/raid1/www/Hosts/bankrupt/TCR_Public/220214.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Monday, February 14, 2022, Vol. 26, No. 44
Headlines
25-16 37TH AVE: Unsecureds to Get At Least $100K in Sale Plan
ADLI LAW: Continued Operations to Fund Plan Payments
ADVANCE TRANSPORTATION: Taps Ann Roberts & Company as Accountant
ADVAXIS INC: To be Delisted From Nasdaq
AERO SHADE: Has 100% Plan Deal Reached With County
AL-VERDE FRUITS: Seeks to Hire Adam Dickreiter as Accountant
ALBAUGH LLC: Moody's Affirms Ba3 CFR, Rates New Secured Debt Ba3
AMERICAN EAGLE: Unsecureds Will Get 0.5% of Claims in Plan
AUTOMOTIVE PARTS: U.S. Trustee Says Disclosures Inadequate
AVAGO TECHNOLOGIES: Egan-Jones Keeps BB+ Senior Unsecured Ratings
AZALEA TOPCO: Moody's Affirms B3 CFR, Rates $400MM Term Loan 'B2'
AZALEA TOPCO: S&P Downgrades ICR to 'B-', Outlook Stable
BAY CIRCLE: NRCT Loses Bid for Summary Judgment in Gateway Suit
BFCD PROPERTIES: Unsecured Creditors to Split $5K in Plan
BOY SCOUTS: Key Abuse-Survivors Group Now Backs Plan
BOY SCOUTS: Parker Waichman Balks at Plan Releases
BRIGHT MOUNTAIN: Incurs $1.7 Million Net Loss in First Quarter
BRINKER INT'L: Egan-Jones Hikes Sr. Unsec. Debt Ratings to BB
BVM THE BRIDGES: Seeks to Hire Johnson Pope as Legal Counsel
CADIZ INC: Appoints Susan Kennedy as Executive Chair
CARVANA CO: BlackRock Holds 5.1% of Class A Shares
CE ELECTRICAL: Fine-Tunes Plan; Plan Confirmation Hearing March 30
CEDAR FAIR: Egan-Jones Retains CCC Sr. Unsecured Debt Ratings
CENTRAL GARDEN: Egan-Jones Retains BB Sr. Unsecured Debt Ratings
CITIUS PHARMACEUTICALS: Stockholders Elect Seven Directors
CLEANSPARK INC: BlackRock Has 5.5% Equity Stake as of Dec. 31
CLEANSPARK INC: Posts $14.5 Million Net Income in First Quarter
CNC PUMA: Reaches Kapitus Stipulation; Files Amended Plan
COCHRANE ANESTHESIA: Seeks to Hire Melissa Offill as Accountant
COEPTIS EQUITY: Wins Cash Collateral Access
COLONIAL GATE: Wins Access to Cash Collateral Thru March 15
DCM-P3 LLC: Seeks to Hire Coldwell Banker as Real Estate Broker
DECOR HOLDINGS: Kauffmann Received "Ordinary Course" Payment
DITECH HOLDING: Summary Judgment Recommended in Trafton Case
DJM HOLDINGS: WSF Opposes Property Valuation
DOLPHIN ENTERTAINMENT: Has 8.1M Outstanding Shares of Common Stock
DUSAN PITTNER: Court Appoints David Madoff as Subchapter V Trustee
EASTERN ILLINOIS: S&P Upgrades ICR to 'BB' on Enrollment Growth
EASTSIDE DISTILLING: Postpones Special Meeting Until March 4
FORMING MACHINING: Moody's Affirms Caa2 CFR; Outlook Remains Neg.
FORUM ENERGY: Provides Fourth Quarter 2021 Operational Update
FOXWOOD HILLS: Hearing Location of Suit vs 783-C et al. Changed
FULL HOUSE: BlackRock Has 5.9% Equity Stake as of Dec. 31
FULL HOUSE: Closes Private Offering of $100M Senior Notes Due 2028
GALVIN'S RIDGE: Voluntary Chapter 11 Case Summary
GIGA-TRONICS INC: Incurs $793K Net Loss in Third Quarter
GILBERT MH: Says Reorganization Plan Feasible at This Time
GPMI CO: Seeks to Tap Dickinson Wright PLLC as Special Counsel
GREAT WESTERN: Fitch Affirms 'B-' LT IDR, Alters Outlook to Pos.
GREENBRIER COMPANIES: Egan-Jones Retains BB- Sr. Unsecured Ratings
GREIF INC: Egan-Jones Hikes Senior Unsecured Ratings to BB
H.T.O. ARCHITECT: Court OKs Professional Fees, Trustee Commission
HAYAT BAHKT: Seeks to Hire Narissa A. Joseph as Legal Counsel
HEXION HOLDINGS: Moody's Assigns First Time B3 CFR; Outlook Stable
HEXION HOLDINGS: S&P Assigns 'B' ICR, Outlook Negative
HOVNANIAN ENTERPRISES: BlackRock Holds 6.4% of Class A Shares
HOVNANIAN ENTERPRISES: Egan-Jones Keeps CCC+ Sr. Unsecured Ratings
HUMANIGEN INC: BlackRock Has 5.2% Equity Stake as of Dec. 31
I.C.S. CUSTOMS: Seeks to Tap Dimand Law Offices as Special Counsel
INTELSAT SA: Seeks to Tap Deloitte as Valuation Services Provider
J. M. DUNN: Seeks to Hire Joan Kehlhof as Bankruptcy Counsel
KINTARA THERAPEUTICS: Keith Murphy Resigns as Director
KNOX CLINIC: Seeks to Hire Brian Hardin as Financial Professional
KOPIN CORP: BlackRock Has 5.3% Equity Stake as of Dec. 31
KRISJENN RANCH: To Seek Plan Confirmation on Feb. 17
L&N TWINS: Files Amendment to Disclosure Statement
LA OAXAQUENA: Seeks to Hire Wiggam & Geer as Bankruptcy Counsel
LINKMEYER PROPERTIES: Says Lawrenceburg Plan Objection Resolved
LIVEWELL ASSISTED: Seeks to Tap Sasser Law Firm as Legal Counsel
LOADCRAFT INDUSTRIES: Taps Gregory Milligan of HMP Advisory as CRO
LOGISTICS GIVING: Wins Interim Cash Collateral Access Thru Mar 10
MACALLISTER & ASSOCIATES: Taps Lefkovitz & Lefkovitz as Counsel
MACHINE TECH: Resolves Trust Bank Claims Pay Issues
MAJOR MODEL: Voluntary Chapter 11 Case Summary
MANHATTAN STUDENT: Seeks to Hire B. Riley Real Estate as Broker
MAPLE MANAGEMENT: Wins Cash Collateral Access Thru Feb 22
MLK BRYANT: March 11 Deadline to File Plan & Disclosures
MOHEGAN TRIBAL: Incurs $11.6 Million Net Loss in First Quarter
MOTELS OF SUGAR: Taps Integra Realty to Appraise Springhill Hotel
MY SIZE: Acquires Israel-Based Omnichannel E-Commerce Platform
NATHAN'S FAMOUS: Egan-Jones Retains B- Sr. Unsecured Debt Ratings
NCL CORP: S&P Assigns 'B+' Rating on New 1BB Sr. Secured Notes
NEPHROS INC: Samjo Capital, et al., Report 4.2% Equity Stake
NESV ICE: Wins Interim Cash Collateral Access Thru April 21
NETWORK COMMUNICATIONS: Case Summary & 20 Top Unsecured Creditors
NORDIC AVIATION: Affiliate Taps Katten Muchin Rosenman as Counsel
NORDIC AVIATION: Affiliates Tap Hirschler as Special Counsel
NORDIC AVIATION: April Hearing on $4.3-Bil. Debt Reduction Plan
NORDSTROM INC: Egan-Jones Keeps B+ Sr. Unsec. Debt Ratings
NORTHERN OIL: BlackRock Has 5.4% Equity Stake as of Dec. 31
NS8 INC: Can't Intervene in Ironshore Insurance Suit vs Ex-CFO
O'CONNOR CONSTRUCTION: Seeks to Hire Joseph Postnikoff as Counsel
OCULAR THERAPEUTIX: Bruce Peacock to Quit as Director
OMEROS CORP: Ingalls & Snyder Has 7.1% Equity Stake as of Dec. 31
ORIGINAL TILE: Gets Interim Cash Collateral Access Mar 4
OXFORD INDUSTRIES: Egan-Jones Hikes Unsecured Debt Ratings to BB+
PALADIN ENERGY: Coverage Claims Remain for Trial in POGO Suit
PANHANDLE PAWN: Seeks to Hire Bruner Wright as Legal Counsel
PANIOLO CABLE: March 1 Hearing in Suit vs. Sandwich Isles
PB-6 LLC: Agoura Hills to Provide $1.15M Financing Facility
PENN TRAFFIC: Dismissal of Syracuse Fund's Claim vs C&S Affirmed
PG&E CORP: District Court Junks PwC Appeal from Subpoena
PHOENIX PROPERTIES: Files Emergency Bid to Use Cash Collateral
PLATINUM GROUP: Franklin Resources, et al. Own 13.1% Equity Stake
PLAYA HOTELS: Goldman Sachs Entities Own 7.3% of Ordinary Shares
PLAYA HOTELS: Wellington Entities Report 6.07% Equity Stake
PLAYER'S POKER: Obtains Court OK to Reject Hofer Lease
PREFERRED READY-MIX: Makes Non-Material Changes to Plan
PREFERRED READY-MIX: Texas Court Mulls Stay of Foran Suit
QUANTUM CORP: Incurs $11.1 Million Net Loss in Third Quarter
QUOTIENT LIMITED: BlackRock Has 5.3% Equity Stake as of Dec. 31
RAMBUS INC: Posts $6.1 Million Net Income in Fourth Quarter
REAL GRANITE: Wins Final Cash Collateral Access
ROSCOE GUITARS: Unsecureds to Get 25% Dividend in 60 Months
ROSCOE GUITARS: Wins Access to Cash Collateral Thru March 1
ROYAL ALICE: District Court Won't Stay Order on Sale, AMAG Deal
RUM RUNNERS: Court Orders Revisions; Confirmation Hearing March 31
SAFE FLEET: Moody's Assigns B2 Rating to New First Lien Debt
SEALED AIR: Egan-Jones Retains BB- Senior Unsecured Ratings
SEMPER UTILITIES: Case Summary & Seven Unsecured Creditors
SPEED INDUSTRIAL: Seeks to Hire Kean Miller as Legal Counsel
STAPLES INC: Moody's Cuts CFR to B3, Alters Outlook to Stable
STONEWAY CAPITAL: Unsecureds to Recover 100% in Joint Plan
SUDBURY PROPERTY: Seeks to Tap Greater Boston Commercial as Broker
TECHNICAL COMMUNICATIONS: Incurs $613K Net Loss in First Quarter
THOMASBORO LANDCO: Voluntary Chapter 11 Case Summary
TOUCHPOINT GROUP: Converts 30K Preferred Shares to Common Shares
TOWNHOUSE HOTEL: March 28 Plan & Disclosure Hearing Set
TOWNHOUSE HOTEL: Unsecured Creditors to Recover 35% to 46% in Plan
TPT GLOBAL: Unit to Start Marketing New 4G+/5G Services
TROJE'S TRASH: Vermillion Entitled to Damages Against Tennis
UNITED AIRLINES: Egan-Jones Hikes Senior Unsecured Ratings to B-
US ECOLOGY: Moody's Puts Ba3 CFR Under Review for Upgrade
US ECOLOGY: S&P Places 'BB-' ICR on CreditWatch Positive
VAIL RESORTS: Egan-Jones Keeps B+ Sr. Unsecured Debt Ratings
VETERAN HOLDINGS: Unsecured Creditors to Have 100% Recovery in Plan
VIASAT INC: Fitch Affirms 'B+' IDR, Outlook Positive
VIASAT INC: Moody's Rates New $700MM First Lien Secured Loan 'Ba3'
VIASAT INC: S&P Affirms 'BB-' ICR, Outlook Stable
VIRGINIA TRUE: Cipollones Lose Bid to Remand Suit to State Court
VISTAGEN THERAPEUTICS: BlackRock Has 6% Equity Stake as of Dec. 31
VISTAGEN THERAPEUTICS: Franklin Resources, et al., Own 5.1% Stake
VOLZ FORESTRY: Seeks to Tap Swenson Law Group as Legal Counsel
WATERLOO AFFORDABLE: Gets Approval to Hire Real Estate Brokers
WESTBANK HOLDINGS: Seeks to Hire Derbes Law Firm as Legal Counsel
WHISPER LAKE: Creditors to Get Proceeds From Liquidation
WYNN RESORTS: Egan-Jones Keeps CCC+ Senior Unsecured Ratings
[^] BOND PRICING: For the Week from February 7 to 11, 2022
*********
25-16 37TH AVE: Unsecureds to Get At Least $100K in Sale Plan
-------------------------------------------------------------
25-16 37th Ave Owners, LLC, submitted a First Amended Chapter 11
Plan and a corresponding Disclosure Statement.
Simultaneously with the filing of this Disclosure Statement, the
Debtor filed a motion for an order approving an auction sale of the
Debtor's property and approving bidding procedures. The Bid
Procedures Motion provides for a "stalking horse" bid to purchase
the Property by LIC inclusive of its credit bid of its secured
claim, and a cash contribution (the "LIC Contribution") to satisfy
all Administrative Claims, Priority Claims, New York City Secured
Claims, and $100,000 to general unsecured creditors, to be used as
the initial bid at a public auction sale (the "Auction Sale"). The
proposed Auction Sale will be subject to extensive marketing and
subject to higher and better bids. The Debtor intends to receive
the highest and best price for its primary and most valuable asset,
so that it may maximize return to creditors of its estate.
At the conclusion of the Auction Sale, the Debtor will declare the
highest and best bidder (the "Purchaser") and seek order of the
Court authorized the conveyance of the Property, the closing of
which shall occur within 30 days after the Auction Sale (the "Sale
Transaction"). The proceeds of the Sale Transaction (the "Sales
Proceeds") will be available to the Debtor's Estate. To the extent,
LIC or its designee is the Purchaser, LIC will provide a "LIC
Contribution" (as part of the Sale Proceeds) that will be
sufficient to pay all administrative, secured and priority tax
claims as well as $100,000 to general unsecured creditors. Should a
higher and better bid be received and the Property is not sold to
LIC or its designee, after a carve out payment of $100,000 pro rata
to Class 6 General Unsecured Creditors, additional monies shall be
first paid to LIC for post-petition interest, fees, and attorney's
fees pursuant to 11 U.S.C. Section 506(b) and any remaining surplus
shall distributed to pro rata Class 4 Other Secured Claims until
they are satisfied in full and then pro rata to general unsecured
creditors.
Class 6 General Unsecured Claim totaling $5,113,589 will each
receive its pro rata payment of $100,000 from either from the LIC
Contribution or a carve out of the Class 3 LIC Secured Claim, and
the remaining Cash from the Sale Proceeds after payment of
Statutory Fees , Administrative Claims, Professional Fee Claims,
Non Tax Priority Claims, Priority Tax Claims, Class 1 Claims, Class
2 Claims, Class 3 Claims, Class 4 Claims and Class 5 Claims. Class
6 is impaired.
Counsel for the Debtor:
Joel Shafferman, Esq.
SHAFFERMAN & FELDMAN LLP
137 Fifth Avenue, 9th Floor
New York, NY 10010
Tel: (212) 509-1802
A copy of the Disclosure Statement dated Feb. 4, 2022, is available
at https://bit.ly/3B0InqU from PacerMonitor.com.
About 25-16 37th Ave Owners
Hollywood, Fla.-based 25-16 37th Ave Owners, LLC is a single asset
real estate debtor (as defined in 11 U.S.C. Section 101(51B)).
25-16 37th Ave Owners filed its voluntary petition for Chapter 11
protection (Bankr. E.D.N.Y. Case No. 21-42662) on Oct. 19, 2021,
listing $250,000 in assets and $18,437,803 in liabilities. Judge
Jil Mazer-Marino presides over the case.
Joel M. Shafferman, Esq., at Shafferman & Feldman, LLP, is the
Debtor's legal counsel.
ADLI LAW: Continued Operations to Fund Plan Payments
----------------------------------------------------
Adli Law Group P.C. filed with the U.S. Bankruptcy Court for the
Central District of California a Plan of Reorganization for Small
Business dated Feb. 8, 2022.
The Debtor is a California professional corporation. Since its
formation on March 22, 2010, the Debtor has been in the business of
the profession of law.
The Debtor's income and expenses are variable; and the variations
cannot be predicted. Accordingly, the projections are based on
calendar year 2020 performance and assume neither growth nor
decline in net disposable income over the 60-month period of the
plan.
The final Plan payment is expected to be paid on June 1, 2026, the
first day of the sixtieth month following the estimated June 1,
2022 effective date of the plan.
This Plan of Reorganization proposes to pay creditors of Adli Law
Group P.C. from the net cash flow from its operations.
Class 1 consists of Priority claims. Unless the holder agrees to
different treatment, each holder of a Class 1 claim shall receive,
in full satisfaction, discharge, exchange, and release thereof,
cash in the amount equal to the holder's allowed priority claim,
and the distribution on account of a Class 1 claim shall be made in
a lump sum on the later of (a) the effective date of the Plan or
(b) the date that is 30 days after the Class 1 claim becomes
allowed.
Class 3(A) consists of Nonpriority unsecured creditors. Unless the
holder agrees to different treatment, each holder of a Class 3A
claim shall receive, in full satisfaction, discharge, exchange, and
release thereof, the treatment described in Article 7 of this
Plan.
Class 3(B) consists of Non-priority unsecured, insured creditors.
Unless the holder agrees to different treatment, each holder of a
Class 3(B) claim shall receive, in full satisfaction, discharge,
exchange, and release thereof, the treatment described in Article 7
of this Plan.
Class 4 consists of Equity security holders of the Debtor. Each
holder of an equity interest in the Debtor shall retain such
interest in the Debtor. Class 4 is unimpaired and each holder of a
Class 4 interest is deemed to have accepted the Plan.
Unless otherwise specifically provided in the Plan, upon the
occurrence of the effective date of this Plan, all property of the
estate shall vest in the reorganized Debtor, free and clear of all
claims, liens, encumbrances, and interests.
The distributions that are required to be made on or after the
effective date of this Plan will be funded from (a) the Debtor's
cash balances existing on the effective date, (b) the cash
generated from the reorganized Debtor's ongoing business
operations, (c) if the reorganized Debtor sells any assets, the
proceeds generated from such asset sale, (d) if the reorganized
Debtor secures an investor, the cash from any infusion of capital,
and (e) any other lawful source.
A full-text copy of the Plan of Reorganization dated Feb. 8, 2022,
is available at https://bit.ly/3gG0ARa from PacerMonitor.com at no
charge.
Attorney for the Debtor:
Dean G. Rallis Jr., Esq.
Hahn & Hahn LLP
301 E. Colorado Blvd., 9th Floor
Pasadena, CA 91101-1977
Tel.: (626) 796-9123
Fax: (626) 449-7357
Email: drallis@hahnlawyers.com
About Adli Law Group P.C.
Adli Law Group, P.C., a full-service law firm in Los Angeles, filed
a petition for Chapter 11 protection (Bankr. C.D. Cal. Case No.
21-18572) on Nov. 10, 2021, listing $4,552,705 in assets and
$4,538,284 in liabilities. Dariush G. Adli, president of Adli Law
Group, signed the petition.
Judge Sheri Bluebond oversees the case.
The Debtor tapped Dean G. Rallis Jr., Esq., at Hahn & Hahn, LLP, as
legal counsel.
ADVANCE TRANSPORTATION: Taps Ann Roberts & Company as Accountant
----------------------------------------------------------------
Advance Transportation Services Incorporated seeks approval from
the U.S. Bankruptcy Court for the Western District of Texas to
employ Ann Roberts & Company as accountant.
The firm will render these services:
(a) file Form 1120 returns for 2019, 2020, and 2021;
(b) file Form 941 returns for 2019, 2020, and 2021; and
(c) help the Debtor with earnings projections.
The hourly rates of the firm's professionals are as follows:
Ann Roberts, CPA $175
Sherri H. Hall, CPA $125
In addition, the firm will seek reimbursement for expenses
incurred.
The firm received a retainer of $5,000 in connection with this
engagement.
Sherri Hall, CPA at Ann Roberts & Company, disclosed in a court
filing that the firm is a "disinterested person" as defined in
Section 101(14) of the Bankruptcy Code.
The firm can be reached through:
Sherri H. Hall, CPA
Ann Roberts & Company
1200 Golden Key Cri., Ste. 340
El Paso, TX 79925
Telephone: (915) 591-4495
Email: sherri@robertsandcopc.com
About Advance Transportation Services
Advance Transportation Services, Inc. filed its voluntary petition
for Chapter 11 protection (Bankr. W.D. Texas Case No. 21-30906) on
Nov. 30, 2021, listing up to $500,000 in assets and up to $1
million in liabilities.
Judge H. Christopher Mott presides over the case.
The Debtor tapped The Law Office of E.P. Bud Kirk as legal counsel
and Ann Roberts & Company as accountant.
ADVAXIS INC: To be Delisted From Nasdaq
---------------------------------------
The Nasdaq Stock Market LLC has determined to remove from listing
the common stock of Advaxis, Inc., effective at the opening of the
trading session on Feb. 22, 2022.
Based on review of information provided by the Company, Nasdaq
Staff determined that the Company no longer qualified for listing
on the Exchange pursuant to Listing Rule 5550(a)(2). The Company
was notified of the Staff determination on June 22, 2021. The
Company appealed the determination to a Hearings Panel on July 29,
2021. On Aug. 9, 2021, the Panel granted the Company request to
remain listed subject to certain conditions. On Nov. 19, 2021, the
Panel granted the Company an extension to regain compliance on or
before Dec. 20, 2021, which represented the full extent of the
Panel discretion.
On Dec. 21, 2021, the Panel issued a delist decision after the
Company failed to regain compliance with the Exchange listing
requirements. The Company did not appeal the Panel decision to the
Nasdaq Listing and Hearing Review Council (Council) and the Council
did not call the matter for review. The Staff determination to
delist the Company common stock became final on Feb. 4, 2022.
About Advaxis Inc.
Advaxis, Inc. -- http://www.advaxis.com-- is a clinical-stage
biotechnology company focused on the development and
commercialization of proprietary Lm-based antigen delivery
products. These immunotherapies are based on a platform technology
that utilizes live attenuated Listeria monocytogenes (Lm)
bioengineered to secrete antigen/adjuvant fusion proteins. These
Lm-based strains are believed to be a significant advancement in
immunotherapy as they integrate multiple functions into a single
immunotherapy and are designed to access and direct antigen
presenting cells to stimulate anti-tumor T cell immunity, activate
the immune system with the equivalent of multiple adjuvants, and
simultaneously reduce tumor protection in the tumor
microenvironment to enable T cells to eliminate tumors.
Advaxis reported a net loss of $26.47 million for the year ended
Oct. 31, 2020, a net loss of $16.61 million for the year ended Oct.
31, 2019, and a net loss of $66.51 million for the year ended Oct.
31, 2018. As of July 31, 2021, the Company had $51.02 million in
total assets, $6.75 million in total liabilities, and $44.28
million in total stockholders' equity.
AERO SHADE: Has 100% Plan Deal Reached With County
--------------------------------------------------
Aero Shade Technologies, Inc., submitted a Chapter 11 Small
Business Plan and a Disclosure Statement.
The Debtor and St. Lucie County entered into a lease agreement in
2009 for the lease of a facility owned by St. Lucie County. The
facility is the Debtor's principal business and manufacturing
location.
Although the Debtor consistently paid to the County all rental
amounts due pursuant to the terms of the Lease Agreement, the
Debtor and the County ended up in a dispute concerning non-monetary
defaults under the Lease. After judgment was entered against the
Debtor in an eviction action, the parties attended mediation that
resulted in the Settlement Agreement. From the Debtor's
perspective, the Settlement Agreement was unduly burdensome because
it failed to provide adequate assurance that the County will issue
permits and other approvals on a timely basis.
The Debtor decided to file for relief under Chapter 11 of the
Bankruptcy Code to reorganize its affairs and to continue to work
with the County to clarify the previously entered Settlement
Agreement. If the Debtor was unable to meet the demands of the
County it would be out of a location to operate, which means out of
business, and many employees would have lost their employment.
To this end, the Debtor filed a Motion for Judicial Settlement
Conference to utilize the services of a third party to modify and
clarify the Settlement Agreement. The Judicial Settlement
Conference resulted in an Agreed Modification to Mutual Settlement
and Release Agreement, which was approved by the Bankruptcy Court.
As of the filing of the Plan, the Debtor has complied with all
material terms in the Modification Agreement. Through extensive
work by the Debtor to come into compliance and meet the requests of
the County, the permit was issued. The result of this case is that
the Debtor remains in business and is able to pay its creditors in
full.
Class 2 General Unsecured Claims include all other allowed claims
of Unsecured Creditors of the Debtor, subject to any Objections
that are filed and sustained by the Court. The general unsecured
claims after the filing of the objections total the amount of
$24,3234. These claims will be paid in full at the rate of
$4,053.76 per month for 6 months. In the event the objections
filed by the Debtor are overruled, the payment to this class will
be revised to ensure all General Unsecured Claims are paid in full.
The payments to this Class will commence on the Effective Date of
the Plan. Class 2 is unimpaired.
Attorneys for the Debtor:
Craig I. Kelley, Esq.
KELLEY, FULTON & KAPLAN, P.L.
1665 Palm Beach Lakes Blvd., The Forum - Suite 1000
West Palm Beach, Florida 33401
Telephone: (561) 491-1200
Facsimile: (561) 684-3773
A copy of the Disclosure Statement dated Feb. 4, 2022, is available
at https://bit.ly/3Gx35Qe from PacerMonitor.com.
About Aero Shade Technologies
Aero Shade Technologies, Inc., designs and manufactures sun
protection and light shades for the aerospace industry. It entered
into a lease agreement in 2009 for the lease of a facility owned by
St. Lucie County.
Aero Shade Technologies sought protection for relief under Chapter
11 of the Bankruptcy Code (Bankr. S.D. Fla. Case No. 21-13573) on
April 15, 2021, disclosing up to $50,000 in both assets and
liabilities. Judge Mindy A. Mora oversees the case. Kelley Fulton
& Kaplan, P.L. and Ackerman Rodgers, CPA, PLLC serve as the
Debtor's legal counsel and accountant, respectively.
AL-VERDE FRUITS: Seeks to Hire Adam Dickreiter as Accountant
------------------------------------------------------------
Al-Verde Fruits & Vegetables, LLC received approval from the U.S.
Bankruptcy Court for the Western District of Texas to employ Adam
Dickreiter, CPA, LLC as its certified public accountant.
The firm will prepare Income Tax Returns and assist the Debtor with
tax reporting and compliance, including assisting the Debtor with
accounting requirements in this bankruptcy case.
The firm will bill its current hourly rate of $200.
The firm neither hold nor represents an interest adverse to the
estate and is a "disinterested person" within the meaning of 11
U.S.C. Sec. 327(a), as disclosed in the court filings.
The firm can be reached through:
Adam Dickreiter, CPA
Adam Dickreiter, CPA, LLC
4100 NW Loop 410, Suite 200
San Antonio, TX 78229
Tel: (210) 344-7520
About Al-Verde Fruits & Vegetables
Al-Verde Fruits & Vegetables, LLC filed its voluntary petition for
relief under Chapter 11 of the Bankruptcy Code (Bankr. W.D. Tex.
Case No. 21-51464) on Dec. 3, 2021, listing under $1 million in
both assets and liabilities. Alejandro Santoyo, president, signed
the petition. Judge Michael M. Parker oversees the case. Langley &
Banack, Inc. serves as the Debtor's legal counsel.
ALBAUGH LLC: Moody's Affirms Ba3 CFR, Rates New Secured Debt Ba3
----------------------------------------------------------------
Moody's Investors Service affirmed Ba3 corporate family rating and
Ba3-PD probability of default rating of Albaugh, LLC ("Albaugh").
Moody's also affirmed existing instrument ratings and assigned Ba3
ratings to the proposed $950 million senior secured credit
facilities, including $200 million five-year revolver and $750
million seven-year senior secured term loan B. The proceeds of the
term loan issuance will be used to acquire Hong Kong-based Rotam
Global AgroSciences Limited (Rotam) for the enterprise value of
$403 million, to refinance Albaugh's and Rotam's existing debt and
to pay associated fees and expenses. The acquisition, which is
subject to regulatory approvals, is expected to close in the second
quarter of 2022. The ratings outlook is stable. Moody's will
withdraw the ratings on Albaugh's existing debt after the new
financing closes and the debt is repaid.
