Taps NOC Legal Services as Bankruptcy Counsel ------------------------------------------------------------ Nice Services, Inc. seeks approval from the U.S. Bankruptcy Court for the Middle District of Florida to hire NOC Legal Services to serve as legal counsel in its Chapter 11 case. The firm's services include: (a) advising the Debtor with regard to its powers and duties in the continued operation of the business and management of the property of the estate; (b) preparing and filing schedules of assets and liabilities, statement of affairs, and other documents required by the court; (c) representing the Debtor at the Section 341 creditors' meeting; (d) advising the Debtor with respect to its responsibilities in complying with the United States Trustee's Operating Guidelines and Reporting Requirements and with the rules of the court; (e) preparing, legal papers and appearing at hearings; (f) protecting the interest of the Debtor in all matters pending before the court; (g) representing the Debtor in negotiation with its creditors in the preparation of a Chapter 11 plan; and (h) performing all other legal services for the Debtor. The firm's hourly rates are as follows: Frank J. Bane, Esq. $400 per hour Associate attorneys $300 per hour Paralegals $100 per hour The Debtor paid the firm $4,000 as retainer fee. Frank Bane, Esq., the firm's attorney who will be providing the services, disclosed in a court filing that he is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code. The firm can be reached at: Frank J. Bane, Esq. NOC Legal Services 8910 N Dale Mabry Hwy, Suite 18 Tampa, FL 33614 Email: NOCLegalServices@outlook.com About Nice Services Nice Services, Inc., a company in Tampa, Fla., filed a petition for Chapter 11 protection (Bankr. M.D. Fla. Case No. 22-00009) on Jan. 03, 2022, listing up to $50,000 in assets and up to $10 million in liabilities. Dr. Donald Lee Pippin, Trustee of Nice Services Trust, signed the petition. The Debtor tapped NOC Legal Services as legal counsel. OCCIDENTAL PETROLEUM: S&P Upgrades ICR to 'BB+', Outlook Stable --------------------------------------------------------------- S&P Global Ratings raised its issuer credit rating on Occidental Petroleum Corp. (OXY) and its issue-level ratings on its debt to 'BB+' from 'BB'. S&P's recovery rating (50%-70% recovery) on the company's unsecured debt remains '3' with a recovery estimate of 60%. S&P said, "The stable outlook on OXY reflects our expectation that it will continue to prioritize debt reduction through excess cash flow in the near term. We expect relatively stable production with average leverage metrics of approximately 25%-30% funds from operations (FFO) to debt and 2.5x-3.0x debt to EBITDA over the next two years. We also expect the company will meet its near-term net debt target prior to increasing shareholder returns." OXY's debt-reduction efforts remain ongoing as stronger oil & gas prices drive cash flow higher. S&P said, "The company continued to repair its balance sheet by repaying more than $6 billion of debt principal in 2021, and we expect absolute debt reduction will continue be a top priority for management in 2022 and beyond. OXY has also benefited from rising oil and gas prices as strong supply/demand fundamentals and heightened geopolitical risk have had a favorable impact on its leverage metrics. Following the latest revision in our oil price assumptions, we forecast average FFO to debt of 25%-30% along with debt to EBITDA in the range of 2.5X-3.0x over the next two years. Moreover, OXY's stated intent to achieve a net debt figure of approximately $25 billion or less in the near term will help lower interest expense and confirms management's commitment to further reducing the company's elevated debt structure--which is critical as the company seeks to regain investment-grade credit ratings." S&P expects excess cash flows will be the primary source of future debt repayment. With the Ghana asset sale completed in fourth quarter of 2021, OXY has now met the lower bound of its post-Anadarko divestiture target of $10 billion to $15 billion. Thus, any additional debt repayment will likely be funded by excess cash flows, which could exceed $6 billion this year and may be quite robust in 2023 as well if oil market fundamentals hold up. S&P said, "Although we expect management will remain opportunistic on the divestiture front with periodic non-core sales, we believe larger and more meaningful pieces of OXY's portfolio are likely off the table now given its strong liquidity and manageable debt maturity schedule over the next several years. The company has also reduced its stake in Western Midstream Partners L.P. (WES) to around 50%, and while that interest has significant value, we do not believe the company intends to sell a large portion of those units any time soon." Management appears to be setting its sights on longer-term goals. Given the company's improved leverage profile and conceivable path to eliminating more debt, it appears increasingly open to reviving shareholder distributions, given that it has held its quarterly common stock dividend to a nominal $0.01 per share since mid-2020. Management noted on the third quarter conference call that it could look to raise its fixed dividend after it achieves around $25 billion of net debt, although production growth (another medium-term priority) does not appear to be on the immediate agenda. Thus, the company's evolving capital allocation strategy will be key to assessing its financial policy over time, especially given that our oil price assumptions are currently in backwardation with our forecasted leverage metrics for OXY weakening in outer years. S&P said, "The stable outlook on OXY reflects our expectation that it will continue to prioritize debt reduction through excess cash flow in the near term. We expect relatively stable production with average leverage metrics approximating 25%-30% FFO to debt and 2.5x-3.0x debt to EBITDA over the next two years. We also expect the company will meet its near-term net debt target prior to increasing shareholder returns." S&P could revise the outlook to negative if: -- Its S&P Global Ratings-adjusted debt to EBITDA increases and approaches 4x, with FFO to debt declining and remaining below 20%. This could occur if oil and gas prices retreat for a prolonged period and the company does not meet our cash flow expectations; or -- Contrary to our expectations, if S&P comes to believe OXY is overly reliant on the capital markets, aggressively spends capital, or favors shareholder returns over debt reduction. S&P said, "We could raise our rating on OXY if its financial metrics improve relative to our base-case scenario such that additional debt reduction helps sustain average FFO to debt above 45% with debt to EBITDA below 2x at our long-term oil and gas price assumptions. This would most likely occur if crude oil prices remain strong, supporting free cash flow and further debt reduction. Management would also need to maintain financial policies in-line with investment-grade peers." PATH MEDICAL: Seeks to Hire Crowe LLP as Record Keeper ------------------------------------------------------ Path Medical, LLC and Path Medical Center Holdings, Inc. seek approval from the U.S. Bankruptcy Court for the Southern District of Florida to hire Crowe, LLP as record keeper. The firm's services include: (a) preparing eligibility calculation, trust reconciliation, share release calculation, distribution reports, Form 8955-SSA support and Form 5500 filing support, distributions services or forms 1099-R and related forms, and summary annual reports; (b) calculating account allocations; (c) performing compliance testing; and (d) analyzing diversification eligibility. The Debtors estimated that fees and costs payable to the firm for services performed in 2021 will be less than $30,000. Peter Shuler, principal of the firm, disclosed in a court filing that he is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code. The firm can be reached at: Peter Shuler Crowe LLP 10 West Broad Street Columbus, OH 43215 Phone: 614-280-5208 About Path Medical Path Medical, LLC and Path Medical Center Holdings, Inc. filed their voluntary petitions for Chapter 11 protection (Bankr. S.D. Fla. Lead Case No. 21-18338) on Aug. 28, 2021. Manual Fernandez, chief executive officer, signed the petitions. At the time of the filing, Path Medical listed $30,047,477 in assets and $86,494,715 in liabilities while Path Medical Center listed $220,060 in assets and $76,988,419 in liabilities. Judge Scott M. Grossman oversees the cases. Brett Lieberman, Esq., at Edelboim Lieberman Revah Oshinsky, PLLC represents the Debtors as legal counsel. PG&E CORP: Judge Alsup Lambasts 'Crime Spree' as Probation Ends --------------------------------------------------------------- Dorothy Atkins of Law360 reports that U.S. District Judge William Alsup offered final comments on Pacific Gas & Electric Corp.'s likelihood of recidivism as the investor-owned utility's criminal probation expired Tuesday, January 25, 2022, writing in a filing that PG&E will likely continue its "crime spree" due to "systemic problems," and that he regrets not doing more. In a Jan. 19, 2022 filing, Judge Alsup wrote that during PG&E's five years of probation, it was prohibited from violating the law, and yet it went on a "crime spree" as its aging infrastructure sparked at least 31 wildfires that burned nearly 1 5 million acres and 23,956 structures and killed 113 Californians. 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. PG&E Corporation and its regulated utility subsidiary, Pacific Gas and Electric Company, faced extraordinary challenges relating to a series of catastrophic wildfires that occurred in Northern California in 2017 and 2018. The utility faced an estimated $30 billion in potential liability damages from California's deadliest wildfires of 2017 and 2018. 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). 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. Weil, Gotshal & Manges LLP and Cravath, Swaine & Moore LLP served as PG&E's legal counsel, Lazard as its investment banker and AlixPartners, LLP as the restructuring advisor to PG&E. Prime Clerk LLC is the claims and noticing agent. 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. Morrison & Foerster LLP served as the Debtors' special regulatory counsel. Munger Tolles & Olson LLP also served as special counsel. The Office of the U.S. Trustee appointed an official committee of creditors on Feb. 12, 2019. The Committee retained Milbank LLP as counsel; FTI Consulting, Inc., as financial advisor; Centerview Partners LLC as investment banker; and Epiq Corporate Restructuring, LLC as claims and noticing agent. On Feb. 15, 2019, the U.S. trustee appointed an official committee of tort claimants. The tort claimants' committee is represented by Baker & Hostetler LLP. PHENOMENON MARKETING: Taps Michael Jay Berger as Bankruptcy Counsel ------------------------------------------------------------------- Phenomenon Marketing & Entertainment, LLC seeks approval from the U.S. Bankruptcy Court for the Central District of California to hire the Law Office of Michael Jay Berger to serve as legal counsel in its Chapter 11 case. The firm's services include: (a) communicating with creditors of the Debtor; (b) reviewing the Debtor's Chapter 11 bankruptcy petition and all supporting schedules to determine if amendments are needed; (c) advising the Debtor of its legal rights and obligations in a bankruptcy proceeding; (d) working to bring the Debtor into full compliance with reporting requirements of the Office of the Office of the United States Trustee; (e) preparing status reports as required by the court, and; (f) responding to any motions filed in the Debtor's bankruptcy proceeding; (g) responding to creditor's inquiries; (h) reviewing proofs of claim filed in the Debtor's bankruptcy; (i) objecting to inappropriate claims; (j) preparing notices of automatic stay in all state court proceedings in which the Debtor is involved; and (k) if appropriate, preparing a Chapter 11 plan of reorganization for the Debtor. The firm's hourly rates are as follows: Michael Jay Berger, Esq. $595 per hour Stephen Biegenzahn, Esq. $595 per hour Sofya Davtyan, Esq. $525 per hour Debra Reed, Esq. $435 per hour Carolyn M. Afari, Esq. $435 per hour Samuel Boyamian, Esq. $350 per hour Gary Baddin $275 per hour Senior paralegals/law clerks $225 per hour Bankruptcy paralegals $200 per hour The Debtor paid the firm $20,000 as a retainer fee. Michael Jay Berger, Esq., sole owner of the firm, disclosed in a court filing that he is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code. The firm can be reached at: Michael Jay Berger, Esq. Law Office of Michael Jay Berger 9454 Wilshire Blvd. 6th Floor Beverly Hills, CA 902 12-2929 Tel.: (310) 271-6223 Fax: (310) 271-9805 Email: michael.bergerbankruptcypower.com About Phenomenon Marketing Phenomenon Marketing & Entertainment, LLC filed a petition for Chapter 11 protection (Bankr. C.D. Calif. Case No. 22-10132) on Jan. 10, 2022, listing $359,080 in assets and $2,289,737 in liabilities. Judge Ernest M. Robles oversees the case. The Debtor tapped the Law Office of Michael Jay Berger as its legal counsel. PHILADELPHIA ENERGY: Trial Begins With Ch.11 Property Damage Claims ------------------------------------------------------------------- Becky Yerak of The Wall Street Journal reports that more than two years after a fire and explosion permanently crippled its refinery complex, Philadelphia Energy Solutions faced off against its insurers in court over how much it could receive through its property damage coverage. Philadelphia Energy lawyer Kenneth Frenchman on Monday at the start of a roughly two-week trial in U.S. Bankruptcy Court in Wilmington, Del., said the defunct oil refiner estimated the cost to replace or repair the property would be $301.7 million. But defunct oil refinery operator and insurers are deeply at odds over the replacement cost estimates. Insurers of the shuttered Philadelphia oil refinery claim that the refinery's bankrupt former owner doesn't deserve a $130 million "windfall" of insurance proceeds to pay for labor costs because the plant isn't being rebuilt. About PES Holdings Headquartered in Philadelphia, Pennsylvania, PES Holdings, LLC -- http://pes-companies.com/-- owns an oil refining complex. The Philadelphia Energy Solutions Refining Complex operates two domestic refineries -- Girard Point and Point Breeze -- in South Philadelphia. The refinery processes approximately 335,000 barrels of crude oil per day (42 U.S. gallons per barrel). In addition to producing unbranded gasoline (87, 89 and 93 octane), PES also produces jet fuel, cleaner-burning diesel, petrochemicals, liquefied petroleum gas and sulfur in the Northeast. The company offers a variety of diesels, including ultra-low-sulfur diesel, non-road, heating oil, locomotive/marine and non-jet kerosene. PES employs over 1,000 people. PES is owned by The Carlyle Group and a subsidiary of Energy Transfer Partners, L.P. PES Holdings and eight of its subsidiaries sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Del. Lead Case No. 18-10122) on Jan. 21, 2018. In the petition signed by Gregory G. Gatta, manager, PES estimated assets and liabilities of $1 billion to $10 billion. The Hon. Kevin Gross is the case judge. The Debtors hired Kirkland & Ellis LLP and Kirkland & Ellis International LLP as their bankruptcy counsel; Pachulski Stang Ziehl & Jones LLP as local bankruptcy counsel; PJT Partners LP as financial advisor; Alvarez & Marsal North America, LLC as restructuring advisor; and Rust Consulting/Omni Bankruptcy as claims and noticing agent. In addition, debtor North Yard GP, LLC, tapped Proskauer Rose LLP as its conflicts counsel, and Bielli & Klauder, LLC, as co-counsel. Debtor Philadelphia Energy Solutions Refining and Marketing LLC tapped Chipman Brown Cicero & Cole, LLP as Delaware counsel, and Curtis, Mallet-Prevost, Colt & Mosle LLP as its conflicts counsel. PIERSON LAKES: Owns Causeway, Bankruptcy Court Rules ---------------------------------------------------- The adversary proceeding captioned PIERSON LAKES HOMEOWNERS ASSOCIATION, INC., Plaintiff v. PIERSON PROJECT, L.L.C., POTAKE LAKE, L.L.C., AND ROCK HILL, L.L.C. D/B/A ROCK HILL PROJECT, Defendants, Adv. Pro. No. 19-08251 (RDD)(Bankr. S.D.N.Y.) is a dispute over responsibility for maintaining a causeway, including a road on it, that crosses Cranberry Lake, which in turn is located in a residential development in Sloatsburg, New York. Defendants Pierson Project, L.L.C., Potake Lake, L.L.C., and Rock Hill, L.L.C. d/b/a Rock Hill Project -- as Sponsors -- contend that because the Causeway was included in a parcel of land that they conveyed to plaintiff and reorganized debtor, Pierson Lakes Homeowners Association, the PLHA has the maintenance responsibility and, in any event separately assumed that responsibility in a 2004 agreement. The PLHA denies that the Causeway has been transferred to it and further contends that under the parties' agreements the Sponsors still have the maintenance responsibility even if the Causeway was previously transferred to it. The parties submitted cross-motions for summary judgment. Subsequently, the Court granted summary judgment to: -- the Sponsors insofar as they seek a declaration that PLHA owns the Causeway and the road on it, -- the Sponsors insofar as they seek a declaration that PLHA undertook responsibility for maintaining the Causeway under the parties' 2004 agreement, and -- to the PLHA insofar as it seeks a declaration Potake Lake, L.L.C. must cause the road on the Causeway to be brought to a proper standard before shifting the maintenance burden regarding the road to the PLHA, which in any event will not occur until the first lot in the phase of the development where the Causeway is located is sold. To the extent that the parties make contrary arguments in their motions for summary judgment, the motions for summary judgment are denied with prejudice. According to Judge Robert D. Drain of the United States Bankruptcy Court for the Southern District of New York, it is clear from the Controlling Documents and the Final Map that, no later than the January 20, 2014 satisfaction of the conditions to the release of the Bill of Sale and Bargain and Sale Deed from escrow and for the recording of the Bargain and Sale Deed, under section 9 of the 2004 Agreement, PLHA became the owner of the Causeway. Section 9 of the 2004 Agreement states that "Upon [Potake Lake, L.L.C.'s] delivery of the initial form of the [Bargain and Sale Deed] . . . to be held in escrow, . . . the PLHA shall assume, shall be deemed to have assumed, and shall be solely responsible for all rights and obligations, including maintenance and repair obligations for Cranberry Lake, the Cranberry Lake Dam, the Spillway, and all appurtenant facilities without the execution of all further documents. Neither Pierson nor Rock Hill nor [Potake Lake, L.L.C.] shall thereafter have any obligations with respect to Cranberry Lake and the Cranberry Lake dam and spillway other than as lot(s) owners." Section VI of The Sixteenth Amendment to the Offering Plan similarly states that "PLHA is solely responsible for all rights and obligations, including maintenance and repair obligations for Cranberry Lake, Dam and Spillway and all appurtenant facilities. The New Sponsors shall not have any obligations with respect to Cranberry Lake, dam and spillway other than as Lot Owners." Taken together, and notwithstanding the regime that applied under the original Offering Plan, these agreements therefore would make the PLHA responsible upon delivery of the initial Bargain and Sale Deed in April 2004 or at the latest upon entry into the Sixteenth Amendment on July 23, 2004 for all maintenance and repair obligations for the "appurtenant facilities" to Cranberry Lake. Based on the definition of "appurtenant," this would include the Causeway but not the road on it. This, too, would apply to the Causeway vis-a-vis the lake, or, perhaps more aptly, the land at the bottom of the lake upon which the Causeway rests. On the other hand, the road across the Causeway is not attached to the lake/lakebed; it is attached to the Causeway, which is the more important thing as between the Causeway and the road. If anything, then, the road is appurtenant to the Causeway, not the lake. According to Judge Drain, the conclusion that the road across the Causeway is not an "appurtenant facility" to Cranberry Lake therefore directs one away from the 2004 Agreement and the Sixteenth Amendment to the parties' other agreements to determine which of them is responsible for maintenance and repair of the road on the Causeway. For these reasons, the motions for summary judgment are granted in part and denied in part. Judge Drain directed counsel for PLHA to email a proposed order and judgment to chambers: (a) declaring PLHA the owner of the Causeway and the road on it since January 20, 2014 and directing the release from escrow of the Bill of Sale and the recording of the Bargain and Sale Deed, (b) declaring that since the delivery of the initial form of the Bargain and Sale Deed in April 2004, PLHA has had the maintenance responsibility for the Causeway, and (c) declaring that until the sale of the first lot in Phase 3, Potake Lake, L.L.C. has the maintenance obligation for the road on the causeway and must deliver the road to the PLHA in the condition required by the Offering Plan and the Declaration. Upon entry of the foregoing order and judgment, this adversary proceeding will be closed. A full-text copy of Judge Drain's Memorandum