"Rotam transaction will help Albaugh improve its product and
geographic diversity, reducing its dependence on glyphosate, while
maintaining fairly strong credit metrics," said Anastasija Johnson,
VP-Senior Credit Officer at Moody's.
Affirmations:
Issuer: Albaugh, LLC
Corporate Family Rating, Affirmed Ba3
Probability of Default Rating, Affirmed Ba3-PD
Senior Secured Bank Credit Facility, Affirmed Ba3 (LGD3)
Assignments:
Issuer: Albaugh, LLC
Senior Secured 1st Lien Term Loan B, Assigned Ba3 (LGD3)
Senior Secured 1st Lien Revolving Credit Facility, Assigned Ba3
(LGD3)
Outlook Actions:
Issuer: Albaugh, LLC
Outlook, Remains Stable
RATINGS RATIONALE
The Ba3 corporate family rating reflects Albaugh's position as one
of the top 10 global crop protection producers with a growing new
product portfolio but high concentration in commodity herbicides,
particularly in glyphosate. As such, the company is constrained by
exposure to seasonal and weather-dependent swings in demand for
agricultural inputs, which is partially mitigated by the expanded
geographic footprint, broader portfolio and market segmentation
approach.
The planned Rotam acquisition is credit positive as it increases
scale to $1.9 million from $1.6 million in the twelve months ended
September 2021, adds manufacturing facilities in China and India
and new markets in Central America, Europe, Middle East, Africa and
Asia as well as new product registrations. In addition, the target
generates two thirds of sales from fungicides and insecticides and
only about a quarter in herbicides, improving but not fundamentally
changing Albaugh's product portfolio. Albaugh's concentration in
commodity herbicides (roughly two-thirds of sales pro forma for
Rotam acquisition), specifically in glyphosate (roughly one-third
of pro forma sales), remains a constraining factor for the rating.
The rating is constrained by the company's limited scale in a
competitive industry and volatility in cash flows due to working
capital swings and foreign currency exposure. In addition, Rotam's
9% EBITDA margins before synergies are lower than Albaugh's current
margins.
The rating benefits from the modestly levered balance sheet even
pro forma for Rotam acquisition. Moody's adjusted pro forma
debt/EBITDA rises to about 2.9x from 2.0x times in the twelve
months ended September 2021, not accounting for the projected $30
million of synergies. If synergies are included, leverage is
approximately 2.6x in the twelve months ended September 2021. The
rating benefits from the expectation of ongoing demand for
agricultural inputs given higher global commodity crop prices, but
some pressure on margins due to higher raw material costs.
The rating incorporates expectations that the company will continue
to expand its growth portfolio (currently about one-third of sales)
either through new product registrations or acquisitions. Moody's
views high concentration in glyphosate as a long-term business
risk, mitigated by the current lack of the low-cost, broad-spectrum
alternative herbicides.
As an agricultural chemicals manufacturer, Albaugh faces high
credit risks related to environmental and social factors, primarily
related to its glyphosate products. Albaugh sells the vast majority
of its glyphosate to wholesalers and does not market a
glyphosate-based product directly to consumers, which somewhat
reduces litigation risks. The use of glyphosate is currently
allowed in the US and Europe, however, local jurisdictions in both
countries have taken decisions to phase out the use of glyphosate,
mostly for usage in turf and ornamental applications. Alabaugh
curently does not offer glyphosate in its turf and ornametal
segment. Given the negative publicity around glyphosate, Moody's
sees a potential risk that regulators such as the European Union
might revoke its licenses. The EU registration is up for renewal in
2022. Albaugh's glyphosate exposure to Europe is relativel
relatively small (under 1%), with the majority of sales coming from
the US.
Governance considerations include concentrated ownership. Albaugh
is a private company, majority owned by its founder Dennis Albaugh
with a 20% stake owned by the Chinese agrochemical developer and
manufacturer and Albaugh's supplier, Nutrichem. Current owners and
management have maintained modest financial leverage and Moody's
expect this to continue, but Moody's would expect to see continued
growth in distributions over time especially if there are no
acquisitions.
Albaugh is expected to have good liquidity. The company had $261
million of cash on hand as of September 2021, some of which will be
used to finance the acquisition. The company expects to have full
availability under its new $200 million five-year revolver. With
the new capital structure in place to finance Rotam deal, there are
no significant near-term maturities and amortization on the term
loan is $7.5 million a year. The term loan has no financial
maintenance covenants, but the revolver has a total net leverage
covenant of 4.25 times. The company has sufficient headroom under
the covenant and is expected to remain in compliance over the next
12 months. The credit facility allows for increased dividend
distribution for up to the greater of $30 million or 10% of EBITDA.
The credit facilities are secured by most of the assets, excluding
the Argentina and China plants, providing limited additional
liquidity.
Albaugh's debt capital structure is comprised of a $200 million
first-lien senior secured revolving due in 2027 and a $750 million
first lien senior secured term loan B due 2029, which are both
rated Ba3 at the same level as the CFR. The rating on the secured
facilities reflects one notch override to bring the rating level in
line with the CFR since the new credit facilities represent the
majority of debt in the capital structure apart from mostly
unsecured local credit facilities and trade payables. In addition,
the business is relatively asset-light. The revolver and the term
loan are secured by the first priority lien on the US, Mexican and
Brazilian assets and Rotam's IP, excluding the Argentine and
Chinese plants. The guarantors represent 65% of sales and assets.
As proposed, the new credit facilities are expected to provide
covenant flexibility that if utilized could negatively impact
creditors. The credit agreement allows for incremental debt
capacity up to the greater of $300 million or 100% EBITDA plus
unlimited amounts subject to 3.0x first lien net leverage ratio,
plus unlimited of junior secured debt subject to the secured net
leverage of 4x, plus unlimited unsecured amount subject to total
net leverage ratio of 4.0x. Amounts up to $300 million or 100%
EBITDA 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 prohibit contribution or transfer (including by
exclusive license) any intellectual property that is material to
the business of the borrower and its restricted subsidiaries, taken
as a whole, to any unrestricted subsidiary. In addition, no
unrestricted subsidiary is permitted to own or have an exclusive
right to use any such intellectual property.
Non-wholly owned subsidiaries are not required to provide
guarantees under the credit agreement. Dividends or transfers
resulting in partial ownership of subsidiary guarantors could
jeopardize guarantees, with no explicit protective provisions
limiting such guarantee release.
The credit agreement provides some limitations on up-tiering
transactions, including effectuate any payment subordination with
respect to the Obligations or (ii) subordinate the Liens on the
Collateral securing the Obligations, in each case, to any
Indebtedness for borrowed money, without the written consent of
each Lender directly and adversely affected thereby.
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 expectations the company will
successfully integrate Rotam, execute its synergies plan and
continue to benefit from strong demand for agricultural input given
higher global commodity crop prices.
Moody's could upgrade the rating if the company increases its
revenues sustainably above $2.5 billion and reduces reliance on
core commodity glyphosate to less than 25%. Moody's could also
upgrade the ratings if the company generates positive free cash
flow on a more consistent basis, while maintaining adjusted
leverage below 3 times and RCF/Debt above 20%.
Moodys' could downgrade the rating if there is a significant
deterioration in the company's operating conditions, if the company
increases its leverage above 4 times on a sustained basis and
retained cash flow to debt declines to 10%.
The principal methodology used in these ratings was Chemical
Industry published in March 2019.
Headquartered in Ankeny, Iowa, Albaugh, LLC is a global
manufacturer and seller of agricultural chemicals. The company is
majority owned by founder Dennis Albaugh with a 20% stake owned by
the Chinese agrochemicals developer and manufacturer and Albaugh's
supplier, Nutrichem.
AMERICAN EAGLE: Unsecureds Will Get 0.5% of Claims in Plan
----------------------------------------------------------
American Eagle Delaware Holding Company LLC, et al., submitted a
Disclosure Statement for the First Amended Chapter 11 Plan of
Reorganization ("Revised Disclosure Statement") dated Feb. 10,
2022.
The Debtors believe that the Plan, which is the result of
extensive, arm's-length negotiations among (i) the Debtors, (ii)
UMB Bank, N.A., as the Trustee for the Series 2018 Bonds, and (iii)
holders of a majority in principal amount of the Series 2018A Bond
Claims (the "Consenting Holders"), provides the Debtors with a
long-term resolution of their financial issues.
In particular, the Debtors, the Trustee, and the Consenting
Holders, as applicable, have agreed to the terms of a Restructuring
Support Agreement (the "Restructuring Support Agreement"), together
with a restructuring of the Debtors' bond obligations that
collectively provide for the Restructuring Transaction. In general,
the Restructuring Transaction provides for:
* The funding of an additional $28,125,000.00 in new money
bond financing comprised of $10,905,000.00 of principal amount of
new taxable Series 2022A-1 Bonds and $17,220,000.00 of principal
amount of new tax-exempt Series 2022A-2 Bonds to fund a Capital
Expenditure Fund (approximately up to $15,230,000, which shall sit
within the Project Account of the Project Fund), an Operating Fund
(up to approximately $6,436,000) to meet the Working Capital
Requirement, Debt Service Reserve Funds for the Series 2022A Bonds
and Series 2022B Bonds, and certain capitalized interest and
closing costs; and
* An exchange of the outstanding Series 2018 Bonds for a pro
rata share of the Series 2022 Bonds.
Class 1 consists of Other Priority Claims. Each such Holder of an
Allowed Other Priority Claim shall receive Cash in an amount equal
to such Allowed Other Priority Claim, on or as soon as reasonably
practicable after the later of (i) the Effective Date; (ii) the
date the Other Priority Claim becomes an Allowed Claim; or (iii)
the date for payment provided by any agreement or arrangement
between the Debtors or the Reorganized Debtors, as the case may be,
and the Holder of the Allowed Other Priority Claim. The Debtors
estimate that the aggregate amount of Allowed Other Priority Claims
does not exceed $0.00. Class 1 Claims are Unimpaired and deemed to
accept the Plan.
Class 2 consists of Allowed Other Secured Claims. Each Holder of an
Allowed Other Secured Claim shall receive, at the sole and
exclusive option of the Reorganized Debtors: (a) Cash equal to the
amount of such Claim; (b) the Collateral securing its Allowed Other
Secured Claim; (c) Reinstatement of its Allowed Other Secured
Claim; or (d) such other treatment that renders its Allowed Other
Secured Claim Unimpaired. The Debtors estimate that the aggregate
amount of Allowed Other Secured Claims will not exceed $350,000.
Class 2 Claims are Unimpaired and deemed to accept the Plan.
Class 7 consists of Allowed General Unsecured Claims. Each Holder
of an Allowed General Unsecured Claim shall receive such Holder's
Pro Rata share of the GUC Fund as full and complete satisfaction of
each Holder's Claim. The Debtors estimate that the aggregate amount
of Allowed General Unsecured Claims will be approximately
.$54,20,781.00. The Debtors estimate that the projected recovery of
Holders of Allowed Claims in Class 7 will be approximately 0.5%.
Class 7 Claims are Impaired and entitled to vote on the Plan.
By no later than the earlier of (a) 90 days after the date on which
the Vista Lake Assets are sold and (b) the Effective Date, the
Debtors shall cause Series 2018A-1 Bonds to be redeemed in an
amount equal to the Vista Lake Sale Proceeds rounded down to the
nearest $5,000 (such amount being referred to as the "Vista Lake
Redemption Amount"). The particular Series 2018A1 Bonds to be
redeemed shall be selected by the 2018 Trustee pro rata based on
the relative outstanding principal amount of each then-current
Series 2018A-1 Bondholder's Series 2018A-1 Bonds and shall be
subject to the approval of Bond Counsel (as defined in the 2018
Indenture).
On the Effective Date, the GUC Fund shall be transferred to the GUC
Fund Account and vest in the Reorganized Debtors free and clear of
all Liens, claims, and encumbrances. The GUC Fund shall be the only
source of funds used to fund Distributions to Holders of Allowed
Class 7 General Unsecured Claims, and only Holders of Allowed Class
7 General Unsecured Claims shall receive Distributions from the GUC
Fund.
Termination and Discharge of the Patient Care Ombudsman
On the Effective Date, the Patient Care Ombudsman shall be
discharged from her duties as patient care ombudsman in the Chapter
11 Cases. Neither the Patient Care Ombudsman, her Professionals or
advisors, shall have any liability with respect to any act or
omission, statement or representation arising out of, related to,
or involving in any way, the Patient Care Ombudsman's evaluations,
her reports, or any pleadings or other writings filed by the
Patient Care Ombudsman in connection with the Chapter 11 Cases
other than acts or omissions involving or arising out of gross
negligence or willful misconduct.
Prior to issuing or serving upon the Patient Care Ombudsman, her
Professionals or advisors any formal or informal discovery request,
including, but not limited to, any subpoena, request for production
of documents, requests for admissions, interrogatories, subpoenas
duces tecum, requests for testimony, interrogatories, or any other
discovery of any kind whatsoever in any way related to the Debtors,
the Chapter 11 Cases, or the Patient Care Ombudsman's evaluations
and reports (the "Discovery"), any creditor or party in interest in
the Chapter 11 Cases must first file an appropriate pleading with
the Bankruptcy Court to request permission to initiate the
Discovery. The Patient Care Ombudsman, her Professionals and
advisors are authorized to retain, dispose of, or destroy any
documents provided by the Debtors or any third parties to the
Patient Care Ombudsman, if any, in the course of his or her
evaluation, in accordance with their respective document retention
policies or applicable law, if any.
Counsel to the Debtors:
Shanti M. Katona
POLSINELLI PC
222 Delaware Avenue, Suite 1101
Wilmington, Delaware 19801
Telephone: (302) 252-0920
Facsimile: (302) 252-0921
E-mail: skatona@polsinelli.com
- and -
David E. Gordon
Caryn Wang
POLSINELLI PC
1201 West Peachtree Street NW, Suite 1100
Atlanta, Georgia 30309
Telephone: (404) 253-6000
Facsimile: (404) 253-6060
E-mail: dgordon@polsinelli.com
cewang@polsinelli.com
About American Eagle
Established in 2018, Eagle Senior Living --
https://www.eagleseniorliving.org/ -- is a non-profit provider of
senior living services across the United States, providing care on
a daily basis to approximately 1,000 residents. Eagle Senior
Living and related entities operate 15 residential senior care
facilities located across the country, from Colorado, Minnesota,
Wisconsin, and Ohio to Alabama, Tennessee, and Florida.
On Jan. 14, 2022, American Eagle Delaware Holding Company LLC and
16 affiliated companies each filed a petition seeking relief under
Chapter 11 of the Bankruptcy Code (Bankr. D. Del. Lead Case No.
22-10028) to seek confirmation of their prepackaged plan. The
Debtors' cases have been assigned to Judge J. Kate Stickles.
Parent company American Eagle Lifecare Corporation and management
company Greenbrier Senior Living are not included in the Chapter 11
filing. Greenbrier Senior Living continues to manage all of the
communities.
American Eagle Delaware Holding estimated assets and debt of $10
million to $50 million as of the bankruptcy filing.
The Debtors are represented in the Chapter 11 cases by Polsinelli
PC as legal counsel. FTI Consulting Inc. and Blueprint Healthcare
Real Estate Advisors, LLC serve as financial advisor and real
estate advisor, respectively. Epiq Corporate Restructuring, LLC is
the claims agent and administrative advisor.
AUTOMOTIVE PARTS: U.S. Trustee Says Disclosures Inadequate
----------------------------------------------------------
The United States Trustee for Region 6 objects to the Disclosure
Statement for Joint Chapter 11 Plan of Liquidation for APDI
Liquidation LLC, formerly known as Automotive Parts Distribution
International, LLC.
The Debtor liquidated substantially all its assets in August 2021.
The Debtor and the Official Committee of Unsecured Creditors
("Committee") propose a joint Plan and Disclosure Statement which
provide for the establishment of a post-confirmation trust
("Trust") with a liquidating trustee ("Trustee").
The United States Trustee asserts that the Disclosure Statement is
inadequate because it does not provide sufficient information about
the post-confirmation Trust. Specifically, the Disclosure Statement
does not identify the proposed Trustee or attach final trust
agreements or other organizational documents setting forth the
rights and duties of the post-confirmation Trustee. 11 U.S.C. §
1129(a)(5)(A-B). Furthermore, no liquidation analysis is attached
to the proposed Disclosure Statement.
The United States Trustee objects to the Plan for two reasons.
First, it contains impermissible exculpation and release
provisions. Second, the Plan impermissibly discharges the Debtor.
The Confirmation Order should also clarify 1) that nothing in the
Plan modifies any party's setoff or recoupment rights; 2) the
Trustee's obligation to timely file post-confirmation operating
reports; and 3) that no governmental or regulatory claims are
released.
A full-text copy of the United States Trustee's dated Feb. 8, 2022,
is available at https://bit.ly/3gCXddY from PacerMonitor.com at no
charge.
About Automotive Parts
Automotive Parts Distribution International, LLC, now known as APDI
Liquidation LLC, was established in January 2008 as a distribution
and marketing company to cover the North American aftermarket. It
offers radiators, condensers, fan assemblies, heater cores,
intercoolers, heavy duty radiators, and fuel pump module
assemblies.
Automotive Parts filed a voluntary petition for Chapter 11
protection (Bankr. N.D. Texas Case No. 21-41655) on July 12, 2021,
listing up to $10 million in assets and up to $50 million in
liabilities. Kevin O'Connor, chief executive officer, signed the
petition. Judge Edward L. Morris oversees the case.
The Debtor tapped Winstead PC, and Ice Miller, LLP as legal counsel
and Howard, LLP as tax services provider.
The U.S. Trustee for Region 6 appointed an official committee of
unsecured creditors in the Debtor's Chapter 11 case on Aug. 6,
2021. Kelley Drye & Warren, LLP and Province, LLC serve as the
committee's legal counsel and financial advisor, respectively.
AVAGO TECHNOLOGIES: Egan-Jones Keeps BB+ Senior Unsecured Ratings
-----------------------------------------------------------------
Egan-Jones Ratings Company, on January 21, 2022, retained its 'BB+'
foreign currency and local currency senior unsecured ratings on
debt issued by Avago Technologies Ltd.
Headquartered in San Jose, California, Avago Technologies Ltd.
manufactures semiconductor products such as optoelectronics,
radio-frequency and microwave components, and application-specific
integrated circuits.
AZALEA TOPCO: Moody's Affirms B3 CFR, Rates $400MM Term Loan 'B2'
-----------------------------------------------------------------
Moody's Investors Service affirmed Azalea TopCo, Inc.'s (dba Press
Ganey) B3 Corporate Family Rating and B3-PD Probability of Default
Rating. Concurrently, Moody's assigned a B2 rating to the company's
proposed incremental $400 million senior secured first lien term
loan and affirmed the B2 ratings on the company's existing $250
million revolver due 2024 and $1,186 million senior secured first
lien term loan. The B2 rating on the first lien debt reflects their
priority position relative to second-lien debt of $444 million
(unrated) in the capital structure. The outlook is stable.
Proceeds from the incremental debt issuance, combined with a
sizeable equity commitment will be used to fund the acquisition of
Forsta, a market research firm and pay related fees and expenses.
The acquisition will contribute approximately $150 million of
revenue to Press Ganey and expand the company's customer base and
service capabilities. The ratings actions are based on expectations
of the company's continued high financial leverage in the context
of the rating category and integration risk from frequent
acquisitions. These factors are mitigated by a solid fundamental
business profile that benefits from exposure to a stable healthcare
sector, strong margins and expected deleveraging in the absence of
any additional debt. Governance was a consideration in the rating
action, specifically the tolerance for high leverage that is used
to fund growth.
The following ratings/assessments are affected by the action:
New Assignments:
Issuer: Azalea TopCo, Inc.
Senior Secured 1st Lien Term Loan, Assigned B2 (LGD3)
Ratings Affirmed:
Issuer: Azalea TopCo, Inc.
Corporate Family Rating, Affirmed B3
Probability of Default Rating, Affirmed B3-PD
Senior Secured Bank Credit Facility, Affirmed B2 (LGD3)
Outlook Actions:
Issuer: Azalea TopCo, Inc.
Outlook, Remains Stable
RATINGS RATIONALE
Press Ganey's B3 CFR is constrained by the company's high financial
leverage, modest scale and risk associated with private equity
ownership. The company's entrenched market position, extensive
survey data and benchmarking capabilities support strong
profitability margins. Moody's believes the company will continue
to benefit from the increasing complexity of the healthcare system
that requires data and information to drive allocation of
resources. In addition, the government mandated patient experience
surveys ensure demand for services that are provided by Press
Ganey. Good operating track record, high client retention rate,
diverse customer base and long-standing relationships with leading
healthcare providers are other favorable rating considerations. The
company, via its acquisitions, recently entered new markets such as
the payor vertical and online information platforms for patients,
which Moody's believes is necessary to maintain market presence in
an increasingly crowded market. The rating also incorporates the
company's exposure to legislative risk inherent in its relationship
with the Centers for Medicare and Medicaid Services ("CMS").
Pro forma leverage (Moody's adjusted debt/EBITDA) for the
transaction is over 10.0x for LTM September 2021. Moody's expects
leverage to moderate to 8.0x over the next 12-18 months driven by
revenue growth and sustained strong margins. Revenue growth in the
base business (excluding acquisitions) is expected to be in the low
to mid-teen area. Over the course of the next 12-18 months revenue
will be boosted as revenues from SPH Analytics, which was acquired
in 2021 and Forsta are annualized. The company's ability to
cross-sell the company's other high value products will drive
earnings and above-average margin growth. However, Moody's
anticipates Press Ganey will continue to augment growth with
acquisitions, limiting the reduction in leverage on a sustainable
basis.
Press Ganey has good liquidity, supported by the company's free
cash flow generation and availability under its $250 million
revolving credit facility. Moody's expects the company to generate
$27 million in free cash flow over this year, with FCF-to-debt of
close to 1%. Cash flow this year includes some one-time expenses.
Reliance on the revolving credit facility is expected to be limited
to funding acquisitions. Alternate liquidity is limited as all
assets are encumbered.
The B2 ratings assigned to Press Ganey's incremental $400 million
first lien senior secured term loan and existing approximately $1.2
billion first lien senior secured term loan due July 2026 are one
notch above the company's B3 CFR, reflecting the priority position
in the capital structure and the benefit from the loss absorption
provided by the $444 million senior second lien term loan
(unrated). The company has a $250 million senior secured first lien
revolver that is rated B2 and is pari passu to the first lien term
loan. The capital structure also includes $182 million of perpetual
preferred equity.
The stable outlook reflects Moody's expectations that the various
players within healthcare sector will continue to demand and
require patient experience measurement and related information and
analytics. The stable outlook also assumes that there will not be
any significant changes in law or regulation that would cause
demand for services provided by Press Ganey to decline. Moody's
expects that revenue will continue to grow organically and via
acquisitions as the company adds revenue sources. Moody's expects
leverage will moderate towards 8.0x by the end of 2022.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Moody's would consider a ratings upgrade if (all metrics Moody's
adjusted): i) Press Ganey continues to grow scale and revenue while
maintaining strong margins; ii) Moody's expects debt-to-EBITDA will
be sustained below 7.0x, iii) free cash flow as a percentage of
debt will be sustained above 5%, and (iv) good liquidity is
maintained.
Moody's would consider a downgrade if (all metrics Moody's
adjusted): i) revenue, client retention or liquidity materially
deteriorate that would indicate declining market share or demand
for services provided by the company, (ii) EBITA to interest is
sustained below 1.0x and (iii) free cash flow to debt approaches
break-even.
The principal methodology used in these ratings was Business and
Consumer Services published in November 2021.
Headquartered in Boston, Massachusetts and South Bend, Indiana,
Azalea TopCo, Inc. (dba Press Ganey) is a leading provider of
performance measurement and improvement services to U.S. healthcare
providers including hospitals, medical practices and alternate-site
providers. Press Ganey is owned by private equity sponsors Ares
Management and Leonard Green & Partners. The company generated
approximately $515 million revenue in LTM period ending September
2021.
AZALEA TOPCO: S&P Downgrades ICR to 'B-', Outlook Stable
--------------------------------------------------------
S&P Global Ratings lowered its issuer credit rating on Azalea TopCo
Inc. (d/b/a Press Ganey) to 'B-' from 'B' and removed all of its
ratings from CreditWatch, where S&P placed them with negative
implications on Feb. 7, 2022. S&P has also lowered its senior
secured credit facility to 'B-' from 'B'. The recovery ratings
remains unchanged at '3'. The downgrade mainly reflects its view
that the Azalea's adjusted leverage will likely remain elevated
over the several years, given the acquisitiveness of the company,
with adjusted leverage over 10x and funds from operations (FFO) to
debt of less than 3%.
S&P said, "At the same time, we assigned our 'B-' issue -level
rating and '3' recovery rating to the company's proposed $400
million senior secured incremental term loan due 2026. The '3'
recovery rating indicates our expectation of meaningful (50%-70%l
rounded estimate: 55%) recovery for noteholders in the event of a
payment default.
"The stable outlook reflects mid- to high-single digit organic
revenue growth for the next 12 months as the company continues to
maintain a leading competitive position in its core health care
business, the steady, subscription nature of its business, and our
expectation that it will be able to stabilize margin amid rising
inflationary pressure and generate about $45 million to $50 million
free cash flow while keeping leverage (including preferred shares)
above 10x.
The downgrade reflects a more aggressive acquisition pace, keeping
leverage above 10x for several years. The acquisition of Forsta,
the company's largest ever, is Azalea's fifth acquisition in the
past two years. S&P said, "We expect acquisition activities will
continue into the next few years as the company expands into
adjacent markets outside of the core patient experience segment. We
believe pro forma leverage (including preferred shares) will be
around 10x-11x for 2022 assuming the Forsta transaction goes
through regulatory approval and that adjusted free cash flow to
debt will be low at about 2%."
S&P said, "We expect the acquisition will increase execution risk
and has limited impact on the business risk profile for at least
the next few years.The Forsta acquisition follows Azalea's
acquisition of SPH Analytics, another large acquisition, in 2021.
Thus, the company will need to integrate two large operations at
once. Forsta also represents a new market for Azalea. Forsta is
based in London and serves mostly non-health care customers by
providing market research software and data visualization tools to
help them analyze the data and get the most out of their data.
Although Forsta is already a partner for Press Ganey by providing
white-label services, its business model and customer base is very
different than Press Ganey's, creating integration risk.
Integration risk is partly mitigated by the expected retention of
Forsta's key executives, but we think the size and nature of the
business still could lead to integration challenges. Both
acquisitions also generate lower margins than Azalea's core
business and it is uncertain when the company will realize
operational synergies."
Press Ganey's continued solid leading market position in its core
health care business, subscription nature of its business, and
long-standing relationships with its client base and strong market
share provides a solid base. S&P said, "We believe the addition of
Forsta diversifies Press Ganey's revenue and customer base, bring
in-house a key vendor, and provide opportunities for operating
expense synergies. Forsta also brings Press Ganey greater
technological expertise, which the company will use to improve
current products and offer new ones, including potentially into
targeted international markets, leveraging the global footprint of
Forsta. Meanwhile, the company's main health care survey business'
above-average EBITDA margins, strong brand awareness, high client
retention rates (about 98%), good revenue visibility from multiyear
contracts, and a diverse customer base with no single client
representing more than 2.5% of total revenue. Additionally, we
continue to view Press Ganey as likely to benefit from an
increasing focus on value-based reimbursement in the health care
provider industry as its data and analytics provide important
qualitative measurements of value."
S&P said, "Our stable outlook reflects mid- to high-single-digit
organic revenue growth for 2022, relatively stable margins despite
the rising inflationary pressure, and the generation of $45 million
to $55 million free cash flow while keeping leverage (including
preferred shares) between 10x and 11x.
"We could lower our rating on Press Ganey if the company's free
cash flow is not able to cover fixed charges including debt
amortization. This could happen as a result of significant client
loss and loss of market share or an unexpected setback in
integrating its recent large acquisitions."
S&P could revise the outlook to stable if:
-- Free cash flow to debt were sustained above 3%; and
-- Adjusted leverage including the preferred shares were sustained
below 8.5x.
BAY CIRCLE: NRCT Loses Bid for Summary Judgment in Gateway Suit
---------------------------------------------------------------
Judge Wendy L. Hagenau of the United States Bankruptcy Court for
the Northern District of Georgia, Atlanta Division, finds genuine
issues of material fact exist in the adversary proceeding styled,
GOOD GATEWAY, LLC and, SEG GATEWAY, LLC, on behalf of JOHN LEWIS,
CHAPTER 11 TRUSTEE FOR BAY CIRCLE PROPERTIES, LLC, Plaintiff, v.