of Decision dated January 14, 2022, is available at https://tinyurl.com/5n7z3muh from Leagle.com. About Pierson Lakes Homeowners Association Inc. Pierson Lakes Homeowners Association, Inc., is a tax-exempt homeowners association based in Sterlington, New York. Pierson Lakes Homeowners Association filed a Chapter 11 petition (Bankr. S.D.N.Y. Case No. 18-22463) on March 27, 2018. In the petition signed by Sean Rice, president, the Debtor disclosed $1.55 million in assets and $3.49 million in liabilities. The Hon. Robert D. Drain presides over the case. Gary M. Kushner, Esq., and Scott D. Simon, Esq., at Goetz Fitzpatrick LLP, serve as bankruptcy counsel to the Debtor. PRINCETON ALTERNATIVE: N.D. Ill. Court Dismisses RICO Suit vs. RBC ------------------------------------------------------------------ Fund Recovery Services, LLC, which is owned by Princeton Alternative Income Fund, L.P., that was the alleged target of the defendants' purportedly fraudulent actions, has sued 35 defendants for violations of federal and state law, including the Racketeer Influenced Corrupt Organizations Act. Some of the defendants have filed or joined in a motion to dismiss, contending, among other things, that (1) the RICO claims are time-barred; (2) Princeton lacks standing to bring these claims; (3) Princeton is precluded from relitigating certain issues; and (4) Princeton fails to state a RICO claim under 18 U.S.C. Section 1962(c) and a RICO conspiracy claim under 18 U.S.C. Section 1962(d). The defendants argue that the Court should dismiss Princeton's RICO claims as time-barred based on two court filings: an adversary complaint brought by Princeton's bankruptcy trustee against officers of Princeton, and Princeton's Fifth Amended Disclosure Statement submitted in support of its Fifth Amended Joint Chapter 11 Plan of Reorganization. They ask the Court to take judicial notice of these documents. In a Memorandum Opinion and Order dated January 17, 2022, Judge Matthew F. Kennelly of the United States District Court for the Northern District of Illinois, Eastern Division, granted the defendants' motion. According to Judge Kennelly, the amended complaint adequately alleges involvement in mail and/or wire fraud with respect to some defendants, but not most of them. Paragraph 213 of the amended complaint lists several e-mails that Princeton alleges were sent in furtherance of the scheme. It identifies Eric Schnosenberg as a sender of these e-mails and Raviv Wolfe (as Argon Credit's CEO), Bruce Goldstein, and Schnosenberg as receiving at least one of them. These allegations, together with the other mail fraud-related allegations in the amended complaint, are sufficient to allege the participation of Schnosenberg, Goldstein, and Wolfe in mail or wire fraud. Paragraph 213 also contains factual allegations sufficient to give rise to an inference that other defendants were involved in the decision to send the e-mails in furtherance of the alleged scheme. According to the amended complaint, Adam Diekelman sent four e-mails to Princeton with fraudulent financial information on behalf of the Board of Managers. Diekelman is not a defendant in this case, but from his e-mails, one can reasonably infer that other members of the Board of Managers participated in the alleged mail or wire fraud. Reading the complaint liberally, the Court finds that the amended complaint adequately alleges involvement in mail and/or wire fraud with respect to Schnosenberg, Goldstein, Wolfe, and the other members of the Board of Managers of Argon Credit. It does not, however, with respect to any of the other defendants. The Court also notes that, given its conclusion that Princeton failed to adequately allege that the defendants engaged in a pattern of racketeering activity, it follows that Princeton has also failed to adequately allege that the defendants agreed to engage in a pattern of racketeering activity. The Court dismisses the RICO conspiracy claim on this basis. Judge Kennelly held that the RICO conspiracy claim is also deficient with respect to at least some defendants because Princeton does not adequately allege that all the defendants made an agreement that someone would commit at least two predicate acts. First, it is not clearly alleged that all of the defendants even knew about the mail and wire fraud. For example, some of the Argon Outsiders, like Alhambra, are alleged only to have been involved in assisting some defendants in executing business transactions with other defendants. They are not alleged to have knowledge of the predicate acts, nor is it apparent that their knowledge can be inferred from the mere fact that they received "prohibited commissions" for their assistance. Second, even if the defendants knew about the fraud, it is not clearly alleged that they all agreed to it. This is true of both Argon Insiders and Argon Outsiders. Although the amended complaint suggests that all of the defendants financially benefited from the alleged fraud committed against Princeton, aside from that, there's very little in the complaint that suggests that all of them were working in agreement to commit this alleged fraud. The Court therefore concludes that the amended complaint, in its present form, contains sufficient factual allegations to support an inference of agreement only among those directly connected with the mail and wire fraud, namely Schnosenberg, Goldstein, Wolfe, and the Board of Managers of Argon Credit. For these reasons, the Court grants the defendants' motion to dismiss. Unless the plaintiff files, by February 8, 2022, a motion for leave to amend with a proposed amended complaint that adequately states a claim over which the Court has subject matter jurisdiction, the Court will enter final judgment dismissing its federal claims with prejudice and its state claims for lack of supplemental jurisdiction. A telephonic status hearing is set for February 14, 2022 at 9:10 a.m., using call-in number 888-684-8852, access code 746-1053. Counsel should wait for the case to be called before announcing themselves A full-text copy of Judge Kennelly's decision is available at https://tinyurl.com/2p8jjk3c from Leagle.com. The case is FUND RECOVERY SERVICES, LLC, Plaintiff, v. RBC CAPITAL MARKETS, LLC, et al., Defendants, Case No. 20 C 5730 (N.D. Ill.). About Princeton Alternative Princeton Alternative Income Fund, LP, provides capital for businesses that make consumer loans in the non-prime market. Princeton Alternative Income Fund, LP and Princeton Alternative Funding LLC, a fund management company, sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D.N.J. Lead Case No. 18-14603) on March 9, 2018. Judge Michael B. Kaplan oversees the cases. In the petitions signed by John Cook, authorized representative, PAIF was estimated to have assets of $50 million to $100 million and liabilities of $1 million to $10 million. PAF was estimated to have assets of less than $100,000 and liabilities of $1 million to $10 million. Sills Cummis & Gross, P.C., is the Debtors' counsel. Liggett & Webb, P.A., has been tapped to serve as accountant. The Debtors tapped JAMS/Hon. Steven Rhodes to provide mediation services. Matthew Cantor was appointed as Chapter 11 trustee for the Debtors. The Trustee tapped Wollmuth Maher & Deutsch LLP as his legal counsel. Attorneys for MicroBilt Corporation are Derek J. Baker, Esq., at Reed Smith LLP, in Princeton, New Jersey. Counsel for the Ad-Hoc Committee of Minority Shareholders is Ronald S. Gellert, Esq., at Gellert Scali Busenkell & Brown, LLC, in Wilmington, Delaware. PRO-DEMOLITION INC: Case Summary & 20 Largest Unsecured Creditors ----------------------------------------------------------------- Debtor: Pro-Demolition, Inc. 5851 W Ponkan Road Apopka, FL 32712 Business Description: Pro-Demolition is a family owned Central Florida demolition company. Since 1999, the Company provided building structure demolition, land clearing, tree removal, excavation services to residential and commercial clients. Chapter 11 Petition Date: January 26, 2022 Court: United States Bankruptcy Court Middle District of Florida Case No.: 22-00267 Debtor's Counsel: Justin M. Luna, Esq. LATHAM LUNA EDEN & BEAUDINE LLP 201 S. Orange Avenue Suite 1400 Orlando, FL 32801 Tel: (407) 481-5800 Fax: (407) 481-5801 Email: jluna@lathamluna.com Estimated Assets: $1 million to $10 million Estimated Liabilities: $1 million to $10 million The petition was signed by Mickey Grosman as president. A full-text copy of the petition containing, among other items, a list of the Debtor's 20 largest unsecured creditors is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/AQYELYQ/Pro-Demolition_Inc__flmbke-22-00267__0001.0.pdf?mcid=tGE4TAMA PUERTO RICO: U.S. Court Imposes Debt Plan Despite Protests ---------------------------------------------------------- Rafael Azul of World Socialist Web Site reports that in the face of protests, a U.S. judge imposed Puerto Rico's debt restructuring plan. On January 3, 2022, demonstrators rallied at the Federal Court House in San Juan, Puerto Rico, demanding that U.S. District Court Judge Laura Taylor Swain reject Puerto Rico's debt restructuring plan, proposed by the Financial Oversight and Management Board for Puerto Rico (FOMBPR). Pointing out the precarious state of the island's economy, the protesters, who included retirees, teachers, government employees and students from the University of Puerto Rico, demanded legislation forbidding the payment of illegal government debt, and instead prioritizing education, such as funding for the University of Puerto Rico, other essential services and guaranteeing retirement pensions. Judge Swain, who presides over the Puerto Rico bankruptcy case, while acknowledging the popular opposition in Puerto Rico, approved the FOMBPR plan on January 18, 2022. Puerto Rico's 25 years of financial implosion and economic decline will now take a new turn with Swain's approval of the debt restructuring plan engineered by the Financial Oversight and Management Board for Puerto Rico, an unelected body appointed by the US Congress in June 2016 under the Obama administration to manage the US island territory’s debt crisis. The seven members of the financial oversight board are well connected to European and US banks and to the Wall Street vulture funds. Five years in the making, the restructuring plan cuts Puerto Rico's 2016 debt default in half, while assuring multi-million-dollar profits for Wall Street high risk hedge ("vulture") funds, at the expense of public employee pensions, jobs and wages. The debt restructuring plan, which is expected to be approved by most debt holders, continues the island government's prolonged austerity policies, including replacing defined benefit pensions with 401K plans (subject to the vagaries of stock markets). It also reduces Puerto Rico's current public debt from $70 billion to $34 billion, lowering what the government pays in debt service. Investors will get $7 billion up front, plus billions more if tax collections exceed projections. The Financial Oversight Board is to remain in control until four years have passed with the government budget in balance. Unresolved are other aspects of the island’s financial crisis, such as the bankruptcy of the public Electrical Authority. Puerto Rico defaulted on a $2 billion government bond payment on July 1, 2016. At the time it had already missed debt payments on tens of billions of dollars worth of other government debt and unfunded pension liabilities. The effects of the 2008 global financial crisis worsened Puerto Rico's crisis, causing the collapse of labor-intensive firms (construction, agriculture, and small and medium businesses). The Puerto Rican establishment responded with a combination of austerity and borrowing. In 2009, the administration of Governor Luis Fortuño Burset passed emergency legislation that led to the sacking of 30,000 public workers, increasing rates of unemployment and encouraging mass emigration. US firms that had established plants in Puerto Rico in the 1980s, due to US government tax breaks, such as big pharmaceutical firms, moved their production to other parts of the world, as these tax advantages were abolished during the Clinton administration. Puerto Rico witnessed a mass exodus of young skilled workers to the United States; its population fell by half a million, from 3.8 million in 1996 to 3.3 million in 2020. As industries were shutting down and plants and jobs were disappearing, the borrowing continued. Old debt was paid with new debt, in violation of the island's constitution, which sets limits on how much the government can borrow. The crisis continued to worsen. By 2014, as it became clear that the situation was untenable, Wall Street rating agencies downgraded Puerto Rican bonds to the status of junk bonds. Vulture hedge funds, such as Aurelius Capital, began buying bonds at a fraction of their face value, determined to collect full payment in the future. The crisis became what the New York Times described as the "biggest financial collapse in United States history." The amount of money involved, $73 billion, was complemented by $50 billion in unfunded pension obligations. In response to the debt crisis, the US Congress imposed the unelected seven-member Financial Oversight Board on Puerto Rico under the terms of the newly approved Puerto Rico Oversight Management and Economic Stability Act (PROMESA). Individual debt holders were barred from suing Puerto Rico, while the unelected Oversight Board came up with a plan to resolve the crisis. The board's real purpose was to protect the investments of Wall Street's financial speculators by imposing deep austerity measures on wages, education, health services, electricity and government pensions. These measures included moves to privatize public education and electricity services. Following the imposition of PROMESA and of the Financial Oversight Board, a series of natural disasters struck the island. In September 2017, Hurricane Maria, a Category 5 storm, had a devastating effect, destroying much of the electrical infrastructure and resulting in more than 5,000 deaths, as well as damages exceeding $100 billion. By 2018, Puerto Rico had lost 15 percent of its medical specialists, leaving only 9,500 to serve the entire population of 3.2 million. Three years after Hurricane Maria, 130,000 people had left the island, while Puerto Rico had only received $1.5 billion in federal assistance, out of the $20 billion it had originally been promised. All these events, austerity, unemployment, the debt crisis, and the disastrous response to Hurricane Maria combined to provoke mass demonstrations in 2019 that led to the collapse of the corrupt administration of then-Governor Ricardo Roselló, alarming the US and Puerto Rican ruling classes. In 2020 the Guayanilla earthquake, which registered 6.4 on the Richter scale, the strongest in 102 years, left the island without electricity and destroyed parts of the southwestern coast, destroying 8,000 homes and creating conditions for a new wave of emigration. These natural disasters also exposed the high rates of income inequality on the island, the highest in the Caribbean and the Western Hemisphere. Forty-five percent of the population subsist below the poverty line, including over 50 percent of Puerto Rican children. One-third of adults report food insecurity, while one-fifth report missing meals because of lack of money. With the COVID-19 pandemic the situation is becoming even worse, due to high rates of unemployment and lower incomes. The spread of the Omicron variant on the island is affecting hospitals and clinics, which are on the verge of collapse due to lack of supplies and personnel. As of January 23, 2022, Puerto Rico reported 3,338 deaths, out of a population of over 3 million, since the beginning of the pandemic in March 2020. It recorded a daily death toll of 14, the first double-digit figure since the summer of 2021, while nearly 700 patients are hospitalized, more than at the last peak of the pandemic. The protests on January 3, 2022 were a warning of growing popular anger. Just as in 2019, all the elements are coming together for a social explosion of the Puerto Rican working class. About Puerto Rico Puerto Rico is a self-governing commonwealth in association with the United States that's facing a massive bond debt of $70 billion, a 68% debt-to-GDP ratio and negative economic growth in nine of the last 10 years. The Commonwealth of Puerto Rico has sought bankruptcy protection, aiming to restructure its massive $74 billion debt-load and $49 billion in pension obligations. The debt restructuring petition was filed by Puerto Rico's financial oversight board in U.S. District Court in Puerto Rico (Case No. 17-01578) on May 3, 2017, and was made under Title III of 2016's U.S. Congressional rescue law known as the Puerto Rico Oversight, Management, and Economic Stability Act ('PROMESA'). The Financial Oversight and Management Board later commenced Title III cases for the Puerto Rico Sales Tax Financing Corporation (COFINA) on May 5, 2017, and the Employees Retirement System (ERS) and the Puerto Rico Highways and Transportation Authority (HTA) on May 21, 2017. On July 2, 2017, a Title III case was commenced for the Puerto Rico Electric Power Authority ("PREPA"). U.S. Chief Justice John Roberts has appointed U.S. District Judge Laura Taylor Swain to oversee the Title III cases. The Honorable Judith Dein, a United States Magistrate Judge for the District of Massachusetts, has been designated to preside over matters that may be referred to her by Judge Swain, including discovery disputes, and management of other pretrial proceedings. Joint administration of the Title III cases, under Lead Case No. 17-3283, was granted on June 29, 2017. The Oversight Board has hired as advisors, Proskauer Rose LLP and O'Neill & Borges LLC as legal counsel, McKinsey & Co. as strategic consultant, Citigroup Global Markets, as municipal investment banker, and Ernst & Young, as financial advisor. Martin J. Bienenstock, Esq., Scott K. Rutsky, Esq., and Philip M. Abelson, Esq., of Proskauer Rose; and Hermann D. Bauer, Esq., at O'Neill & Borges are on-board as attorneys. McKinsey & Co. is the Board's strategic consultant, Ernst & Young is the Board's financial advisor, and Citigroup Global Markets Inc. is the Board's municipal investment banker. Prime Clerk LLC is the claims and noticing agent. Prime Clerk maintains a case web site at https://cases.primeclerk.com/puertorico Epiq Bankruptcy Solutions LLC is the service agent for ERS, HTA, and PREPA. O'Melveny & Myers LLP is counsel to the Commonwealth's Puerto Rico Fiscal Agency and Financial Advisory Authority (AAFAF), the agency responsible for negotiations with bondholders. The Oversight Board named Professor Nancy B. Rapoport as fee examiner and to chair a committee to review professionals' fees. REDWOOD EMPIRE: Seeks to Employ Dorsey & Whitney as Legal Counsel ----------------------------------------------------------------- Redwood Empire Lodging, LP seeks approval from the U.S. Bankruptcy Court for the District of Arizona to hire Dorsey & Whitney, LLP to serve as legal counsel in its Chapter 11 case. The firm's services include: (a) preparing and filing any necessary amendments to the Chapter 11 bankruptcy petition, schedules of assets and liabilities, and statement of financial affairs; (b) prosecuting, to the extent necessary, continued relief under certain first-day motions, including the motion to allow the use of cash collateral, and provide legal services relating to the relief requested in the first-day motions; (c) advising the Debtor with respect to its powers and duties in the continued management of its business and property, including the preparation and review of pleadings, motions and correspondence; (d) attending meetings and negotiating with representatives of creditors and other parties in interest, and advising the Debtor on the conduct of the case, including all of the legal and administrative requirements of operating in Chapter 11; (e) acting as litigation counsel to prosecute claims and causes of action on behalf of the Debtor, including preference or fraudulent transfer actions relating to creditors; (f) acting as litigation counsel regarding the defense of any actions commenced against the Debtor; (g) assisting the Debtor in reviewing and objecting to claims filed against the Debtor; (h) advising the Debtor in connection with any contemplated sales of assets or business combinations; (i) advising the Debtor in connection with any financing and cash collateral arrangements, and negotiating and drafting documents related to such arrangements; (j) advising the Debtor on matters relating to the evaluation of the assumption, rejection or assignment of unexpired leases and executory contracts; (k) advising the Debtor with respect to legal issues arising in or relating to its ordinary course of business; (l) preparing legal papers; (m) negotiating and preparing a plan of reorganization, disclosure statement and all related documents, and taking any necessary action to obtain confirmation of such plan; (n) attending meetings with third parties and participating in negotiations; (o) appearing before the bankruptcy court, any appellate courts, and the Office of the United States Trustee; and (p) performing all other necessary legal services for the Debtor. The firm's hourly rates are as follows: Partners, Counsel, and Associates Up to $650 Paralegals and Legal Specialists Up to $285 Isaac Gabriel, Esq., a partner at Dorsey & Whitney, disclosed in a court filing that he is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code. The firm can be reached at: Isaac M. Gabriel, Esq. Dorsey & Whitney, LLP 2415 E. Camelback Road, Suite 700 Phoenix, AZ 85016 Phone: (602) 735-2702 Fax: (480) 546-4248 Email: gabriel.isaac@dorsey.com About Redwood Empire Lodging Redwood Empire Lodging, LP, owns and operates two hotels: the Best Western Plus located at 208 N. Lake Powell Blvd., Page, Ariz.; and the Best Western Sonoma Winegrower's Inn located at 6500 Redwood Drive, Rohnert Park, Calif. Redwood Empire Lodging sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Ariz. Case No. 21-04678) on June 16, 2021. In the petition signed by Debra Heckert, member, the Debtor disclosed up to $50 million in both assets and liabilities. Judge Eddward P. Ballinger Jr. is assigned to the case. The Debtor tapped Isaac M. Gabriel, Esq., at Dorsey & Whitney LLP as legal counsel. SARATOGA & NORTH CREEK RAILWAY: Train Tracks Up for Auction ----------------------------------------------------------- John Cropley of The Daily Gazette reports that Saratoga & North Creek Railway's tracks are up for auction. A 30-mile section of train track leading into the Adirondacks is up for auction. The track and its easement running from North Creek to Tahawus are the primary asset of the Saratoga & North Creek Railway, which ceased operation in early 2018 and removed its equipment from the site. The S&NC filed for Chapter 11 bankruptcy protection in March 2020 and Chapter 11 liquidation in September 2021. William A. Brandt Jr. of DSI Consulting is the Chapter 11 trustee. He said Monday, January 24, 2022, that he has received inquiries from potential bidders interested in using the line to resume freight service to the titanium mine that the line was built to serve. The trackage may appear to be in rough shape, but it is still usable, he said. "Railroads everywhere require continual maintenance and that has not been done in a while," Brandt said. "We actually can run cars across the entire line, albeit at reduced speed." One reason for its durability is that it was commissioned by the federal government, which needed ready access to the titanium at Tahawus to support production needs during World War II. It has a 125-pound rail, which is heavy for such an application, Brandt said. "They way over-engineered it," he added. There's two more segments totaling about 60 miles between North Creek and Saratoga Springs, one owned by Warren County, one owned by the town of Corinth. A train would have to travel the entire length to get freight to the interconnection with the Canadian Pacific and the rest of the continent. Because the railway is designated a common carrier, the two other track owners can't refuse operations on the rails, Brandt said, but negotiations may not be necessary. Brandt said he's heard reports that one or both municipalities might want to sell their trackage, and he's heard directly from potential bidders that they'd try to make such a purchase. "I believe that the southern two segments will quickly thereafter be engaged in discussions," he said. None of this would preclude the return of tourist trains, which have operated on various parts of the line with various operators. The potential freight operations at this point would be limited to loading hopper cars at Tahawus by day and hauling them out at night, and possibly serving Barton Garnet Mine in the same manner, Brandt said. Such a purchase would, however, preclude the tracks being torn up and the right of way replaced by a mix-use recreation trail, which is an option Brandt doesn't support. "I have spent a lot of time with the local officials," he said. "Their line to me is, the forest has an abundant amount of hiking trails. There’s no crying need for yet one more." There is, he said, a crying need for more good jobs in the region such as the ones that a working railroad would support, as well as a national security interest in keeping the mines along the route viable. The Bankruptcy Court on Jan. 13 approved an amended bankruptcy plan that includes a requirement that the buyer preserve future operation of rail service along the 29.71-mile stretch north of North Creek. Bidding is open through midnight Feb. 23 in U.S. Bankruptcy Court in Colorado. About Saratoga & North Creek Railway Saratoga & North Creek Railway was a heritage railway that started operation in July 2011. Passenger operations stopped on April 7, 2018, and the final revenue freight train to remove stored tank cars operated in May 2018. Saratoga & North Creeks Railway sought Chapter 11 bankruptcy protection (Bankr. D. Colo. Case No. 20-12313) on March 20, 2020. In its petition, Saratoga & North Creek Railway listed estimated assets between $1,000,001 and $10 million and estimated liabilities between.$1,000,001 to $10 million. The case is handled by Honorable Judge Thomas B Mcnamara. Jennifer M Salisbury, of Markus Williams Young & Hunsicker LLC, is the Debtor's counsel. SCHULDNER LLC: Trustee Selling Duluth Property to Ruuskas for $70K ------------------------------------------------------------------ Steven B. Nosek, in his capacity as the Subchapter V Trustee of Schuldner, LLC, asks authority from the U.S. Bankruptcy Court for the District of Minnesota to sell the real property located at 803 E 6th Street, in Duluth, Minnesota 55805, to Senja Ruuska and Brent Ruuska for $70,000 cash. A hearing on the Motion is set for Feb. 9, 2022. Any response to the Motion will be filed and delivered no later than Feb. 4, 2022, which is five days before the date set for the hearing. The Debtor's business is to own and rent 15 properties located in Duluth, MN. At the present time, six of the properties are leased and two of the six occupants are paying rent. The balance of the leased properties are not paying rent for various reasons asserted by the tenants. Certain of the unoccupied properties have been and/or may be condemned by the City of Duluth Housing Department. By Court Order dated Sept. 17, 2021, the Debtor was taken out of possession and the Trustee was Ordered to assume the affairs of the Debtor, conduct the Debtor's business, propose a Plan and generally comply with the requirements of the Debtor under the applicable provisions of the Bankruptcy Code. The Trustee has retained a broker and listed all 15 properties for sale. Listing Agreements have been signed with Heirloom Realty, LLC. Heirloom has been authorized to be retained as the Broker for the Debtor. The Debtor has entered into a Purchase Agreement for the sale of the Property. The Property to be sold was listed for a price of $99,900. The proposed purchase price for the Property is $70,000 cash, which is under the listing price but the only offer thus far. The Property has most of the windows boarded up with plywood and has been frozen and unoccupied for more than three years and there have been no other offers on this property. Therefore, the Trustee and Broker feel this is an acceptable offer for the Property. There are no contingencies to the proposed sale other than the Debtor obtaining approval from the Bankruptcy Court. The Purchasers have demonstrated that non-contingent financing is in place and available. The Trustee believes that the sale price is fair, reasonable and that the sale should be approved by the Court. The Property is subject to a Mortgage in favor of Wilmington Trust National Association, as Trustee for the Benefit of the Holders of B2R Mortgage Trust 2016-1 Mortgage Pass Thru Certificates. He believes that the Creditor will consent to the proposed sale. By the Motion, the Debtor requests the Court enters an order approving the sale of the Property, and granting such other and further relief as the Court deems just and equitable. A copy of the Agreement is available at https://tinyurl.com/37afa35b from PacerMonitor.com free of charge. About Schuldner LLC Schuldner LLC is a privately held company engaged in activities related to real estate. It owns 15 single-family rental homes in Duluth, Minn., with a total appraised value of $1.8 million. Schuldner filed for Chapter 11 protection (Bankr. D. Minn. Case No. 18-43739) on Nov. 30, 2018. In the petition signed by Carl L. Green, president, the Debtor disclosed $1,806,000 in assets and $1,035,000 in debt. The Hon. Katherine A. Constantine is the case judge. The Debtor hired Joseph W. Dicker, P.A., as counsel. SEBSEN ELECTRIC: Wins Cash Collateral Access on Final Basis ----------------------------------------------------------- Judge Catherine Peek McEwen of the U.S. Bankruptcy Court for the Middle District of Florida authorized Sebsen Electric, LLC, on a final basis, to use the cash collateral retroactive to July 12, 2021. The Debtor is permitted to use cash collateral to pay for its current and necessary expenses according to the budget (plus 10% permitted variance per line item) and other Court-approved payments, including fees to the U.S. Trustee. The authorization will continue until further Court order. The Debtor's secured creditors will have a perfected postpetition lien against the cash collateral to the same extent, validity and priority as their prepetition liens. The Debtor will also maintain insurance coverage for its property in accordance with the obligations under the loan and security documents with the Secured Creditors. A copy of the final order is available for free at https://bit.ly/3qWulTH from PacerMonitor.com. About Sebsen Electric, LLC Sebsen Electric, LLC filed a petition under Subchapter V of Chapter 11 of the Bankruptcy Code (Bankr. M.D. Fla. Case No. 21-03626) on July 12, 2021. On the Petition Date, the Debtor disclosed $545,466 in total assets and $888,950 in total liabilities. The petition was signed by Anthony S. Italiano, manager. Buddy D. Ford, P.A. represents the Debtor as counsel. Ruediger Mueller is appointed as the Debtor's Subchapter V Trustee. SNAP ONE: Moody's Assigns 'B2' CFR Following Debt Refinancing ------------------------------------------------------------- Moody's Investors Service assigned a B2 corporate family rating and B2-PD probability of default rating to Snap One Holdings Corp. following the refinancing of credit facilities in December 2021. Moody's also assigned a B2 instrument level rating to the company's senior secured first lien credit facilities, which includes a $100 million revolver due December 2026 and a $465 million term loan due 2028. These ratings actions are a result of a change in the borrower of the company's credit facilities from Wirepath LLC to Snap One Holdings Corp. As a result, all ratings for Wirepath LLC will be withdrawn. The Speculative Grade Liquidity rating has been assigned as SGL-2. The outlook remains stable. RATINGS RATIONALE Snap One's B2 CFR reflects the company's strong market presence and the enhancement of scale, global distribution and market share via acquisitions and organic revenue growth in the 10% area. The company is one of the most recognized names by professional installers in the home audio-visual ("AV") and automation markets and is one of the largest players in the space. Snap One's direct-to-integrator sales model is designed to eliminate the risk of intermediation by lower-cost retail providers by replacing traditional design, manufacturing, and distribution roles with a fully integrated platform based on an efficient e-commerce platform. Moody's believes that smart home industry has a favorable long-term outlook as consumers embrace new technologies that improve connectivity and quality of life. Moody's expects that the company will be able to expand into additional home equipment via organic growth or small acquisitions that could increase the revenue base and increase scale in the long term. In addition, the company's strategy of penetrating the technology-enabled smart home market can create opportunities for subscription-based revenue. Snap One's ratings are constrained by its exposure to volatility in the economic environment related to housing market strength and consumer discretionary spend. The company's products are concentrated in the very high end of the home AV market with average spend of $20,000 per project by the customer. Demand for the company's products are elastic and susceptible to decline during recessionary conditions when consumers suspend high ticket discretionary purchases. Without penetration into the mid-tier of home AV and automation installations, the risks of significantly declining demand in a recessionary environment will continue to be a feature of the credit. Despite public ownership, the company remains sponsor-controlled which, in Moody's view, elevates the risk of aggressive growth or shareholder return strategies. The stable outlook reflects the expectation that operating conditions will be favorable over the foreseeable future and the strong performance and resiliency of demand that the company has shown over the pandemic is expected to continue. Snap One has been able to expand its customer base to 16,000 integrators and 70% of its sales are from proprietary brands that have higher margins than third party brands. Demand for residential AV and automation equipment is supported by secular tailwinds as more consumers seek to make their homes connected and as homes become 'smarter'. The company's products are targeted towards the high end of the residential market and projects that are completed by the company's network of installers tend to be highly technical in nature. Going forward, leverage is expected to decline to around 4.7x by the end of 2022 and free cash flow to be positive for the year, driven by steady revenue growth and stable margins. The credit facilities provide covenant flexibility that if utilized could negatively impact creditors. Notable terms include the following: (i) Incremental debt capacity up to the sum of the greater of $110,000,000 and 100.0% of Consolidated EBITDA, plus unused capacity reallocated from the general debt basket, plus unlimited amounts subject to pro forma net first lien leverage ratio of 4.5x. Amounts up to the greater of $55m and 50% of Consolidated EBITDA may be incurred with an earlier maturity than the initial term loans. (ii) The credit agreement permits the transfer of assets to unrestricted subsidiaries, up to the carve-out capacities, subject to "blocker" provisions which prohibit the transfer of material intellectual property to unrestricted subsidiaries. (iii) Non-wholly-owned subsidiaries are not required to provide guarantees; dividends or transfers resulting in partial ownership of subsidiary guarantors could jeopardize guarantees, subject to protective provisions limiting such guarantee releases in connection with a de minimis transfer of capital stock with no bona fide business purpose, intended solely to release the guarantee as determined by the borrower. (iv) There are no express protective provisions prohibiting an up-tiering transaction. The SGL-2 Speculative Grade Liquidity Rating reflects Moody's expectation that Snap One will maintain good liquidity. Liquidity is supported by about $60 million of cash on the balance sheet as of September 30, 2021 and expected $50 million in free cash flow for 2022, which together should cover the expected cash outflow through 2022, including a $4.7 million mandatory debt amortization and any working capital uses. Free cash flow to debt is expected to be in the 10% to 12% range for this year and next year, which is strong for the rating category. Liquidity is also supported by the company's $100 million revolver that has full availability other than around $5 million of letters of credit. The revolver is subject to a springing leverage covenant but Moody's does not expect the company to draw down on the revolver over the next 12 months and thus the revolver is not expected to be subject to the covenant. Assignments: Issuer: Snap One Holdings Corp. Corporate Family Rating, Assigned B2 Probability of Default Rating, Assigned B2-PD Speculative Grade Liquidity Rating, Assigned SGL-2 Senior Secured 1st Lien Term Loan, Assigned B2 (LGD3) Senior Secured 1st Lien Multicurrency Revolving Credit Facility, Assigned B2 (LGD3) Outlook Actions: Issuer: Snap One Holdings Corp. Outlook, Assigned Stable FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS The ratings could be upgraded if Moody's expects 1) sustained organic revenue growth and increasing scale and continued diversification of products sold; 2) debt to EBITDA (Moody's adjusted) to remain below 4.0x; and 4) the company will sustain good liquidity through cycles. The ratings could be downgraded if 1) revenue or profits do not grow as expected, evidencing increased competition or loss of market share; 2) Moody's expects debt to EBITDA will be sustained above 5.5x; 3) liquidity deteriorates; or 4) free cash flow approaches break--even (all metrics Moody's adjusted). Snap One Holdings Corp. is a technology-enabled, value-added wholesale supplier and distributor of products and services to integrators in, primarily, the home and small business audio visual equipment sector. Snap One, which generated $960 million of revenues for the LTM period ended September 30, 2021, is a publicly traded company, but still majority owned by funds affiliated with private equity sponsor Hellman & Friedman. The company is headquartered in Charlotte, NC. The principal methodology used in these ratings was Business and Consumer Services published in November 2021. SPL PARTNERS: Unsecured Creditors to be Paid in Full in Plan ------------------------------------------------------------ SPL Partners LLC filed with the U.S. Bankruptcy Court for the Eastern District of New York a Chapter 11 Plan of Reorganization and a Disclosure Statement dated Jan. 24, 2022. The Debtor is a Delaware limited liability company. The Debtor's principal asset is real property located at 9201 4th Avenue, Brooklyn, New York (the "Property"). The Property is a mixed-use office and retail building with 7-story plus mezzanine level, lower level and 6-level below grade parking garage. The Property consists of 71,140 square feet. This is a reorganization plan. In other words, the Debtor seeks to reorganize its financial affairs and not liquidate all of its assets. The Plan fixes Signature's claim, which is the accurate amount of its claim, plus accruing interest at the Note rate of $1,651.93 for each day after January 24, 2022 and attorneys' fees and costs subject to an application under Section 506(b) of the Bankruptcy Code. General unsecured claims against the Debtor's estate aggregate approximately $225,000. The aforementioned amounts do not include the following: (a) the claim of Xemex in the amount of $649,938, which is disputed by the Debtor; (b) the claim of Spiropoulos in the amount of $533,979, which is being subordinated under the Plan; and (c) the claim of Silvestri in the amount of $200,000, which is being subordinated under the Plan. The Plan will treat claims as follows: * Class 1 shall consist of New York City's real estate tax Claim, which is approximately $547,000. On the Effective Date, pursuant to section 1124 of the Bankruptcy Code, the Debtor shall pay the Allowed Amount of such Claim plus interest at the applicable statutory rate as it accrues from the Petition Date through the date of payment. * Class 2 shall consist of the Allowed Secured Claim of Signature, which is secured by a mortgage lien on the Property. Signature's Claim shall be fixed at the amount of $16,707,320.43 plus interest from January 24, 2022 at the per diem rate of $1,651.93 and attorneys' fees and costs allowed by the Court after determination of an application by Signature. On the Effective Date, pursuant to section 1124 of the Bankruptcy Code, the Debtor shall pay the Allowed Secured Claim of Signature in full. * Class 3 shall consist of General Unsecured Claims. The Debtor estimates that the aggregate amount of all Class 3 Claims are approximately $224,664.39. The Debtor shall pay the General Unsecured Claims in full on the Effective Date. Unimpaired and deemed to accept the Plan. * Class 4 shall consist of the subordinated claims of Silvestri and Spiropoulos, which aggregate $733,978.72. The Class 4 subordinated creditors shall receive their pro rata share of any net proceeds realized by the Reorganized Debtor as a result of litigation, including collection of outstanding accounts receivable. * Class 5 shall consist of the Interest Holder. On the Effective Date, the Interest Holder's interest in the Debtor will be cancelled and new interest will be issued in favor of the Funder, the company providing funding under the Plan. Interest Holder will receive its pro rata share of any net proceeds realized by the Reorganized Debtor as a result of litigation, including collection of outstanding accounts receivable, after satisfaction of the Class 4 subordinated creditors' claims. Payments under the Plan will be paid from Exit Financing, and a $5,000,000 equity infusion being provided by the Funder. Proof of the commitment for such equity infusion. Title to the Property shall be revested in the Reorganized Debtor. However, if the exit financing lender requires that the Property be titled in the name of a newly formed, single purpose entity then the Reorganized Debtor shall convey title of the Property to the new entity, which shall assume responsibility for repayment of the Exit Financing. The transfer of the Property to any newly formed entity shall be free and clear of all liens, claims and encumbrances. Signature shall assign its mortgage to the holder of the Exit Financing. A full-text copy of the Disclosure Statement dated Jan. 24, 2022, is available at https://bit.ly/3IHGyC3 from PacerMonitor.com at no charge. Counsel to Debtor: Melissa A. Pena, Esq. Norris McLaughlin, P.A. 7 Times Square, 21st Floor New York, NY 10036 Tel: 212-808-0700 Fax: 212-808-0844 Email: mapena@norris-law.com About SPL Partners LLC Brooklyn, N.Y.