NRCT, LLC, Defendant, Adv. Proc. No. 19-5284 (Bankr. N.D. Ga.),
that preclude judgment as a matter of law.
Prior to the bankruptcy cases, Good Gateway, LLC and SEG Gateway,
LLC, obtained a judgment against Chuck Thakkar and others for $12
million. The judgment was recorded. At the time, Chuck Thakkar and
Saloni Thakkar jointly owned the property now referred to as the
Bay Circle Property. Shortly before the bankruptcy, Mr. and Mrs.
Thakkar conveyed the Bay Circle Property to Bay Circle, but subject
to Gateway's lien. As one of the milestone payments was
approaching, Bay Circle sought to sell its property. Bay Circle was
the second Debtor to seek to sell or refinance its property in
furtherance of the Wells Fargo Settlement.
Gateway objected that its interest in the Bay Circle property was
unnecessarily lost and asked that other Debtors be required to sell
their property first or for adequate protection of the lien it lost
by virtue of the sale of the Bay Circle Property. The Court
approved the sale and provided Gateway a replacement lien on Bay
Circle's claims for contribution and subrogation up to the amount
of $2,675,000 (1/2 the sale price of the Bay Circle Property). The
Court later modified the AP Order.
On December 11, 2018, the Court appointed a Chapter 11 Trustee in
all five bankruptcy cases. The appointment was triggered by Mr.
Thakkar's actions in the Nilhan Developers case. When the Trustee
was appointed, the Trustee was tasked with investigating the
potential Contribution Claim of Bay Circle against NRCT and any
other Debtors or entities. The Trustee asked GlassRatner Advisory &
Capital Group, LLC to use its expertise and analyze possible claims
by Bay Circle against the other Debtors and non-Debtors, taking
into account payments made by the different Debtors and other
obligors both before and after the filing of the petition. On March
27, 2019, the Trustee filed his Preliminary Analysis Regarding Bay
Circle's Contribution Claim with a chart showing the payments made
by the Debtors to Wells Fargo and Bay Point. The Trustee
acknowledged that additional information was needed to complete the
analysis. Paul Dopp of GlassRatner conducted an analysis and
produced a report suggesting possible claims based on various
assumptions. The Dopp Report set forth two possibilities, Scenario
1 and Scenario 2, and concluded Bay Circle held a claim in the
range of $0 to $2,675,000.
On April 29, 2019, the Trustee filed a Motion Requesting
Determination of the Amount of Debtor Bay Circle's Contribution
Claim, attaching the Dopp Report. The Trustee requested the Court
enter an order holding Bay Circle has a contribution claim against
NRCT and each of the non-Debtor obligors in the amount of
$2,675,000, the maximum adequate protection claim provided to
Gateway. Chuck and Saloni Thakkar, Niloy and Rohan Thakkar, and
Gateway all filed responses. The Thakkars objected to the
procedural posture of the motion and argued it was not appropriate
for the Trustee to pursue a claim on behalf of Bay Circle against
NRCT since he served as trustee of both. Gateway argued in support
of the Motion to Determine Claim and in favor of Scenario 2,
calculating Bay Circle's Contribution Claim using all co-obligors,
not just the Debtors.
After a hearing on May 30, 2019, the Court entered a Scheduling
Order, which, among other things, instructed parties-in-interest to
submit papers about whether the Court should modify its AP Order
and directed the Trustee to file a motion for approval of any
arrangement whereby Gateway may prosecute the Contribution Claim of
Bay Circle. After reviewing the responses of the parties, the Court
entered an Amendment to Order on Amended and Restated Motion for
Relief under 11 U.S.C. Section 363 and Substantive Consolidation.
It modified the AP Order to clarify the order in three key ways:
the order was without prejudice to any defenses that might be
raised to the Contribution Claim; the lien held by Gateway was only
on the net proceeds of Bay Circle's claims, and not on the claims
themselves; and, although Bay Circle may have claims against
non-Debtors, Gateway's lien was only on Bay Circle's claims against
the other Debtors.
On June 20, 2019, the Trustee filed a Motion for Order Regarding
Standing to Pursue Contribution and/or Subrogation Claims of Bay
Circle. The Court approved the motion and granted Gateway standing
to pursue the Contribution Claim of Bay Circle on July 11, 2019.
Gateway filed a complaint on behalf of the Trustee against NRCT
with respect to Bay Circle's Contribution Claim on August 13, 2019,
initiating this adversary proceeding.
Here, Plaintiff, as the party seeking contribution, has the burden
of proving by a preponderance of the evidence that it is entitled
to contribution. Part of the Plaintiff's case is that it paid more
than its fair share of the obligation. Judge Hagenau points out
that while there is a presumption all co-obligors are solvent, the
defendant is entitled to offer proof to overcome that presumption.
The evidence should include not only a balance sheet analysis but
also whether the entity is paying its debts as they come due and
other relevant facts. Defendant argues that because the Debtors are
in bankruptcy, it is entitled to a presumption of insolvency, but
the law of contribution does not provide for such a presumption,
Judge Hagenau notes. Evidence of bankruptcy is some evidence of
insolvency, but it is not dispositive, the judge says. If Defendant
provides evidence of insolvency, the burden of persuading the
finder of fact that the plaintiff paid more than its fair share
remains on the Plaintiff, the judge adds.
The Court holds that Plaintiff is entitled to the benefit of the
presumption that all co-obligors are solvent. Defendant, therefore,
has the burden of coming forward with evidence to rebut or meet the
presumption. Nevertheless, Plaintiff retains the ultimate burden of
proving it is entitled to contribution because it paid more than
its fair share, according to Judge Hagenau. Movant Defendant
submitted no evidence of the insolvency of it or any co-obligor,
and so has not rebutted the presumption of solvency, Judge Hagenau
points out. Without such evidence, the Defendant's motion for
summary judgment is nothing more than a denial of the allegations
of Plaintiff's pleadings. As such, Defendant is not entitled to
summary judgment, Judge Hagenau concludes.
"The measure of contribution is based on the number of available
obligors. No evidence or argument has been presented as to how to
divide the liability; the Dopp Report is unauthenticated hearsay
which, on its face, raises issues about how to calculate
contribution. A genuine issue of material fact exists regarding the
number of obligors available to contribute and, ultimately, whether
Bay Circle paid more than its fair share. Accordingly, Defendant
has not established it is entitled to judgment as a matter of law,"
Judge Hagenau holds.
A full-text copy of the Order dated January 31, 2022, is available
at https://tinyurl.com/5n7rkfdn from Leagle.com.
About Bay Circle Properties, et al.
Bay Circle Properties, LLC, DCT Systems Group, LLC, Sugarloaf
Centre, LLC, Nilhan Developers, LLC, and NRCT, LLC, own 16
different real properties including significant undeveloped
acreage. The properties also include office and warehouse
buildings, retail shopping centers and free standing single tenant
buildings.
Bay Circle Properties, et al., filed Chapter 11 bankruptcy
petitions (Bankr. N.D. Ga. Case Nos. 15-58440 to 15-58444) on May
4, 2015. The Chapter 11 cases are jointly administered. In the
petition signed by Chuck Thakkar, manager, Bay Circle estimated $1
million to $10 million in assets and liabilities.
The Debtors tapped John A. Christy, Esq., J. Carole Thompson
Hord,Esq., and Jonathan A. Akins, Esq., at Schreeder, Wheeler &
Flint, LLP, as bankruptcy attorneys. The Debtors engaged RG Real
Estate, Inc., as real estate broker.
Ronald L. Glass was appointed as Chapter 11 trustee for the
Debtors. The trustee tapped Morris, Manning & Martin, LLP as his
bankruptcy counsel; GlassRatner Advisory & Capital Group, LLC as
his financial advisor; and Nelson Mullins Riley & Scarborough LLP
as special counsel.
BFCD PROPERTIES: Unsecured Creditors to Split $5K in Plan
---------------------------------------------------------
BFCD Properties, LLC, filed with the U.S. Bankruptcy Court for the
Middle District of Pennsylvania an Amended Disclosure Statement in
support of its Amended Chapter 11 Plan dated Feb. 8, 2022.
The Debtor is an entity initially established in December 13, 2012
to hold title to the real estate and vehicles of Craig Deimler and
William Fisher-Deimler, its principals.
The second mortgage on the Debtor's real property had required
interest-only payments for several years. When this loan became
fully amortized, the lender would not negotiate acceptable payment
terms or agree to a loan modification. The lender then filed a
Motion for Relief from the Automatic Stay in the Debtor's
principals' individual Chapter 13 bankruptcy, leaving the Debtor no
alternative but to file the within case to avoid foreclosure.
Class C consists of all general unsecured claims against the
Debtor, including the unsecured portion of Class B-2. Holders of
Class C claims shall be paid, pro rata, a total of $5,000.00, to be
paid on the Effective Date. The Effective Date payment shall be
paid from the funds contributed.
The pro rata share of the claimed amount of any claims which are
then subject to objections as to which a Final Order has not been
entered shall be deposited in an interest bearing bank account
until a Final Order is entered. When Final Orders are entered
disallowing or allowing and liquidating all Class C claims, the
remaining funds in the bank account shall be distributed to the
holders of all Class C claims pro rata. Any claim by or through the
U.S. Small Business Administration shall be filed within 60 days
after confirmation of the Plan, or it shall be barred.
The Debtor shall fund this Plan with income from the operation of
its business and cash on hand. Such income will come from payments
made by its principals for rental for the Debtor's real estate and
motor vehicles. The payments that will be made will mirror those
called for under the Plan, such that the Debtor will be able to
satisfy its obligations thereunder.
The Debtor's principals will also pay any attorney's fees and costs
and any other payments required hereunder. The Debtor shall retain
the Assets of the estate and shall pay the creditors the amounts
set forth in the Plan. Consistent with the provisions of this Plan
and subject to any releases, the Debtor reserves the right to begin
or continue any adversary proceeding permitted under the Code and
Rules to collect any debts, or to pursue claims in any court of
competent jurisdiction.
Except as expressly provided for in this Plan, nothing in this Plan
shall be deemed to constitute a waiver of any claim that the Debtor
may assert against any other party, including the holder of any
claim provided for in this Plan, and the allowance of any claim
against the Debtor or the estate shall not bar any claim by the
Debtor against the holder of such claim.
The Debtor projects that the first secured claim of Mid Penn Bank
will be reamortized at its existing contract rate of interest
(fixed) and paid in full over 30 years. The second secured claim of
Mid Penn Bank (U.S. Small Business Administration loan guarantee)
will have its claim stripped down to the equity available in its
collateral and paid in full over 30 years at its existing contract
rate of interest (fixed).
Statutory lien creditors (Dauphin County, City of Harrisburg, and
Capital Region Water) will be paid in full over five years, with
interest (if requested in their Proofs of Claim or an objection to
their Plan treatment is filed, and without interest if not). Truist
will be paid under longer and different terms from those provided
for in the loan documents. VW Credit will be paid in full pursuant
to its existing loan terms. The one general unsecured creditor, the
stripped-down claim of Mid Penn Bank (U.S. Small Business
Administration loan), will be paid approximately 3.11% of its
general unsecured claim in a lump sum on the Effective Date.
A full-text copy of the Amended Disclosure Statement dated Feb. 8,
2022, is available at https://bit.ly/3LqKRUb from PacerMonitor.com
at no charge.
Attorneys for Debtor in Possession:
Brett Weiss, Esq.,
The Weiss Law Group, LLC
6404 Ivy Lane, Suite 650
Greenbelt, MD 20770
Tel: (301) 924-4400
Fax: (240) 627-4186
Email: brett@BankruptcyLawMaryland.com
-- and --
Kara Katherine Gendron, Esq.
Mott & Gendron Law
125 State St.
Harrisburg, PA 17101
Phone: 717-232-6650
Email: mottgendronecf@gmail.com
About BFCD Properties
BFCD Properties, LLC, sought protection for relief under Chapter 11
of the Bankruptcy Code (Bankr. M.D. Pa. Case No. 21-01127) on May
18, 2021, listing $100,001 to $500,000 in both assets and
liabilities. Judge Henry W. Van Eck oversees the case. The Weiss
Law Group, LLC, and Mott & Gendron Law serve as the Debtor's legal
counsel.
BOY SCOUTS: Key Abuse-Survivors Group Now Backs Plan
----------------------------------------------------
Becky Yerak and Andrew Scurria of The Wall Street Journal report
that the Boy Scouts of America has won over a key abuse-survivors
group on bankruptcy plan.
Lawyers of the official committee, representing 82,200 individual
claimants, will now recommend they accept the youth group's offer.
The Boy Scouts of America won backing for a landmark sex-abuse
compensation plan from the official committee representing 82,200
individual claimants, further solidifying support for ending the
largest bankruptcy case ever filed over childhood abuse.
The proposed deal with the survivors' committee, among the harshest
critics of the Boy Scouts since it filed for chapter 11 two years
ago, comes as the youth organization nears a trial scheduled for
later this month on a bankruptcy-exit plan that includes roughly
$2.7 billion for abuse victims.
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: Parker Waichman Balks at Plan Releases
--------------------------------------------------
Parker Waichman LLP on behalf of its abuse survivor clients that
have voted to reject the plan (the "Rejecting PW Abuse Survivor
Clients"), filed objection to the Second Modified Fifth Amended
Chapter 11 Plan of Reorganization for Boy Scouts of America and
Delaware BSA, LLC, et al., and in support of this Objection, states
as follows:
Parker Waichman points out that confirmation of the Plan should be
denied because it (a) proposes nonconsensual third-party releases
and a channeling injunction which are (at a minimum) defective
because of insufficient consideration for Abuse Claims2 and (b)
proposes to implement settlements that are not fair or reasonable,
including for the reasons stated by the Official Committee of Tort
Claimants ("TCC") in its letter recommending that holders of Abuse
Claims vote to reject the Plan.
Parker Waichman further points out that the Plan seeks approval of
nonconsensual third-party releases of Abuse Claims against a long
list of non-debtor "Protected Parties" and "Limited Protected
Parties." The Plan also seeks to enjoin lawsuits against these
third parties and channel all Abuse Claims against them to the
Settlement Trust. Even presuming this Court does not follow recent
decisions by District Courts in other Circuits4 calling into
question Bankruptcy Courts' authority to grant non-consensual
third-party releases, the non-consensual third-party releases
proposed by the Plan are not justified under the circumstances of
these Chapter 11 cases, because those releases are proposed to be
granted for insufficient consideration. In support hereof, the
objectors intend to rely on the evidence adduced and presented by
Participating Parties and to join in their objections to the
fairness and reasonableness of the various settlements that the
Plan proposes to implement.
Counsel to Parker Waichman LLP, on behalf of its Rejecting PW Abuse
Survivor Clients:
J. Cory Falgowski, Esq.
BURR & FORMAN LLP
1201 N. Market Street, Suite 1407
Wilmington, Delaware 19801
Telephone: (302) 830-2312
Email: jfalgowski@burr.com
- and -
Melanie H. Muhlstock, Esq.
PARKER WAICHMAN LLP
6 Harbor Park Drive
Port Washington, NY 11050
Telephone: (516) 466-6500
Facsimile: (516) 466-6555
Email: mmuhlstock@yourlawyer.com
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.
BRIGHT MOUNTAIN: Incurs $1.7 Million Net Loss in First Quarter
--------------------------------------------------------------
Bright Mountain Media, Inc. filed with the Securities and Exchange
Commission its Quarterly Report on Form 10-Q disclosing a net loss
of $1.71 million on $2.40 million of advertising revenue for the
three months ended March 31, 2021, compared to a net loss of $3.03
million on $2.27 million of advertising revenue for the three
months ended March 31, 2020.
As of March 31, 2021, the Company had $33.07 million in total
assets, $30.67 million in total liabilities, and $2.41 million in
total shareholders' equity.
Bright Mountain said, "As we continue our efforts to grow our
business, we expect that our monthly cash operating overhead will
continue to increase as we add personnel, although at a lesser
rate, and we are not able at this time to quantify the amount of
this expected increase. In 2021 we implemented policies and
procedures around cash collections to prevent the aging of accounts
receivables that was experienced in 2020. Cash collection efforts
have been successful, and we feel that we have appropriately
reserved for uncollectible amounts at March 31, 2021."
The report of the Company's independent registered public
accounting firm on the Company's audited consolidated financial
statements at Dec. 31, 2020 and 2019 and for the years then ended
contains an explanatory paragraph regarding substantial doubt of
the Company's ability to continue as a going concern based upon its
net losses, cash used in operations and accumulated deficit. These
factors, among others, raise substantial doubt about the Company's
ability to continue as a going concern.
"Our ability to fully implement the Bright Mountain Media Ad
Exchange Network and maximize the value of our assets are dependent
upon our ability to raise additional capital sufficient for our
short-term and long-term growth plans. Historically, we have been
dependent upon debt financing and equity capital raises to provide
adequate funds to meet our working capital needs. During the three
months ended March 31, 2021, we did not raise any debt or equity
capital. During the three months ended March 31, 2020 we raised
$2,558,750 through the sale of our securities in one private
placement. While we have engaged a placement agent to assist us in
raising capital, the placement agent is acting on a best-efforts
basis and there are no assurances we will be successful in raising
additional capital during 2022 through the sale of our securities.
Any delay in raising sufficient funds will delay the implementation
of our business strategy and could adversely impact our ability to
significantly increase our revenues in future periods. In
addition, if we are unable to raise the necessary additional
working capital, absent a significant increase in our revenues,
most particularly from our advertising segment, of which there is
no assurance, we will be unable to continue to grow our company and
may be forced to reduce certain operating expenses to conserve our
working capital," Bright Mountain said.
During the three months ended March 31, 2021 the Company received
proceeds of $1,137,140 through the granting of the 2nd tranche of
PPP loans from the US Government and paid dividends of $1,261.
A full-text copy of the Form 10-Q is available for free at:
https://www.sec.gov/ix?doc=/Archives/edgar/data/1568385/000149315222003400/form10-q.htm
About Bright Mountain
Based in Boca Raton, Fla., Bright Mountain Media, Inc. --
www.brightmountainmedia.com -- is an end-to-end digital media and
advertising services platform, efficiently connecting brands with
targeted consumer demographics. In addition to its corporate
website, the Company owns and/or manages 24 websites which are
customized to provide its niche users, including active, reserve
and retired military, law enforcement, first responders and other
public safety employees with products, information and news that
the Company believes may be of interest to them. The Company also
owns an ad network which was acquired in September 2017.
Bright Mountain reported a net loss of $72.71 million for the year
ended Dec. 31, 2020, a net loss of $4.17 million for the year ended
Dec. 31, 2019, and a net loss of $5.22 million for the year ended
Dec. 31, 2018. As of Dec. 31, 2020, the Company had $36.53 million
in total assets, $33.01 million in total liabilities, and $3.51
million in total shareholders' equity.
East Brunswick, New Jersey-based WithumSmith+Brown, PC, the
Company's auditor since 2021, issued a "going concern"
qualification in its report dated Dec. 23, 2021, citing that the
Company has suffered recurring losses from operations and has a net
capital deficiency that raise substantial doubt about its ability
to continue as a going concern.
BRINKER INT'L: Egan-Jones Hikes Sr. Unsec. Debt Ratings to BB
-------------------------------------------------------------
Egan-Jones Ratings Company on January 20, 2022, upgraded the
foreign currency and local currency senior unsecured ratings on
debt issued by Brinker International Inc.
Headquartered in Coppell, Texas, Brinker International, Inc. is a
restaurant operator who owns, operates, or franchises
establishments in the United States and internationally.
BVM THE BRIDGES: Seeks to Hire Johnson Pope as Legal Counsel
------------------------------------------------------------
BVM The Bridges, LLC seeks approval from the U.S. Bankruptcy Court
for the Middle District of Florida to hire Johnson Pope Bokor
Ruppel & Burns, LLP as counsel.
The firm will render these services:
a. give the Debtor legal advice with respect to their duties
and obligations as Debtor in Possession or "DIP';
b. take necessary steps to analyze and pursue any avoidance
actions, if in the best interest of the estate;
c. prepare on behalf of the Debtor the necessary motions,
notices, pleadings, petitions, answers, orders, reports and other
legal papers required in this Chapter 11 case;
d. assist the Debtor in taking all legally appropriate steps
to effectuate compliance with the Bankruptcy Code; and
e. perform all other legal services for the Debtor which may
be necessary herein including closings of sales of the Debtor’s
real property assets.
Alberto "Al" F. Gomez, Jr., Esq., a partner of Johnson Pope,
currently charges $410 per hour for his services.
The firm received a retainer in the amount of $20,000, plus the
court filing fee of $1,738.
Johnson Pope is disinterested and does not hold or represent an
interest adverse to the estate or the Debtors as required by 11
U.S.C. Section 327, according to court filings.
The firm can be reached through:
Alberto "Al" F. Gomez, Jr., Esq.
Johnson Pope Bokor Ruppel & Burns, LLP
401 East Jackson Street #3100
Tampa, FL 33602
Tel: 813-225-2500
Fax: 813-223-7118
E-mail: al@jpfirm.com
About BVM The Bridges, LLC
BVM The Bridges, LLC operates an 87-bed/69-unit assisted living
facility known as The Bridges Assisted Living & Memory Care and The
Claridge House at the Bridges located at 11202 Dewhurst Drive in
Riverview, Florida since 2014. The Debtor's average census is 70
residents.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. M.D. Fla. Case No. 8:22-bk-00345) on
January 28, 2022. In the petition signed by John Bartle, president,
the Debtor disclosed up to $10 million in assets and up to $50
million in liabilities.
Alberto F. Gomez, Jr, Esq. at Johnson, Pope, Bokor, Ruppel & Burns,
LLP is the Debtor's counsel.
CADIZ INC: Appoints Susan Kennedy as Executive Chair
----------------------------------------------------
Cadiz Inc.'s Board of Directors has appointed Susan Kennedy to
serve as executive chair of the Company. Kennedy steps into the
role Cadiz founder Keith Brackpool has held since 2001. Brackpool
will remain on the Board as a non-executive director.
"It's an honor to be entrusted with this leadership role," Kennedy
said. "I am excited to take the helm at such a propitious time for
the company and, most importantly, at such a critical time in the
fight against climate change."
In 2020, Cadiz completed acquisition of a 220-mile pipeline
previously used by El Paso Natural Gas to carry oil and gas and is
in the process of repurposing the pipeline to carry water. When
completed, the repurposed gas pipeline will be part of an
underground water pipeline network that connects the State Water
Project and the Colorado River Aqueduct to groundwater banks that
can store water during flood years and provide flexibility and
reliability during droughts.
"Given the stress of more frequent and intense droughts on the
State Water Project and Colorado River and with few new storage
projects on the horizon, this project is critical to the health and
security of California's water supply," Kennedy said. "It will
also be the first project in the world to repurpose fossil fuel
infrastructure to address the impacts of climate change – game
changing when it comes to water."
"Susan's reputation for successfully executing large-scale
initiatives involving complex stakeholder engagement is legendary,"
Brackpool said. "I have known Susan for over two decades and can
think of no one more capable of stepping into this role at this
time than Susan."
Kennedy joined the Cadiz Board in March 2021 after more than 30
years in California government and politics, having served as chief
of staff to Governor Arnold Schwarzenegger, Cabinet Secretary to
Governor Gray Davis and Communications Director for U.S. Senator
Dianne Feinstein. Kennedy also served on some of the State's most
powerful regulatory boards overseeing investor-owned energy, water
and telecommunications industries, health insurance and water
projects. In the governor's office, Kennedy was known for her
execution skills, which put her at the center of complex deals and
groundbreaking policies, including AB 32 - California's
internationally recognized climate change law, the Low Carbon Fuel
Standard and implementation of the California Bay-Delta Accord.
After leaving the Governor's office in 2011 she founded energy
storage start-up Advanced Microgrid Solutions, which was acquired
by Fluence (FLNC NASDAQ) in 2020.
"We enthusiastically welcome Susan to this new leadership position
at the helm of our Board," said Scott Slater, Cadiz CEO and board
member. "Susan's exceptional experience and innovative thinking
will be an important asset as we complete our mission of bringing
water to Californians in need."
For her services as Chair of the Board, an executive officer role,
Ms. Kennedy will receive base compensation of $300,000 and will be
entitled to performance-based bonus awards.
About Cadiz Inc.
Founded in 1983 and headquartered in Los Angeles, California, Cadiz
Inc. -- http://www.cadizinc.com-- is a natural resources
development company dedicated to creating sustainable water and
agricultural opportunities in California. The Company owns 70
square miles of property with significant water resources in
Southern California and are the largest agricultural operation in
San Bernardino, California, where we have sustainably farmed since
the 1980s. The Company is also partnering with public water
agencies to implement the Cadiz Water Project, which was named a
Top 10 Infrastructure Project that over two phases will create a
new water supply for approximately 400,000 people and make
available up to 1 million acre-feet of new groundwater storage
capacity for the region.
Cadiz Inc. reported a net loss and comprehensive loss applicable to
common stock of $37.82 million for the year ended Dec. 31, 2020, a
net loss and comprehensive loss applicable to common stock of
$29.53 million for the year ended Dec. 31, 2019, and a net loss and
comprehensive loss of $26.27 million for the year ended Dec. 31,
2018. As of Sept. 30, 2021, the Company had $120.11 million in
total assets, $72.99 million in total liabilities, and $47.12
million in total stockholders' equity.
CARVANA CO: BlackRock Holds 5.1% of Class A Shares
--------------------------------------------------
BlackRock, Inc. disclosed in a Schedule 13G filed with the
Securities and Exchange Commission that as of Dec. 31, 2021, it
beneficially owns 4,324,029 shares of Class A common stock of
Carvana Co., representing 5.1 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/1364742/000083423722007801/us1468691027_020722.txt
About Carvana
Founded in 2012 and based in Tempe, Arizona, Carvana Co. --
http://www.carvana.com-- is a holding company that was formed as a
Delaware corporation on Nov. 29, 2016. Carvana is an e-commerce
platform for buying and selling used cars. The Company owns and
operates Carvana.com, which enables consumers to quickly and easily
shop vehicles, finance, trade-in or sell the ir current vehicle to
Carvana, sign contracts, and schedule as-soon-as-next-day delivery
or pickup at one of Carvana's patented, automated Car Vending
Machines.
Carvana Co. reported a net loss of $462.22 million in 2020, a net
loss of $364.64 million in 2019, and a net loss of $254.74 million
in 2018. As of Sept. 30, 2021, the Company had $5.36 billion in
total assets, $4.65 billion in total liabilities, and $708 million
in total stockholders' equity.
* * *
As reported by the TCR on May 24, 2021, S&P Global Ratings revised
its ratings outlook to positive from stable and affirmed its 'CCC+'
issuer credit rating on online used-car retailer Carvana Co. "The
positive outlook indicates that we could raise the ratings on
Carvana if the company continues to make progress in leveraging its
scale to improve margins such that it can achieve near breakeven
EBITDA while maintaining sufficient liquidity to pay for its cash
burn for at least 18 months," S&P said.
CE ELECTRICAL: Fine-Tunes Plan; Plan Confirmation Hearing March 30
------------------------------------------------------------------
CE Electrical Contractors, LLC, submitted a Revised Disclosure
Statement for Chapter 11 Plan of Reorganization February 10, 2022.
The Bankruptcy Court has scheduled a hearing to consider
confirmation of the Plan on March 30, 2022 at 10:00 a.m. at the
U.S. Bankruptcy Court, 450 Main Street, Hartford, Connecticut.
The Bankruptcy Court has directed that objections, if any, to
confirmation of the Plan be served and filed on or before March 21,
2022 at 5:00 p.m.
The Plan is a reorganizing Plan. The Debtor intends to remain in
business and generate funds so that it can pay a dividend to
creditors.
Class 9 consists of the Allowed Unsecured Claims of the Debtor. The
Schedules indicate that there are approximately 240 general
unsecured creditors, more or less in this Class. The Debtor
estimates that the general unsecured Claims against the Estate
total approximately $9,706,959. When deficiency or unsecured claims
of De Lage Landen, Global Merchant, the U.S. S.B.A. and Wellen
Capital are included, general unsecured claims rise to
$10,378,565.
Unsecured claims will be paid 5% of the allowed amounts of their
claims over 68 months beginning in month 5 of the Plan. In year 1,
beginning in month 5, the monthly payment will be $2,400.00, the
monthly payment amount in year 2 will be $3,999.66, the monthly
payment amount in year 3 will be $5,999.33, the monthly payment
amount in year 4 will be $5,999.33, the monthly payment amount in
year 5 will be $10,479.00, and the monthly payment amount in year 6
will be $17,198.33 with $640.00 added to the final payment in month
72. Total payments to members of this class will be $543,942.00. If
the Court approves the proposed temporary injunction and Paul
Calafiore obtains the sole membership interest in the Debtor, then
at month 36 he will contribute an additional $50,000 in new value
monies to the Debtor with the $50,000 to be distributed by the
Debtor to members of Class 9 in month 36.