-based SPL Partners LLC is a single asset real estate debtor (as defined in 11 U.S.C. Section 101(51B)). On Aug. 31, 2021, Xemex LLC, Stacey Angelides and Angelo Gerosavas filed an involuntary petition against SPL Partners pursuant to Chapter 11 of the Bankruptcy Code (Bankr. E.D.N.Y. Case No. 21-42248). The creditors are represented by Ralph E. Preite, Esq., at Koutsoudakis & Iakovou Law Group, PLLC. Judge Elizabeth S. Stong presides over the case. Melissa A. Pena, Esq., at Norris McLaughlin, P.A. serves as the Debtor's legal counsel. SPRUCE POWER: S&P Assigns 'B' Issuer Credit Rating, Outlook Stable ------------------------------------------------------------------ On Jan. 25, 2021, S&P Global Ratings assigned its 'B' issuer credit rating to Spruce Power Holdings LLC. S&P Global Ratings also assigned its 'B' issue-level rating and '4' recovery rating to the company's proposed term loan B (TLB) offering. The '4' recovery rating indicates its expectation of average (30%-50%; rounded estimate: 40%) recovery in the event of default. S&P said, "The stable outlook reflects our expectations of highly contracted cash flows and stable operating performance, which will support the company's debt obligations during the outlook horizon. However, we don't project a material improvement in Spruce's credit metrics, given the company's very highly leveraged capital structure and the relatively modest cash flow sweep associated with the TLB. "Spruce's strategy of acquiring existing residential solar photovoltaic systems mitigates some of the risks associated with this growing and highly competitive market. Since its formation in 2017, Spruce has acquired existing residential solar photovoltaic (PV) systems, mainly from utilities or independent power producers that were looking to exit this highly competitive and fragmented market. As a result, Spruce now operates a residential fleet of about 326 megawatts (MW) spread across 50,000 systems. "By acquiring fully built and contracted assets, Spruce is less likely to be affected by some of the risks associated with this evolving market. We view technological and regulatory changes as more likely to affect companies looking to increase their portfolio, as opposed to Spruce, for which we are not modeling additional acquisitions. As an example, technological improvements are unlikely to materially affect the company's cash flows, given that customers looking to terminate their agreements before maturity would have to indemnify Spruce for the expected cash flows over the remaining life of the contract. In addition, by not installing new systems, in our opinion, Spruce is less susceptible to potential supply chain disruptions because its equipment needs will be limited to maintaining the systems. Similarly, shifts in government policies that affect residential solar growth, such as broader tax incentives, are unlikely to directly affect Spruce." A high level of contractedness should result in good cash flow visibility. Almost all of Spruce's projected cash flows are contracted under long-term agreements, either as power purchase agreements or leases, which result in high cash flow predictability. The contracts with customers are long term, with a weighted-average length of 13.5 years. Furthermore, Spruce benefits from sound underwriting standards, with customers having an overall weighted-average FICO score of about 756. S&P said, "Therefore, we don't anticipate material deviation from the historically low delinquency rate, given the essential nature of the service provided and the value proposition for customers compared with alternatives. We also don't view the performance guarantees associated with the leases as likely to result in material volatility, given that the historical production was largely in line with expectations." As the owner of the systems, Spruce also benefits from the associated incentives, which include solar renewable energy credits (SRECs), tax credits, carbon offsets, utility rebates, and any other non-power attributes of the systems. Most of Spruce's projected revenues from SRECs have been hedged over S&P's outlook horizon, which should mitigate the impact of higher volatility resulting from potential policy changes. Spruce's limited scope and scale, combined with material exposure to California, result in concentration risks. Compared with peers, Spruce is smaller in terms of MW capacity deployed and less diversified both in terms of service offering and geographic exposure. About half of its systems are in California. S&P said, "We tend to view a higher concentration as credit negative, given that a more limited asset base may be at greater risk from unfavorable market disruptions. For example, Spruce could be negatively affected by environmental disturbances, such as a prolonged wildfire season in California. At the same time, we would expect Spruce to have adequate insurance coverage to withstand such an event, but it could still result in disruptions." S&P said, "We expect the highly leveraged capital structure to improve only marginally during our outlook horizon. We consider Spruce's financial metrics as highly leveraged at about 10x in 2022, only modestly declining to about 9x by 2024. This modest improvement is largely spurred by the TLB cash sweep, as EBITDA is projected to gradually decline due to seasoning of the contracts and system degradation. We would view those credit metrics as being weaker than most peers. The repayment structure of the TLB is also somewhat weaker than that of peers, with a requirement to sweep 50% of excess cash flow for year 1-4 and 75% thereafter, as well as the standard 1% mandatory amortization. Over the longer term, this highly leveraged capital structure is also exposed to renewal rates, which could be credit negative if they were weaker than expected. "We also view Spruce's owner, HPS Investment Partners (HPS), as a financial sponsor, given its ownership and ability to dictate financial policies, which we anticipate will keep Spruce highly leveraged." Refinancing could eventually be challenged by declining cash flows combined with a highly leveraged capital structure. Declining cash flows, combined with a sizable TLB balance at maturity, could result in some refinancing pressure as we near the maturity of this offering. S&P anticipates that the TLB balance will be about $455 million by 2029, considering the projecting cash sweeps as well as mandatory amortization. In addition, if sweep activity was lower than expected and resulted in a higher TLB balance than initially projected, it would lead to higher refinancing risks. Spruce's cash flows are projected to decline, mostly due to lower generation as the solar systems degrade over time. Furthermore, maturing contracts will result in lower EBITDA, which could be mitigated by a robust renewal rate. While S&P has limited visibility on renewal behavior at this stage, it expects that factors such as available alternatives and expected cost savings will be material for customers in their decision-making process. S&P said, "Finally, although we do not project any acquisitions in our base-case scenario, Spruce could also add assets to its portfolio, in accordance with the TLB agreement, which could have an impact on its credit metrics, as these would likely be financed with additional debt. "The stable outlook reflects our expectation that Spruce will operate in line with budget and generate predictable cash flows that will support its debt obligations during our outlook horizon. Given the nature of the almost fully contracted portfolio, we view the key exposures as being resource risks, operating issues, or unfavorable borrowers' behavior. We also expect that the TLB balance to reach $550 million by the end of 2024, due to the cash flow sweep as well as mandatory amortization." S&P could lower the rating if there are lower-than-expected cash sweeps, which result in slower-than-expected deleveraging and a higher debt outstanding than projected. Such a scenario could occur if: -- Operating conditions or performance materially deteriorated, which could be driven by extreme weather events; or -- Borrowers' behavior was unfavorable, such as materially higher credit losses, which could be driven by a significant economic recession. S&P sai,d "We view a positive rating action as unlikely, given the company's business model and highly leveraged capital structure. However, we could raise the rating if debt to EBITDA were below 6x on a sustained basis. We view such a scenario as unlikely, as it would require materially higher-than-expected cash sweeps. We view this as unlikely to occur, as under the outstanding lease agreements, the benefits of materially higher-than-expected resources conditions would likely accrue to the customers through net metering." ESG credit indicators: E-1, S-2, G-3 S&P said, "Environmental factors are a positive consideration in our credit rating analysis of Spruce. The E-1 indicator reflects the company's 100% renewables generation. We believe Spruce is better positioned than peers to manage the energy transition, given its fully renewable generation profile, with about 326 MW of distributed solar generation. Our assessment of the governance indicator reflects the aggressive financial risk profile and the potential for corporate decisions that prioritize the interests of the controlling owners, in line with our view of most rated entities owned by private-equity sponsors. We think financial sponsors are more likely to hold these companies for shorter time frames and focus on maximizing shareholder returns." STEINWAY MUSICAL: Moody's Withdraws 'B2' CFR on Debt Repayment -------------------------------------------------------------- Moody's Investors Service has withdrawn Steinway Musical Instruments, Inc.'s ratings including the B2 Corporate Family Rating, the B2-PD Probability of Default Rating, and the B2 rating on the senior secured term loan. The stable outlook has also been withdrawn. The rating action follows the full repayment and cancellation of the term loan. The following ratings/assessments are affected by the action: Ratings Withdrawn: Issuer: Steinway Musical Instruments, Inc. Corporate Family Rating, Withdrawn, previously rated B2 Probability of Default Rating, Withdrawn, previously rated B2-PD Senior Secured 1st Lien Term Loan B, Withdrawn, previously rated B2 (LGD4) Outlook Actions: Issuer: Steinway Musical Instruments, Inc. Outlook, Changed To Rating Withdrawn From Stable RATINGS RATIONALE Moody's has withdrawn the ratings because Steinway's debt previously rated by Moody's has been fully repaid. Steinway Musical Instruments, Inc., headquartered in New York, New York, is one of the world's leading manufacturers of musical instruments. The company's products include Steinway & Sons, Boston and Essex pianos, Selmer Paris saxophones, Bach Stradivarius trumpets, C.G. Conn French horns, King trombones, and Ludwig snare drums. The company is owned by Paulson & Co. Inc. and generated annual revenues of $512 million for the latest 12-month period ended Sept. 30, 2021. SYMPLR SOFTWARE: Moody's Affirms B3 CFR Amid Midas Transaction -------------------------------------------------------------- Moody's Investors Service affirmed Symplr Software, Inc.'s ("symplr") credit ratings, including its B3 corporate family rating, B3-PD probability of default rating, and B2 instrument ratings of symplr's senior secured first-lien debt, which includes an upsized, $1,226 million (from $976 million) term loan and an undrawn, $100 million revolving credit facility. Symplr's outlook remains stable. Earlier this month symplr announced that it will be acquiring Midas Health Analytics Solutions ("Midas") from Conduent Technologies, for $340 million. Proceeds from the incremental first-lien term loan and from an incremental $90 million second-lien term loan (unrated), as well as $37 million of incremental preferred stock will be used to effect the purchase of Midas, meet transaction fees, and allocate $18 million of cash to symplr's balance sheet. The following ratings/assessments are affected by the action: Ratings Affirmed: Issuer: Symplr Software, Inc. Corporate Family Rating, Affirmed B3 Probability of Default Rating, Affirmed B3-PD Senior Secured Bank Credit Facility, Affirmed B2 (LGD3) Outlook Actions: Issuer: Symplr Software, Inc. Outlook, Remains Stable RATINGS RATIONALE The B3 CFR reflects symplr's small revenue scale, very high Moody's-adjusted pro-forma debt-to-EBITDA leverage of roughly 8.1 times, and integration risks as the healthcare governance, risk, and compliance ("GRC") software-solutions provider undertakes another acquisition -- symplr's tenth over the past five years. The acquisition of Midas, financed mostly with debt and a nominal amount of preferred equity, extends Moody's timeframe for symplr's deleveraging, while it adds product diversity and improves the company's revenue base by nearly 20%. Combined, symplr and Midas will have an expected revenue base greater than $500 million in 2022, strong EBITDA margins, and free cash flow generation capabilities consistent with the CFR. Minimal operating synergies are assumed for the integration of Midas, which has EBITDA margins approaching 50%. Still, the primarily-debt-financed acquisition has a moderately negative impact on symplr's leverage at closing since Midas is being bought for about ten times its EBITDA. Symplr's estimated year-end 2021 Moody's leverage is 7.8 times, and 8.8 times when excluding an addback adjustment for the timing of earnings from contract billing. Pro-forma for the Midas purchase, those measures at December 31, 2021 would be 8.1 times and 8.9 times, respectively. Midas's patient-safety-and-risk and data-analytics software and services will augment symplr's workforce management, credentialing, and compliance, quality and safety ("CQS") capabilities and enhance cross-selling opportunities into existing symplr accounts. A customer's decision to buy the respective services is made at the same healthcare-provider C-suite level. Nearly 40% of US hospitals use Midas to remain compliant with patient safety guidelines, and there is favorable customer overlap between Midas and symplr. Symplr's ongoing heavy acquisition platform involves a raft of earnings adjustments and addbacks that cloud organic revenue growth and profitability measures. Moody's 8.1 times (or 8.9 times, when not making the favorable adjustment for the timing of contract billing) pro-forma leverage calculation is weak for the CFR, and unimproved relative to the measure when Moody's originally assigned ratings, in late 2020. Although Moody's expects debt leverage will moderate through scale economies and higher SaaS subscription revenue, private equity ownership, an active history of acquisitions, and very loose covenants that do not tighten imply that symplr's financial strategy will could continue to be aggressive. Moody's notes too, however, that symplr has thus far successfully integrated the handful of acquisitions it has made over the past one and a half years. The Midas purchase is among the smaller of the recent acquisitions. Symplr's revenue grew by mid-single-digit percentages on an organic basis in 2021, driven by strength in core products, and Moody's expects at least that level of organic growth in 2022 through new cross selling opportunities, a revitalized sales force, and the migration of customers to cloud-based services. The company's modest revenue scale, now greater than $500 million (expected for 2022), weighs less heavily on the ratings. Healthcare industry trends support the rating and help Moody's to look beyond the drawbacks of symplr's brief operating history, high financial leverage and poor earnings quality. These supporting trends include increased healthcare spending, greater, regulatory-driven complexity, margin pressures caused by the transition to value-based care, and the need for an enterprise-wide solution to support the complexity of GRC as hospitals and healthcare providers consolidate. Additionally, the credentialing, staffing, and scheduling services that symplr's platforms facilitate have become even more necessary to providers in response to the COVID pandemic. Moody's views symplr's liquidity as good. Balance sheet cash has been minimal and typically supported by revolver borrowings and/or (as it is here) acquisition term loan financing. However, symplr generated positive CFO in the first nine months of 2021, a reversal relative to 2020 and 2019. Capital expenditures, including relatively large software development costs that are capitalized, continue to weigh on free cash flow. Moody's expects free cash flows that, as a percentage of debt, will be in the low-single-digits over the next 12 to 18 months, average for the ratings category. Although fully available at present, the large, $100 million revolving credit facility has been used to support cash flow shortfalls caused by acquisition-driven growth. The credit agreement's very loose covenant package, including an 8.5 times first-lien-leverage limit with no stepdowns, applicable when the revolver is 35% drawn, and no covenants associated with the term loans, suggests the company will have unimpeded access to the liquidity facility. Symplr's corporate governance policy presents risks through both the high financial leverage employed and private equity ownership, which typically places shareholder interests above those of creditors. Moody's expects aggressive financial policies will sustain high levels of leverage, including debt-funded M&A transactions and other shareholder-friendly policies. The burden of servicing the high debt load may restrict symplr's ability to continue investing in products and platform modernization that might otherwise support the company's competitiveness. The stable rating outlook reflects Moody's expectation that organic top-line growth of mid- to upper-single-digit percentages and the successful integration of acquisitions will allow for at least low-single-digit percentage (of total debt) free cash flow as well as deleveraging, to below 7.0 times by the end of 2023. Since Moody's-expected deleveraging has been delayed for more than a year, due to debt-funded acquisitions, retaining the stable outlook will require progress towards lower leverage. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS The ratings could be upgraded if earnings growth and synergy realization enable symplr to sustain Moody's-adjusted debt-to-EBITDA leverage below 6.5 times, and if free cash flow as a percentage of debt is expected to be sustained in the mid-single digits. A ratings downgrade could result if Moody's expects symplr to generate minimal or no free cash flow, or if liquidity deteriorates. Failure to achieve at least mid-single-digit organic revenue growth or to make progress towards deleveraging, due to difficulties integrating acquisitions or falling short of anticipated synergies, could also pressure the rating. Through its operating subsidiaries, Symplr Software Intermediate Holdings, Inc. provides on-premise and software-as-a-service ("SaaS") medical compliance and credentialing solutions to healthcare facilities and healthcare providers. With backing from private equity owner Clearlake Capital, symplr in December 2020 acquired TractManager, Inc., a provider of internet-based tools and services that assist healthcare providers and payers with improving the effectiveness and efficiency of their programs in compliance, supply chain, credentialing, and clinical evidence. In mid-2021, symplr acquired HealthcareSource, a provider of talent management software for major acute- and non-acute-care hospital systems. In mid-July 2021, the company announced a substantial equity investment by the private equity firm Charlesbank. Again, with private equity support, symplr in early 2022 is acquiring Midas, a provider of patient safety & risk and data analytics software solutions for the healthcare industry. Moody's expects the combined companies to generate 2022 revenue of more than $500 million. The principal methodology used in these ratings was Software Industry published in August 2018. SYMPLR SOFTWARE: S&P Alters Outlook to Stable, Affirms 'B-' ICR --------------------------------------------------------------- S&P Global Ratings affirmed all ratings on Houston-based Symplr Software Intermediate Holdings Inc., including its 'B-' issuer credit rating and 'B' rating on the first-lien debt. The recovery rating remains '2', indicating its expectation for substantial (70%-90%; rounded estimate: 75%) recovery in the event of payment default. S&P said, "We revised the outlook to stable from negative, reflecting our expectation that Symplr will produce at least mid-single-digit percentage organic revenue growth and flat or positive cash flow. "We expect pro forma debt to EBITDA of about 14x (burdened by preferred equity as well as acquisition and integration costs) and FOCF to debt below 1% in 2022.Symplr's aggressive pace of acquisitions has resulted in its high leverage, and we project that adjusted debt to EBITDA will be about 14x in 2022 following the Midas acquisition. This will be heavily burdened by acquisition-related costs, which we view as recurring based on the company's track record. While we expect some deleveraging in 2023, Symplr will maintain above 10x leverage through its aggressive financial policy under the ownership of financial sponsor Clearlake Capital. "Our ratings reflect our belief that Symplr can generate organic revenue growth and positive cash flow excluding mergers and acquisitions, which we believe are accretive but not essential to its competitive position. Similarly, we believe the historical cash flows and high leverage reflect the company's willingness to operate aggressively and not its inability to expand organically. Its strategy is very aggressive, and leverage could increase materially even further from our already elevated forecast. Although Symplr could produce positive cash flow in 2022, we believe this is uncertain as the company integrates recent acquisitions and continues to execute its growth strategy. Nevertheless, we believe it can meet its financial commitments and halt acquisitions if necessary in response to unfavorable business, financial or economic conditions, or internal setbacks. Symplr's core business includes Cactus, which expanded at double-digit percentages; API, which expanded at high-single-digit rates; and Access Management, which expanded at mid-single-digit rates. They make up more than 90% of core Symplr billings. As such, we expect the company to expand on its own, even if it halts acquisitions. "We view the Midas acquisition as accretive to Symplr's offerings.Midas offers a platform focused on operations and clinical performance with solutions that manage risk and control costs. Its incident reporting system aggregates incident information, and the safety and risk management products manage internal investigations and litigation processes. They capture the quality and safety data metrics for mandatory reporting and benchmarking them against other hospitals. While we view these offerings as essential for hospitals, the market for this software and data is highly fragmented." Like Symplr's products, large electronic health records vendors already provide revenue cycle management software and services, patient engagement, and other data-related information. It is well positioned to expand into this market because of client relationships with products that are even more critical than Symplr's offerings. Symplr's strategy of acquiring products and investing in R&D and customer support to turn them around is not without risk. While Symplr has acquired higher-growth products such as Phynd, Halo, and Spinfusion, it also looks for value in acquiring products that require investment and have longer paths to growth, such as HealthSource and Tractmanager. In addition to integration risk, the company has added costs associated with supporting multiple back ends and has not yet fully transitioned to software-as-a-service (SaaS). Finally, S&P expects over the coming few years the company will need to invest more to shift to SaaS and integrate all products onto one platform, which could temporarily burden EBITDA for 2-3 years. S&P said, "The stable outlook reflects our expectation that Symplr will produce at least mid-single-digit percentage organic revenue growth, allowing it to generate cash flow. We expect the company to continue its aggressive financial policy, pursuing large debt-funded acquisitions that maintain leverage above 10x with minimal FOCF. However, we view these acquisitions as supplementary to organic growth, and thus somewhat discretionary." S&P could lower the rating on Symplr over the next 12 months if: -- Organic earnings and free cash flow are weaker, potentially due to competitive pressures, difficulty turning around acquired products, or unforeseen integration challenges from recent acquisitions, resulting in sustained negligible cash flow; or -- There is a near-term liquidity shortfall from internal disruptions or an overly aggressive a pace of acquisitions. Although unlikely in the next 12 months, S&P could raise its ratings if: -- S&P expects the company's FOCF to debt to exceed 5% on a sustained basis; and -- S&P believes the company is committed to maintaining financial policies that will support it. TALEN ENERGY: S&P Rates Secured Credit Facility 'B', Outlook Stable ------------------------------------------------------------------- S&P Global Ratings assigned its 'B' rating to Talen Energy Supply LLC's $848 senior secured credit facility due 2024. S&P said, "At the same time, we lowered our ratings on Talen's secured debt to 'B' from 'B+', reflecting our expectations for lower recovery on secured debt. The 'B' senior secured debt ratings and '2' recovery reflect our expectations for substantial recovery 70%-90% (rounded estimate: 80%) in a default scenario. "We also affirmed our 'CCC' ratings on Talen's senior unsecured debt. Our 'B-' issuer credit rating is unchanged. "The stable outlook reflects our expectation that Talen will generate positive, although minimal free operating cash flow (FOCF) in 2022 and 2023, and that liquidity will remain adequate over the next 12 months. We expect leverage to remain elevated above 8x in all years of our forecast period." Talen's new senior secured facility provides the company additional liquidity but leads to lower expected recovery for all senior secured debt. The $848 million secured facility ranks pari passu with existing secured debt and lowers our overall recovery expectations for Talen in a default scenario. The existing revolving credit facility has been reduced to $459 million from $690 million and now serves as a letter of credit (LC) facility, back-stopping $459 million in LCs through maturity in 2024. It is 25% cash collateralized ($110 million cash collateral posted); therefore, no additional funds can be drawn and we no longer consider the revolving credit facility a source of liquidity for the company. At present, the entire $848 million credit facility is drawn and will be subject to a senior secured net leverage ratio of 4.25x beginning in the second quarter of 2022. The stable outlook reflects S&P's expectations that Talen will generate positive (albeit minimal) FOCF in 2022 and 2023, and that its liquidity will remain adequate. S&P also expects leverage to remain elevated above 8x for our entire forecast period. S&P could consider taking a negative rating action on Talen if: -- Credit metrics--including interest cover and adjusted debt to EBITDA--weakens significantly, causing us to view the capital structure as unsustainable; -- Covenant headroom tightens or liquidity deteriorates, leading to a shortfall; or -- Talen initiates a debt restructuring or distressed exchange. While unlikely over the coming year, S&P could consider a positive rating acting if leverage declines sustainably below 6.5x TECT AEROSPACE: Gets Court Okay to Send Liquidation Plan for Vote ----------------------------------------------------------------- James Nani of Bloomberg Law reports that Boeing Co. supplier TECT Aerospace Group Holdings Inc. received bankruptcy court approval to solicit votes for its liquidation plan after resolving remaining creditor disputes over plan disclosures. Judge Karen B. Owens of the U.S. Bankruptcy Court for the District of Delaware approved the disclosure statement in an order Tuesday, January 22, 2022, after canceling a scheduled hearing. Under TECT's plan, creditors with priority and other secured claims would see full recoveries. Unsecured creditors' recoveries aren't listed, although the disclosure statement says they would be impaired. About TECT Aerospace TECT Aerospace Group Holdings, Inc., and its affiliates manufacture high precision components and assemblies for the aerospace industry, specializing in complex structural and mechanical assemblies and machined components for various aerospace applications. TECT produces assemblies and parts used in flight controls, fuselage/interior structures, doors, wings, landing gear, and cockpits. TECT operates manufacturing facilities in Everett, Washington, and Park City, and Wellington, Kansas, and their corporate headquarters are located in Wichita, Kansas. TECT currently employs approximately 400 individuals nationwide. TECT and its affiliates are privately held companies owned by Glass Holdings, LLC and related Glass-owned or Glass-controlled entities. TECT Aerospace Group Holdings, Inc. and six affiliates sought Chapter 11 protection (Bankr. D. Del. Case No. 21-10670) on April 6, 2021. TECT Aerospace estimated assets of $50 million to $100 million and liabilities of $100 million to $500 million as of the bankruptcy filing. The Debtors tapped RICHARDS, LAYTON & FINGER, P.A., as counsel; WINTER HARBOR, LLC, as restructuring advisor; and IMPERIAL CAPITAL, LLC, as an investment banker. KURTZMAN CARSON CONSULTANTS LLC is the claims agent. The Boeing Company, as DIP Agent, is represented by Alan D. Smith, Esq. and Kenneth J. Enos, Esq. As reported by Troubled Company Reporter on June 2, 2021, Judge Brendan Linehan Shannon of the U.S. Bankruptcy Court for the District of Delaware authorized the bidding procedures proposed by TECT Aerospace Group Holdings Inc. and affiliates in connection with the auction sale of their Everett, Washington assets. TON REAL: Case Summary & Three Unsecured Creditors -------------------------------------------------- Debtor: Ton Real Estate Investments X, LLC 400 S. Green St., Suite H Chicago, Illinois 60607 Business Description: Ton Real Estate Investments X, LLC is a Single Asset Real Estate Debtor (as defined in 11 U.S.C. Section 101(51B)). Chapter 11 Petition Date: January 25, 2022 Court: United States Bankruptcy Court Northern District of Indiana Case No.: 22-30056 Debtor's Counsel: Christopher A. Hansen, Esq. 400 S. Green St. Ste. H Chicago, Illinois 60607 Tel: 708-284-6502 Email: hansenlegal@yahoo.com Estimated Assets: $10 million to $50 million Estimated Liabilities: $1 million to $10 million The petition was signed by John Thomas as manager. A full-text copy of the petition is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/M3RFAJI/Ton_Real_Estate_Investments_X__innbke-22-30056__0001.0.pdf?mcid=tGE4TAMA List of Debtor's Three Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ 1. Elkhart County Treasurer Real Estate Taxes $372,509 P.O. Box 116 Goshin, Indiana 46527 2. Cramer Norcross Legal Fees $10,434 2 N LaSalle St Ste 900 Chicago, IL 60602 3. Newby Lewis Legal Fees $4,375 916 Lincoln Way La Porte, In 46750 TRENT RIVER: Flamengos Buying River Bend Property for $1 Million ---------------------------------------------------------------- Trent River Adventures, LLC, asks the U.S. Bankruptcy Court for the Eastern District of North Carolina to authorize the private sale of interest in the real property identified as 141.23 Acres River Bend Golf & Country Club located at 94 Shoreline Drive, in River Bend, Craven County, North Carolina, to Flamengos Investments, LLC, and/or assigns for $1 million. Among the assets owned by the Debtor on the Petition Date was the Property. By way of a proposed Agreement for Purchase and Sale of Improved Real Property and Amendment I to Real Property Purchase and Sale Agreement, the Debtor asks the authority to sell the Debtor's interest in the Property by private sale to the Purchaser for a gross purchase price of $1 million. Per the proposed Offer to Purchase, the Purchaser has escrowed the sum of $25,000 with Brandt Deal, Attorney. The Purchaser will also escrow $43,000 to issue refunds upon the request of any of the 718 individuals who purchased a promotional anniversary membership coupon in 2020. The Coupon Holders, pursuant to the terms of the promotional anniversary membership agreement, could golf at River Bend Country Club for up to 36 months at an extremely discounted rate $49 per year. Of the 718 Coupon Holders, approximately 200 regularly play golf at River Bend County Club. The Refund Escrow should sufficiently compensate the Coupon Holders likely to request any refund. The Debtor seeks an order of the Court declaring that the sale of its Property described be made free and clear of any and all liens, encumbrances, claims, rights, and other interests, including but not limited to the following: (i) any and all liens and/or security interests in favor of William C. Bear; (ii) any and all liens and/or security interests in favor of Frank Brown; (iii) any and all liens and/or security interests in favor of Frank T. Fragale; (iv) any and all liens and/or security interests in favor of James L. Hoffman, Jr.; (v) any and all liens and/or security interests in favor of Charles Hendricks; (vi) any and all real property taxes due and owing to any City, County, or municipal corporation, and more particularly, to the Craven County Tax Collector; and (vii) any and all remaining interests, liens, encumbrances, rights and claims asserted against the Property, which relate to or arise as a result of sale of the Property, or which may be asserted against the buyers of the Property, including, but not limited to, those liens and claims, whether fixed and liquidated or contingent and unliquidated, that have or may be asserted against the Property by the North Carolina Department of Commerce, the North Carolina Department of Revenue, the Internal Revenue Service, and any and all other taxing and government authorities. The Property will be sold with any claims or liens against the Property transferring to the proceeds of the sale in their respective priorities. The proceeds will be subject to (i) ordinary closing costs, including existing and pro-rated ad valorem taxes and the broker's commission equal to 6% of the gross sales proceeds; and (ii) the terms and conditions of the Offer to Purchase. The net proceeds will be paid at closing to the holders of valid liens and security interests, in accordance with their respective priority. The Debtor prays of the Court to grant the following relief: 1. To allow the private sale of the Debtor's property to the Buyer for $1 million; 2. To allow the Purchaser to escrow $43,000 for the purpose of issuing refunds to Coupon Holders, upon their request; 3. To allow the sale of the Property described, free and clear of all liens, claims, encumbrances, rights and interests described; 4. To allow the described liens and interests of the creditors named to attach to the proceeds of the sale in their respective priorities; 5. To allow net proceeds to be paid at closing to the holders of valid liens and security interests, in accordance with their respective priority; 6. To allow that the Purchaser of the Property does not assume, have any liability for, or in any manner be responsible for any liabilities or obligations of the Debtor, whether in rem claims or in personam claims; 7. To enjoin all creditors and claimants of the Debtor, and all persons having an interest of any nature derived through the Debtor, from pursuing any action against the Purchaser once acquired by the Purchaser; 8. That the 14-day stay applicable to orders authorizing the sale of the Property pursuant to Rule 6004(h) of the Federal Rules of Bankruptcy Procedure be waived; and, 9. For such other and further relief as the Court deems just and proper. A copy of the Agreement is available at https://tinyurl.com/8pu8bvbn from PacerMonitor.com free of charge. About Trent River Adventures Trent River Adventures, LLC, a company that owns and operates a golf course facility in New Bern, N.C., sought protection under Chapter 11 of the Bankruptcy Code (Bankr. E.D.N.C. Case No. 20-00926) on March 3, 2020. At the time of the filing, Debtor disclosed assets of between $1 million and $10 million and liabilities of the same range. Judge Joseph N. Callaway oversees the case. The Law Offices of Oliver & Cheek, PLLC and Lori G. Baldwin, CPA serve as Debtor's legal counsel and accountant, respectively. On Aug. 17, 2020, the Order Confirming Plan was entered in the Debtor's case. US AIR FORCE: S&P Assigns 'BB' Rating on 2022A Sr. Secured Notes ---------------------------------------------------------------- S&P Global Ratings assigned its 'BB' rating to the $148.7 million series 2022A senior notes issued by the Provident Group Falcon Properties LLC, through the Industrial Development Authority of the City of Phoenix, Ariz. S&P also assigned a recovery rating of '3', reflecting its expectation of meaningful (50%-70%, rounded estimate: 55%) recovery in the event of default. The notes, along with $83.1 million in unrated subordinated bonds, will be used to finance the construction and operation of the independent 375-key upscale U.S. Air Force Academy Hotel, which is to be located at the north entrance to the U.S. Air Force Academy in Colorado Springs, Colo. Pricing occurred earlier this month and was delayed from the original timing. But given that the construction schedule and hotel opening dates have been moved accordingly, there are no material changes from its preliminary rating on the senior notes published Oct. 28. Since S&P assigned a 'BB' preliminary rating to the 2022A senior secured notes, there have been some modifications to the transaction outlined below that are credit neutral: -- The total par amount on the senior series 2022A is $148.7 million compared with an expected $152 million. The total par amount on the subordinated debt is $83.1 million versus the expected $82.2 million, consisting now of a series B and series C as opposed to the prior structure which only contemplated an unrated series B. -- Construction will start in February 2022 versus Nov. 2021. -- Substantial completion is expected on Sept. 2, 2024, compared with the initially expected June 7, 2024. -- The hotel opening date is expected on Oct. 17, 2022, compared with the initially expected July 22, 2024. -- The capitalized interest expense ends on April 17, 2025, rather than the initially expected Jan. 22, 2025. -- The first senior interest payment is in December 2025 instead of the initially expected June 1, 2025. -- The bonds' final maturity remains on Dec. 1, 2057. S&P said, "The stable outlook reflects our view that the U.S. Air Force Academy Hotel project will be completed within time and on budget due to our opinion of the experienced construction company and a reasonable construction schedule--together with adequate liquidity to cover any unexpected delay or cost overruns. "Under our forecast assumptions, we anticipate once the ramp up is achieved, the hotel will have a stabilized revenue per available room (RevPar) of about $159, which we assume escalates at 2% annually thereafter. "We could lower the rating if there are significant construction-related delays that prolong the substantial completion date or cost overruns that extend beyond the existing liquidity and construction company's responsibility. During operations, we could lower the rating if the hotel cannot attract demand in line with our forecast occupancy levels or if pricing needs to be significantly lower, resulting in a sustained projected minimum DSCR of about 1.25x. This could occur if RevPar is 5%-10% lower than in our base case. "A higher rating is not likely during construction based on our view that the construction contract has lower incentives for the construction company to perform compared to rated peers in a stressed condition. (The project's liquidated damages and liability cap are much lower than the contract maximum price.) During operations, we could consider a higher rating if the project is able to demonstrate a track record of senior DSCRs approaching 2x while maintaining liquidity and a strong resilience under our downside scenario." VERTEX ENERGY: Convertible Note Share Issuance Proposal Approved ---------------------------------------------------------------- At the special meeting of the stockholders of Vertex Energy, Inc., the stockholders: (a) approved the issuance of shares of the company's common stock issuable upon the conversion of its $155 million aggregate principal amount at maturity 6.25% Convertible Senior Notes due 2027, in accordance with Nasdaq Listing Rules 5635(a) and (d); and (b) approved an adjournment of the special meeting, if necessary, to solicit additional proxies if there are no sufficient votes in favor of the proposal above. The proposals were each approved by the requisite vote of the company's stockholders, provided that such an adjournment was not necessary in light of the approval of the convertible note share issuance Proposal. About Vertex Energy Houston-based Vertex Energy, Inc. (NASDAQ: VTNR) is a specialty refiner of alternative feedstocks and marketer of high-purity petroleum products. Vertex is one of the largest processors of used motor oil in the U.S., with operations located in Houston and Port Arthur (TX), Marrero (LA) and Heartland (OH). Vertex also co-owns a facility, Myrtle Grove, located on a 41-acre industrial complex along the Gulf Coast in Belle Chasse, LA, with existing hydro-processing and plant infrastructure assets, that include nine million gallons of storage. The Company has built a reputation as a key supplier of Group II+ and Group III Base Oils to the lubricant manufacturing industry throughout North America. Vertex Energy reported a net loss attributable to the company of $12.04 million for the year ended Dec. 31, 2020, a net loss attributable to the company of $5.05 million for the year ended Dec. 31, 2019, and a net loss attributable to the company of $2.22 million for the year ended Dec. 31, 2018. As of June 30, 2021, the Company had $135.11 million in total assets, $79.58 million in total liabilities, $37.03 million in total temporary equity, and $18.50 million in total equity. VIPER PRODUCTS: Seeks to Employ Charles Darter as Accountant ------------------------------------------------------------ Viper Products & Services, LLC seeks approval from the U.S. Bankruptcy Court for the Northern District of Texas to hire Charles W. Darter, Jr., an accountant practicing in Lubbock, Texas, to prepare its tax returns and assist with other accounting matters. Mr. Darter will be paid on an hourly basis