Class 10 consists of Claims of Interest Holders. Paul Calafiore is
the sole member of the Debtor. There are no other members. He is
the managing member. He intends to retain his equity interest in
the Debtor postconfirmation. If the unsecured creditor class votes
to reject the Plan, then Mr. Calafiore intends that a contribution
of $50,000.00 that he intends to make to the Debtor following
confirmation, be treated as a new value contribution under Section
1129(b).
The Debtor intends to hold an evidentiary hearing shortly before
the confirmation hearing on the issue of issuance of the temporary
injunction. If no injunction is issued, Paul Calafiore will try to
negotiate deals for the 16 obligations of the Debtor which he has
personally guaranteed, for a total liability of $2,980,482.55. If
no injunction issues, and he is unable to cope with the demands,
lawsuits and legal fees, Paul Calafiore will file a personal
Chapter 11 case.
Attached is a statement of Mr. Calafiore's assets, signed under
penalty of perjury. During the period of time that any temporary
injunction is in effect, Mr. Calafiore may not sell any assets he
owns of a value greater than $25,000 without first giving 30 days
notice to People's, Liberty and any other creditor requesting
notice of a sale not later than 60 days after the Plan's Effective
Date.
In addition, should Mr. Calafiore be notified that he is in default
of any personal payment obligation where the default amount exceeds
$10,000, Mr. Calafiore shall notify all of the same entities of
such default within 20 days. Should any creditor be directly
affected by a sale or a default, then such creditor may, without
having to pay a Court fee to reopen the case, may petition the
Court to reopen the bankruptcy case and request that the injunction
be modified or vacated. Mr. Calafiore shall have a reasonable time
to cure any default and may oppose any motion to modify or vacate
the injunction.
A full-text copy of the Revised Disclosure Statement dated Feb. 10,
2022, is available at https://bit.ly/3gECx5p from PacerMonitor.com
at no charge.
Attorney for the Debtor:
Steven R. Fox
THE FOX LAW CORPORATION, INC.
17835 Ventura Blvd. Suite 306
Encino, CA 91316
Tel: (818) 774-3545
Fax: (818) 774-3707
E-mail: srfox@foxlaw.com
Jenna N. Sternberg
BOATMAN LAW LLC
155 Sycamore Street
Glastonbury, CT 06033
Tel: (860) 291-9061
Fax: (860) 291-9073
E-mail: jsternberg@boatmanlaw.com
About CE Electrical Contractors
CE Electrical Contractors LLC filed a voluntary petition for relief
under Chapter 11 of the Bankruptcy Code (Bankr. D. Conn. Case No.
21-20211) on Mar. 5, 2021. Paul Calafiore, the managing member,
signed the petition. In the petition, the Debtor disclosed total
assets of $1,625,485 and total liabilities of $8,648,831.
Judge James J. Tancredi oversees the case.
The Debtor tapped The Fox Law Corporation, Inc. as lead bankruptcy
counsel and Boatman Law LLC as local bankruptcy counsel.
CEDAR FAIR: Egan-Jones Retains CCC Sr. Unsecured Debt Ratings
-------------------------------------------------------------
Egan-Jones Ratings Company, on January 20, 2022, retained its 'CCC'
foreign currency and local currency senior unsecured ratings on
debt issued by Cedar Fair LP. EJR also maintained its 'C' rating on
commercial paper issued by the Company.
Headquartered in Sandusky, Ohio, Cedar Fair, L.P. owns and operates
amusement parks.
CENTRAL GARDEN: Egan-Jones Retains BB Sr. Unsecured Debt Ratings
----------------------------------------------------------------
Egan-Jones Ratings Company, on January 18, 2022, retained its 'BB'
foreign currency and local currency senior unsecured ratings on
debt issued by Central Garden & Pet Co.
Headquartered in Walnut Creek, California, Central Garden & Pet
Company manufactures and distributes branded and private label
products.
CITIUS PHARMACEUTICALS: Stockholders Elect Seven Directors
----------------------------------------------------------
Citius Pharmaceuticals, Inc. held its 2022 annual meeting of
stockholders on Feb. 8, 2022, during which the stockholders elected
seven members to the company's Board of Directors for a one-year
term expiring at the annual meeting of stockholders to be held in
2023 and until their successors are duly elected and qualified.
The newly elected directors are:
* Myron Holubiak
* Leonard Mazur
* Suren Dutia
* Carol Webb
* Dr. William Kane
* Howard Safir
* Dr. Eugene Holuka
The company's stockholders approved on a non-binding advisory basis
its executive compensation.
Citius' stockholders approved the recommendation, on an advisory
basis, of a three-year frequency with which the company should
conduct future stockholder advisory votes on its executive
compensation.
The company's stockholders also ratified the selection of Wolf &
Company, P.C. as its independent registered public accounting firm
for the fiscal year ending Sept. 30, 2022.
About Citius
Headquartered in Cranford, NJ, Citius Pharmaceuticals, Inc. --
http://www.citiuspharma.com-- is a specialty pharmaceutical
company dedicated to the development and commercialization of
critical care products targeting unmet needs with a focus on
anti-infectives, cancer care and unique prescription products.
Citius reported a net loss of $23.05 million for the year ended
Sept. 30, 2021, a net loss of $17.55 million for the year ended
Sept. 30, 2020, a net loss of $15.56 million for the year ended
Sept. 30, 2019, a net loss of $12.54 million for the year ended
Sept. 30, 2018, and a net loss of $10.38 million for the year ended
Sept. 30, 2017. As of Sept. 30, 2021, the Company had $142.43
million in total assets, $9.65 million in total liabilities, and
$132.78 million total equity.
CLEANSPARK INC: BlackRock Has 5.5% Equity Stake as of Dec. 31
-------------------------------------------------------------
BlackRock, Inc. disclosed in a Schedule 13G filed with the
Securities and Exchange Commission that as of Dec. 31, 2021, it
beneficially owns 2,277,816 shares of common stock of CleanSpark,
Inc., representing 5.5 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/827876/000083423722007276/us18452b2097_020422.txt
About CleanSpark
Headquartered in Bountiful, Utah, CleanSpark, Inc. --
www.cleanspark.com -- in the business of providing advanced
software and controls technology solutions to solve modern energy
challenges. The Company has a suite of software solutions that
provide end-to-end microgrid energy modeling, energy market
communications and energy management solutions. Its offerings
consist of intelligent energy monitoring and controls, intelligent
microgrid design software, middleware communications protocols for
the energy industry, energy system engineering and software
consulting services.
CleanSpark reported a net loss of $21.81 million for the year ended
Sept. 30, 2021, a net loss of $23.35 million for the year ended
Sept. 30, 2020, and a net loss of $26.12 million for the year ended
Sept. 30, 2019. As of Sept. 30, 2021, the Company had $317.47
million in total assets, $11.76 million in total liabilities, and
$305.72 million in total stockholders' equity.
CLEANSPARK INC: Posts $14.5 Million Net Income in First Quarter
---------------------------------------------------------------
CleanSpark, Inc. filed with the Securities and Exchange Commission
its Quarterly Report on Form 10-Q disclosing net income of $14.49
million on $41.24 million of total net revenues for the three
months ended Dec. 31, 2021, compared to a net loss of $7.17 million
on $2.26 million of total net revenues for the three months ended
Dec. 31, 2020.
As of Dec. 31, 2021, the Company had $418.14 million in total
assets, $24.07 million in total liabilities, and $394.08 million in
total stockholders' equity.
The Company said that while it has experienced negative cash flows
from investing and operating activities due to its continued
investments in capital expenditures, it has generated positive cash
flows from financing activities. The Company has sufficient
capital for ongoing operations from raising additional capital
through the registered sale of equity securities pursuant to a
registration statement on Form S-3. In addition, the Company is
continuing to grow its business segments through which it expects
to grow the working capital base. As of Dec. 31, 2021, the Company
had working capital of $36,200,586.
A full-text copy of the Form 10-Q is available for free at:
https://www.sec.gov/ix?doc=/Archives/edgar/data/0000827876/000095017022000992/clsk-20211231.htm
About CleanSpark
Headquartered in Bountiful, Utah, CleanSpark, Inc. --
www.cleanspark.com -- in the business of providing advanced
software and controls technology solutions to solve modern energy
challenges. The Company has a suite of software solutions that
provide end-to-end microgrid energy modeling, energy market
communications and energy management solutions. Its offerings
consist of intelligent energy monitoring and controls, intelligent
microgrid design software, middleware communications protocols for
the energy industry, energy system engineering and software
consulting services.
CleanSpark reported a net loss of $21.81 million for the year ended
Sept. 30, 2021, a net loss of $23.35 million for the year ended
Sept. 30, 2020, and a net loss of $26.12 million for the year ended
Sept. 30, 2019. As of Sept. 30, 2021, the Company had $317.47
million in total assets, $11.76 million in total liabilities, and
$305.72 million in total stockholders' equity.
CNC PUMA: Reaches Kapitus Stipulation; Files Amended Plan
---------------------------------------------------------
CNC Puma Corporation Inc. submitted a Third Amended Chapter 11 Plan
of Reorganization for Small Business under Subchapter V dated Feb.
8, 2022.
Sales for November 2021 and December 2021 were particularly low in
that in addition to the seasonal decreases in sales, the Debtor
experienced an unusual reduction of sales due to the public surge
in Covid-19 infection rates resulting in part from the Omicron
variant, which significantly reduced customer traffic at the
Debtor's restaurant.
While seasonal patterns are expected to continue, the Debtor does
not anticipate such significant drops in sales to continue as the
surge of Covid-19 infections lessens, and the marginal increase
generated from the Debtor's new management and implementation of
its night club is expected to continue, which, along with regular
dining services, is expected to generate sales sufficient to fund
the payments required under the Plan, as detailed in the Debtor's
projections.
Class 4 consists of Strategic Funding Source, Inc., dba Kapitus
Claim. Kapitus filed Proof of Claim No. 9, in the amount of
$279,878.72. The Debtor has been paying Kapitus monthly payments on
account of its claim since the commencement of the Debtor's case,
in the amount of $3,500.00, as adequate protection payments. The
Debtor and Kapitus entered into a stipulation ("Kapitus
Stipulation"), to confirm the treatment of Kapitus' claim under the
Plan.
The Class 4 claim shall be allowed as a secured claim in the full
amount owed under the terms of the Kapitus Factoring Agreement, in
full satisfaction of any and all claims Kapitus has asserted or
could assert against the Debtor, including any claims arising under
the Kapitus Factoring Agreement, the Kapitus UCC and Kapitus' Proof
of Claim ("Kapitus Allowed Claim").
The Kapitus Allowed Claim shall be paid as follows: (a) payment of
$225,000.00 over 5 years, with interest accruing at the fixed rate
of 6.0% per annum, payable through ACH debit from the Debtor's bank
account, through equal monthly payments of $4,349.88, with payments
beginning on the 10th date of the 1st month following the Effective
Date of the Plan ("Plan Payment"); and (b) upon the Debtor's full
payment of the Plan Payment, the remaining balance of the Kapitus
Allowed Claim shall be forgiven, as to the Debtor only and not to
any guarantor under the Kapitus Factoring Agreement, and the
Kapitus UCC shall be released, such that all obligations of the
Debtor shall be considered satisfied in full.
The secured debt shall be secured, post confirmation, by the same
assets described in the Kapitus UCC. The security interest shall be
deemed to continue to be perfected as of the date of entry of the
Confirmation Order without the need to file or execute any document
as may otherwise be required under applicable non bankruptcy law.
Kapitus is authorized, but not required, to file a new
postconfirmation UCC financing statement to continue the perfection
of the prepetition security interest described in the Kapitus UCC.
Except as modified by the Kapitus Stipulation, all other terms of
the Kapitus Factoring Agreement remain in full force and effect and
shall be binding upon the Debtor to the fullest extent under
applicable law, including Kapitus' right to collect all amounts due
on account of the Kapitus Allowed Claim in the event the Debtor
does not make full payment of the Plan Payment, and Kapitus shall
retain its security interest against the Debtor's assets to the
same extent described in the Kapitus UCC.
The treatment of the Kapitus Allowed Claim under the Plan shall not
be considered a legal determination of Kapitus' claim of ownership
interest in the Debtor's receivables, and Kapitus reserves any and
all rights with respect to its claim of ownership interest in the
Debtor's receivables and is not waiving any such rights, including
its right to demand turnover of such receivables, in the event of a
default or conversion or dismissal of the Debtor's chapter 11
proceeding.
Class 6 consists of Non-Priority Unsecured Claims. The Debtor will
pay all projected disposable income remaining after payment of
claims in Class 1 through Class 5 under the Plan, which, is
estimated to result in payment of approximately $0.00 to allowed
Class 6 claims.
The known claims total approximately $377,675.32, including the
SBA's $152,419.52 claim. The claims do not include the scheduled
claim of BBVA USA in the amount of $172,832.00 on account of the
Debtor's loan obtained under the Coronavirus Aid, Relief and
Economic Security (CARES) Act, which was forgiven in full in
accordance with the terms of the loan on or about January 5, 2022.
The Debtor estimates payments under the Plan will result in an
approximate 0.0% return to Class 6 claims, which could be more
depending in part on the ultimate amount of allowed claims,
including the CDTFA's priority tax claim. Class 6 is impaired.
The source of funding for the Plan will come from cash on hand on
the Effective Date, expected to approximate $200,000.00 to
$250,000.00, and income generated from the Debtor’s ongoing
business.
A full-text copy of the Third Amended Chapter 11 Plan of
Reorganization dated Feb. 8, 2022, is available at
https://bit.ly/3Jlswq4 from PacerMonitor.com at no charge.
Counsel for Debtor:
J. Luke Hendrix, Esq.
Law Offices of J. Luke Hendrix
28693 Old Town Front St Suite 400-D
Temecula, CA 92590
Tel: (951) 221-3721
Email: luke@jlhlawoffices.com
About CNC Puma Corporation Inc.
CNC Puma Corporation Inc. -- https://www.thebankoldtown.com/ --
owns and operates bars and restaurants specializing in Mexican
cuisine.
CNC Puma Corporation filed its voluntary petition for relief under
Chapter 11 of the Bankruptcy Code (Bankr. C.D. Cal. Case No. 20
17551) on Nov. 19, 2020. Ryan Parent, chief financial officer and
secretary, signed the petition. At the time of filing, the Debtor
disclosed $250,128 in assets and $1,134,882 in liabilities.
The Law Offices of J. Luke Hendrix represents the Debtor as
counsel.
COCHRANE ANESTHESIA: Seeks to Hire Melissa Offill as Accountant
---------------------------------------------------------------
Cochrane Anesthesia, PLLC seeks approval from the U.S. Bankruptcy
Court for the Northern District of Texas to employ Melissa Offill,
a certified public accountant practicing in Aledo, Texas.
Ms. Offill will render these services:
(a) assist the Debtor in the analysis of its financial
position, assets, and liabilities;
(b) assist the Debtor in the accounting of all receipts and
disbursement from the estate and the preparation of all necessary
reports in relation thereto;
(c) assist the Debtor in the development of a plan of
reorganization and in the preparation of an accompanying disclosure
statement, any amendments to the plan or disclosure statement, and
any related agreements and/or documents;
(d) assist the Debtor in the preparation of a final report and
final accounting of the administration of the estate; and
(e) perform all other accounting services and provide all
other financial advice to the Debtor in connection with this
Chapter 11 case as may be required or necessary.
Ms. Offill will be paid at her hourly rate of $150, while her staff
will be paid at $50 per hour.
Ms. Offill disclosed in a court filing that she is a "disinterested
person" as that term is defined in Section 101(14) of the
Bankruptcy Code.
The accountant can be reached at:
Melissa Offill, CPA
Offill Consulting Services, LLC
151 Crooked Stick Lane
Aledo, TX 76008
Telephone: (817) 992-0929
Email: melissa@offillconsulting.com
About Cochrane Anesthesia
Cochrane Anesthesia, PLLC sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. N.D. Texas Case No. 21-42824) on Dec. 3,
2021. In the petition signed by Glenn Cochrane, managing partner,
the Debtor disclosed up to $100,000 in assets and up to $500,000 in
liabilities.
Judge Mark X. Mullin oversees the case.
The Debtor tapped Joyce W. Lindauer, Esq., at Joyce W. Lindauer
Attorney, PLLC as legal counsel and Melissa Offill, CPA, as
accountant.
COEPTIS EQUITY: Wins Cash Collateral Access
-------------------------------------------
The U.S. Bankruptcy Court for the Northern District of California,
San Francisco Division, has approved the Stipulation between Gina
R. Klump, the Subchapter V Trustee of Coeptis Equity Fund LLC and
secured creditor CSMC 2020-BPLI Trust regarding the Trustee's use
of cash collateral.
The parties agree the Trustee may use the cash collateral of CSMC
pursuant to pay for expenses related to clean up of the real
property located at 3422 Anne Street, Stockton, California, in the
amount of $1,400. This amount is not deducted from the total amount
owed to CSMC and all further cash collateral, should there be any,
will be segregated and turned over to CSMC.
A copy of the stipulation is available at https://bit.ly/3Bc2DWG
from PacerMonitor.com.
A copy of the order is available at https://bit.ly/3GJatsb from
PacerMonitor.com.
About Coeptis Equity
Coeptis Equity Fund, LLC filed a petition for Chapter 11 protection
(Bankr. N.D. Calif. Case No. 21-30726) on Oct. 27, 2021, listing as
much as $10 million in both assets and liabilities. Gina R. Klump
is the Subchapter V trustee appointed in the Debtor's bankruptcy
case.
The case is assigned to Judge Dennis Montali.
COLONIAL GATE: Wins Access to Cash Collateral Thru March 15
-----------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York has
authorized Colonial Gate Gardens LLC to use cash collateral on an
interim basis pursuant to the budget, in an amount up to $290,368,
until the earliest of (i) March 15, 2022; (ii) entry of a final
order or a further interim order granting the Debtor continued
access to cash collateral; or (iii) the occurrence of a Termination
Event.
Each of these constitutes a Termination Event:
* The Chapter 11 case has been dismissed or converted to a
Chapter 7 case under the Bankruptcy Code, or there will have been
appointed in the Chapter 11 case, a trustee or an examiner with
expanded powers beyond the authority to investigate particular
activities of the Debtor;
* The Debtor files a motion seeking to modify, vacate, stay,
supplement or amend the terms of this Interim Order without the
prior written consent of any Secured Party;
* The Third Interim Order is modified, vacated, stayed,
supplemented, reversed, or is for any reason not binding on the
Debtor, without the prior written consent of a Secured Party;
* The Debtor fails to perform, in any material respect, any of
the terms, provisions, conditions, covenants, or obligation under
the Second Interim Order;
* The Debtor expends more than 110% of the Budget, unless caused
by an increase in business by the Debtor; and
* There is at any time a material inaccuracy in any financial
report or certification provided by the Debtor to Wilmington
Trust.
Wilmington Trust, National Association, as Trustee for the Benefit
of the Holders of Corevest American Finance 2017-1 Trust Mortgage
Pass-Through Certificate has an alleged first priority mortgage on
the Debtor's Properties as well as a first lien on the Cash
Collateral.
As reported by the Troubled Company Reporter, the Properties
consist of single-family houses and condominium units throughout
Orange, Rockland and Ulster Counties in New York, and are
encumbered by Wilmington's blanket first mortgage. Wilmington
asserts that it is owed approximately $5,657,906 on the mortgage.
As adequate protection for any diminution in the value of
Wilmington's interest in its collateral, Wilmington will receive
(i) replacement liens on all property of the Debtor and its estate
and (ii) adequate protection to the extent required by the
pre-petition loan documents to the same extent and validity as its
pre-petition liens. The Debtor will also make adequate protection
payments to Wilmington at the non-default contract rate amounting
to $20,892 pursuant to pre-petition loan documents.
The Adequate Protection Liens will be subject to the Carve out
consisting of (i) payment of fees due to the Office of the United
States Trustee; and (iii) amounts allowed by the Court as fees and
expenses of a trustee appointed under Section 726(b) of the
Bankruptcy Code for up to $7,500.
A hearing to consider entry of a final order is set for March 15 at
10 a.m.
A copy of the order is available for free at https://bit.ly/3gFQXSM
from PacerMonitor.com.
About Colonial Gate Gardens LLC
Colonial Gate Gardens LLC is a limited liability company, formed
and existing under the laws of the State of New York, with its
principal office located at 45 Washington Ave, Spring Valley, New
York 10977. Colonial Gate Gardens is engaged in the real estate
investment business by purchasing single-family homes and or
condominium units, renovating them and then leasing them to tenants
in exchange for rent.
Colonial Gate Gardens sought protection under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. S.D.N.Y. Case No. 21-22265) on May 6,
2021. In the petition signed by Yitzchok Loeffler, managing
director, the Debtor disclosed up to $10 million in both assets and
liabilities.
Avrum J. Rosen, Esq., at Law Office of Avrum J. Rosen, PLLC, is the
Debtor's counsel.
DCM-P3 LLC: Seeks to Hire Coldwell Banker as Real Estate Broker
---------------------------------------------------------------
DCM-P3, LLC seeks approval from the U.S. Bankruptcy Court for the
Central District of California to employ Coldwell Banker Realty as
its real estate broker.
The firm will assist the Debtor with the marketing and sale of the
residence located at 34 Black Hawk, Irvine, California 92603.
The firm will receive a commission equal to 5 percent of the
selling price.
Coldwell Banker is disinterested as that term is defined at 11
U.S.C. Sec. 101(14). according to court filings.
The firm can be reached through:
Greg Bingham
Coldwell Banker Realty
840 Newport Center Dr., Suite 100
Newport Beach, CA 92660
Tel: (562) 335-0145
Email: greg-bingham@camoves.com
About DCM-P3 LLC
Irvine, Calif.-based DCM-P3, LLC filed a petition for Chapter 11
protection (Bankr. C.D. Calif. Case No. 21-12507) on Oct. 14, 2021,
listing as much as $10 million in both assets and liabilities.
Judge Theodor Albert oversees the case. Brutzkus Gubner Rozansky
Seror Weber, LLP is the Debtor's legal counsel.
DECOR HOLDINGS: Kauffmann Received "Ordinary Course" Payment
------------------------------------------------------------
Bryan Ryniker, the Litigation Administrator for the
post-confirmation debtors Decor Holdings, Inc., et al., commenced
separate preference actions against three sets of defendants all
represented by Montgomery, McCracken, Walker & Rhoads LLP. The
Defendants each filed motions for summary judgment asserting the
affirmative defenses of ordinary course of business pursuant to 11
U.S.C. Section 547(c)(2) and the contemporaneous exchange for new
value defense pursuant to Section 547(c)(2). The Plaintiff filed
oppositions and cross-motions seeking entry of summary judgment
regarding their prima facie cases as to the preference claims.
At a hearing held on December 1, 2021, the United States Bankruptcy
Court for the Eastern District of New York granted the
Cross-Motions, finding that the Plaintiff established a prima facie
case regarding the preference claims alleged in each adversary
proceeding. The Court directed that the parties file additional
briefs regarding the ordinary course of business defense and
reopened discovery with respect to the new value defense. Pursuant
to the Court's directive, the parties were to choose the
appropriate test regarding the ordinary course of business defense
and to apply it to their specific case. The parties were also
directed to submit supplemental briefs regarding the new value
defense.
The Court has reviewed the briefs and the Court has determined that
based on the average lateness of the payments during the agreed
upon two year period prior to the preference period when compared
with the average lateness of the payments during the preference
period, they are close enough to find that all of the payments made
during the preference period are within the parties' ordinary
course of business.
While a bit complicated, most courts have concluded that the
ordinary course of business defense set forth in section
547(c)(2)(A) is a subjective test "'intended to protect recurring,
customary credit transactions that are incurred and paid in the
ordinary course of business of the debtor and the debtor's
transferee,'" Bankruptcy Judge Robert E. Grossman says, citing
Jacobs v. Gramercy Jewelry Mrg. Corp. (In re M. Fabrikant & Sons,
Inc.), Adv. No. 08-1690, 2010 WL 4622449 *2 (Bankr. S.D.N.Y. Nov.
4, 2010) (citing 5 Collier on Bankruptcy par. 547.04[2], at 547-51
(15th Ed. 2010).
Being careful to recognize that substantial deviations from the
parties' established practice are not protected, this defense is
necessary to provide a level of predictability so that suppliers
such as the Defendants are permitted to keep payments that would
otherwise be deemed preferences, Judge Grossman holds. Congress has
stated that the purpose of the ordinary course defense is to "leave
undisturbed normal financial relations, because it does not detract
from the general policy of the preference section to discourage
unusual action by either the debtor or his creditors during the
debtor's slide into bankruptcy," the judge explains citing H.R.
Rep. No. 95-595, at 373 (1977); S. Rep. No. 95-989, at 88 (1977).
In addition, where the parties' commercial dealings have taken
place over a significant time period, courts should consider
carefully before finding that the debtor favored that creditor, and
conversely, if the relationship is recent, courts will review the
credit terms more rigorously to determine whether the debtor
favored one creditor over another. With respect to the Defendants
in these adversary proceedings, the business relationship with the
Debtors was not recent and spanned for at least several years.
Therefore, while the Defendants have the burden of establishing
their ordinary course defense, the Court does take into
consideration that fact that the Defendants had significant prior
dealings with the Debtors which spanned over a number of years.
The relevant factors to consider when examining the ordinary course
of business defense are (1) the prior course of dealing, (2) the
amount of payments, (3) the timing of the payments, and (4) the
circumstances surrounding the payments. Judge Grossman says no one
factor is determinative regarding this issue. To determine whether
transfers were in the ordinary course of business the Court is
charged with determining what the ordinary course of business was
and then to compare the preferential transfers to it. The Plaintiff
has acknowledged that the Debtors ordinarily paid the Defendants
beyond the stated terms of the invoice and undertook no unusual
collection activity during the preference period, that every
payment during the preference period was made by check, as were the
payments during the Baseline Period, and the Debtors never informed
the Defendants of any financial troubles suffered by the Debtors.
In addition, the Debtors admit that there was no pressure put on
the Defendants to pay during the preference period.
The Bankruptcy Court has the sole discretion to determine which
test or methodology to apply when analyzing the payments during the
preference period. The two most common tests are the
average-lateness method and the total-range method.
Under the total range of payments test, the Court reviews all of
the payments made during the Baseline Period (which is agreed by
all parties as the two years prior to the 90-day preference period)
and determines the range of payments from the earliest to the
latest. If the payments made during the preference period fit
within the range, they are protected by the ordinary course of
business defense. If the Court finds that the range of payments
during the Baseline Period is too broad, the Court may adopt the
bucketing analysis. Under the bucketing analysis, the Court reviews
the payments made during the baseline period and groups them into
buckets by age, then applies an appropriately sized bucket to the
preference period payments to determine wheat is ordinary and what
is not. As this Court previously stated, a range from the Baseline
Period that captures around 80% of the payments would be an
appropriate size bucket.
As for the proper test to apply, the Defendants in each adversary
proceeding have chosen the average date of payment to compare the
Baseline Period payments with the payments made during the
preference period. The Defendants argue that under this test, all
of the preference payments identified in each adversary proceeding
would qualify as ordinary course payments. The Defendants also
applied the range of payments test, which also captured all of the
payments in each adversary proceeding as ordinary course payments.
Finally, the Defendants compared the payments in each case under
the bucketing theory, which captured all but one payment in the
amount of $1,937.03 in adversary proceeding number 21-8040.
Kaufmann, the defendant in that adversary proceeding, has asserted
that the new value exception would provide an adequate defense to
cover that payment as well.
The Plaintiff has chosen the range of payments test because he
believes it provides a more complete picture of the relationship
between each of the Defendants and Debtors than the average
lateness test. According to the Plaintiff, using average payment
times as a yardstick is not appropriate because there are "wild
variations" in the Baseline Period for each case that are not
present in the preference periods. The Plaintiff argues that
because there is such a wide range of payments made during the
baseline period in each adversary proceeding, there can be no
ordinary course of business defense based on the application of
this test. The Plaintiff cites to In re Waterford Wedgewood USA,
Inc., 508 B.R. 821, 835 (Bankr. S.D.N.Y. 2014) in support of his
argument. However, Judge Grossman notes that in the Waterford
Wedgewood decision, the court analyzed an ordinary course of
business defense based on the business terms specific to the
industry, which is an objective test under section 547(c)(2)(B).