and will be reimbursed for work-related expenses incurred. As disclosed in court filings, Mr. Darter is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code. Mr. Darter can be reached at: Charles W. Darter, Jr. 8008 Slide Rd., #7 Lubbock, TX 79424 Tel: (806) 798-8194 About Viper Products & Services Viper Products & Services, LLC provides environmentally sound solutions for the oil and gas industry. Based in Lubbock, Texas, Viper Products & Services offers oil spill management, testing, reporting, remediation, reclamation, excavation, and bore and core drilling services. Viper Products & Services filed its voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. N.D. Texas Case No. 21-50187) on Dec. 13, 2021, listing $1 million to $10 million in both assets and liabilities. Zack Tuttle, manager, signed the petition. The Debtor tapped McWhorter, Cobb & Johnson, LLP as legal counsel and Charles W. Darter, Jr. as accountant. WAYNE BARTON: Seeks to Hire Wernick Law as Bankruptcy Counsel ------------------------------------------------------------- Wayne Barton Study Center, Inc. seeks approval from the U.S. Bankruptcy Court for the Southern District of Florida to hire Wernick Law, PLLC to serve as legal counsel in its Chapter 11 case. The firm's services include: (a) giving advice to the Debtor with respect to its powers and duties and the continued management of business operations; (b) advising the Debtor with respect to its responsibilities in complying with the U.S. Trustee's Operating Guidelines and Reporting Requirements and with the rules of the court; (c) preparing adversary proceedings and legal documents; (d) protecting the interest of the Debtor in all matters pending before the court; and (e) representing the Debtor in negotiations with creditors in the preparation of a Chapter 11 plan. The firm's hourly rates are as follows: Aaron A. Wernick, Esq. $600 per hour Lenore Rosetto Parr, Esq. $475 per hour Paralegal $200 per hour Aaron Wernick, Esq., the firm's attorney who will be providing the services, disclosed in a court filing that he is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code. The firm can be reached at: Aaron A. Wernick, Esq. Wernick Law, PLLC 2255 Glades Road, Suite 324A Boca Raton, FL 33431. Tel: 901-525-1322 Fax: 901-525-2389 Email: awernick@wernicklaw.com About Wayne Barton Wayne Barton Study Center, Inc. is a tax-exempt entity in Boca Raton, Fla., which was established to enhance the health, welfare, and education of children in need in its community. Wayne Barton Study Center filed a petition for Chapter 11 protection (Bankr. S.D. Fla. Case No. 22-10384) on Jan. 18, 2022, listing up to $10 million in assets and liabilities. Wayne Barton, president, signed the petition. Judge Mindy A. Mora oversees the case. The Debtor tapped Wernick Law, PLLC as legal counsel. WC MANHATTAN PLACE: Voluntary Chapter 11 Case Summary ----------------------------------------------------- Debtor: WC Manhattan Place Property, LLC 814 Lavaca Street Austin, TX 78010 Business Description: WC Manhattan Place Property, LLC is a Single Asset Real Estate debtor (as defined in 11 U.S.C. Section 101(51B)). Chapter 11 Petition Date: January 25, 2022 Court: United States Bankruptcy Court Western District of Texas Case No.: 22-10047 Judge: Hon. Tony M. Davis Debtor's Counsel: Ron Satija, Esq. HAYWARD PLLC 901 Mopac Expressway South Austin, TX 78746 Tel: (737) 881-7104 Email: rsatija@haywardfirm.com Estimated Assets: $10 million to $50 million Estimated Liabilities: $10 million to $50 million The petition was signed by Natin Paul as authorized signatory. The Debtor did not file together with 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/QFB6J3A/WC_Manhattan_Place_Property_LLC__txwbke-22-10047__0001.0.pdf?mcid=tGE4TAMA WH INTERMEDIATE: Moody's Assigns First Time B2 Corp. Family Rating ------------------------------------------------------------------ Moody's Investors Service assigned first time ratings to WH Intermediate, LLC ("WHP" dba WHP Global), including a B2 corporate family rating and a B2-PD probability of default rating. At the same time, Moody's assigned B2 ratings to the proposed senior secured credit facilities issued by WHP's subsidiary, WH Borrower, LLC ("Borrower"), consisting of a $50 million revolving credit facility and $450 million term loan. The outlook is stable. The proceeds will be used to refinance existing indebtedness, fund a distribution to shareholders, put excess cash on balance sheet and pay related fees and expenses. Moody's ratings and outlook are subject to review of final documentation. The B2 CFR assignment reflects governance considerations, including high pro forma leverage of around 5.5 times and majority private equity ownership. It also reflects WHP's relatively short operating track record having been founded in 2019. While initial leverage is high, Moody's expects that leverage will decline to below 5 times over the next year as the company integrates recent sizable acquisitions and new license contracts as well as through potential further acquisitions using balance sheet cash. The rating also reflects the relatively stable and predictable revenue and cash flow streams derived from the licensed business model, as well as strong profit margins and interest coverage metrics. Assignments: Issuer: WH Intermediate, LLC Corporate Family Rating, Assigned B2 Probability of Default Rating, Assigned B2-PD Issuer: WH Borrower, LLC Senior Secured 1st Lien Term Loan, Assigned B2 (LGD3) Senior Secured 1st Lien Revolving Credit Facility, Assigned B2 (LGD3) Outlook Actions: Issuer: WH Intermediate, LLC Outlook, Assigned Stable Issuer: WH Borrower, LLC Outlook, Assigned Stable RATINGS RATIONALE WHP's B2 CFR considers governance considerations including high pro forma leverage of around 5.5 times lease-adjusted debt/EBITDAR and majority private equity ownership which tend to have financial policies that lead to sustained high financial leverage. Also, while many of its brands have a long operating history, the rating reflects WHP's relatively short track record having been founded in 2019, as well as integration risks associated with having completed several material acquisitions in the past two years and meaningful brand and licensee concentrations as a percentage of pro forma revenue. The rating is supported by the relatively stable and predictable revenue and cash flow streams derived from royalty payments received from licensees, which include significant guaranteed minimum amounts, with upside from license overage receipts being accretive to earnings and cash flow as it leverages the existing cost base. Further, the licensor business model is asset light with low capital costs, which supports robust operating margins, cash flows, and interest coverage metrics that are particularly strong for the rating category. Moody's expects WHP to maintain good liquidity over the next 12 months, supported by balance sheet cash and solid free cash flow generation. The company will have access to a new $50 million revolving credit facility due 2026. The revolver will contain a springing first lien net leverage ratio maximum of 6.75 times, which would be tested if the facility has more than 30% of the total commitment amount drawn at each quarter end. Moody's does not expect the covenant will be tested. The term loan will not contain financial maintenance covenants. Alternate sources of liquidity are available to the company if needed, in the form of brand trademarks and intellectual property. The B2 ratings assigned to WH Borrower's senior secured credit facilities are equal to the B2 CFR, as they comprise the only debt in the consolidated capital structure. The facilities are secured by a first lien on substantially all assets of WH Borrower and its wholly-owned domestic subsidiaries, including, pledges of equity in first-tier non-wholly-owned subsidiaries. The facilities are guaranteed by WH Borrower, LLC's current and future direct and indirect domestic wholly-owned subsidiaries, as well as its direct parent and financial reporting entity, WH Intermediate. As proposed, the secured term loan is expected to provide covenant flexibility that if utilized could negatively impact creditors. Notable terms include the following: Incremental debt capacity up to the sum of (A) the greater of (1) $90 million and (2) 100% of Consolidated pro forma EBITDA, plus the unused portion of the general debt basket, plus (B) unlimited amounts subject to the closing date First Lien Secured Net Leverage Ratio (for pari passu secured debt). An amount up to the Incremental Starter Basket may be incurred with an earlier maturity date than the initial term loans. The credit agreement permits the transfer of assets to unrestricted subsidiaries, up to the carve-out capacities, subject to "blocker" provisions which will include restrictions on the ownership of material intellectual property of the Borrower and its restricted subsidiaries by any unrestricted subsidiary and any transfer of such intellectual property to any unrestricted subsidiary. Non-wholly-owned subsidiaries are not required to provide guarantees; dividends or transfers resulting in partial ownership of subsidiary guarantors could jeopardize guarantees, subject to certain "Chewy" protective provisions limiting such guarantee releases. There will be customary affected lender voting provisions with respect to amendments that provide for subordination of the payment of the obligations and/or liens on the collateral, in each case as set forth in the facilities documentation. The proposed terms and the final terms of the credit agreement may be materially different. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS The stable outlook reflects Moody's expectation for modest deleveraging over the next year as the company anniversaries recent sizable acquisitions and new license contracts, and through potential further acquisitions using balance sheet cash. The ratings could be downgraded if the company experiences weaker than anticipated operating performance resulting from challenges in integrating acquired brands, the non-renewal of licenses, or renewals of its licenses at materially lower revenue streams. More aggressive in its financial policies or a material deterioration in liquidity could also result in a downgrade. Specific metrics include debt-to-EBITDA sustained above 6 times or EBITA-to-interest sustained below 2.25 times. A ratings upgrade is unlikely over the near-to-intermediate term given the company's short track record, small scale, and Moody's expectation that cash flow will likely support acquisition activity. Over time, ratings could be upgraded if the company maintains its operating performance and more conservative financial policies through a demonstrated willingness to sustain debt-to-EBITDA below 4.5 times and EBITA-to-interest expense above 3 times. Headquartered in New York, NY, WHP Global is a brand management company with a portfolio of brands that include Anne Klein, Joseph Abboud, Lotto, Toys "R" Us, Babies "R" Us, and Geoffrey(R) the Giraffe, among others. The company is majority owned by funds managed by Oaktree Capital Management, L.P., a global investment manager specializing in alternative investments, with the remaining equity owned by management and others. WH Borrower, LLC is the borrowing entity in the credit group, and WH Intermediate is its direct parent, guarantor and financial reporting entity. WHP Global is privately owned and does not publicly disclose its financial information. Pro forma annual revenue exceeds $100 million. The principal methodology used in these ratings was Apparel published in June 2021. WH INTERMEDIATE: S&P Assigns 'B-' ICR, Outlook Stable ----------------------------------------------------- S&P Global Ratings assigned a 'B-' issuer credit rating to reflect the WH Intermediate LLC's high leverage and small scale with limited track record of operations. The outlook is stable. S&P said, "Concurrently, we assigned a 'B-' issue-level rating and '3' recovery rating to the company's proposed senior secured $50 million revolving credit facility and $450 million term loan B. The recovery rating indicates our expectation for meaningful (50%-70%; 55% rounded estimate) recovery in the event of a payment default. "The stable outlook reflects our expectation for the company's pro forma revenues to be over $100 million due to recent acquisitions and their guaranteed minimum royalties. We expect the company to pursue acquisitions frequently reflecting an aggressive financial policy with leverage being sustained above 5x. WH Intermediate LLC (d/b/a WHP Global), a brand acquisition and development platform, is seeking to issue a proposed senior secured $50 million revolving credit facility due 2026 and a senior secured $450 million term loan B due 2027 to repay existing debt to issue a $50 million dividend to shareholders, and to put cash on the balance sheet for future acquisitions. WHP is majority owned by co-founders Yehuda Shmidman and funds managed by Oaktree Capital Management L.P. (Oaktree), with other as minority shareholders. The company is the majority owner of, and highly concentrated in, the Toys 'R' Us brand. S&P said, "The ratings reflect WHP's high leverage, financial sponsor ownership and our view that its high growth strategy entails significant risk.WHP was founded in 2019 by Yehuda Shmidman, who has 15 years of experience leading both public and private global brand management firms, and Oaktree's private-equity division. Through this partnership the company has been able to deploy capital to acquire strong brands from distressed companies. WHP has acquired seven brands since its inception in July 2019, with five of these transactions occurring in 2021. The largest to date is its acquisition of the Toys 'R' Us and Babies 'R' Us brands (95% owned) out of bankruptcy that we expect will double the company's size. Notably, since this acquisition the company has announced a partnership with Macy's whereby Toys 'R' Us will have a presence in 400 Macy's locations. We view this partnership favorably as an indicator for WHP's ability to position the nostalgic brand for growth. "The proposed financing transaction will leave $100 million of cash on the balance sheet for potential acquisitions. Additionally, its majority owner Oaktree has made available another $150 million of capital that can be deployed for future transactions. We believe the pace of acquisitions will continue to be aggressive as the company seeks to gain scale and further diversify its brand ownership. Pro forma leverage for the LTM ended Sept. 30, 2021, is about 5.7x, which is expected to improve to 5.3x by year-end due to new license growth. We forecast the company will use incremental debt to fund acquisitions as needed, leading to leverage being sustained over 5x over the long term. The company's acquisition model is based on buying assets in the mid-single-digit multiple area, which could be challenged when competing against the larger brand management company, Authentic Brands Group LLC. Authentic Brands is also backed by private-equity capital and has the financial ability to acquire larger assets at higher multiples as illustrated by its EUR2.1 billion consideration to acquire Reebok from Adidas AG. Additionally, we believe WHP's limited track record of growing brands introduces significant risk to its high growth strategy. We apply a negative one-notch modifier to reflect uncertainty in the company's forecast given its limited track record and our expectation for a high level of acquisition activity." WHP's asset-light licensing model generates predictable revenue streams and EBITDA margins over 70%. WHP's licensing business model provides for guaranteed minimum royalties for use of its owned brands through multiyear contracts. The royalty-based licensing business model is predicated on providing brand management strategy and marketing for the licensees, which generate a predictable stream of royalty income for WHP, the licensor. As part of the relationship WHP would also be responsible for introducing the brand to new categories, channels, and geographies (for example, the Toy 'R' Us partnership with Macy's). This model generates very significant margins since the licensee is responsible for design, manufacturing, logistics, and working-capital management. S&P forecasts EBITDA margins to be at least 70% through 2022 given its licensing model. Additionally, low levels of capital expenditures support good free operating cash flow generation of at least $40 million per year. S&P said, "We expect future acquisitions to be completed with similar economics. However, there is fashion risk and licensing contract renewal risk for WHP. The company's ability to purchase the right brands as well as reposition them for growth will be its greatest challenge. Most of the licensing contracts are between 5 to 15 years and typically contain minimum sales in order to exercise renewal rights. We do not believe that there are any material contracts expiring in the next year as it acquired most of its brands in the last 18 months." WHP is small in scale and highly concentrated in discretionary consumer products and apparel. Last twelve months ended September 2021 revenues were $45 million. Pro forma for the acquisition and consolidation of Toys 'R' Us the company will increase in size to about $115 million, which is still small relative to other consumer products and apparel peers. WHP estimates it is the 10th largest licensor in the world with $4 billion of gross merchandise value, where Disney is number one and Authentic Brands Group is number three. The company is also the owner of about 100 international Toys 'R' Us licensees which can add to its scale over time. The company's revenues are highly concentrated with 44% forecasted to be generated by the Toys 'R' Us and Babies 'R' Us licenses. Anne Klein and Joseph Abboud are its next largest brands and the top 3 brands are expected to generate 75% of its revenue. WHP generates about 52% of its revenues in the U.S., 30% in APAC, and 18% in EMEA, which we view as diversified. The company's fashion and footwear brands: Joseph Abboud (sold through Men's Wearhouse), Anne Klein, Lotto, Joe's Jeans, and William Rast are also not tier 1 apparel brands and face fashion risk which could pressure opportunities to expand beyond its guaranteed minimum royalty stream. For example, Joseph Abboud and Anne Klein apparel brands are associated with formal workwear, a category in secular decline due to casualization trends that were accelerated by the pandemic. WHP's brands compete against larger, better-known brands with greater financial resources to innovate and go to market. The company's brands are also concentrated in discretionary products that face declines during economic downturns. S&P said, "The stable outlook reflects our expectation for the company's pro forma revenues to be over $100 million due to recent acquisitions and their guaranteed minimum royalties. We expect the company to pursue acquisitions frequently leading to aggressive financial policies with leverage being sustained above 5x." S&P could lower the rating if the capital structure becomes unsustainable or liquidity becomes constrained. This could occur if: -- WHP is unsuccessful at its brand acquisition strategy and is unable to purchase good brands to turnaround at mid-single-digit multiples. -- Leverage increases significantly to fund a sizable acquisition or to fund a shareholder distribution. -- WHP is unable to execute on its strategy for Toys 'R' Us, leading to lower-than-expected revenue and higher costs to revitalize the legacy brand. S&P could raise the rating if the company successfully executes on its acquisitive growth strategy while maintaining leverage under 6.5x. This could occur if: -- WHP is successful at its brand strategy for Toys 'R' Us and its partnership with Macy's Inc. -- WHP diversifies its current brand concentration while gaining scale, continuing to grow revenues and maintaining adjusted EBITDA margins above 70%; and -- It demonstrates a financial policy consistent with maintaining leverage below 6.5x while pursuing modest or tuck-in acquisitions or funding shareholder dividends. ESG credit indicators: E-2 S-2 G-3 S&P said, "Governance is a moderately negative consideration. Our assessment of the company's financial risk profile as highly leveraged reflects corporate decision-making that prioritizes the interests of the controlling owners, in line with our view of the majority of rated entities owned by private-equity sponsors. Our assessment also reflects the generally finite holding periods and a focus on maximizing shareholder returns." WJA ASSET: April 6 TD REO's Plan Confirmation Hearing Set --------------------------------------------------------- TD REO Fund, LLC, a Debtor Affiliate of WJA Asset Management, LLC, filed with the U.S. Bankruptcy Court for the Central District of California a Disclosure Statement Describing Chapter 11 Plan of Liquidation. On Jan. 20, 2022, Judge Scott C. Clarkson approved the Disclosure Statement and ordered that: * April 6, 2022, at 1:30 p.m. is the hearing to consider confirmation of the Chapter 11 Plan of Liquidation of TD REO Fund, LLC. * Feb. 28, 2022, at 5:00 p.m. is the deadline to file Ballots accepting or rejecting the Plan. * March 16, 2022, is the deadline for the Debtor to file and serve its memorandum of points and authorities in support of confirmation of the Plan, together with any supporting declarations and a ballot tabulation summary. * March 23, 2022,. is the deadline to file any objection to confirmation of the Plan. * March 30, 2022, is the deadline to file replies to any objection to confirmation of the Plan. A full-text copy of the order dated Jan. 20, 2022, is available at https://bit.ly/3qWQjWG from PacerMonitor.com at no charge. Attorneys for the Debtors: SMILEY WANG-EKVALL, LLP Lei Lei Wang Ekvall Philip E. Strok Kyra E. Andrassy Robert S. Marticello 3200 Park Center Drive, Suite 250 Costa Mesa, California 92626 Telephone: 714 445-1000 Facsimile: 714 445-1002 E-mail: lekvall@swelawfirm.com pstrok@swelawfirm.com kandrassy@swelawfirm.com rmarticello@swelawfirm.com About WJA Asset Management Luxury Asset Purchasing International, LLC, et al., are part of a network of entities or "Funds" formed to offer a range of investment opportunities to individuals. Many of the existing funds are performing and some Funds had substantial gains. However, certain Funds, i.e., those invested in private trust deeds secured by real estate, suffered losses. William Jordan Investments, Inc. ("Advisor"), is a registered investment advisor. Laguna Hills, California-based WJA Asset Management, LLC ("Manager"), is the managing member of Luxury, et al. William Jordan was the president and sole owner of Advisor and was the sole member and manager of Manager. On May 18, 2017, Luxury and its affiliates filed voluntary petitions under Chapter 11 of the United States Bankruptcy Code. On May 25, 2017, four other affiliated filed voluntary Chapter 11 petitions. On June 6, 2017, CA Real Estate Opportunity Fund III filed its Chapter 11 petition. The Debtors' cases are jointly administered under Bankr. C.D. Cal. Lead Case No. 17-11996, and the Debtors continue to operate their businesses and manage their affairs as DIP. Pursuant to court orders, Howard Grobstein is now serving as the chief restructuring officer of the Debtors and Mr. Jordan no longer has any ongoing role in the Debtors' operations. At the time of the filing, WJA estimated assets of less than $500,000 and liabilities of $1 million to $10 million. Judge Scott C. Clarkson presides over the cases. Lei Lei Wang Ekvall, Philip E. Strok, Robert S. Marticello, and Michael L. Simon, at Smiley Wang Ekvall, LLP, are serving as counsel to the Debtors. Ann Moore of Norton Moore Adams has been tapped as special counsel. Elite Properties Realty is the broker. [*] Companies That Went Bankrupt Due to Bad Decisions ----------------------------------------------------- Victoria Vouloumanos of BuzzFeed reports on the companies that went bankrupt due to bad decisions. Sometimes, companies are so big that it seems impossible for them to fail. But as it turns out, there are countless companies that have failed or nearly bankrupted themselves for ridiculous reasons. 