This is not the subsection the Defendants have chosen -- they are
relying on the subjective test set forth in subsection (c)(2)(A)
based on the parties' prior conduct. In the other case cited by the
Plaintiff, In re Fabrikant, 2010 WL 4622449, the court adopted the
average lateness test and found that the averages were too far
apart to apply that test. The difference between the two averages
were approximately fifty days apart in the Fabrikant case, which is
substantially different from the spreads between the averages in
each of these adversary proceedings. The court in Fabrikant
declined to apply the range of payment test because there were
aberrant, unusual payments during the chosen baseline period which
were made well outside the average, thereby skewing the range.
The Court agrees with the Defendants and adopts the average
lateness test. This method is more likely to "weed out" payments
that could skew the analysis. If the average lateness test reveals
that the averages in each case are within several days of each
other and the Court believes that the Baseline Period provides a
sufficient comparison to the payments made during the preference
period, then each of the Defendants will have met their burden and
no further tests need be examined. The results of the average
lateness test are:
-- Adversary Proceeding No. 21-8040: Average lateness during the
Baseline Period is 40.55 days. Average lateness during the
preference period is 36.71 days. The difference is less than four
days.
-- Adversary Proceeding No. 20-8133: Average lateness during the
Baseline Period is 39.33 days. Average lateness during the
preference period is 46.2 days. The difference is less than seven
days.
-- Adversary Proceeding No. 20-8125: Average lateness during the
Baseline Period is 47.57 days. Average lateness during the
preference period is 45.2 days. The difference is less than three
days.
The Court has examined applicable case law regarding this test
along with the general course of conduct between the parties during
the Baseline Period and the preference period. The largest spread
in averages between the Baseline Period and the preference period
is less than seven days. Keeping in mind that there are scores of
transactions during the Baseline Period in each case, coupled with
the fact that there are sufficient transfers during the preference
period in each case to analyze, these averages provide sufficient
evidence of an ordinary course defense to the otherwise
preferential transfers. In cases examining long-standing
relationships between debtors and suppliers, it is apparent that
averages which are within these ranges are acceptable.
The Plaintiff has provided graphs intended to show that the
payments made during the preference period were so out of the norm
that using an average lateness test masks these anomalies. However,
the Court views these graphs differently. They show how within the
norm the payments during the preference period were as they are
clumped so closely to the average payment date. If anything, they
are completely in character based on the parties' prior payment
history.
The Court sees no reason to go beyond the average lateness test but
even if the Court were to adopt the range of payment analysis, it
would have been appropriate to further narrow the test by using the
bucketing analysis. Under a bucketing analysis, the percentage of
payments in each bucket need not be identical.
In this case, a bucketing analysis encompassing 82% of the payments
made in the Baseline Periods for each of the cases would capture
all of the preference period payments in Adversary Proceeding Nos.
20-8125 and 20-8133, and all but one payment in the amount of
$1,937.03 in Adversary Proceeding No. 21-8040. While the Court does
not need to analyze the new value defenses, it is likely that
Kaufmann would be able to demonstrate at least part of the new
value alleged in the total amount of $51,524.25 which would cover
this nominal payment.
For these reasons, the Court grants the Motions as to their
ordinary course of business defense pursuant to section
547(c)(2)(B). The only cause of action outstanding is the
fraudulent conveyance claim in each adversary proceeding. However,
since the Trustee has established a prima facie case regarding the
preference claims, it appears that each of the transfers were made
on account of an antecedent debt. There would be no basis for a
constructive fraudulent conveyance claim because adequate value was
received by the Debtors.
A full-text copy of the Supplemental Findings of Fact and
Conclusions of Law dated February 3, 2022, is available at
https://tinyurl.com/38ttv8vx from Leagle.com.
The adversary proceeding is BRIAN RYNIKER, IN HIS CAPACITY AS
LITIGATION ADMINISTRATOR OF THE POST-CONFIRMATION ESTATES OF DECOR
HOLDINGS, INC., et al., Plaintiff, v. P. KAUFMANN, INC., Defendant,
Adv. Pro. No. 21-08040 (REG)(Bankr. E.D.N.Y.).
About Robert Allen Duralee Group
The Robert Allen Duralee Group --
https://www.robertallendesign.com/ -- is a supplier of decorative
fabrics and furniture to the design industry in the United States.
In addition to their own extensive product lines, the Robert Allen
Duralee Group represents six other furnishing companies, including
Paris Texas Hardware, The Finial Company, Clarke & Clarke, Thibaut
and Byron & Byron. The Robert Allen Duralee Group maintains
showroom premises located in major metropolitan cities across the
United States and Canada, and an extensive worldwide agent showroom
network that collectively service more than 30 countries around the
globe. Decor is a privately-owned company with headquarters in
Hauppauge, New York.
The Robert Allen Duralee Group, Inc., and 4 related entities,
including ultimate parent Decor Holdings, Inc., sought Chapter 11
protection on Feb. 12, 2019. The lead case is In re Decor
Holdings, Inc. (Bankr. E.D.N.Y. Lead Case No. 19-71020).
Decor Holdings estimated assets of $50 million to $100 million and
liabilities of $50 million to $100 million as of the bankruptcy
filing.
The Hon. Robert E. Grossman is the case judge.
The Debtors tapped Hahn & Hessen LLP as counsel; Halperin Battaglia
Benzija, LLP, as special counsel; RAS Management Advisors, LLC, as
restructuring advisor; Blum Shapiro as tax advisor; SSG Capital
Advisors, LLC, as investment banker; Great American as sales agent;
and Omni Management Group, Inc., as claims agent.
DITECH HOLDING: Summary Judgment Recommended in Trafton Case
------------------------------------------------------------
Magistrate Judge Dustin M. Howell of the United States District
Court for the Western District of Texas, Austin Division,
recommends that the District Court grant NewRez LLC's Motion for
Summary Judgment in the case captioned NANCY A. TRAFTON, Plaintiff,
v. NEWREZ LLC, Defendant, No. A-18-CV-00580-RP (W.D. Tex.), and
dismiss Trafton's causes of action.
This lawsuit revolves around a $90,000 home equity loan Plaintiff
Nancy Trafton procured in 2006, wherein she pledged her Austin
homestead as security for the loan. Trafton initially brought this
lawsuit against Ditech for breach of contract, usury, and requested
declarations that Ditech improperly accelerated her Note, and thus
has no right to foreclose on her homestead. In 2019, Ditech went
into Chapter 11 bankruptcy, and NewRez thereafter became the new
servicer for Trafton's loan. Trafton substituted NewRez as the
defendant. NewRez moved to dismiss Trafton's complaint on the
grounds that Trafton cannot maintain a breach of contract claim
regarding a contract that she is currently in breach of, and
because it believes an injunction issued in Ditech's bankruptcy
proceeding precludes claims for monetary relief against the loan
servicers. The Court denied NewRez's motion to dismiss because,
based on Trafton's complaint, it was unclear whether she remained
in default of her loan. NewRez now moves for summary judgment on
the same basis.
The crux of the parties' dispute revolves around whether Trafton is
in breach of the loan agreements. According to the magistrate, if
Trafton is in default, she cannot maintain a breach of contract
claim against NewRez because "[a] fundamental principle under Texas
law is that "'[a] party to a contract who is in default cannot
maintain a suit for breach of contract.'" Trafton does not dispute
that her breach of the loan agreements would merit the dismissal of
her breach of contract claim, but rather argues that NewRez's
proffered loan history document is "anything but a history of the
Home Equity Loan," and fails to account for her payments curing
past due payments through January 1, 2014, the magistrate notes.
Yet NewRez agrees that Trafton has cured past due payments through
February 2014, and instead argues that she has failed to make
payments on the loan for any amounts due after 2014. And Trafton
has failed to present any competent summary judgment evidence,
apart from her own declaration, supporting her contention that she
made payments on the loan after the 2019 payment, which covered
only past due payments for 2014, or that NewRez rejected those
payments or improperly applied such payments, the magistrate
further notes.
Because Trafton has not presented competent summary judgment
evidence demonstrating that she is not in default of her home
equity loan, the magistrate recommends that the District Court
grant NewRez's motion for summary judgment on her breach of
contract claim since Trafton cannot maintain a suit for breach of
contract regarding a contract that she herself has breached by
failing to make payments pursuant to her loan agreements. Because
Trafton's breach of contract claim should be dismissed, the
magistrate also recommends that the District Court grant NewRez's
motion for summary judgment on Trafton's declaratory judgment cause
of action, and any purported accounting claim.
A full-text copy of the Report and Recommendation dated February 1,
2022, is available at https://tinyurl.com/3tkb7ssd from
Leagle.com.
About Ditech Holding Corporation
Fort Washington, Pennsylvania-based Ditech Holding Corporation and
its subsidiaries -- http://www.ditechholding.com/-- are
independent servicer and originator of mortgage loans.
Ditech Holding and certain of its subsidiaries, including Ditech
Financial LLC and Reverse Mortgage Solutions, Inc., filed voluntary
Chapter 11 petitions (Bankr. S.D.N.Y. Lead Case No. 19 10412) on
Feb. 11, 2019, after reaching terms with lenders of a Chapter 11
plan that will reduce debt by $800 million.
The Debtors tapped Weil, Gotshal & Manges LLP as legal counsel,
Houlihan Lokey as investment banker and AlixPartners LLP as
financial advisor. Epiq Bankruptcy Solutions LLC served as claims
and noticing agent.
Kirkland & Ellis LLP and FTI Consulting Inc. served as the
consenting term lenders' legal counsel and financial advisor,
respectively.
The U.S. Trustee for Region 2 appointed an official committee of
unsecured creditors in the Debtors' cases on Feb. 27, 2019. The
creditors' committee tapped Pachulski Stang Ziehl & Jones LLP as
its legal counsel and Goldin Associates, LLC, as its financial
advisor.
On May 2, 2019, the U.S. trustee appointed an official committee
of
consumer creditors. The consumers committee tapped Quinn Emanuel
Urquhart & Sullivan, LLP, as counsel and TRS Advisors LLC, as
financial advisor.
On Sept. 26, 2019, the Bankruptcy Court confirmed Ditech's Chapter
11 bankruptcy plan, which became effective four days later.
DJM HOLDINGS: WSF Opposes Property Valuation
--------------------------------------------
Wilmington Savings Fund Society, FSB, doing business as Christiana
Trust, not in its individual capacity, but solely as Trustee for
BAT 2020-4 ("Secured Creditor"), objects to confirmation of the
Amended Chapter 11 Plan of Reorganization of DJM Holdings, Ltd.
Secured Creditor holds a security interest in the Debtor's real
property located at 5611 SOUTH BLVD., MAPLE HTS, OH 44137, by
virtue of a Mortgage recorded on December 2, 2005, Instrument
Number 200512020965 of the Public Records of Cuyahoga County, OH.
Said Mortgage secures a Note in the amount of $86,800.
The Debtor filed an Amended Chapter 11 Plan of Reorganization on
September 30, 2021. The Plan proposes to satisfy Secured
Creditor's claim by paying $66,000.
Secured Creditor disputes this valuation. Until a final
determination on valuation occurs, it would be premature to
consider confirming Debtor's Plan.
Secured Creditor requests it be allowed an opportunity to obtain a
full appraisal of the subject property to further its position as
to the value compared to the alleged value used by Debtors.
A full-text copy of Secured Creditor's objection dated Feb. 8,
2022, is available at https://bit.ly/3rJCefJ from PacerMonitor.com
at no charge.
Attorney for Creditor:
Susana E. Lykins, Esq. (0075603)
Robertson, Anschutz, Schneid, Crane & Partners, PLLC
10700 Abbott's Bridge Rd., Suite 170
Duluth, GA 30097
Phone: 470-321-7112 Ext 145
E-mail: slykins@raslg.com
About DJM Holdings
Concord-based DJM Holdings Ltd is the fee simple owner of 38
properties in Ohio, having a total current value of $1.02 million.
DJM Holdings sought protection under Chapter 11 of the Bankruptcy
Code (Bankr. N.D. Ohio Case No. 21-10483) on Feb. 14, 2021. At the
time of the filing, the Debtor disclosed $1,144,439 in assets and
$2,816,538 in liabilities. Judge Arthur I. Harris oversees the
case. The Debtor is represented by Forbes Law, LLC.
DOLPHIN ENTERTAINMENT: Has 8.1M Outstanding Shares of Common Stock
------------------------------------------------------------------
Dolphin Entertainment, Inc. filed a Current Report on Form 8-K with
the Securities and Exchange Commission in order to clarify the
number of shares of its common stock, $0.015 par value per share it
has outstanding. As of Feb. 8, 2022, the company has 8,080,381
shares of common stock outstanding.
About Dolphin Entertainment
Headquartered in Coral Gables, Florida, Dolphin Entertainment, Inc.
-- http://www.dolphinentertainment.com-- is an independent
entertainment marketing and premium content development company.
Through its subsidiaries, 42West LLC, The Door Marketing Group LLC
and Shore Fire Media, Ltd, the Company provides expert strategic
marketing and publicity services to many of the top brands, both
individual and corporate, in the entertainment, hospitality and
music industries.
Dolphin Entertainment reported a net loss of $1.94 million for the
year ended Dec. 31, 2020, compared to a net loss of $2.33 million
for the year ended Dec. 31, 2019. As of Sept. 30, 2021, the
Company had $54.13 million in total assets, $30.60 million in total
liabilities, and $23.53 million in total stockholders' equity.
Miami, Florida-based BDO USA, LLP, the Company's auditor since
2014, issued a "going concern" qualification in its report dated
April 15, 2021, citing that the Company has suffered recurring
losses from operations, and at Dec. 31, 2020, has an accumulated
deficit, and a working capital deficit that raise substantial doubt
about the Company's ability to continue as a going concern.
DUSAN PITTNER: Court Appoints David Madoff as Subchapter V Trustee
------------------------------------------------------------------
Judge Frank J. Bailey of the United States Bankruptcy Court for the
District of Massachusetts, Eastern Division, removes Dusan Pittner
as debtor-in-possession pursuant to 11 U.S.C. Section 1185(a) based
on the Debtor's failure to comply with court orders. Judge Bailey
finds cause to convert or dismiss, but also finds that removal of
Dusan Pittner is in the best interest of creditors and the estate.
As a result of the Debtor's removal, David B. Madoff, the
subchapter V trustee in this case, shall perform the duties
specified in Section 1183(b)(5), including operating the business
of the Debtor.
"The Debtor's deliberate refusal to obey an order of the Court, the
December 21 Order, is cause under Section 1185(a) to remove the
Debtor from possession. I further hold that the removal of the
Debtor from possession under Section 1185(a), with the resulting
increase in the powers and duties of the subchapter V Trustee under
Section 1183(b)(5), is in the best interests of creditors and the
estate and better serves these interests than either conversion of
the case to one under chapter 7 or dismissal of the case. For these
reasons, the Court will by separate order remove the Debtor from
possession," Judge Bailey concludes.
A full-text copy of the Memorandum of Decision on Order to Show
Cause dated February 4, 2022, is available at
https://tinyurl.com/ywcfs699 from Leagle.com.
Dusan Pittner filed a Chapter 11 petition (Bankr. D. Mass. Case No.
21-11009) on July 8, 2021, and is represented by David Baker, Esq.
EASTERN ILLINOIS: S&P Upgrades ICR to 'BB' on Enrollment Growth
---------------------------------------------------------------
S&P Global Ratings raised its long-term rating and underlying
rating (SPUR) to 'BB' from 'BB-' on Eastern Illinois University
Board of Trustees' auxiliary facilities system (AFS) revenue bonds,
issued for Eastern Illinois University (EIU). At the same time, S&P
Global Ratings raised its SPUR on the university's certificates of
participation (COPs) outstanding to 'BB' from 'BB-'. The outlook is
stable.
"The upgrades reflect our view of EIU's steady enrollment growth
which is expected to continue into fall 2022," said S&P Global
Ratings credit analyst Nicolas Fortin. "Furthermore, we believe
that stabilization in state operating appropriations over recent
years has enabled the university to budget effectively while the
State of Illinois' proposed increases in state appropriations to
EIU will enable the university to return to balanced operations and
further improve available resource ratios."
S&P said, "We assess EIU's enterprise profile as adequate,
characterized by relatively stable undergraduate FTE enrollment and
steadily growing graduate FTE enrollment, and a demand profile
comparable with other Illinois regional public universities. We
assess the university's financial profile as vulnerable, with a
high tuition discount rate compared with that of similarly rated
public universities, a trend of full-accrual operating deficits
which are somewhat offset by improved, although still relatively
weak, available resources partially driven by stable state
operating appropriations received in recent years. We believe these
credit factors, combined, lead to an indicative stand-alone credit
profile of 'bb+'. As our criteria indicate, the final rating can be
one notch within the indicative stand-alone credit profile. In our
opinion, the 'BB' rating better reflects our view of the school's
slim available resource ratios compared with those of peers."
"The stable outlook reflects our expectation that the university
will, at least, keep enrollment stable and maintain current
available resource ratios," Mr. Fortin added. "We expect state
operating appropriations to EIU to increase in fiscal 2023 and we
do not expect any decreases over the coming years."
EIU is one of nine state-supported universities in Illinois. The
main campus is in Charleston, about 200 miles south of Chicago. It
is primarily an undergraduate institution, with four colleges and a
graduate school supporting programs in the sciences, humanities,
business, and education. Founded as a teachers' college in 1895,
EIU is known for its large teacher education programs.
EASTSIDE DISTILLING: Postpones Special Meeting Until March 4
------------------------------------------------------------
Eastside Distilling, Inc. postponed the Special Meeting of
Stockholders scheduled to be held on Feb. 8, 2022 due to its
receipt of insufficient proxies and a probable lack of the required
quorum. A quorum consists of a majority of the shares entitled to
vote.
The Special Meeting has been postponed until Friday, March 4, 2022
at 2:00 p.m. Pacific Time to allow additional time for the
Company's stockholders to vote on the proposals set forth in the
Company's definitive proxy statement filed with the United States
Securities and Exchange Commission on Nov. 26, 2021.
The purpose of the special meeting is to approve the terms and
issuance of common stock purchase warrants to purchase up to
900,000 shares of the Company's common stock at an exercise price
equal to $3.00 per share.
During the current postponement, the Company continues to solicit
votes from its stockholders with respect to the proposals set forth
in the Company's proxy statement.
The special meeting will be a virtual meeting to be held over the
Internet. Stockholders will be able to attend the virtual special
meeting, vote their shares electronically and submit their
questions during the live webcast of the meeting by visiting
https://www.virtualshareholdermeeting.com/EAST2021SM and following
the instructions on the website to enter the 16-digit control
number printed on their proxy card or notice of internet
availability of proxy materials.
The proxy statement, filed and made available to stockholders on
Nov. 26, 2021, is available at www.proxyvote.com.
The Company encourages all stockholders of record on Nov. 26, 2021
who have not yet voted, to do so by March 3, 2022 at 11:59 p.m.
(Eastern Time). Stockholders who have any questions or require any
assistance with completing a proxy or voting instruction form or
who do not have the required materials, may contact Amy Brassard,
using the following contact information: Telephone: 1-503-542-7420
Email: abrassard@eastsidedistilling.com.
About Eastside Distilling
Headquartered in Portland, Oregon, Eastside Distilling, Inc. --
www.eastsidedistilling.com -- manufactures, acquires, blends,
bottles, imports, exports, markets, and sells a wide variety of
alcoholic beverages under recognized brands.
Eastside Distilling reported a net loss of $9.86 million for the
year ended Dec. 31, 2020, a net loss of $16.91 million for the year
ended Dec. 31, 2019, and a net loss of $9.05 million for the year
ended Dec. 31, 2018. As of June 30, 2021, the Company had $27.20
million in total assets, $18.52 million in total liabilities, and
$8.68 million in total stockholders' equity.
FORMING MACHINING: Moody's Affirms Caa2 CFR; Outlook Remains Neg.
-----------------------------------------------------------------
Moody's Investors Service affirmed its ratings for Forming
Machining Industries Holdings, LLC, the legal borrower of the debt
facilities of The Atlas Group ("Atlas;" taken together, "Forming
Machining" or the company), including the company's corporate
family rating and probability of default rating, at Caa2 and
Caa2-PD, respectively. Concurrently, Moody's affirmed the
first-lien senior secured bank credit facility ratings and the
second-lien senior secured term loan rating, at Caa1 and Ca,
respectively. The outlook remains negative.
The affirmation of the ratings is supported by Moody's expectation
that the company's financial leverage will remain very high, albeit
improving, over the next 12 to 18 months. The expectation of
improvement is based on anticipated revenue and earnings growth as
production volumes gradually improve, combined with the ramp-up of
new business awards. Additionally, although liquidity remains weak,
a recent sale lease-back transaction has provided additional cash
to support near-term liquidity. That said, free cash flow will
remain constrained as investments will be needed to support the
conversion of new business awards to revenue. The company's
nearly-fully drawn revolver expires in October 2023.
Moody's took the following rating actions:
Affirmations:
Issuer: Forming Machining Industries Holdings, LLC
Corporate Family Rating, Affirmed at Caa2
Probability of Default Rating, Affirmed at Caa2-PD
Senior Secured 1st Lien Bank Credit Facility, Affirmed at Caa1
(LGD3)
Outlook Actions:
Issuer: Forming Machining Industries Holdings, LLC
Outlook, Remains Negative
RATINGS RATIONALE
Forming Machining's Caa2 CFR reflects the company's very high
financial leverage and weak liquidity due to significantly reduced
commercial aerospace production volumes, which has negatively
impacted the company's revenue and earnings. Credit constraints
include the company's relatively small revenue base (approximately
$138 million as of September 30, 2021) and high degree of customer
and aircraft platform concentration. The company's meaningful
exposure to the 737 MAX platform accentuated the negative impact of
the coronavirus pandemic on the company's credit profile.
The company benefits from the fact that it has sole-source content
on important aerospace platforms across the commercial aerospace,
business jet and defense markets. The company has made strides to
further diversify its business, reflected in the composition of its
new business awards including in the area of defense and other end
markets such as the courier/cargo-related business.
The negative ratings outlook reflects Moody's expectation that
financial leverage, albeit improving, will remain very high and
liquidity will remain weak until earnings from backlog conversion
further materialize and production volumes more meaningfully
increase. The negative outlook also reflects rising refinancing
risk given the expiration of the company's revolving credit
facility in October 2023.
Moody's considers Forming Machining's liquidity to be characterized
as weak, underscored by negative to breakeven free cash flow,
limited availability under the company's $50 million revolving
credit facility and tight covenant headroom.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The ratings could be upgraded if the company's liquidity
meaningfully improves including positive free cash flow and reduced
refinancing risk. In addition, the ratings could be upgraded if the
trajectory of aerospace & defense end-markets improves further,
with production of the Boeing 737 MAX expected to meaningfully
increase. Debt/EBITDA improving to less than 8.0 times and
EBITA/interest improving to greater than 1.0 times on a sustained
basis, could also lead to an upgrade.
Conversely, ratings could be downgraded if there is heightened
liquidity risk such that there is an increased likelihood of a
default event including a distressed exchange. Further, reduced
recovery prospects for lenders could also lead to a downgrade.
Headquartered in Wichita, Kansas, Forming Machining Industries
Holdings, LLC, the legal borrower of the debt facilities of The
Atlas Group ("Atlas;" taken together, "Forming Machining"), is a
manufacturer of complex assemblies for commercial, military, and
business aircraft. Products include door, nacelle and wing
structures. Atlas is controlled by AE Industrial Partners, LP.
Atlas' annual revenues well exceed $100 million.
The principal methodology used in these ratings was Aerospace and
Defense published in October 2021.
FORUM ENERGY: Provides Fourth Quarter 2021 Operational Update
-------------------------------------------------------------
Forum Energy Technologies, Inc. announced that fourth quarter 2021
operating results are expected to be below previously provided
guidance levels. Results in the fourth quarter were negatively
affected by further supply chain disruptions, which caused both
revenue to be deferred and costs to increase. In addition, the
Company incurred excess logistics and freight costs in an effort to
mitigate these supply chain disruptions. Also, medical benefit
costs were higher than expected in the fourth quarter due to the
direct and indirect effects of the COVID pandemic.
As a result of these factors, revenue and adjusted EBITDA for the
fourth quarter of 2021 are now expected to be approximately $148
million and $4 million, respectively.
On a full year basis, 2021 revenue of $541 million and adjusted
EBITDA of $20 million are expected to exceed prior year revenue by
$29 million and adjusted EBITDA by $40 million, respectively.
Cris Gaut, FET's chairman and chief executive officer, commented,
"While the ongoing business impact from supply chain disruptions
and increased expediting costs are disappointing, we remain pleased
with our overall full-year 2021 performance. The team's hard work
to increase our revenue and meaningfully improve profitability over
2020 are commendable. Our bookings of new orders continue to be
strong and our fourth quarter book to bill ratio of approximately
1.1x builds upon our already meaningful backlog, setting up
continued revenue expansion over the course of 2022."
"We expect fourth quarter free cash flow of approximately negative
$8 million to be better than our previous guidance, despite lower
profitability. In addition, we executed several noteworthy
strategic moves during the fourth quarter that are not included in
the free cash flow calculation, including the collection of a
long-term receivable for $11 million in cash. We also repurchased
56 thousand shares of FET common stock for $1.1 million pursuant to
our Board authorized stock repurchase plan. In addition, we
utilized $4 million in cash for two tuck-in acquisitions of
complementary businesses. Overall, net debt increased by $3
million in the quarter. We will share more details on these
actions and our 2022 outlook on our earnings call."
Due to the preliminary nature of this guidance, a reconciliation to
net income and cash flow from operations is not currently
available. A full reconciliation will be provided with Forum's
fourth quarter and full year 2021 earnings release.
About Forum Energy
Forum Energy Technologies -- www.f-e-t.com -- is a global oilfield
products company, serving the drilling, downhole, subsea,
completions and production sectors of the oil and natural gas
industry. The Company's products include highly engineered capital
equipment as well as products that are consumed in the drilling,
well construction, production and transportation of oil and natural
gas. Forum is headquartered in Houston, TX with manufacturing and
distribution facilities strategically located around the globe.
Forum Energy reported a net loss of $96.89 million for the year
ended Dec. 31, 2020, compared to a net loss of $567.06 million for
the year ended Dec. 31, 2019. As of Sept. 30, 2021, the Company
had $799.97 million in total assets, $453.95 million in total
liabilities, and $346.02 million in total equity.
* * *
As reported by the TCR on July 15, 2021, Moody's Investors Service
upgraded Forum Energy Technologies, Inc.'s Corporate Family Rating
to Caa1 from Caa2. "The upgrade of Forum's ratings reflects
reduced risk of default and our expectation that Forum will grow
revenue and EBITDA through 2022 driving reduced leverage and better
interest coverage," commented Jonathan Teitel, a Moody's analyst.
As reported by the TCR on Aug. 25, 2021, S&P Global Ratings revised
its outlook on Forum Energy Technologies Inc. to stable from
negative and affirmed its 'CCC+' issuer credit rating. The stable
outlook reflects S&P's view that despite expecting leverage to
remain at unsustainable levels over the next 12 months, including
funds from operations (FFO) to debt of about 5%, S&P expects Forum
will maintain adequate liquidity and generate a small amount of
FOCF.
FOXWOOD HILLS: Hearing Location of Suit vs 783-C et al. Changed
---------------------------------------------------------------
The venue of the hearing for the continued Joint Pretrial
Conferences for Plaintiff Foxwood Hills Property Owners
Association, Inc., the listed Defendants represented by Michael
Dodd, Esq., and defendant Christopher A. Pierce, in the adversary
proceeding styled Foxwood Hills Property Owners Association, Inc.,
Chapter 11 Plaintiff(s), v. 783-C, LLC et al., Defendant(s), Adv.
Pro. No. 20-80049-HB. (Bankr. D.S.C.) scheduled for April 5, 2022,
at 10:30 a.m. to be held in Spartanburg, South Carolina, has been
changed to the Clement F. Haynsworth Federal Building and U.S.
Courthouse, 300 East Washington Street, Greenville, SC 29601 at the
same date and time.
A full-text copy of the Order dated February 3, 2022, issued by
Chief Bankruptcy Judge Helen E. Burris of the United States
Bankruptcy Court for the District of South Carolina is available at
https://tinyurl.com/4h55yr3n from Leagle.com.
About Foxwood Hills Property
Owners Association
Foxwood Hills Property Owners Association, Inc., is an
organization
of owners of Foxwood Hills -- a lakefront community of primary and
vacation homes nestled in the northwest corner of Oconee County,
S.C.
Foxwood Hills Property Owners Association filed its voluntary
petition under Chapter 11 of the Bankruptcy Code (Bankr. D.S.C.
Case No. 20-02092) on May 8, 2020. At the time of the filing, the
Debtor disclosed $4,253,427 in assets and $219,780 in liabilities.
Judge Helen E. Burris oversees the case.