1. "Friendster shot themselves in the foot with a ton of bad decisions that led to stuff like long login times for basically no reason. It is weird to think that for a short time, Friendster was big and hip enough that I actually had it on one of my business cards around 2000." What Happened: Friendster was a social networking site founded in 2002, predating both MySpace and Facebook. It gained 3 million users in its first few months and received a lot of media attention, including coverage from Time Magazine, Esquire, Vanity Fair, and Entertainment Weekly. Founder and CEO Jonathan Abrams was even invited onto Jimmy Kimmel Live. In 2003, Google offered $30 million to purchase Friendster, but Abrams declined. However, Friendster's success also led to challenges. According to the New York Times, "As Friendster became more popular, its overwhelmed web site became slower. Things would become so bad that a Friendster web page took as long as 40 seconds to download." Kent Lindstrom, an early investor and one of the first employees at Friendster, claimed that rather than focus on the technical or performance problems, the board talked about competitors and adding new, unnecessary features, like Internet phone services and VoIP (voice over Internet protocol). Additionally, there wasn't much to do on Friendster after you created your profile and social network. Meanwhile, other social networking sites, like Myspace, were adding user-demanded features such as blogs and other tools to augment their profiles. Unfortunately, adding these new features to Friendster would only further slow down the site. On top of that, Abrams was known to be out partying rather than focusing on fixing Friendster. Between 2004 and 2006, Friendster turned over five CEOs. By 2006, Friendster was almost out of money and had halved its payroll to 25 employees. Venture capitalists considered shutting it down, and Viacom was offered the chance to acquire Friendster for $5 million, but private investors invested $3 million into the company instead. Friendster was able to regain trust and fix most of the issues slowing down the site by 2007. By 2009, Malaysia-based FinTech company MOL Global acquired Friendster for a total of $26.5 million, sold all of its registered patents to Facebook for $40 million, and, in 2011, deleted all of its user’s data to relaunch as a gaming site. According to Wired, despite having millions of users, many users weren't connected to others. And because they were too loosely affiliated with the network, it wasn't worth dealing with the new interface. In 2015, the site shut down. 2. "RadioShack. Those guys just couldn't make their niche happen and never attempted to evolve." What Happened: During the 1970s, RadioShack (founded 1921) was opening three new stores a day as CB radios became popular. In 1977, the company introduced the TRS-80, one of the first mass-produced personal computers, which was so popular that it initially outsold Apple. Unfortunately, by the 1980s, companies like Dell and IBM began selling more powerful computers, so RadioShack turned to cell phones to capitalize on a new market. As the cell phone market boomed, RadioShack concentrated on selling not only the actual cell phone but also service plans and accessories 00 even negotiating deals with cell phone carriers to receive percentages of customers' monthly fees. Cell-related sales accounted for 51% of RadioShack's $4.4 billion in sales by 2011. Due to their success, RadioShack stopped carrying legacy products, and its staff was trained primarily to sell cell phones. However, carriers soon began opening their own retail stores. Between 2000 and 2015, RadioShack's marketing lost focus and management saw constant shifts. This resulted in six different CEOs between 2006 and 2016 and in different slogans such as, "You've got questions, we've got answers," and, "Radio Shack: Let's Play," which confused and failed to connect with customers. On top of this, stores like Best Buy and Walmart began to pop up. They offered lower prices and e-commerce options, pushing RadioShack out of its niche. While RadioShack still boasted 4,300 stores in North America in 2014, many were too close to each other (near Sacramento, CA, there were 25 stores within a 25-mile radius), causing drops in profitability and inventory problems. This, combined with new competition, overconcentration in the cell phone market, management problems, and financial mistakes — RadioShack took out a loan from Salus Capital under the condition that they couldn't close stores without Salus' consent, leading to cash burns — led to RadioShack losing $1.1 million per day, according to quarterly figured from the end of October 2014. On Feb. 2, 2015, the company was delisted from the NSYE. On Feb. 3, it defaulted on its loan from Salus. On Feb. 5, RadioShack filed for Chapter 11 bankruptcy. That same year, General Wireless acquired RadioShack for $26.2 million (the total value of the bid for RadioShack's assets was actually around $220 million). In 2017, RadioShack filed for bankruptcy again. 3. "One time, Red Lobster offered an unlimited [snow] crab leg deal. They brought the servings out slowly and were like, 'Nobody is going to sit there for six hours and just eat crab legs.' Actually, lots of people did — so many, they lost millions." What Happened: A 2021 article from Mashed explains that you could get unlimited snow crabs from Red Lobster for $22.99 a person. However, at the time, the price of snow crabs was rising in the U.S. due to farming quotas, and many people were eating three to four servings of snow crabs. The article also notes that The New York Post reported that [Red Lobster] lost $405.9 million in stock in a single trading session and $3.3 million in profits. 4. "MySpace. All it had to do was not change, so people could come back to it after checking out Facebook. Instead, they got rid of everything people liked about the site and didn't make any beneficial changes. When people popped back in looking for a Facebook alternative, they found a weird, new music-focused version." What Happened: As Friendster suffered from technical problems, Myspace entered the scene and offered non-restrictive service, letting users customize their pages and providing new, user-demanded features. It launched in 2003 and was acquired by News Corporation for $580 million in 2005. Between then and 2009, it was the largest social networking site in the world. After being acquired, Myspace focused on revenue rather than being a technology platform, sacrificing usability and ignoring what users wanted. This led to intrusive ads, many of which asked for users to sign up for credit cards or other services. Additionally, money was sunk into developer resources to create sections that would generate more revenue. Ultimately, poor product quality (including buggy products on top of sketchy ads), overspending ($120 million was allegedly spent to develop and launch Myspace Music), legal battles that hampered its public image (including some which involved child sexual abuse), and new competition (including from Facebook, Bebo, Twitter, and Soundcloud) led to the decline of Myspace. Despite multiple attempts to rebrand, Myspace has not recaptured the success it had in 2005. In 2008, Facebook overtook Myspace as the world's largest social networking site. In 2011, Time Inc. purchased Myspace for $35 million, and the now-smaller scale social media platform focuses mainly on music. 5. "WeWork was going great right up until the IPO prospectus, and everyone realized that CEO Adam Neumann was a crazy person. Neumann himself managed to personally walk away with $1B in exchange for lighting tens of billions of dollars of investment on fire. Truly epic." What Happened: WeWork, the commercial real estate company providing shared workspaces (ideally for startups and freelancers), experienced a meteoric rise and fall under co-founder and CEO Adam Neumann. Neumann founded WeWork in 2010 with Miguel McKelvey. Six years later, WeWork had been dubbed a unicorn company with a $10 billion valuation. By 2019, SoftBank had reportedly invested $18.5 billion into WeWork. That same year, WeWork publicly filed documents for an IPO, triggering its public fall. To note, there had been concerns about the company's unsustainable business model and profitability since 2015, when BuzzFeed News published the documents that WeWork had used to convince investors of its multi-billion worth. In 2017, Wall Street Journal Real Estate called WeWork "a $20 billion startup fueled by Silicon Valley pixie dust." The company, or better, Neumann, had been known for fostering a fun "office culture," including perks such as cold brew, community events, and even unlimited, free beer on tap. However, it began limiting beer in 2018 after an employee filed a lawsuit, alleging that she'd been sexually harassed and fired in retaliation for reporting the two incidents. She cited the company's excessive drinking culture as a contributing factor and that the male employees interrogated "professed to be too drunk to remember the incident." On the other hand, to help "develop personal accountability" in employees, McKelvey announced a new vegetarian policy: The company would no longer serve red meat, pork, or poultry at company functions or reimburse employees who ordered hamburgers during meetings. Neumann once allegedly smoked so much weed in WeWork's private jet that the flight crew found a sizable chunk of marijuana in the plane, causing the plane to be recalled. His wife also reportedly demanded "employees be fired within minutes of meeting them because she disliked their 'energy.'" And, after an all-hands meeting in which Neumann detailed firing 7% of WeWork's staff to cut costs, the meeting wrapped up with shots of tequila and a set performed by hip-hop group Run-DMC. In January 2019, WeWork had a valuation of $47 billion. By October, the time of its IPO filing, WeWork's valuation had dropped to $10 billion, in part due to Neumann's reckless behavior and leadership. Within six weeks of filing, Neumann was ousted as CEO and WeWork tanked. The filing didn't necessarily reveal new information, but as the Guardian expressed, "Widely known facts were re-aired in a new climate. What was once amusing or somewhat confusing was now, in a new light, merely horrifying. ... WeWork’s investors folded quickly, suddenly demanding from the company the focus and discipline critics had been saying was missing for years." However, the IPO filing did reveal that WeWork paid Neumann nearly $6 million for trademark rights for the word "We." As a result, Neumann returned the money to WeWork while letting it retain rights to the trademark. As WeWork's reputation plummeted and its leaders lost faith in Neumann, SoftBank paid him $1.7 billion to step down and leave the company. SoftBank also initially agreed to pay Neumann $960 million for his shares, a $185 million consulting fee, and $500 million in credit to help repay his loans. Including Neumann's shares, SoftBank had agreed to buy a total of about $3 billion in WeWork stock as part of a bailout package. The company later backed out of the agreement, citing government investigations into WeWork. In turn, WeWork and Neumann independently sued SoftBank over the withdrawal, and all three parties settled. Under the settlement, Neumann received $480 million for his shares. Currently, SoftBank owns a majority of WeWork shares. 6. "Circuit City. It was a major retail chain in the 1980s that collapsed under mismanagement. Its arguably biggest blunder was firing all of their experienced, better-paid workers for cheaper, inexperienced ones. Apparently, selling merchandise and keeping customers happy are important in the retail business. Who knew?" What Happened: Consumers cited Circuit City's most obvious failing as its customer service, according to a 2008 article from Time. "In March 2007, [Circuit City] announced plans to lay off its highest-paid hourly employees, including salespeople, and replace them with cheaper workers. That same year, then CEO Philip Schoonover received some $7 million in compensation." The highest-paid employees were the most experienced employees (who had accumulated higher wages over the years). Circuit City also outsourced its IT department. After the company fired over 3,000 employees, WSWS reported, "The firings are the most abrupt and brazen manifestation of a trend by corporate America to push out older and better-compensated workers and replace them with a smaller, younger, uninsured and underpaid workforce." 7. "Quiznos. The corporate office decided to buy the vendors and then contract all of the franchises to only buy materials from corporate with a price hike. The margins got way too high, and all of the stores went out of business. They shot themselves straight in the foot." What Happened: A 2021 article from Eat This cites that "Quiznos reached a high of $1.9 billion in systemwide sales in 2007" but "generates less than $100 million a year in sales across all its stores" as of this year. The article goes on to say that experts attribute Quiznos' fall to rapid expansion at the expense of their franchisees. Quiznos onboarded inexperienced franchisees and made "difficult financial demands which precluded these small operators from making a profit." Eat This also cites YouTuber Company Man, stating that a large portion of Quiznos' revenue came from franchise fees. They also sold "food and paper products to its franchisees through a subsidiary called American Food Distributors. Operators were forced to buy these supplies at prices far higher than the industry average, while Quiznos directly profited from hiking up the prices." 8. "Xerox. They had a research lab, the Palo Alto Research Center (PARC), that invented the personal computer, and a working prototype in 1973. This was a time when the concept of a personal computer didn't exist — everything was mainframes. They also invented laser printers, computer graphical interfaces, WYSIWYG text editor (a precursor to Word, etc.), Ethernet (which much of the internet runs on), and much more. Steve Jobs got a tour of PARC in 1979 after Xerox sat on the invention doing nothing (they made copiers, goshdarnit), and the rest is history. Xerox then almost went bankrupt in 2000 as the world transitioned to email, powered mostly by personal computers and the internet." What Happened: In 1959, Xerox introduced the Xerox 914, the world's first automatic, plain-paper copier. Its innovative ad campaign featured a monkey making photocopies to highlight how simple it was to use. The 914 was a huge success, and by the 1960s, Xerox was the dominant manufacturer of office copiers. In 1970, Xerox opened the Xerox Palo Alto Research Center (PARC), which invented many modern computing technologies, including graphical user interface (GUI), laser printing, WYSIWYG text editors, Ethernet, WIMP (Window, Icon, Menu, and Pointing device) system, mouse, and much more. Some of these early PARC technologies were seen in the Xerox Alto, released in 1971 and believed to be the future of computing. The Alto was a minicomputer, similar to a modern PC, and the first computer designed to support an operating system based on GUI. In 1979, Steve Jobs visited PARC after a deal with Xerox's venture capital division: Xerox could invest $1 million in Apple in exchange for a tour of their technology. The myth then goes that Jobs had Apple Development incorporate what he saw at PARC into Apple computers and invited some key researchers to join Apple. Engineer Larry Tesler, who gave Jobs a demonstration of the Alto, later said, "Jobs was pacing around the room, acting up the whole time. He was very excited. Then, when he began seeing the things I could do onscreen, he watched for about a minute and started jumping around the room, shouting, 'Why aren't you doing anything with this? This is the greatest thing. This is revolutionary!'" Job's line of thinking is what many consider to be Xerox's downfall: An inability to capitalize on market potential and commercialize products despite inventing revolutionary tech. For instance, Xerox released the Star, the first commercial system to use technologies now common in PCs, in 1981. However, the Star failed to sell well. It cost $16,595 (around $47,240 in 2020), while the IBM PC, released the same year, cost around $1,565 (roughly $4,455 in 2020). In 1984, Apple released the Macintosh — the first successful mass-market, all-in-one personal computer to have a GUI, mouse, and built-in screen — which cost $2,495 ($6,220 in 2020). The 1980s were "generally rough" for Xerox. It had dropped out of the mainframe and personal computer businesses. By 1985, Xerox only held 40% of the worldwide plain-paper copier market, a significant drop from its 85% market share in 1974. The company experienced somewhat of a resurgence in the 1990s, releasing new products (like DocuTech) and rebranding as "The Document Company." In spite of this, the company restructured in 1998 and cut 9,000 jobs. By the end of 1999, shares had plunged after the company warned of disappointing quarterly profits. By 2001, the company was on the verge of Chapter 11 bankruptcy with more than $17 billion in debt. Xerox's inability to capitalize on the commercial potential of its innovations was in part due to management. PARC scientists even condescendingly dubbed executives "toner heads" due to their inability to think beyond photocopiers. In 2002, PARC broke away from Xerox as an independent, wholly-owned subsidiary. Xerox has since managed to turn itself around and generated approximately $7 billion globally in 2020. 9. "Blackberry. Most popular smartphone in the world — then they were less than 1% of the market share, and their stock value dropped. A couple of years ago, they announced that they would focus more on software and essentially gave up making phones. Lots of BlackBerry executives took advantage of their market share and thought a flat, touchscreen phone wouldn't take off the way it did. How the mighty have fallen." What Happened: In 2009, Fortune magazine named Blackberry the fastest growing company in the world, but by 2013, Blackberry's stock price collapsed by 90%. Blackberry's insistence on producing phones with full keyboards — despite consumers' preference for touchscreens — is cited as a big reason for their failure to keep up with Apple's iPhones and Google's Androids. While they had once controlled 50% of the smartphone market in the US and 20% globally, Blackberry had 0% of the market share by 2016. That same year, Blackberry announced it would stop making its own phones and signed over most of its global branding rights to Chinese manufacture TCL. In 2020, Blackberry ended the arrangement with TCL, and Texas start-up Onward Mobility acquired a license to make 5G devices — one being a 5G BlackBerry device with Android and a physical QWERTY keyboard — for Blackberry in 2021. 