The Debtor tapped Nexsen Pruet, LLC as legal counsel and Elliott
Davis, LLC, as accountant. American Legal Claim Services, LLC, is
the claims and noticing agent.
FULL HOUSE: BlackRock Has 5.9% Equity Stake as of Dec. 31
---------------------------------------------------------
BlackRock disclosed in a Schedule 13G filed with the Securities and
Exchange Commission that as of Dec. 31, 2021, it beneficially owns
2,035,646 shares of common stock of Full House Resorts Inc.,
representing 5.9 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/891482/000083423722007218/us3596781092_020422.txt
About Full House Resorts Inc.
Headquartered in Las Vegas, Nevada, Full House Resorts --
www.fullhouseresorts.com -- owns, leases, develops and operates
gaming facilities throughout the country. The Company's properties
include Silver Slipper Casino and Hotel in Hancock County,
Mississippi; Bronco Billy's Casino and Hotel in Cripple Creek,
Colorado; Rising Star Casino Resort in Rising Sun, Indiana; and
Stockman's Casino in Fallon, Nevada. The Company also operates the
Grand Lodge Casino at the Hyatt Regency Lake Tahoe Resort, Spa and
Casino in Incline Village, Nevada under a lease agreement with the
Hyatt organization. The Company is currently constructing a new
luxury hotel and casino in Cripple Creek, Colorado, adjacent to its
existing Bronco Billy's property.
Full House reported net income of $147,000 for the year ended Dec.
31, 2020, compared to a net loss of $5.82 million for the year
ended Dec. 31, 2019. As of Sept. 30, 2021, the Company had $470.09
million in total assets, $362.77 million in total liabilities, and
$107.32 million in stockholders' equity.
* * *
As reported by the TCR on Feb. 9, 2021, Moody's Investors Service
assigned a Caa1 Corporate Family Rating and Caa1-PD Probability of
Default Rating to Full House Resorts Inc. (FHR). The Caa1 CFR
reflects the long, approximately 24 months, Bronco Billy's
construction period, uncertainty related to the level of visitation
and earnings at the redesigned property, FHR's modest scale, and
exposure to cyclical discretionary consumer spending.
FULL HOUSE: Closes Private Offering of $100M Senior Notes Due 2028
------------------------------------------------------------------
Full House Resorts, Inc. closed on Feb. 7, 2022, its previously
announced private offering of $100.0 million aggregate principal
amount of its 8.25% Senior Secured Notes due 2028.
The Notes were sold at a price of 102.0% of the principal amount of
the Additional Notes. The Additional Notes were issued pursuant to
an indenture, dated as of Feb. 12, 2021, pursuant to which the
Company issued $310 million of identical senior secured notes in
February 2021. In connection with the issuance of the Additional
Notes, the Company and the subsidiary guarantors party to the
Indenture entered into two Supplemental Indentures with Wilmington
Trust, National Association, as trustee, dated Feb. 1, 2022 and
Feb. 7, 2022, respectively.
The Notes bear interest at a rate of 8.25% per year and mature on
Feb. 15, 2028. Interest on the Notes is payable on February 15 and
August 15 of each year, with interest for the Additional Notes
beginning to accrue from the prior interest payment date. The net
proceeds from the sale of the Additional Notes are expected to be
used: (i) to develop, equip and open The Temporary by American
Place, the Company's planned temporary casino in Waukegan, Illinois
which the Company intends to operate while it designs and
constructs its permanent American Place facility; (ii) to pay the
transaction fees and expenses of the offer and sale of the
Additional Notes; and (iii) for general corporate purposes.
Also on Feb. 7, 2022, the Company entered into a First Amendment to
Credit Agreement with Capital One, National Association, which,
among other things, increased the borrowing capacity under the
Company's Credit Agreement, dated as of March 31, 2021, from $15.0
million to $40.0 million. No borrowings are currently outstanding
under the Credit Agreement.
The Notes are guaranteed, jointly and severally, by each of the
Company's restricted subsidiaries. The Notes and the Guarantees
will be the Company's and the Guarantor's general senior secured
obligations, subject to the terms of the Collateral Trust Agreement
(as defined in the Indenture), ranking senior in right of payment
to all of the Company's and the Guarantor's existing and future
debt that is expressly subordinated in right of payment to the
Notes and the Guarantees, if any, ranking equally in right of
payment with all of the Company's and the Guarantors' existing and
future senior debt, including borrowings under the Credit
Agreement.
The Notes, together with borrowings under the Credit Agreement, are
equally and ratably secured by a first priority security interest
in, subject to certain exceptions and limitations and the terms of
the Collateral Trust Agreement, the Company's and the Guarantors'
furniture, equipment, inventory, accounts receivable, other
personal property and real property. Additionally, the Notes (but
not the borrowings under the Credit Agreement) are secured by a
first priority security interest in the securities accounts and the
deposit accounts established pursuant to the Cash Collateral and
Disbursement Agreement.
About Full House Resorts Inc.
Headquartered in Las Vegas, Nevada, Full House Resorts --
www.fullhouseresorts.com -- owns, leases, develops and operates
gaming facilities throughout the country. The Company's properties
include Silver Slipper Casino and Hotel in Hancock County,
Mississippi; Bronco Billy's Casino and Hotel in Cripple Creek,
Colorado; Rising Star Casino Resort in Rising Sun, Indiana; and
Stockman's Casino in Fallon, Nevada. The Company also operates the
Grand Lodge Casino at the Hyatt Regency Lake Tahoe Resort, Spa and
Casino in Incline Village, Nevada under a lease agreement with the
Hyatt organization. The Company is currently constructing a new
luxury hotel and casino in Cripple Creek, Colorado, adjacent to its
existing Bronco Billy's property.
Full House reported net income of $147,000 for the year ended Dec.
31, 2020, compared to a net loss of $5.82 million for the year
ended Dec. 31, 2019. As of Sept. 30, 2021, the Company had $470.09
million in total assets, $362.77 million in total liabilities, and
$107.32 million in stockholders' equity.
* * *
As reported by the TCR on Feb. 9, 2021, Moody's Investors Service
assigned a Caa1 Corporate Family Rating and Caa1-PD Probability of
Default Rating to Full House Resorts Inc. (FHR). The Caa1 CFR
reflects the long, approximately 24 months, Bronco Billy's
construction period, uncertainty related to the level of visitation
and earnings at the redesigned property, FHR's modest scale, and
exposure to cyclical discretionary consumer spending.
GALVIN'S RIDGE: Voluntary Chapter 11 Case Summary
-------------------------------------------------
Debtor: Galvin's Ridge Landco, LLC
11118 U.S. Hwy 31
Spanish Fort, AL 36527-5647
Chapter 11 Petition Date: February 11, 2022
Court: United States Bankruptcy Court
Southern District of Alabama
Case No.: 22-10258
Debtor's Counsel: Edward J. Peterson, Esq.
STICHTER, RIEDEL, BLAIN, & POSTLER, P.A.
110 E. Madison St.
Suite 200
Tampa, FL 33602
Tel: (813) 229-0144
E-mail: epeterson@srbp.com
Estimated Assets: $10 million to $50 million
Estimated Liabilities: $10 million to $50 million
The petition was signed by J. Marion Uter as manager.
The Debtor stated it has no creditors holding unsecured claims.
A full-text copy of the petition is available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/SHX4WEY/Galvins_Ridge_Landco_LLC__alsbke-22-10258__0001.0.pdf?mcid=tGE4TAMA
GIGA-TRONICS INC: Incurs $793K Net Loss in Third Quarter
--------------------------------------------------------
Giga-Tronics Incorporated filed with the Securities and Exchange
Commission its Quarterly Report on Form 10-Q disclosing a net loss
of $793,000 on total revenue of $1.97 million for the three months
ended Dec. 25, 2021, compared to net income of $833,000 on total
revenue of $4.08 million for the three months ended Dec. 26, 2020.
For the nine months ended Dec. 25, 2021, the Company reported a net
loss of $1.54 million on total revenue of $7.59 million compared to
net income of $435,000 on $10.32 million of total revenue for the
nine months ended Dec. 26, 2020.
As of Dec. 25, 2021, the Company had $8.13 million in total assets,
$3.47 million in total liabilities, and $4.66 million in total
shareholders' equity.
"The COVID-19 pandemic has caused significant disruptions to the
global, national and local economy. The overall economic and other
impacts of the COVID-19 pandemic in the areas in which the Company
and its customers and suppliers operates is not known and cannot be
predicted at this time. While the disruption is currently expected
to be temporary, there is uncertainty about the duration and the
total economic impact. If this situation is prolonged, the
pandemic could cause additional delays and could have a short- or
long-term adverse impact, possibly material, on the Company's
future financial condition, liquidity, and results of operations,"
Giga-Tronics said.
"To mitigate these risks, the Company has purchased long-lead
inventory ahead of order receipt according to a forecast of
anticipated business for its EW business. Microsource generally
buys inventory upon receipt of each contract but has experienced
delays in delivery of specialty components and certain chips needed
for its RADAR filter production. Microsource management is working
to secure supply of these materials to minimize gaps in delivery to
its customers," the Company said.
A full-text copy of the Form 10-Q is available for free at:
https://www.sec.gov/Archives/edgar/data/0000719274/000143774922002730/giga20211225_10q.htm
About Giga-tronics Inc.
Headquartered in Dublin, California, Giga-tronics is a publicly
held company, traded on the OTCQB Capital Market under the symbol
"GIGA". Giga-tronics -- http://www.gigatronics.com-- produces
RADAR filters and Microwave Integrated Components for use in
military defense applications as well as sophisticated RADAR and
Electronic Warfare (RADAR/EW) test products primarily used in
electronic warfare test & emulation applications.
Giga-Tronics reported a net loss of $393,000 for the year ended
March 27, 2021, compared to a net loss of $687,000 for the year
ended March 28, 2020. As of Sept. 25, 2021, the Company had $9.10
million in total assets, $3.76 million total liabilities, and $5.34
million in total shareholders' equity.
GILBERT MH: Says Reorganization Plan Feasible at This Time
----------------------------------------------------------
Debtor Gilbert MH, LLC, filed a supplemental response to the
objection to First Amended Chapter 11 Plan of Reorganization dated
Nov. 29, 2021, filed by parties in interest Gilbert Family
Hospital, LLC, Henry and Karen Higgins, and Justin Hohl
(collectively, "Gilbert Hospital").
Gilbert MH points out that the Objection asserts that the Plan is
not feasible because the amount of attorneys' fees awarded to
Gilbert Hospital exceeds the amount of the judgment entered against
it. That Objection has now been rendered meaningless by the recent
ruling of the District Court in the litigation between Debtor and
Objector Gilbert Hospital. The District Court has awarded Debtor
attorney's fees in the amount of $100,731. There are now three
awards from the District Court litigation. In addition to the
recent fee award, Debtor was awarded damages in the amount of
$150,071. Objector Gilbert Hospital was awarded fees in the amount
of $179,048.
Gilbert MH further points out that no matter how the Court
determines the issues of recoupment and setoff that are contained
in Gilbert Hospital's Stay Lift Motion, there will be no less than
$71,754.92 due Debtor by Gilbert Hospital. If no recoupment is
permitted, the estate will have no less than $250,000 available to
pay claims and expenses (assuming the Judgment Debtors pay the
judgment). If the Court allows setoff or recoupment only as to the
fee awards, there will be $150,000 available to pay creditors. The
Plan is clearly feasible at this time, according to the Debtor.
Attorneys for the Debtor:
Lawrence D. Hirsch, Esq.
PARKER SCHWARTZ, PLLC
7310 NORTH 16TH STREET, SUITE 330
PHOENIX, ARIZONA 85020
Tel: (602) 282-0477
Fax: (602) 282-0478
E-mail: LHIRSCH@PSAZLAW.COM
About Gilbert MH
Gilbert MH, LLC filed its voluntary petition for relief under
Chapter 11 of the Bankruptcy Code (Bankr. D. Ariz. Case No.
21-01948) on March 19, 2021. At the time of the filing, the Debtor
had between $1 million and $10 million in both assets and
liabilities. Judge Eddward P. Ballinger Jr. oversees the case.
The Debtor is represented by Lawrence D. Hirsch, Esq., at Parker
Schwartz, PLLC.
GPMI CO: Seeks to Tap Dickinson Wright PLLC as Special Counsel
--------------------------------------------------------------
GPMI, Co. seeks approval from the U.S. Bankruptcy Court for the
District of Arizona to employ the law firm of Dickinson Wright PLLC
as its special counsel.
The Debtor needs the assistance of a special counsel in connection
with a potential litigation against Albaad USA Inc.
The hourly rates of the firm's attorneys and staff are as follows:
Robert A. Shull $795
Bradley A. Burns $450
Members $300 - $800
Associates $230 - $400
Paralegals $100 - $200
In addition, the firm will seek reimbursement for expenses
incurred.
Robert Shull, Esq., an attorney at Dickinson Wright, disclosed in a
court filing that the firm is a "disinterested person" as that term
is defined in Section 101(14) of the Bankruptcy Code.
The firm can be reached through:
Robert A. Shull, Esq.
Dickinson Wright PLLC
1850 North Central Avenue, Suite 1400
Phoenix, AZ 85004
Telephone: (602) 285-5000
Facsimile: (844) 670-6009
Email: rshull@dickinsonwright.com
About GPMI Co.
GPMI Company is engaged in developing new concepts, innovating
products, program development, and marketing. GPMI is an Arizona
based company established in 1989, with production facilities
across the United States.
GPMI filed its voluntary petition for relief under Chapter 11 of
the Bankruptcy Code (Bankr. D. Ariz. Case No. 22-00150) on Jan. 10,
2022, listing as much as $50 million in both assets and
liabilities. Yarron Bendor, president, signed the petition.
Judge Eddward P. Ballinger Jr. oversees the case.
The Debtor tapped Engelman Berger, PC, led by Steven N. Berger,
Esq., as legal counsel; Dickinson Wright PLLC as special counsel;
and MCA Financial Group, Ltd. as financial consultant.
GREAT WESTERN: Fitch Affirms 'B-' LT IDR, Alters Outlook to Pos.
----------------------------------------------------------------
Fitch Ratings has affirmed Great Western Petroleum, LLC's (GWP)
Long-Term Issuer Default Rating (IDR) at 'B-', its senior secured
credit facility at 'BB-'/'RR1' and its senior secured second lien
notes at 'B-'/'RR4'. The Rating Outlook has been revised to
Positive from Stable.
GWP's ratings reflect its smaller pure-play Denver-Julesburg (DJ)
Basin scale, FCF expectations that provide a notable opportunity in
2022 to reduce the draw on the company's Reserve Based Loan (RBL)
and Fitch's forecast 2021 year-end leverage around 1.5x. The
ratings also consider the risks associated with the relatively
higher regulatory and community standards that are applied to E&P
companies operating in the state of Colorado.
The Positive Outlook reflects GWP's improved leverage and Fitch's
expectation for positive FCF generation, which would be applied to
reduce RBL borrowings.
KEY RATING DRIVERS
Positive FCF Generation: Fitch is forecasting GWP to generate FCF
of approximately $100 million for 2021 and $85 million in 2022
before trending towards a more neutral FCF in 2023/2024 under its
price deck, which uses WTI of $67 in 2022, $57 in 2023 and $50
thereafter. FCF in 2022, with further upside at strip pricing,
provides an opportunity to reduce RBL borrowings and improve
liquidity.
Improving liquidity should better GWP's position to extend its
revolver maturity. GWP's hedge book uses a combination of swaps,
collars and regional basis swaps to manage oil and gas price
volatility. GWP currently has approximately three quarters of
forecast 2022 oil and natural gas production hedged and 10% - 20%
of 2023 oil and natural gas production. This is a reduction from
the three-year rolling hedge book GWP used previously but still
provides visibility into future FCF's.
Sub 1x Leverage Target: GWP targets a sub 1x leverage level. Fitch
forecasts GWP leverage of 1.4x at YE 2021, which is a meaningful
decrease from 2.4x at YE 2020 and is likely to decline further in
2022 due to GWP's EBITDA improvement in a supportive commodity
price environment.
Debt Structure: With a $485 million RBL commitment, of which $288
million was drawn at 3Q21 and $312 million in second lien notes,
GWP has a simple but RBL reliant and encumbered capital structure.
Increased RBL liquidity, particularly through debt reduction as
oppose to borrowing base growth and demonstrated market access to
to issue unsecured notes would be credit supportive.
Pure-Play DJ Basin Producer: GWP's production scale at
approximately 51Mboped in 3Q21 with approximately 196MMboe proved
reserve as of year-end 2020 is consistent with typical 'B' category
rated E&P producers. Its 53M net acres, located solely in the DJ
Basin split between Weld and Adams county, exposes the company to
single basin risks, which in the DJ Basin includes a more rigorous
regulatory environment. GWP benefits from a decent liquids
weighting, 66% in 3Q21, which supports its unit economics.
Production Costs and Commitments: GWP's relatively low lease
operating expenses and roughly two-thirds of production liquids
weighting help offset the differential and transportation costs GWP
incurs operating in the DJ basin to support a competitive 3Q21
Fitch calculated unhedged cash netback of $32.6/bbl. Fitch
anticipates GWP is positioned to meet its oil and gas minimum
volume commitments, but to do so third-party oil purchases were
required in 2021 and at current oil production levels may need to
be purchased during Fitch's forecast period.
Regulatory Environment: Oil and gas developers in Colorado have
been subject to regulatory scrutiny and ballot initiatives to
severely curtail production in the state, including a failed
state-wide 2018 ballot that would have restricted oil and gas
development in the state by requiring all new development to be
setback 2,500 feet from certain structures such as schools, homes
and hospitals. In 2019, state law changed the mission of the
Colorado Oil & Gas Conservation Commission (COGCC) from 'fostering'
to 'regulating', with new rules reflecting this mandate coming into
effect in January 2021. The new rules focus on community
engagement, transparency and continuous dialogue. These rules
established a one permit process and have provided a framework that
gives producers improved visibility to navigate.
Fitch does not foresee near-to-medium term operational risks under
the new regulatory environment. GWP has been proactive with its
permitting planning and has over 350 existing permits, which under
its current two rig program, provides for approximately four years
of drillable inventory. Fitch believes the regulatory environment
has affected M&A interest in the basin, providing an opportunity
for in basin E&P companies to make potential acquisitions at
relatively attractive multiples. However, the regulatory and
political environment may remain an overhang as it relates to
capital market access pricing.
DERIVATION SUMMARY
GWP's 3Q21 production of 51Mboepd is below Civitas Resources, Inc
(BB-/Stable) pro forma its consolidation of Bonanza Creek,
Extraction and Crestone's operations, of 159Mbopepd. Civitas
compares to GWP as a larger pure-play DJ Basin producer. Civitas'
forecast 2021 gross leverage of approximately 0.5x is below GWP at
approximately 1.4x, with both company's concentration in the DJ
basin and its associated operational and capital market risks
tempering the overall impact of their low leverage for their
respective rating levels of their IDRs.
GWP's production is ahead of 'B-' rated Ranger Oil Corporation
(B-/Stable; 38Mboepd), whose operations are located in the Eagle
Ford trend and in line with Talos (B-/Stable), whose offshore asset
base produced 57Mboepd in 3Q21. Forecast leverage for Talos at sub
2.0x is modestly higher than GWP, while Ranger's forecast sub-1.5x
leverage is in-line. GWP's debt to flowing barrel of $17.6M/bbl is
similar to Talos' 18.7M/bbl at 3Q21, and materially below Ranger
29.7/bbl.
Compared to 'B' rated E&P company's Callon Petroleum (B/Stable) and
SM Energy (B/Stable), GWP's production is meaningfully behind these
peers' respective 3Q21 averages of 100Mboped and 156Mboepd. GWP's
3Q21 unhedged cash netback of $32.6/bbl trails Callon's $37/bbl and
SM's $39.5/bbl.
KEY ASSUMPTIONS
-- WTI (USD/bbl) of $68 in 2021, $67 in 2022, $57 in 2023 and $50
in 2024 and longer term;
-- Henry Hub natural gas (USD/mcf) of $3.80 in 2021, $3.25 in
2022, $2.75 in 2023, $2.50 in 2024 and longer term;
-- Mid to high single digit production growth during 2022 - 2024;
-- Excess cash partially utilized to reduce RBL / RBL
successfully refinanced successfully;
-- Unit production costs are largely flat during forecast period.
KEY RECOVERY RATING ASSUMPTIONS
The recovery analysis assumes that GWP would be reorganized as a
going-concern in bankruptcy rather than liquidated. Fitch has
assumed a 10% administrative claim.
Going-Concern (GC) Approach
Fitch assumes a bankruptcy scenario exit EBITDA of $220 million,
which reflects the approximate 2023 and 2024 EBITDA's in Fitch's
stress case. The EBITDA estimate considers a weakened oil and
natural gas environment that results in restrained capital
investment causing lower-than-expected production, less economic
drilling inventory and liquidity constraints.
Fitch uses a GC enterprise value (EV) multiple of 3.0x, which is
unchanged from GWP's previous recovery assumption. The historical
bankruptcy case study exit multiples for peer companies range from
2.8x to 7.0x, with an average of 5.2x and a median of 5.4. The
lower multiple reflects GWP's footprint, which is at approximately
53K net acres is smaller position and its location in the DJ Basin,
which is subject to increased regulatory risks and less M&A
activity than other onshore basins.
Liquidation Approach
Fitch uses transactional and asset-based valuations that is
informed by recent transactions for the DJ Basin, on $/acre,
$/drilling location, $/flowing barrel and $/proved reserve
estimates to determine a reasonable sales price for the company's
assets.
Fitch used PDC Energy Inc.'s acquisition of SRC Energy, Inc. in
August 2019 and Bonanza Creek's 2021 acquisition of Highpoint
Energy as key comparisons. SRC's acreage position is slightly south
and east of GWP's company's Weld County position, which has
different valuation impacts than the company's Adams County core,
which is in the volatile oil window.
Fitch assumes GWP's revolver was drawn to $485 million, or 100% of
the elected commitment amount. The allocation of value in the
liability waterfall results in a recovery corresponding to an 'RR1'
rating for the RBL and an 'RR4' rating for the senior secured
second lien notes.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
-- Generation of material FCF over mid-cycle pricing with
proceeds used for revolver reduction;
-- Utilization of revolver commitment below 50%;
-- Midcycle debt/EBITDA below 2.5x;
-- Production greater than 60 mboepd.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
-- Material reduction in liquidity;
-- Generation of FCF deficits over mid-cycle pricing;
-- Limitations on capital market access affecting refinancing or
liquidity;
-- Mid-cycle debt/EBITDA above 3.0x.
BEST/WORST CASE RATING SCENARIO
International scale credit ratings of Non-Financial Corporate
issuers have a best-case rating upgrade scenario (defined as the
99th percentile of rating transitions, measured in a positive
direction) of three notches over a three-year rating horizon; and a
worst-case rating downgrade scenario (defined as the 99th
percentile of rating transitions, measured in a negative direction)
of four notches over three years. The complete span of best- and
worst-case scenario credit ratings for all rating categories ranges
from 'AAA' to 'D'. Best- and worst-case scenario credit ratings are
based on historical performance.
LIQUIDITY AND DEBT STRUCTURE
RBL Reliance Reduced with FCF: At 3Q21 GWP's liquidity consisted of
$197 million of undrawn capacity on its $485 million RBL along with
readily available cash of $18 million, which with forecasted FCF
generation in 2022 should support near-term RBL repayments. There
are no debt maturities until the RBL comes due in June 2024, and
the next bond maturity is September 2025. Fitch believes the
company may need to refinance the notes to a longer maturity in
order to extend the revolver.
GWP's RBL has two financial maintenance covenants including a
maximum leverage ratio not to exceed 3.5 to 1 and a current ratio
that is not to be less than 1.0 to 1.0. Terms of the second lien
issuance only allows the revolving credit facility to be first lien
debt, prohibits any secured debt junior to the revolver and senior
to the second liens, and allows parity second lien debt of up to
$50 million.
ESG CONSIDERATIONS
GWP has an Environmental, Social and Governance (ESG) Relevance
Score of '4' for Exposure to Social Impacts, due to heightened
regulatory pressure for Colorado oil and gas operators, which may
have a longer-term impact on costs and inventory. Fitch believes
this has a negative impact on the credit profile and is relevant to
the rating in conjunction with other factors.
GWP has an ESG Relevance Score of '4' for Energy/Management,
reflecting the company's financial and operational flexibility due
to scale, business mix and diversification. These factors have a
negative impact on the credit profile, and are relevant to the
ratings in conjunction with other factors.
Unless otherwise disclosed in this section, the highest level of
ESG credit relevance is a score of '3'. This means ESG issues are
credit-neutral or have only a minimal credit impact on the entity,
either due to their nature or the way in which they are being
managed by the entity.
ISSUER PROFILE
GWP is a private, independent oil and natural gas company focused
on exploration and development of unconventional oil and gas
reserves in the liquids-rich core of the Greater Wattenberg field
in the DJ Basin. GWP has 53 thousand net acres, primarily located
in Weir and Adams County, Colorado.
GREENBRIER COMPANIES: Egan-Jones Retains BB- Sr. Unsecured Ratings
------------------------------------------------------------------
Egan-Jones Ratings Company, on January 21, 2022, retained its 'BB-'
foreign currency and local currency senior unsecured ratings on
debt issued by The Greenbrier Companies, Inc.
Headquartered in Lake Oswego, Oregon, The Greenbrier Companies,
Inc. supplies transportation equipment and services to the railroad
and related industries.
GREIF INC: Egan-Jones Hikes Senior Unsecured Ratings to BB
----------------------------------------------------------
Egan-Jones Ratings Company, on January 18, 2022, upgraded the
foreign currency and local currency senior unsecured ratings on
debt issued by Greif Inc. to BB from BB-.
Headquartered in Delaware, Ohio, Greif, Inc. manufactures and
markets industrial packaging products and services.
H.T.O. ARCHITECT: Court OKs Professional Fees, Trustee Commission
-----------------------------------------------------------------
Pending before the United States Bankruptcy Court for the Southern
District of New York is the Trustee's Final Report filed by Angela
Tese-Milner, the Chapter 7 Trustee, for the estate of H.T.O.
Architect, PLLC. The TFR includes (i) the Trustee's application for
payment of commissions (ii) the first and final fee application of
the Trustee's counsel Cullen and Dykman LLP, and (iii) the first
and final fee application of the Trustee's accountant Gary R.
Lampert, CPA.
The Trustee seeks commission totaling $21,131.69. C&D seeks payment
for professional fees in the amount of $133,566.00 and expenses in
the amount of $3,827.97 for services rendered from January 13, 2020
through and including September 30, 2021. Lampert makes his first
and final application for the allowance and compensation for
professional fees in the amount of $28,492.00 and $331.80 in
expenses for services rendered from January 23, 2020 through
September 28, 2021.
The objection deadline was January 24, 2022. A former employee of
the Debtor filed a timely objection to the TFR and the Trustee
filed a response. The Objection characterizes the Trustee's
proposed distribution as a "settlement" to which he objects,
arguing that the priority claim of the New York State Department of
Labor should be paid in full. But, Bankruptcy Judge Martin Glenn
finds that there is no "settlement" here; rather, the Trustee
proposes to pay all claims according to the priorities set forth in
the Bankruptcy Code. Unfortunately, after payment of secured claims
and administrative expenses, there is only a small amount available
for a pro rata distribution to priority claimants.
Judge Glenn holds that distributions will be made strictly in
accordance with the Bankruptcy Code priority scheme. The Trustee
explains that, after paying the secured claims and administrative
expenses in full, there are insufficient funds to pay in full the
priority claims in this case. The TFR provides that the New York
State Department of Labor's priority claims will receive payment
that is approximately 3.5% of the amount of its allowed claim,
which is pari passu with the recoveries for the similar priority
claims of the New York State Department of Taxation & Finance and
the Department of the Treasury. These proposed distributions comply
with section 726(b) of the Bankruptcy Code which "makes clear that
distribution to Section 507 priority creditors shall be made pro
rata amongst creditors within the same priority tier," Judge Glenn
rules.
Therefore, Judge Glenn overrules the Objection and approves the TFR
and Fee Applications.
A full-text copy of the Memorandum Opinion dated February 3, 2022,
is available at https://tinyurl.com/4xfdttun from Leagle.com.
About HTO Architect, PLLC
H.T.O. Architect, PLLC is a full-service architectural firm based
in Manhattan, specializing in the design of high-rise residential,
hospitality and mixed-use buildings.
HTO Architect filed a Chapter 11 petition (Bankr. S.D.N.Y. Case No.
19-10915) on March 28, 2019. At the time of the filing, the Debtor
estimated $1,000,001 to $10,000,000 in both assets and
liabilities.