10. "Teledesic. Their goal was to have a global network of low-Earth-orbiting satellites that provided broadband access to pretty much everyone on the planet. They were financed by tech titans in the wireless communications space. It all seemed like a great idea. The only problem was that the technology wasn't there yet. They went bankrupt in 2002. The Teledesic Case Study is taught at Harvard Business School and other MBA programs as a cautionary tale." What Happened: Teledesic formed in 1990 to build a global broadband satellite network, and it took off in 1994 when Craig McCaw (who had just sold McCaw Cellular Communications to AT&T) and Bill Gates (who remained a passive investor) each invested $5 million. The ambitious idea was to provide wireless internet access around the world so that, as the Seattle Times exemplified, "Field hospitals would use it to beam images to consulting doctors in cities. The military could send information to forces in remote areas. Faraway spots that lacked even basic telephone service would be able to access data beamed down at high speeds from orbiting satellites." The project would cost $9 billion. Teledesic got as far as convincing the UN and the US to set aside a portion of airwaves to carry Teledesic network signals, and they raised around $900 million in cash. The company originally predicted operation would begin by 2001. But when Boeing came on as the satellite contractor in 1997, the start date was pushed to 2002. A year later, Boeing was replaced by Motorola, and the start date was pushed back to 2003. By 1999, the satellite industry began to collapse. Two big satellite mobile-phone companies, Iridium and ICO, filed for bankruptcy, further pushing back the start date to 2004. McCaw then began raising and investing money in Iridium and ICO to merge with Teledesic, and some employees began to feel frustrated. The company also saw at least seven different CEOs between 1993 and 2000. Eventually, Alenia Spazio replaced Motorola as contractor. While the original idea included 840 satellites, the contract with Alenia Spazio only included 30 satellites, and the cost of the project was cut to $1 billion. By then, Teledesic was down to 50 employees. In 2002, Teledesic laid off all but 10 employees, suspended its satellite contract, and officially halted the project. 11. "JCPenney tried to stop bullshitting customers, and it backfired. They said no more sales. They were just going to price everything low because pretty much all sales at department stores are lies, anyway. You’re not really getting 70% off — the retail price was deliberately set stupid high to convince you it was a great deal, but the discount price is the actual value of it. JCPenney’s heart was in the right place, but ultimately, it failed because customers are really that dumb and would rather be lied to." What Happened: In 2012, JCPenney announced no more "fake prices." Instead, their new pricing structure set original prices at least 40% lower than their previous prices so that customers no longer needed to rely on sales or coupons. However, when the company released its first-quarter results, it reported a $163 million net loss. Time reported that a woman interviewed in an Associated Press story said, "The closest JCPenney is about a half-hour away from me. If I don’t get a special discount, it’s not worth the trip." 12. "Blockbuster had the chance to buy Netflix, but they were extremely stupid and turned them down. Now, they're gone and just a fond memory of the '90s. They were on their way out even before Netflix with services like Red Box and Game Fly, which mailed movies to you. Man, they were stupid. The writing was on the wall for years." What Happened: While many attribute Blockbuster's fall to Netflix, the home movie and video game rental company had been declining even before then. Founded in 1985, Blockbuster saw growth until 2004, when it peaked with more than 9,000 stores and employed approximately 58,500 people in the US. Despite Blockbuster being a multi-billion dollar company, co-owner Wayne Huizenga worried about how new tech, like video on demand and cable TV, would affect business even in the early 1990s, especially as the growth rate of VCR ownership had gone down in the US. In 1997, Warner Bros. offered Blockbuster an exclusive, early-access rental deal — wherein Blockbuster could release DVD rentals before they went on sale to the public — but Blockbuster declined. Instead, Walmart seized the deal, and other mass retailers began selling DVDs below wholesale price. Blockbuster couldn't match such prices, severely impacting its business model. In 2000, Netflix co-founder Reed Hastings offered to sell Blockbuster to Netflix for $50 million, but Blockbuster declined as CEO John Antioco thought it was a small niche business. A former Blockbuster executive also told Variety, "Management and vision are two separate things. We had the option to buy Netflix for $50 million and we didn't do it. They were losing money. They came around a few times." Between poor leadership, the recession, and competition from wholesale retailers and new technology (including Redbox kiosks), Blockbuster saw significant losses in revenue throughout the late 2000s. It filed for bankruptcy protection in 2010. In 2011, Dish Network acquired Blockbuster for $320 million. By 2018, only nine franchise-owned stores remained in the, eight of which closed that year. The last location remained in Bend, Oregon, and was listed as an Airbnb rental for 1990s-themed sleepovers for three nights in 2020. 13. "On paper, Sears had everything to be the e-commerce retailer that dominated the globe. By 1985, they had their own credit card, Discover, to rival MasterCard and Visa. They had their own insurance company in Allstate. They partnered with IBM to create 'Prodigy,' one of the first proto-ISPs in 1984, that offered all sorts of online services (except buying stuff from Sears) years before the World Wide Web existed. In theory, they were posed to make e-commerce a thing back in the late '80s and sweep the world in the '90s — with no chance for outsiders like Amazon, who had to build their stuff from the ground up, to catch on." What Happened: Sears launched the Discover card nationwide in 1985 with no annual fee and a higher credit limit than most other credit cards. At the time, Sears was the largest retailer in the US. Discover later introduced the innovative "Cashback Bonus." However, by the fourth quarter of 1986, Sears lost $22 million in credit card operations. Sears sold its financial business in 1993 and began accepting MasterCard and Visa, in addition to Discover. Sears named Allstate Insurance after a car tire it sold in its catalog. In 1993, it took almost 20% of the company public and by 1995, AllState became fully public. Prodigy, an online server turned Internet service provider, began in the late '80s as a joint venture between Sears and IBM. By 1990, Prodigy was the "second-largest server of its kind" and enabled users to shop, email, participate in online forums, and read news online. Despite becoming the largest server in 1993, Prodigy eventually suffered from low pricing, heavily moderated forums, privacy concerns, and the taking away of its unlimited chat feature. In 1996, Sears and IBM sold Prodigy. What Happened: Schiltz was the world's top-selling brewery in 1934, but by 1982, it was bought out by Stroh. The 'Schlitz Mistake,' as it's notoriously called, was the company's attempt to cut corners on quality to save on costs in the early 1970s. It implemented a new process called "accelerated batch fermentation." When the company recalled more than 100 million cans and bottles of beer, it lost more than $1.4 million. In 1976, Schlitz tried to combat the success of Miller Lite and launched Schlitz Light, but it was deemed a failure. To turn around its declining sales, Schlitz launched a disastrous ad campaign in 1977, dubbed the "Drink Schlitz or I’ll kill you" campaign. The ads failed so badly that Schlitz pulled them 10 weeks after they aires and fired their advertisers. 14. "Schlitz. Throughout the '60s, it was one of America's biggest national beers. In 1974, Schlitz's president and chairman, Robert Uihlein, Jr., believed beer drinkers couldn't distinguish their favorite beer from other brands and oversaw the introduction of a slimmer brewing process. It replaced barley with corn syrup and used silica gel as a preservative during the brewing process that was then filtered out, i.e. didn't have to be listed as an ingredient. Instead, the beer spoiled faster, grew cloudy on racks, didn't produce a frothy head when poured, and was flavorless — resulting in a 100-million bottle recall. Schlitz also didn't realize light beer was becoming a thing, so it got its clock cleaned by Bud and Miller. It then ran an ad campaign with some belligerent-sounding guy threatening to kill another guy, who was off-camera, if he took his Schlitz away. By the '80s, it went back to its original brewing process, but the damage was done." 15. "Can we get an honorable mention for Staples and its multiple attempts to merge with Office Depot, despite the fact that they're both on track to die within the decade?" What Happened: Staples was founded in 1986 and, 10 years later, had made it into the Fortune 500. In 1996, Staples reached an agreement to acquire Office Depot for $3.36 billion in stock, but the FTC blocked the deal as the merger would reduce competition and increase office supply prices. Instead, the company opened 170 new stores in 1996 and 1997 and continued to grow despite the 2000 Dot-com bubble burst and the 2001 recession. In 2002, Staples generated $11.6 billion in sales and had 1,300 store locations. Its online business, launched in 1998, was also now transforming North American commercial delivery. That same year, Staples saw a new CEO and a new strategy, shifting from growth to profitability. By 2007, Staples was no longer an EDLP (every day low price) value retailer but a hi-lo promotional (a pricing strategy wherein a business charges a high price for a product, then decreases the price through promotions or sales) business. By the 2008 recession, Staples was still the leading office-supply retailer, closing 2007 with $19.4 billion in sales. Because of this success, Staples had begun expanding into international markets and acquiring companies (and hastened to do so as the US economy softened), raising its total debt from $350 million in 2007 to more than $4 billion by the end of 2008. Between 2008 to 2011, Staples' international business saw significant losses. Similarly, Staples' stock dropped by 37% while the overall market increased by 21% between 2008 and 2013. To combat these losses, Staples began aggressively cutting costs, reducing store count, and selling general merchandise beyond office supplies (including hammers, blenders, and stethoscopes, for example). However, these strategies proved unsuccessful, and, in 2014, revenues fell by $2 billion since 2012. Despite this, in 2015, the company announced it planned to acquire Office Depot for $6.3 billion. For context, Office Depot had also struggled during the recession. As in 1996, the FTC blocked the deal. Staples subsequently called off the sale, announced hundreds of layoffs, and was ordered to pay Office Depot a $250 million breakup fee. In 2017, Staples then attempted to reposition itself as a solutions partner for business, downplaying its retail operations, and was acquired by Sycamore Partners for $6.9 billion. In January 2021, Staples once again attempted to acquire Office Depot, offering $2.1 billion, which Office Depot rebuffed. Staples then offered $1 billion for Office Depot's consumer business in June 2021 and filed for antitrust approval in November. [*] Roth IRAs Protected in Ga. Bankruptcies, 11th Circuit Finds --------------------------------------------------------------- Nathan Hale of Law360 reports that the ruling on an issue of first impression, the Eleventh Circuit decided Monday that Roth IRAs are excluded from Georgia debtors' bankruptcy estates under federal law, reversing two lower court rulings on how to treat the popular individual retirement accounts. The appellate panel found that although the bankruptcy court for the Northern District of Georgia previously declined to find that Roth IRAs should be protected in bankruptcy alongside traditional IRAs -- as previously decided by the Eleventh Circuit -- subsequent changes to state law made clear that the Georgia Assembly intended for both types of accounts to be treated the same. [*] Top Lawyers' Fees Could Hit $2,000 an Hour in 2022 ------------------------------------------------------ Maria Chutchian of Reuters reports that new corporate bankruptcy filings slowed down slightly this year after a pandemic surge in 2020. But there were still enough big 2021 cases to keep leading practitioners busy -- with some billing over $1,800 an hour. Kirkland & Ellis' highest hourly partner rates hit $1,895 in the bankruptcies of offshore driller Seadrill Ltd, mall operator Washington Prime Group and construction startup Katerra Inc. Even the most junior associates at the firm billed $625 per hour in those cases, while other Kirkland associates billed as high as $1,195 -- more than some partners at the firm, according to fee information filed with bankruptcy courts. Rates at some other firms weren't far behind. Simpson Thacher & Bartlett partners charged up to $1,850 per hour in the bankruptcy of Chilean bank holding company Corp Group Banking SA. Its most junior associates topped those at Kirkland, charging $655 per hour in the Corp Group case. A full-text copy of the Reuters report, which includes graphics on billing rates for notable bankruptcies in 2021, is available at https://www.reuters.com/legal/transactional/2000-an-hour-bankruptcy-lawyer-2022-could-be-year-2021-12-29/ [^] Recent Small-Dollar & Individual Chapter 11 Filings ------------------------------------------------------- In re Sharon Baptist Church of Alexander Bankr. E.D. Ark. Case No. 22-10128 Chapter 11 Petition filed January 14, 2022 See https://www.pacermonitor.com/view/CAI26TQ/Sharon_Baptist_Church_of_Alexander__arebke-22-10128__0001.0.pdf?mcid=tGE4TAMA represented by: Vanessa Cash Adams, Esq. AR LAW PARTNERS, PLLC E-mail: vanessa@arlawpartners.com In re California Roofs and Solar, Inc. Bankr. E.D. Cal. Case No. 22-10061 Chapter 11 Petition filed January 17, 2022 See https://www.pacermonitor.com/view/GY6J7DQ/California_Roofs_and_Solar_Inc__caebke-22-10061__0001.0.pdf?mcid=tGE4TAMA represented by: Michael Jay Berger, Esq. LAW OFFICES OF MICHAEL JAY BERGER E-mail: michael.berger@bankruptcypower.com In re James Bradley Lager Bankr. N.D. Tex. Case No. 22-30072 Chapter 11 Petition filed January 17, 2022 represented by: Melissa Hayward, Esq. In re Kamcare, LLC Bankr. E.D. Cal. Case No. 22-20108 Chapter 11 Petition filed January 18, 2022 See https://www.pacermonitor.com/view/X6ILVSY/Kamcare_LLC__caebke-22-20108__0001.0.pdf?mcid=tGE4TAMA represented by: Gabriel E. Liberman, Esq. LAW OFFICES OF GABRIEL LIBERMAN, APC E-mail: attorney@4851111.com In re AFAB Solutions LLC Bankr. M.D. Fla. Case No. 22-00110 Chapter 11 Petition filed January 18, 2022 See https://www.pacermonitor.com/view/EMY4XBY/AFAB_Solutions_LLC__flmbke-22-00110__0001.0.pdf?mcid=tGE4TAMA represented by: Thomas C. Adam, Esq. THE ADAM LAW GROUP P.A. E-mail: tadam@adamlawgroup.com In re Welding & Fabrication, Inc. Bankr. S.D. Fla. Case No. 22-10364 Chapter 11 Petition filed January 18, 2022 See https://www.pacermonitor.com/view/2XSRIKI/Welding__Fabrication_Inc__flsbke-22-10364__0001.0.pdf?mcid=tGE4TAMA represented by: Aaron A. Wernick, Esq. WERNICK LAW, PLLC E-mail: awernick@wernicklaw.com In re Laura Cantor Inc. Bankr. D.N.J. Case No. 22-10406 Chapter 11 Petition filed January 18, 2022 See https://www.pacermonitor.com/view/RXDYQ7Q/Laura_Cantor_Inc__njbke-22-10406__0001.0.pdf?mcid=tGE4TAMA represented by: Brett Silverman, Esq. SILVERMAN LAW PLLC E-mail: bsilverman@silvermanpllc.com In re Jasvir S Dhaliwal Bankr. E.D.N.Y. Case No. 22-40086 Chapter 11 Petition filed January 18, 2022 represented by: Alla Kachan, Esq. In re E3A BBQ LLC Bankr. S.D.N.Y. Case No. 22-22012 Chapter 11 Petition filed January 18, 2022 See https://www.pacermonitor.com/view/4URVCKA/E3A_BBQ_LLC__nysbke-22-22012__0001.0.pdf?mcid=tGE4TAMA represented by: Anne Penachio, Esq. PENACHIO MALARA, LLP E-mail: frank@pmlawllp.com In re Johana Roth Bankr. D.N.J. Case No. 22-10419 Chapter 11 Petition filed January 19, 2022 represented by: Geoffrey Neumann, Esq. BROEGE NEUMANN FISCHER & SHAVER, LLC In re Mark Bottone Bankr. E.D.N.Y. Case No. 22-70068 Chapter 11 Petition filed January 19, 2022 represented by: Richard Feinsilver, Esq. In re Carnation Home Fashions, Inc. Bankr. S.D.N.Y. Case No. 22-35018 Chapter 11 Petition filed January 19, 2022 See https://www.pacermonitor.com/view/FW3QPZQ/Carnation_Home_Fashions_Inc__nysbke-22-35018__0001.0.pdf?mcid=tGE4TAMA represented by: Michelle L. Trier, Esq. GENOVA, MALIN & TRIER, LLP In re Troy Cleaners Company Bankr. E.D. Mich. Case No. 22-30084 Chapter 11 Petition filed January 20, 2022 See https://www.pacermonitor.com/view/ZCEYXLY/Troy_Cleaners_Company__miebke-22-30084__0001.0.pdf?mcid=tGE4TAMA represented by: George E. Jacobs, Esq. BANKRUPTCY LAW OFFICES E-mail: george@bklawoffice.com In re RBSF Construction Co. Bankr. E.D. Pa. Case No. 22-10137 Chapter 11 Petition filed January 20, 2022 See https://www.pacermonitor.com/view/FI6SWDQ/RBSF_Construction_Co__paebke-22-10137__0001.0.pdf?mcid=tGE4TAMA represented by: Paul A.R. Stewart, Esq. HELM LEGAL SERVICES, LLC E-mail: pstewart@legalhelm.com In re Sports One Superstores Corp. Bankr. N.D. Tex. Case No. 22-30085 Chapter 11 Petition filed January 20, 2022 See https://www.pacermonitor.com/view/SL4RIXI/Sports_One_Superstores_Corp__txnbke-22-30085__0001.0.pdf?mcid=tGE4TAMA represented by: Brandon Tittle, Esq. TITTLE LAW GROUP, PLLC E-mail: btittle@tittlelawgroup.com In re Texas Holdings Firm Corporation Bankr. N.D. Tex. Case No. 22-30086 Chapter 11 Petition filed January 20, 2022 See https://www.pacermonitor.com/view/STI5A4I/Texas_Holdings_Firm_Corporation__txnbke-22-30086__0001.0.pdf?mcid=tGE4TAMA represented by: Brandon Tittle, Esq. TITTLE LAW GROUP, PLLC E-mail: btittle@tittlelawgroup.com In re Michael Amichay Willner Bankr. E.D. Va. Case No. 22-10061 Chapter 11 Petition filed January 20, 2022 represented by: Jillinda Glenn, Esq. In re Amir Keivan Hedayat and Minou M. Hedayat Bankr. C.D. Cal. Case No. 22-10087 Chapter 11 Petition filed January 21, 2022 In re Books Delight Cafe, DBA Shantae Daniel, Rodney Daniel, Monique Daniel - Hall Bankr. M.D. Fla. Case No. 22-00264 Chapter 11 Petition filed January 21, 2022 See https://www.pacermonitor.com/view/74K6MFA/Books_Delight_Cafe_DBA_Shantae__flmbke-22-00264__0001.0.pdf?mcid=tGE4TAMA Filed Pro Se In re CTM Auto Repair Incorporated Bankr. N.D. Ill. Case No. 22-00754 Chapter 11 Petition filed January 24, 2022 See https://www.pacermonitor.com/view/3BAVTFY/CTM_Auto_Repair_Incorporated__ilnbke-22-00754__0001.0.pdf?mcid=tGE4TAMA represented by: Salvador Gutierrez, Esq. ILLINOIS ADVOCATES LLC E-mail: sgutierrez@iladvocates.com In re Atlantis Transportation Services Inc. Bankr. E.D.N.Y. Case No. 22-40111 Chapter 11 Petition filed January 21, 2022 See https://www.pacermonitor.com/view/K6K57ZY/Atlantis_Transportation_Services__nyebke-22-40111__0001.0.pdf?mcid=tGE4TAMA represented by: Alla Kachan, Esq. LAW OFFICES OF ALLA KACHAN, P.C. E-mail: alla@kachanlaw.com In re David Michael Mobley Bankr. S.D. Tex. Case No. 22-60004 Chapter 11 Petition filed January 21, 2022 represented by: Jerome Brown, Esq. In re Advantage Limousine, LLC Bankr. M.D. Fla. Case No. 22-00278 Chapter 11 Petition filed January 24, 2022 See https://www.pacermonitor.com/view/QPVMDQA/Advantage_Limousine_LLC__flmbke-22-00278__0001.0.pdf?mcid=tGE4TAMA represented by: Buddy D. Ford, Esq. BUDDY D. FORD, P.A. E-mail: All@tampaesq.com In re Mark Gregory Amarant Bankr. S.D. Fla. Case No. 22-10541 Chapter 11 Petition filed January 24, 2022 represented by: Zach Shelomith, Esq. In re Floresdream, LLC Bankr. D. Neb. Case No. 22-80046 Chapter 11 Petition filed January 24, 2022 See https://www.pacermonitor.com/view/H3EE27I/Floresdream_LLC__nebke-22-80046__0001.0.pdf?mcid=tGE4TAMA represented by: John A. Lentz, Esq. LENTZ LAW, PC, LLO E-mail: john@johnlentz.com In re UB Homes, LLC Bankr. D.N.J. Case No. 22-10541 Chapter 11 Petition filed January 24, 2022 See https://www.pacermonitor.com/view/ZCUJ2UQ/UB_Homes_LLC__njbke-22-10541__0001.0.pdf?mcid=tGE4TAMA represented by: Eugene D. Roth, Esq. LAW OFFICE OF EUGENE D. ROTH E-mail: erothesq@gmail.com In re Joseph Severino Bankr. N.D. Ill. Case No. 22-00769 Chapter 11 Petition filed January 24, 2022 In re Joseph Ryan Ellison Bankr. D. Kan. Case No. 22-10044 Chapter 11 Petition filed January 24, 2022 represented by: Eric D. Bruce, Esq. In re South Harbor Irrevocable Trust Bankr. D. Md. Case No. 22-10347 Chapter 11 Petition filed January 24, 2022 See https://www.pacermonitor.com/view/KCR7GPQ/South_Harbor_Irrevocable_Trust__mdbke-22-10347__0001.0.pdf?mcid=tGE4TAMA represented by: Michael G. Wolff, Esq. WOLFF & ORENSTEIN, LLC E-mail: mwolff@wolawgroup.com ********* 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., Philadelphia, Pa., USA. Randy Antoni, Jhonas Dampog, Marites Claro, Joy Agravante, Rousel Elaine Tumanda, Joel Anthony G. Lopez, Psyche A. Castillon, Ivy B. Magdadaro, Carlo Fernandez, Christopher G. Patalinghug, and Peter A. Chapman, Editors. Copyright 2022. All rights reserved. ISSN: 1520-9474. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. 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