Judge Martin Glenn presides over the case. Michael J. Macco, Esq.,
at Macco & Stern, LLP, represents the Debtor as counsel.
HAYAT BAHKT: Seeks to Hire Narissa A. Joseph as Legal Counsel
-------------------------------------------------------------
Hayat Bahkt Corp seeks approval from the U.S. Bankruptcy Court for
the Eastern District of New York to employ the Law Office of
Narissa A. Joseph as its legal counsel.
The firm will render these legal services:
(a) consult with the Debtor concerning the administration of
the case;
(b) investigate the Debtor's past transactions, commence
actions with respect to its avoiding powers under the Bankruptcy
Code; and advise the Debtor with respect to transactions entered
into during the pendency of this case;
(c) assist the Debtor in the formation of a Chapter 11 plan;
and
(d) perform any and all such other legal services as may be
required by the Debtor in the interest of the estate.
The hourly rates of the firm's attorneys and staff are as follows:
Partners $350 - $400
Associates $275 - $300
Clerks and paraprofessionals $75 - $100
Narissa Joseph, Esq., the owner of the Law Office of Narissa A.
Joseph, disclosed in a court filing that the firm is a
"disinterested person" as that term is defined in Section 101(14)
of the Bankruptcy Code.
The firm can be reached through:
Narissa A. Joseph, Esq.
Law Office of Narissa A. Joseph
305 Broadway Suite 1001
New York, NY 10007
Telephone: (212) 233-3060
Email: njosephlaw@aol.com
About Hayat Bahkt Corp
Hayat Bahkt Corp sought Chapter 11 protection (Bankr. E.D.N.Y. Case
No. 21-43039) on Dec. 7, 2021, listing as much as $1 million in
both assets and liabilities. Judge Nancy Hershey Lord oversees the
case. The Law Office of Narissa A. Joseph serves as the Debtor's
legal counsel.
HEXION HOLDINGS: Moody's Assigns First Time B3 CFR; Outlook Stable
------------------------------------------------------------------
Moody's Investors Service assigned first time ratings to Hexion
Holdings Corporation ("Hexion"), including a B3 corporate family
rating, a B3-PD probability of default, and a B2 rating to the
company's proposed $1.4 billion first lien term loan due in 2029
and a Caa2 rating on its $425 million second lien term due in 2030.
In addition, the private equity sponsor, American Securities Corp.,
will contribute $685 million of new cash equity. Proceeds from the
term loan and equity contribution will be used to finance the
acquisition of Hexion Holdings Corporation and Hexion, Inc. Rating
on the debt of Hexion, Inc. will be withdrawn once the transaction
has been completed and its debt has been repaid. The outlook is
stable.
These first-time ratings are subject to the receipt and review of
final documentation.
"American Securities is acquiring a slimmed down Hexion that
produces wood adhesives, formaldehyde and versatic acid based
additives; leverage is elevated but it's a much more stable
business and should generate much more consistent earnings and free
cash flow," stated John Rogers, Senior Vice President and lead
analyst on Hexion. Rogers also noted that the lack of detailed
financial informtion, including audits on the company as currently
configured, limits the rating.
Assignments:
Issuer: Hexion Holdings Corporation
Corporate Family Rating, Assigned B3
Probability of Default Rating, Assigned B3-PD
Senior Secured 1st Lien Term Loan, Assigned B2 (LGD3)
Senior Secured 2nd Lien Term Loan, Assigned Caa2 (LGD5)
Outlook Actions:
Issuer: Hexion Holdings Corporation
Outlook, Assigned Stable
RATINGS RATIONALE
Hexion's B3 CFR reflects its elevated leverage, limited free cash
flow in 2022, the limited historical financial information
(including the lack of audits) on the company's operations as
currently configured. The rating also incorporates Moody's view
that the private equity sponsor will maintain a more aggressive
financial policy than Hexion's prior owners. The rating is
supported by Hexion's position as the largest supplier of wood
adhesives in North America, long term customer contracts for
formaldehyde, and the higher margin Performance Materials business
(Versatic Acids and Derivatives). Leverage is expected to be north
of 6x including Moody's standard adjustments.
Moody's has a positive view of the wood adhesives business given
growing demand in North America, the contractual pass through of
raw material costs and limited competition, given the nature of the
products sold. This business accounts for 80-85% of the sales and
earnings of the entire company, which will provide a steady stream
of earnings and cash flow that can support a more levered capital
structure. The Performance Materials business is much smaller, but
a true specialty chemical business with EBITDA margins that are
normally in the mid-20% range. However like many specialty chemical
companies this business has been negatively impacted by rising
costs in 2021, especially related to energy costs in Europe during
the last quarter of 2021; this business operates two sites in the
Netherlands.
The company's liquidity is good due to an undrawn $175 million ABL
revolver (unrated) that is expected to have at least $125 million
of availability. Free cash flow in the first year is expected to be
weak due to the one-time costs related to the transaction and
right-sizing of overhead costs for the reduced operating footprint.
This five-year facility is expected to have a springing fixed
charge coverage ratio of 1.0x and will only be tested when
availability falls below 10% or $13 million. Moody's expects the
facility to be utilized, but not to the level that would trigger
the springing covenant.
The B2 ratings on the first lien term loans reflect their priority
in the capital structure and the first lien on the non-ABL
collateral at facilities in the US and two-thirds of the stock of
the foreign entities, and a second lien on the ABL collateral. The
Caa2 rating on the second lien term loan reflects its subordination
to a substantial amount of first lien debt as well the limited
value of the collateral package.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The stable outlook reflects Moody's expectation that the adhesives
business will continue to generate a steady and growing stream of
earnings and cash flow, and that management will continue to focus
on right-sizing its cost structure, subsequent to the expiration of
the transition services agreements from prior divestitures.
Moody's would consider an upgrade to the rating if leverage falls
below 6.0x and annualized free cash flow rises above $50 million on
a sustained basis. Moody's would consider a downgrade to the rating
if free cash flow is persistently negative or availability is
sustained below $60 million.
The ABL revolver and term loan facility are expected to provide
covenant flexibility that if utilized, could negatively impact
creditors, including an incremental first lien facility not to
exceed the greater of $305 million and 100% of consolidated EBITDA,
plus additional amounts up to the available capacity under the
General Debt Basket, plus an unlimited amount subject to a first
lien net leverage covenant or total leverage covenant. Amounts up
to $150 million and 50% of consolidated EBITDA may be incurred with
an earlier maturity date than the initial term loans. Partial
dividends of ownership interests could jeopardize guarantees with
no explicit protective provisions limiting such guarantee releases.
Collateral leakage is permitted through transfers of assets to
unrestricted subsidiaries subject to carve-out capacity; there are
no additional express "blocker" provisions restricting such
transfer of specified assets to unrestricted subsidiaries. There
are no express protective provisions prohibiting an up-tiering
transaction. Non-pro-rata distributions and commitment reductions
are permitted in connection with loan buybacks or similar programs.
The proposed terms and the final terms of the credit agreement may
be materially different.
ESG CONSIDERATIONS
Environmental, social and governance factors are relevant to the
credit profile but are not key drivers of the rating. Hexion has
environmental risk that is commensurate with other chemical
companies due to the age of the production facilities and the toxic
nature of several of their main products (e.g., formaldehyde and
Versatic Acid). However, they have modest environmental liabilities
despite the age of some of their facilities. Accruals for future
environmental liabilities are $25 million. As with environmental
risks, Hexion's social risks are commensurate to most other
chemical companies with Health and Safety at their production
facilities presenting the greatest risk. Hexion's
governance-related risks are elevated due to ownership by a private
equity sponsor, the lack of an independent board and financial
policies that prioritize equity returns.
Hexion is a chemical company with three main lines of business. The
largest is its wood adhesive business where it is the largest
producer in North America with similar operations in Brazil,
Australia and New Zealand. The company is also a merchant producer
of formaldehyde under long term contracts in the US and Brazil. The
third business is its Performance Materials business, which is a
producer of Versatic Acids and Derivatives that are used in a wide
variety of applications, including construction materials and
archetectural and automobile coatings. Revenues are expected to be
over $2 billion in 2022.
The principal methodology used in these ratings was Chemical
Industry published in March 2019.
HEXION HOLDINGS: S&P Assigns 'B' ICR, Outlook Negative
------------------------------------------------------
S&P Global Ratings assigned its 'B' issuer credit rating to Hexion
Holdings Corp. (the debt-issuing parent of subsidiary Hexion Inc.)
with a negative outlook. S&P also assigned a negative outlook to
its existing 'B' issuer credit rating on Hexion Inc. Once the
transaction closes and all of Hexion Inc.'s debt is repaid, S&P
expects to withdraw all ratings on Hexion Inc. and continue to
publish reports at the parent company level.
S&P said, "We assigned our 'B' issue-level rating to the proposed
new $1.4 billion first-lien senior secured term loan of Hexion
Holdings Corp. Our '3' recovery rating indicates our expectation of
meaningful (50-70%; rounded estimate: 60%) recovery in the event of
a payment default.
"We assigned our 'B-' issue-level rating to the proposed new $425
million second-lien senior secured term loan of Hexion Holdings
Corp. Our '5' recovery rating indicates our expectation of modest
(10-30%; rounded estimate: 20%) recovery in the event of a payment
default.
"The negative outlook reflects our expectation that debt leverage
will remain elevated for the rating over the next 12 months, with
S&P Global Ratings-adjusted debt to EBITDA between 6x-7x in 2022.
"Our assessment of Hexion's business incorporates its exposure to
several diversified but somewhat cyclical end markets. These
include home construction, industrial, furniture, energy, and auto.
The company is also exposed to volatile raw material costs for key
inputs, such as methanol and urea. Despite a significant portion of
the company's sales made under contracts that allow it to recover
raw material costs, Hexion has average profitability among
specialty chemical producers, with expected adjusted EBITDA margins
for the next two years in the low- to midteen percentage area. We
believe the company operates in a competitive market and is
constrained in its pricing capability, which affects its
profitability. The company experiences volatile input costs for its
key materials, which it mitigates largely by having contracts with
customers allowing cost pass-through. We anticipate end markets
could be cyclical, and EBITDA could weaken during troughs.
Partially offsetting some of these weaknesses are Hexion's good
geographic footprint (though reduced after the divestitures) and
customer diversity--nearly half of its revenues are generated
outside the U.S.
"We anticipate 2022 EBITDA to continue to reflect strong demand in
end markets, albeit lower than that witnessed in 2021. The company
saw considerable growth in revenues and earnings in 2021 due to
strong economic rebound in its end markets relative to 2020 and
positive pricing actions. Additionally, housing construction held
up demand even in recessionary conditions in 2020. Going forward,
we expect Hexion to operate at a smaller scale and with lower
revenues and EBITDA than historical levels given the two
divestitures over the last 12 months. Still, post divestitures,
Hexion's profitability is likely to increase.
"Following the close of the transaction, we expect Hexion's pro
forma leverage to increase and remain elevated in the near term .
We expect credit measures to weaken because of a lower earnings
base following the divestiture of Hexion's epoxy resins business to
Westlake, upon which Hexion's acquisition was conditioned. Hexion's
acquisition is expected to be funded with cash from this
divestiture, new term loan debt, and sponsor equity. We expect pro
forma S&P Global Ratings-adjusted weighted average leverage to
increase to the 6x-7x range in 2022. We do not anticipate
significant deleveraging in the near future given the expectation
of aggressive financial policies linked with financial sponsor
ownership.
"Our base case views the weighted-average ratio of funds from
operations (FFO) to debt to be below 10% over the next 24 months,
compared to over 20% for fiscal 2021, but expects adequate
liquidity. We base this largely on our expectation of a reduced
revenue base and normalization of margins. Meanwhile, we expect the
company to have adequate liquidity with support from its new
proposed asset-based lending (ABL) revolving credit facility,
reduced seasonal working capital needs due to lower scale of
operations, and no material debt obligations due in next 12 months.
At the same time, we note the negative impact of financial sponsor
ownership on future cash build-up to meet liquidity needs in case
of a low-probability high-impact event.
"Our negative outlook reflects our expectation for a consistently
high debt level and leverage owing to new financial sponsor
ownership. The outlook also reflects our view for potential
variability in earnings for 2022 as the company establishes a track
record under new ownership and with a portfolio of businesses that
is different from its historic portfolio. The company also faces
price competition from both large and small regional players, which
could pressurize volumes or constrain margins. In our base case, we
expect debt to EBITDA to stay within the 6x-7x range on a
weighted-average basis after accounting for potential volatility in
the company's EBITDA and credit measures.
"We could lower the rating if credit measures deteriorate such that
debt to EBITDA is at the higher end of the 6x-7x range over the
next 12 months. This could happen if the company experiences
weakness in its end markets or if raw material costs increase and
the company cannot pass on costs in a timely manner. We could also
consider a negative rating action if liquidity weakens on account
of margin compression, shareholder rewards, acquisitions or
low-probability high-impact events, such that sources over uses of
funds falls below 1.2x, or if we believe Hexion has low prospects
of generating positive free cash flow. The company has incurred
extraordinary levels of transaction expenses and nonrecurring items
in recent times relative to companies we rate and as a result our
view of future earning capacity has assumptions about the one-time
nature of these expenses. We could lower the ratings if against our
expectations costs do not decline, resulting in a weakening of
EBITDA.
"We could consider revising the outlook to stable if earnings in
2022, and prospects for earnings in 2023 meet our expectations and
the company establishes a track record with its current businesses
and ownership especially related to supportive financial policy. We
will consider quarterly earnings improvement, and free cash flow
generation in 2022 in reviewing the prospects for stronger annual
earnings, or free cash flows, than we assume at the current rating.
We could upgrade Hexion if it improves business strength and its
earnings consistently exceed our expectations and leverage improves
as a result. We would also expect liquidity sources to remain above
1.2x uses."
ESG credit indicators: E-2, S-3, G-3
Social factors are a moderately negative consideration in S&P's
credit analysis of Hexion Inc. The company's exposure to
formaldehyde could result in some vulnerability to greater
regulatory or customer scrutiny.
Governance factors are also a moderately negative consideration in
S&P's analysis given we view financial sponsor owned companies with
aggressive or highly leveraged financial risk profiles as
demonstrating corporate decision making that prioritizes interests
of controlling owners, typically with finite holding periods and a
focus on maximizing shareholder returns.
HOVNANIAN ENTERPRISES: BlackRock Holds 6.4% of Class A Shares
-------------------------------------------------------------
BlackRock, Inc. disclosed in a Schedule 13G filed with the
Securities and Exchange Commission that as of Dec. 31, 2021, it
beneficially owns 359,565 shares of Class A common stock of
Hovnanian Enterprises Inc., representing 6.4 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/357294/000083423722007791/us4424874018_020722.txt
About Hovnanian Enterprises
Hovnanian Enterprises, Inc., founded in 1959 by Kevork S. Hovnanian
and headquartered in Matawan, New Jersey, designs, constructs,
markets, and sells single-family detached homes, attached townhomes
and condominiums, urban infill, and active lifestyle homes in
planned residential developments. The Company is a homebuilder with
operations in Arizona, California, Delaware, Florida, Georgia,
Illinois, Maryland, New Jersey, Ohio, Pennsylvania, South Carolina,
Texas, Virginia, Washington, D.C. and West Virginia. The Company's
homes are marketed and sold under the trade names K. Hovnanian
Homes, Brighton Homes.
Hovnanian Enterprises disclosed net income of $607.82 million on
$2.78 billion of total revenues for the year ended Oct. 31, 2021,
compared to net income of $50.93 million on $2.34 billion of total
revenues for the year ended Oct. 31, 2020. As of Oct. 31, 2021,
the Company had $2.32 billion in total assets, $2.15 billion in
total liabilities, and $175.38 million in total equity.
* * *
In August 2021, Moody's Investors Service upgraded Hovnanian
Enterprises, Inc.'s Corporate Family Rating to Caa1 from Caa2.
Moody's said the Corporate Family Rating upgrade to Caa1 reflects
the reduced risk of restructuring activity given the improvement in
Hovnanian's operating and financial performance and the extension
of the company's debt maturity profile given the recent debt
redemptions.
As reported by the TCR on July 28, 2021, S&P Global Ratings
affirmed its ratings on U.S.-based homebuilder Hovnanian
Enterprises Inc., including its 'CCC+' issuer credit rating, and
S&P revised its outlook to positive. The positive outlook indicates
that S&P could raise the rating to 'B-' if the company reduces debt
and EBITDA to interest coverage is sustained above 2x over the next
12 months, amid further profit improvements.
HOVNANIAN ENTERPRISES: Egan-Jones Keeps CCC+ Sr. Unsecured Ratings
------------------------------------------------------------------
Egan-Jones Ratings Company, on January 18, 2022, retained its
'CCC+' foreign currency and local currency senior unsecured ratings
on debt issued by Hovnanian Enterprises Inc. EJR also maintained
its 'B' rating on commercial paper issued by the Company.
Headquartered in Matawan, New Jersey, K. Hovnanian Enterprises,
Inc. provides home building services.
HUMANIGEN INC: BlackRock Has 5.2% Equity Stake as of Dec. 31
------------------------------------------------------------
BlackRock, Inc. disclosed in a Schedule 13G filed with the
Securities and Exchange Commission that as of Dec. 31, 2021, it
beneficially owns 3,343,800 shares of common stock of Humanigen,
Inc., representing 5.2 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/1293310/000083423722007355/us4448632038_020422.txt
About Humanigen, Inc.
Based in Brisbane, California, Humanigen, Inc. (OTCQB: HGEN),
formerly known as KaloBios Pharmaceuticals, Inc.
--http://www.humanigen.com-- is a clinical stage biopharmaceutical
company developing its clinical stage immuno-oncology and
immunology portfolio of monoclonal antibodies. The Company is
focusing its efforts on the development of its lead product
candidate, lenzilumab, its proprietary Humaneered anti-human GM-CSF
immunotherapy, through a clinical research agreement with Kite
Pharmaceuticals, Inc., a Gilead company to study the effect of
lenzilumab on the safety of Yescarta, axicabtagene ciloleucel
including cytokine release syndrome, which is sometimes also
referred to as cytokine storm, and neurotoxicity, with a secondary
endpoint of increased efficacy in a multicenter Phase Ib/IIclinical
trial in adults with relapsed or refractory large B-cell lymphoma.
Humanigen reported a net loss of $89.53 million for the 12 months
ended Dec. 31, 2020, compared to a net loss of $10.29 million for
the 12 months ended Dec. 31, 2019. As of Sept. 30, 2021, the
Company had $77.94 million in total assets, $95.58 million in total
liabilities, and a total stockholders' deficit of $17.64 million.
I.C.S. CUSTOMS: Seeks to Tap Dimand Law Offices as Special Counsel
------------------------------------------------------------------
I.C.S. Customs Service Inc. seeks approval from the U.S. Bankruptcy
Court for the Northern District of Illinois to employ Dimand Law
Offices, PC as its special counsel.
The Debtor needs the assistance of a special counsel to assist in
the collection of accounts receivable in connection with its
Chapter 11 case.
Dimand Law Offices will receive a fee of 25 percent of all money
collected on all accounts. The contingency fee will be 33 percent
for accounts it has received authorization for legal suit.
In addition, the firm will be entitled to an hourly fee of $350.
Michael Dimand, Esq., an attorney at Dimand Law Offices, disclosed
in a court filing that the firm is a "disinterested person" as that
term is defined in Section 101(14) of the Bankruptcy Code.
The firm can be reached through:
Michael A. Dimand, Esq.
Dimand Law Offices, PC
125 E. Lake St., Suite 206
Bloomingdale, IL 60108
Telephone: (847) 641-5177
Facsimile: (847) 648-4125
Email: mdimand@aol.com
About I.C.S. Customs Service
Founded in 1989, I.C.S. Customs Service Inc. is a full-service
customs broker with headquarters in Chicago, Illinois. The company
offers a full range of customs brokerage and freight forwarding
services to customers throughout Europe, Asia, and North America.
I.C.S. Customs Service filed its voluntary petition for Chapter 11
protection (Bankr. N.D. Ill. Case No. 21-12153) on Oct. 25, 2021,
listing $1 million to $10 million in both assets and liabilities.
William Sharpe, president, signed the petition.
Judge Jacqueline P. Cox oversees the case.
The Debtor tapped Scott R. Clar, Esq., at Crane, Simon, Clar &
Goodman as legal counsel and Dimand Law Offices, PC as special
counsel.
INTELSAT SA: Seeks to Tap Deloitte as Valuation Services Provider
-----------------------------------------------------------------
Intelsat SA and its affiliates seek approval from the U.S.
Bankruptcy Court for the Eastern District of Virginia to employ
Deloitte Transactions and Business Analytics LLP as their valuation
services provider.
The Debtors need the assistance of a valuation services provider in
meeting certain management planning requirements related to their
loans. The firm will develop an estimated range of fair values of
these loans.
The hourly rates of the firm's valuation services professionals are
as follows:
Partner/Principal/Managing Director $535 – $645
Senior Manager $505 – $580
Manager $475 – $540
Senior Associate $425 – $485
Associate $315 – $415
The hourly rates of the firm's corporate restructuring and
accounting services professionals are as follows:
Partner/Principal/Managing Director $775 – $995
Senior Manager $690 – $730
Manager $575 – $625
Senior Associate $425 – $510
Associate $315 – $415
In addition, the firm will seek reimbursement for expenses
incurred.
Manish Choudhary, a managing director at Deloitte Transactions and
Business Analytics, disclosed in a court filing that the firm is a
"disinterested person" as that term is defined in section 101(14)
of the Bankruptcy Code.
The firm can be reached through:
Manish Choudhary
Deloitte Transactions and Business Analytics LLP
100 Kimball Dr.
Parsippany, NJ 07054
Telephone: (973) 602-6000
Facsimile: (973) 602-5050
About Intelsat SA
Intelsat S.A. -- http://www.intelsat.com/-- is a publicly held
operator of satellite services businesses, which provides a diverse
array of communications services to a wide variety of clients,
including media companies, telecommunication operators, internet
service providers, and data networking service providers. The
Company is also a provider of commercial satellite communication
services to the U.S. government and other select military
organizations and their contractors. The Company's administrative
headquarters are in McLean, Virginia, and the Company has extensive
operations spanning across the United States, Europe, South
America, Africa, the Middle East, and Asia.
Intelsat S.A. and its debtor-affiliates concurrently filed
voluntary petitions for relief under Chapter 11 of the Bankruptcy
Code (Bankr. E.D. Va. Lead Case No. 20-32299) on May 13, 2020. The
petitions were signed by David Tolley, executive vice president,
chief financial officer, and co-chief restructuring officer. At the
time of the filing, the Debtors disclosed total assets of
$11,651,558,000 and total liabilities of $16,805,844,000 as of
April 1, 2020.
Judge Keith L. Phillips oversees the cases.
The Debtors tapped Kirkland & Ellis LLP and Kutak Rock LLP as legal
counsel; Alvarez & Marsal North America, LLC as restructuring
advisor; PJT Partners LP as financial advisor & investment banker;
Deloitte LLP as tax advisor; Deloitte Financial Advisory Services
LLP as fresh start accounting services provider; and Deloitte
Transactions and Business Analytics LLP as valuation services
provider. Stretto is the claims and noticing agent.
The Office of the U.S. Trustee appointed a committee of unsecured
creditors on May 27, 2020. The committee tapped Milbank LLP and
Hunton Andrews Kurth LLP as legal counsel; FTI Consulting, Inc. as
financial advisor; Moelis & Company LLC as investment banker; Bonn
Steichen & Partners as special counsel; and Prime Clerk LLC as
information agent.
J. M. DUNN: Seeks to Hire Joan Kehlhof as Bankruptcy Counsel
------------------------------------------------------------
J. M. Dunn Electric, Inc. seeks approval from the U.S. Bankruptcy
Court for the Southern District of Texas to employ the law firm of
Joan Kehlhof, LLC as its legal counsel.
The firm will render these legal services:
(a) perform the responsibilities of the Debtor in this Chapter
11 case;
(b) appear before the bankruptcy court; and
(c) perform such other legal services as may be necessary in
this case.
Joan Kehlhof, Esq., will be paid at an hourly rate of $275.
The firm received a retainer of $23,500 from the Debtor prior to
the filing of this bankruptcy case.
Ms. Kehlhof disclosed in a court filing that her firm is a
"disinterested person" as that term is defined in Section 101(14)
of the Bankruptcy Code.
The firm can be reached through:
Joan Kehlhof, Esq.
Joan Kehlhof, LLC
2302 Parana Drive
Houston, TX 77080
Telephone: (713) 686-5444
Facsimile: (713) 686-0703
Email: jkehlhof@whkllp.com
About J. M. Dunn Electric
J. M. Dunn Electric, Inc. sought Chapter 11 protection (Bankr. S.D.
Texas Case No. 22-30067) on Jan. 6, 2022, listing as much as $1
million in both assets and liabilities. Judge Eduardo V. Rodriguez
oversees the case.
Joan Kehlhof, Esq., at Joan Kehlhof, LLC serves as the Debtor's
legal counsel.
KINTARA THERAPEUTICS: Keith Murphy Resigns as Director
------------------------------------------------------
Keith Murphy resigned from the Board of Directors of Kintara
Therapeutics, Inc., effective Feb. 4, 2022.
At the time of his resignation, Mr. Murphy served on the
Compensation Committee and Nominating and Corporate Governance
Committee of the Board.
Mr. Murphy's resignation was not the result of any disagreements
with Kintara relating to its operations, policies or practices, as
disclosed in a Form 8-K filed by the company with the Securities
and Exchange Commission.
About Kintara
Located in San Diego, California, Kintara (formerly DelMar
Pharmaceuticals) is dedicated to the development of novel cancer
therapies for patients with unmet medical needs. Kintara is
developing two late-stage, Phase 3-ready therapeutics for clear
unmet medical needs with reduced risk development programs. The
two programs are VAL-083 for GBM and REM-001 for CMBC.
Kintara reported a net loss of $38.30 million for the year ended
June 30, 2021, compared to a net loss of $9.13 million for the year
ended June 30, 2020. As of Sept. 30, 2021, the Company had $22.34
million in total assets, $3.18 million in total liabilities, and
$19.16 million in total stockholders' equity.
San Francisco, CA-based Marcum LLP, the Company's auditor since
2019, issued a "going concern" qualification in its report dated
Sept. 28, 2021, citing that the Company has incurred significant
losses and needs to raise additional funds to meet its obligations
and sustain its operations. These conditions raise substantial
doubt about the Company's ability to continue as a going concern.
KNOX CLINIC: Seeks to Hire Brian Hardin as Financial Professional
-----------------------------------------------------------------
Knox Clinic Corporation seeks approval from the U.S. Bankruptcy
Court for the Eastern District of Michigan to hire Brian Hardin,
CPA as its financial professional.
The Debtor will pay a retainer in the amount of $9,600, to fund 48
hours of contemplated work at $200 per hour.
Brian Hardin, CPA does not represent any entity having an adverse
interest in connection with the case of the Chapter 11 Debtor, and
is disinterested, according to court filings.
The firm can be reached through:
Brian Hardin, CPA
Brian Hardin CPA
600 Round Rock W Dr #701
Round Rock, TX 78681
Phone: +1 512-708-8654
Email: team@gohardin.com
About Knox Clinic Corporation
Knox Clinic Corporation filed its voluntary petition for relief
under Chapter 11 of the Bankruptcy Code (Bankr. E.D. Mich. Case No.
22-40018) on Jan. 3, 2022, listing under $1 million in both assets
and liabilities. Robert Bassel, Esq. represents the Debtor as
counsel.
KOPIN CORP: BlackRock Has 5.3% Equity Stake as of Dec. 31
---------------------------------------------------------
BlackRock, Inc. disclosed in a Schedule 13G filed with the
Securities and Exchange Commission that as of Dec. 31, 2021, it
beneficially owns 4,882,516 shares of common stock of Kopin
Corporation, representing 5.3 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/771266/000083423722007222/us5006001011_020422.txt
About Kopin
Kopin Corporation -- http://www.kopin.com-- is a developer and
provider of innovative display and optical technologies sold as
critical components and subassemblies for military, industrial and
consumer products. Kopin's technology portfolio includes
ultra-small Active Matrix Liquid Crystal displays (AMLCD), Liquid
Crystal on Silicon (LCOS) displays and Organic Light Emitting Diode
(OLED) displays, a variety of optics, and low-power ASICs.
For the nine months ended Sept. 25, 2021, Kopin reported a net loss
of $10.16 million. Kopin reported a net loss of $4.53 million for
the year ended Dec. 26, 2020, compared to a net loss of $29.37
million for the year ended Dec. 28, 2019. As of Sept. 25, 2021,
the Company had $58.95 million in total assets, $13.70 million in
total current liabilities, $1.57 million in other long term
liabilities, $812,351 in operating lease liabilities, and $42.86
million in total stockholders' equity.
KRISJENN RANCH: To Seek Plan Confirmation on Feb. 17
----------------------------------------------------
Judge Ronald B. King has entered an order conditionally approving
the Disclosure Statement of Krisjenn Ranch, LLC, et al.
An in-person hearing on confirmation of the Plan will be held on
Feb. 17, 2022, at 1:30 p.m., in Courtroom Number 1, Third Floor,
Judge King presiding, United States Courthouse, Hipolito F. Garcia
Federal Building, 615 E. Houston, San Antonio Texas 78205.
Feb. 14, 2022, is fixed for the deadline by which creditors and
parties in interest may file objections to the confirmation of the
Plan.
Feb. 14, 2022, is fixed as the deadline by which the holders of
claims and interests against the Debtors may submit their ballots
to accept or reject the Plan.
The Debtors must submit a ballot summary to the Court no later than
Feb. 16, 2022.
Attorney for the Debtors:
Ronald J. Smeberg, Esq.
THE SMEBERG LAW FIRM, PLLC
4 Imperial Oaks
San Antonio, Texas 78248
Tel: (210) 695-6684
Fax: (210) 598-7357
E-mail: ron@smeberg.com
About KrisJenn Ranch
KrisJennRanch, LLC, is a Texas limited liability company with two
series. The first series is KrisJennRanch, LLC Series Uvalde Ranch
and the second is KrisJennRanch, LLC Series Pipeline Row. Series
Pipeline owns a pipeline and right of way. Additionally, Series
Unvalde owns the KrisJennRanch located at 6048 CR 365, Uvalde,
Texas 78801. The Express Pipeline and the Ranch were each
encumbered by a $5.9 million loan from Mcleod Oil related to an
investment in a pipeline and its right of way.
KrisJenn Ranch, LLC, KrisJenn Ranch, LLC Series Uvalde Ranch and
KrisJenn Ranch, LLC Series Pipeline Row sought protection under
Chapter 11 of the Bankruptcy Code (Bankr. W.D. Tex. Lead Case No.
20-50805) on April 27, 2020.
At the time of the filing, KrisJenn Ranch, LLC, disclosed total
assets of $16,246,409 and total liabilities of $6,548,315.
Judge Ronald B. King oversees the cases. Muller Smeberg PLLC is
the Debtors' legal counsel.
No creditors' committee has yet been appointed in this case by the
United States Trustee. No trustee or examiner has been requested
or appointed.
L&N TWINS: Files Amendment to Disclosure Statement
--------------------------------------------------
L&N Twins Place, LLC, submitted a First Amended Disclosure
Statement in connection with Chapter 11 Plan of Liquidation dated
Feb. 10, 2022.
The Plan will be implemented through, and the Distributions
contemplated to be made under the Plan that will be funded by, the
proceeds of the Debtor's sale of its rights, title and interests
with regard to the real property located at 2-4 Virginia Place,
Pleasantville, New York (the "Property") and any funds received
from on-going litigation.
The Property was sold pursuant to Bankruptcy Court Order on August
4, 2017 for a purchase price of $1,490,000.00. As provided in the
sale Order the remaining net proceeds from the sale are being held
in escrow by the law firm of Reich, Reich & Reich, P.C ("Sale
Proceeds"). Under the Plan, the Sale Proceeds will be used to fully
pay all Statutory Fees, Administrative Claims and General Unsecured
Claims on the Effective Date of the Plan.
On July 28, 2017 an Order was entered approving the sale of the
Property to Mishto for the purchase price of $1,490,000.00 ("Sale
Order"). The closing on the sale of the Property was held on August
4, 2017. Pursuant to the Sale Order the law firm of Reich, Reich &
Reich, P.C. (the "Reich Firm") is holding the sale proceeds in
escrow. As of the date of this Disclosure Statement the balance of
the proceeds in escrow with the Reich Firm is $478,065.99.
Adversary Proceeding Against Maria Balaj
On May 23, 2019 the Debtor commenced an Adversary Proceeding
against Maria seeking an Accounting and damages for Breach of
Fiduciary Duty, Unjust Enrichment and Conversion. Maria has
confessed judgment ("Judgment") to L & N in the amount of
$110,960.00 in the Adversary Proceeding. The Judgment shall be
solely enforceable as an offset by L&N against Maria's claim
against L & N, if any, or as against any distribution she may be
entitled to as a member of L & N. The Judgment has yet to be
entered by the Court but shall be entered contemporaneously with
the confirmation of the Plan.
Class 2 consists of the Allowed General Unsecured Claims, if any,
of: (a) Claim No. 4 filed by Puka Capital Funding asserting a
general unsecured claim in the total amount of $627,501.97 (the
"Puka Claim"). The Puka Claim, as determined by the Bankruptcy
Court's Judgment and has been paid in full, less the charging lien
of its former counsel Delbello, Donellon, Weingarten, Wise &
Wiederkerhr, LLP (the "Delbello Firm") in the amount of
$42,123.16.
On April 20, 2020 the Bankruptcy Court entered an Order authorizing
the Debtor to distribute the funds to satisfy the Puka Claim and
the Delbello Firm's charging lien; (b) Amended Claim No. 5 filed by
the Internal Revenue Service asserting a general unsecured claim in
the amount of $20,718.63; (c) Claim No. 6 filed by Alexander
Zadrima, Esq asserting a general unsecured claim in the amount of
$12,500.00; (d) Claim No. 7 filed by Vout, Lohrfink, Magro &
McAndrew, LLP asserting a general unsecured claim in the amount of
$3,120.00 on account of alleged legal fees; (e) Claim No. 8 filed
by Maria Balaj asserting a general unsecured claim in the amount of
$640,000.00 for breach of fiduciary duty and self dealing which is
pending before the bankruptcy court for hearing and determination;
and (f) Claim No. 9 filed by the New York Department of Taxation
and Finance asserted an unsecured priority claim in the amount of
$50.00.
Class 3 consists of the Interests of David Balaj and Maria Balaj in
the Debtor which are not affected by the terms of the Plan. Any
surplus funds remaining in the Estate after full payment of the
Statutory Fees, Administrative Claims, Priority Tax Claims and
General Unsecured Claims and obligations shall be held by the law
firm of Reich, Reich & Reich, P.C. subject to either, an agreement
by and between the members providing for the allocation of their
respective interests, or further order of either the Bankruptcy
Court, the Supreme Court of the State of New York for the County of
Westchester or any other tribunal agreed upon by the members to
determine their respective interests in the surplus funds.
The treatment and consideration to be received by holders of
Allowed Interests in Class 3 shall be, subject to the terms hereof,
in full settlement and final satisfaction of their respective
Interests to the extent of the distributions on account of such
Interests. There shall be no payment to Class 3 creditors until
such time as the objection to Maria's Claim No. 8 is resolved by
final order of the Bankruptcy Court.
All proceeds of the Sale, including the Sale Proceeds currently
held in escrow by the Reich Firm pursuant to the Sale Order, shall
be paid to Creditors and Interests Holders in order of priority in
accordance with the terms of the Plan. Except as set forth
elsewhere in the Plan, all Distributions required to be made under
the Plan shall be made by the Reich Firm, as Disbursing Agent in
accordance with the terms of the Plan from the Sale Proceeds and
any cash on hand.
All Distributions contemplated to be made under the Plan to Class
1, Class 2 and Class 3 creditors will be made on the Effective
Date, provided however that no payment or Distribution shall be
made with respect to any portion of a Disputed Claim unless and
until all objections to such Disputed Claim are withdrawn or
resolved by Final Order of the Bankruptcy Court or any Court with
appropriate jurisdiction. With respect to the Class 3 interests of
David Balaj and/or Maria Balaj no payment or Distribution of the
surplus shall be made with respect to any portion of their
interests until they either resolve any dispute with respect to
their interests voluntarily or a Final Order of the Bankruptcy
Court or any Court with appropriate jurisdiction resolves any such
dispute.
A full-text copy of the First Amended Disclosure Statement dated
Feb. 10, 2022, is available at https://bit.ly/3gIP1ZG from
PacerMonitor.com at no charge.
Counsel to the Debtor:
Reich, Reich & Reich, P.C.
Jeffrey A. Reich
235 Main Street, Suite 450
White Plains, New York 10601
Tel: (914) 949-2126
E-mail: jreich@reichpc.com
About L&N Twins Place
L&N Twins Place, LLC, a single asset real estate, as defined in 11
U.S.C. Section 101(51B), owns a multi-family residential building
located at 2-4 Virginia Place, Pleasantville, New York, valued at
$1.27 million.
L&N Twins Place sought Chapter 11 protection (Bankr. S.D.N.Y. Case
No. 17-22758) on May 23, 2017. The petition was signed by David
Balaj, managing member. The Debtor disclosed assets at $1.28
million and liabilities at $650,449.
Judge Robert D. Drain is assigned to the case.
The Debtor tapped Jeffrey A. Reich, Esq., at Reich Reich & Reich,
P.C., as counsel.
LA OAXAQUENA: Seeks to Hire Wiggam & Geer as Bankruptcy Counsel
---------------------------------------------------------------
La Oaxaquena LLC seeks approval from the U.S. Bankruptcy Court for
the Northern District of Georgia to hire Wiggam & Geer, LLC as its
bankruptcy counsel.
The firm's services include:
(a) prepare pleadings and applications;
(b) conduct of examination;
(c) advise the Debtor of their rights, duties and obligations
as Debtor-in-possession;
(d) consult and represent the Debtor with respect to a Chapter
11 plan;
(e) perform those legal services incidental and necessary to
the day-to-day operations of Debtor's business, including, but not
limited to, institution and prosecution of necessary legal
proceedings, and general business and corporate legal advice and
assistance;
(f) take any and all other action incident to the proper
preservation and administration of the Debtor's estates and
business.
The firm has stated present fee rates of $425 per hour for
attorneys and $150 per hour for legal assistants.
Wiggam & Geer represents no interests adverse to Applicant in the
matters upon which the firm is to be engaged, according to court
filings.
The firm can be reached through:
Will B. Geer, Esq.
Wiggam & Geer, LLC
50 Hurt Plaza, SE, Suite 1150
Atlanta, GA 30303
Tel: (678) 587-8740
Fax: (404) 287-2767
Email: wgeer@wiggamgeer.com
About La Oaxaquena LLC
La Oaxaquena LLC is part of the restaurants industry.
La Oaxaquena LLC filed its voluntary petition for relief under
Chapter 11 of the Bankruptcy Code (Bankr. N.D. Ga. Case No.
22-50127) om Jan. 5, 2022. The petition was signed by Ana Lopez
Garcia, managing member. At the time of filing, the Debtor
estimated $50,000 in assets and $1 million to $10 million in
liabilities. Will Geer, Esq. and WIGGAM & GEER, LLC represents the
Debtor as counsel.
LINKMEYER PROPERTIES: Says Lawrenceburg Plan Objection Resolved
---------------------------------------------------------------
Judge Andrea K. McCord has extended Linkmeyer Properties, LLC's
deadline to file a Second Amended Disclosure Statement to March 7,
2022.
On Oct. 21, 2021, debtors Linkmeyer Properties, LLC, et al., filed
with the U.S. Bankruptcy Court for the Southern District of Indiana
an Amended Chapter 11 Disclosure Statement and Amended Chapter 11
Plan.
On January 5, 2022, the City of Lawrenceburg, Indiana (the "City")
filed its Objection to Debtor's Amended Disclosure Statement.
A hearing was held on the Amended Disclosure Statement and the
Objection on Jan. 12, 2022, at which time the Debtor was ordered to
file an amended disclosure statement within 21 days.
In seeking an extension, the Debtor said in a Feb. 3, 2022 filing
that the Debtor and the City have reached an agreement by which
the
City's claim shall be sold to an investor group.
The Agreement shall result in an agreed entry ("Agreed Entry")
resolving the City's Objection and detailing the terms of the
resolution between the Debtor, the City and the investor group
including the terms of the sale of the City's claim in its
entirety.
The parties are in the process of drafting the terms and conditions
of the Agreed Entry which shall be filed no later than 30 days.
Accordingly, the Debtor requested an extension of time of 30 days
to and including March 5, 2022, to file an amended disclosure
statement to provide the parties time to submit the Agreed Entry.
About Linkmeyer Properties
Linkmeyer Properties, LLC, Linkmeyer Kroger, LLC, and Linkmeyer
Development II, LLC filed voluntary petitions for relief under
Chapter 11 of the Bankruptcy Code (Bankr. S.D. Ind. Lead Case No.
20-90898) on Aug. 13, 2020. At the time of the filing, each Debtor
disclosed estimated assets of less than $50,000 and estimated
liabilities of between $1 million and $10 million. Judge Andrea K.
Mccord oversees the cases. Hester Baker Krebs, LLC serves as
Debtors' legal counsel.
LIVEWELL ASSISTED: Seeks to Tap Sasser Law Firm as Legal Counsel
----------------------------------------------------------------
Livewell Assisted Living, Inc. seeks approval from the U.S.
Bankruptcy Court for the Eastern District of North Carolina to
employ Sasser Law Firm as its legal counsel.
Sasser Law Firm will render these services:
(a) advise the Debtor regarding its powers and duties in the
continued operation of its business and management of its
property;
(b) prepare and file monthly reports, plan of reorganization,
and disclosure statement;
(c) prepare legal papers;
(d) perform all other legal services for the Debtor;
(e) undertake necessary action to avoid liens against the
Debtor's property obtained by creditors and to recover preferential
payments within 90 days of the filing of said petition under
Chapter 11;
(f) perform a search of the public records to locate liens and
assess validity; and
(g) represent at hearings, confirmation, and any 2004
examination.
The firm will charge $350 per hour for attorney time.
Travis Sasser, Esq., an attorney at Sasser Law Firm, disclosed in a
court filing that the firm is a "disinterested person" as that term
is defined in Section 101(14) of the Bankruptcy Code.
The firm can be reached through:
Travis Sasser, Esq.
Sasser Law Firm
2000 Regency Parkway, Suite 230
Cary, NC 27518
Telephone: (919) 319-7400
Facsimile: (919) 657-7400
Email: tsasser@carybankruptcy.com
About Livewell Assisted Living
Livewell Assisted Living, Inc., a part of the continuing care
retirement communities industry, filed its voluntary petition for
Chapter 11 protection (Bankr. E.D.N.C. Case No. 22-00264) on Feb.
7, 2022, listing up to $500,000 in assets and up to $10 million in
liabilities. Justin Beckett, president, signed the petition.
Travis Sasser, Esq., at Sasser Law Firm represents the Debtor as
legal counsel.
LOADCRAFT INDUSTRIES: Taps Gregory Milligan of HMP Advisory as CRO
------------------------------------------------------------------
Loadcraft Industries, Ltd. seeks approval from the U.S. Bankruptcy
Court for the Western District of Texas to employ HMP Advisory
Holdings, LLC and designate Gregory Milligan, the firm's executive
vice president, as its chief restructuring officer.
The firm will render these services:
a. in cooperation with the Debtor and its staff, perform a
financial review of the Debtor, its historical financial results,
on-going business operations and prospects, and historical
transactions and corporate governance changes;
b. manage the day-to-day business operations of the Debtor,
including liquidity, employees, and all business affairs consistent
with the role of a CRO;
c. assist the Debtor and its counsel to evaluate
reorganization options to maximize the value of the bankruptcy
estate for the benefit of all stakeholders. The evaluation process
will include conferring with major stakeholders to obtain relevant
information and assess the varying perspectives about the disputed
historical transactions;
d. assist the Debtor and its counsel to evaluate causes of
action that can increase the total recovery to all stakeholders;
e. assist the Debtor with preparation of any bankruptcy
required reporting, including Monthly Operating Reports;
f. assist the Debtor and its counsel to obtain Court approval
for debtor-in-possession financing, if necessary and appropriate;
g. assist the Debtor to develop and maintain thirteen-week
cash forecasts and budget-to-actual reporting or other reporting as
may be required by potential debtor-in-possession financing;
h. assist the Debtor and its counsel to develop a plan of
reorganization, including financial projections, liquidation
analysis, claims analysis and reconciliation, and other analysis,
as needed;
i. assist the Debtor and counsel, as requested to complete
Initial Debtor Interview questionnaire and related information,
complete and file the required Schedules of Assets and Liabilities
and Statement of Financial Affairs, and prepare for 341 meeting of
creditors;
j. assist the Debtor and its counsel to negotiate with various
stakeholders of the Debtor, including but not limited to, secured
and unsecured creditors, regarding the possible financial
restructuring of such stakeholders' claim or interests in the
Debtor;
k. assist the Debtor and its counsel with general matters
related to the Chapter 11 case; and
l. provide other activities.
The firm will be paid at these hourly rates:
Mr. Milligan $550
Erik White, Managing Director $400
Wade Horst, Manager $300
President/Executive Vice President/COO $500 - $600
Managing Director $400 - $500
Senior Manager/Director $300 - $300
Manager $250 - $350
Senior Consultant $175 - $300
Support Staff $80 - $200
HMP will be reimbursed for the reasonable out-of-pocket expenses of
its professionals incurred in connection with its services, such as
travel, lodging, mileage, rental cars, and photocopies.
The firm received a retainer in the amount of $75,000.
Mr. Milligan, an executive vice president of HMP, assured the court
that the firm is a "disinterested person" within the meaning of
Bankruptcy Code Section 101(14).
The firm can be reached through:
Gregory S. Milligan
HMP Advisory Holdings, LLC
d/b/a Harney Partners
3800 N. Lamar Blvd., Suite 200
Austin, TX 78756
Phone: 512-892-0803
About Loadcraft Industries
Loadcraft Industries is a company in Brady, Texas, that specializes
in the manufacturing of mobile drilling rig and custom oilfield
equipment.
Loadcraft Industries sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. W.D. Texas Case No. 21-11018) on Dec. 30,
2021, listing as much as $10 million in assets and liabilities.
Judge Tony M. Davis oversees the case.
Waller Lansden Dortch & Davis, LLP is the Debtor's legal counsel.
LOGISTICS GIVING: Wins Interim Cash Collateral Access Thru Mar 10
-----------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Utah, Central
Division, has authorized Logistics Giving Resources, LLC to use
cash collateral on an interim basis in accordance with the budget,
with a 10% variance through March 10, 2022.
The Debtor currently has authority to use cash collateral as
specified under a Prior Cash Collateral Order, which approved
payment of only limited expenses of the Debtor for a limited period
pending the final hearing on the Motion.
As contemplated by the Motion and the Prior Cash Collateral Order,
the Debtor asks the Court to expand the Cash Collateral Authority
to permit the Debtor to pay business expenses not authorized under
the Prior Cash Collateral Order.
As adequate protection for the Debtor's use of cash collateral,
each qualifying Affected Creditor is granted a properly perfected
security interest and replacement lien in all pre-petition and
post-petition assets of the Debtor.
The Replacement Lien granted will attach and become valid, binding,
continuing, enforceable, fully-perfected and non-avoidable by
operation of law as of the Petition Date without any further
action.
The Debtor is prohibited from paying any more than $4,500/week in
compensation to Troy Hyde, regardless of whether that compensation
takes the form of direct payment of wages or indirect payments for
his personal benefit, other than ordinary medical insurance and
comparable benefits.
A continued hearing on the matter is scheduled for March 3 at 2
p.m.
A copy of the order and the Debtor's budget for the period from
January 14 to April 30, 2022 is available for free at
https://bit.ly/3GLUGsm from PacerMonitor.com.
The Debtor projects $1,576,255 in total cash deposits and
$1,416,669 in total estimated cash expenditures for February 2022.
About Logistics Giving
Logistics Giving Resources, LLC, an employment agency in Layton,
Utah, filed its voluntary petition for relief under Chapter 11 of
the Bankruptcy Code (Bankr. D. Utah Case No. 22-20143) on Jan. 14,
2022. Troy Vaughn Hyde, member, signed the petition. In its
petition, the Debtor disclosed $6,450,752 in assets and $1,156,332
in liabilities as of Dec. 31, 2021.
Judge William T. Thurman oversees the case.
Matthew M. Boley, Esq., at Cohne Kinghorn, P.C. represents the
Debtor as legal counsel. Rocky Mountain Advisory, LLC is the
Debtor's accountant and financial advisor.
MACALLISTER & ASSOCIATES: Taps Lefkovitz & Lefkovitz as Counsel
---------------------------------------------------------------
MacAllister & Associates, LLC seeks approval from the U.S.
Bankruptcy Court for the Middle District of Tennessee to employ
Lefkovitz & Lefkovitz, PLLC as its legal counsel.
The firm will render these legal services:
(a) advise the Debtor regarding its rights, duties, and
powers;
(b) prepare and file statements and schedules, plans, and
other documents and pleadings necessary to be filed by the Debtor
in this proceeding;
(c) represent the Debtor at all hearings, meetings of
creditors, conferences, trials, and any other proceedings in this
case; and
(d) perform such other legal services as may be necessary in
connection with this case.
The hourly rates of the firm's counsel and staff are as follows:
Steven L. Lefkovitz $555
Associate Attorneys $350
Paralegals $125
The firm received a retainer of $6,000 from the Debtor.
Steven Lefkovitz, Esq., an attorney at Lefkovitz & Lefkovitz,
disclosed in a court filing that the firm is a "disinterested
person" as that term is defined in section 101(14) of the
Bankruptcy Code.
The firm can be reached through:
Steven L. Lefkovitz, Esq.
Lefkovitz & Lefkovitz, PLLC
618 Church Street, Suite 410
Nashville, TN 37219
Telephone: (615) 256-8300
Facsimile: (615) 255-4516
Email: slefkovitz@lefkovitz.com
About MacAllister & Associates
MacAllister & Associates, LLC filed its voluntary petition for
relief under Chapter 11 of the Bankruptcy Code (Bankr. M.D. Tenn.
Case No. 22-00318) on Feb. 3, 2022, listing up to $1,757,849 in
total assets and $4,082,795 in total liabilities. Christine
Constantino, Jr., agent, signed the petition.
Judge Charles Walker oversees the case.
Steven L. Lefkovitz, Esq., at Lefkovitz & Lefkovitz, PLLC serves as
the Debtor's legal counsel.
MACHINE TECH: Resolves Trust Bank Claims Pay Issues
---------------------------------------------------
Machine Tech, Inc., submitted a First Amended and Restated
Disclosure Statement regarding Plan of Reorganization dated Feb. 8,
2022.
The Debtor operates a manufacturing business in Adel, Georgia. The
Debtor has structured a plan to provide for retention of assets and
restructuring of debts.
Two significant orders have been entered by the Bankruptcy Court
which would effect the outcome of this case or the distribution to
creditors. First is the consent order dated January 12, 2022, which
resolved Trust Bank's treatment under the plan. Though not yet
approved by the Court, by motion dated January 12, 2022, Debtor
asked the Court to approve a settlement with Commercial Finance of
Atlanta.
Class 4 consists of the secured claims, if any and to the extent
allowed, held by Trust Bank, or related persons or entities,
potentially collateralized by a first priority interest in the
Debtor's equipment and other assets. The plan provides that Class 4
claims shall retain any liens as to the collateral and be paid in
accordance with a consent order dated January 12, 2022.
In general, the consent order provides for an allowed secured claim
of $452,770.91 and an allowed unsecured claim of $17,397.80. The
secured claim will be payable over 59 months starting on the
Effective Date in payments of $7,200.00 until a final payment on
the 60th month of any remaining balance on the secured claim. It
also contains provisions regarding a possible liquidation process
for excess equipment serving as collateral. The unsecured claim is
treated as a Class 7 claimant.
The Amended Disclosure Statement does not alter the proposed
treatment for unsecured creditors and the equity holder:
* Class 7 consists of general unsecured creditors. These
claims, to the extent determined to be allowed secured claims, will
be paid 5% of the allowed amount of each claim in 60 equal monthly
payments without interest. Debtor believes that these claims are
approximately $2,626,498.00. Based on this amount, monthly payments
will be $2,188.75 per month.
* Class 8 consists of the Debtor's equity interest. All
interests will be retained.
A full-text copy of the First Amended Disclosure Statement dated
Feb. 8, 2022, is available at https://bit.ly/34rnmtS from
PacerMonitor.com at no charge.
Attorney for Debtor:
Wesley J. Boyer, Esq.
BOYER TERRY LLC
348 Cotton Avenue, Suite 200
Macon, Georgia 31201
Tel: (478) 742-6481
E-mail: Wes@BoyerTerry.com
About Machine Tech
Machine Tech, Inc., based in Adel, GA, filed a Chapter 11 petition
(Bankr. M.D. Ga. Case No. 19-71340) on Nov. 1, 2019. In the
petition signed by Joseph A. Bell, president, the Debtor was
estimated to have $100,000 to $500,000 in assets and $1 million to
$10 million in liabilities. Wesley J. Boyer, Esq., at Boyer Terry
LLC, serves as bankruptcy counsel.
MAJOR MODEL: Voluntary Chapter 11 Case Summary
----------------------------------------------
Debtor: Major Model Management Inc.
344 West 38th Street, Suite 602
New York, NY 10018
Business Description: Major Model Management is a modeling
agency based in New York.
Chapter 11 Petition Date: February 11, 2022
Court: United States Bankruptcy Court
Southern District of New York
Case No.: 22-10169
Judge: Hon. Martin Glenn
Debtor's Counsel: Melissa A. Pena, Esq.
NORRIS MCLAUGHLIN, P.A.
7 Times Square, 21st Floor
New York, NY 10036
Tel: 908-722-0700
Email: mapena@norris-law.com
Estimated Assets: $500,000 to $1 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Guido Dolci as president.
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/KZ4TZLY/Major_Model_Management_Inc__nysbke-22-10169__0001.0.pdf?mcid=tGE4TAMA
MANHATTAN STUDENT: Seeks to Hire B. Riley Real Estate as Broker
---------------------------------------------------------------
Manhattan Student Housing LLC seeks approval from the U.S.
Bankruptcy Court for the District of Kansas to employ B. Riley Real
Estate, LLC as broker.
The broker will provide these services:
(a) consult with the Debtor to discuss its goals, objectives
and financial parameters in relation to its real property located
at 2021 College View Manhattan, Kansas;
(b) market the property for sale;
(c) assist the Debtor with refinancing its obligations to its
current secured lender that holds a security interest in the
property with a new lender; and
(d) report periodically to the Debtor regarding the status of
the services and details related thereto.
The broker will be compensated as follows:
(a) for the sale of the property, the firm will be paid a fee
equal to 3 percent of the total purchase price;
(b) alternatively, if the Debtor proceeds with a refinancing
transaction, and it does not finalize the sale of the property, the
firm will be paid a fee of 3 percent of the principal loan amount;
(c) in case the Debtor either refinances one or more of the
notes owed to Central National Bank, the firm will be reimbursed
for all expenses advanced and incurred.
Al Lieberman, a principal at B. Riley Real Estate, disclosed in a
court filing that the firm is a "disinterested person" as that term
is defined in section 101(14) of the Bankruptcy Code.
The firm can be reached through:
Al Lieberman
B. Riley Real Estate, LLC
875 N. Michigan Avenue, Suite 3900
Chicago, IL 60611
Telephone: (312) 894-7622
Email: alieberman@brileyfin.com
About Manhattan Student Housing
Manhattan Student Housing, LLC filed its voluntary petition for
relief under Chapter 11 of the Bankruptcy Code (Bankr. D. Kan. Case
No. 22-20010) on Jan. 10, 2022, listing $6,221,752 in assets and
$4,209,215 in liabilities. Gary L. Robben, managing member, signed
the petition.
Judge Robert D. Berger oversees the case.
Erlene W. Krigel, Esq., at Krigel & Krigel, PC serves as the
Debtor's legal counsel.
MAPLE MANAGEMENT: Wins Cash Collateral Access Thru Feb 22
---------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Illinois has
authorized Maple Management, LLC to use cash collateral to pay the
ordinary and necessary operating expenses of its business, as set
forth in the budget, until 5 p.m. on February 23, 2022.
The Debtor is permitted to use Cash Collateral only to pay actual,
ordinary and necessary operating expenses related to the business
of the Debtor for the purposes and up to the amounts set forth in
the budget, with a 10% variance.
The budget provided for $47,743 in monthly expenses. Any budgeted
expense in one month that is not paid in that month will be carried
over for payment by the Debtor in subsequent months, except for the
monthly adequate protection payment to Greenwich Capital Management
LP, as the Funder, of $1,000 per week or the sum as may be further
determined by the Court. The Funder has a perfected, pre-petition,
senior security interest in substantially all of the Debtor's
personal property.
As adequate protection, Greenwich Capital is granted valid and
perfected postpetition liens and security interests in the personal
property and all proceeds thereof to the same extent, validity and
priority held by the Funder prepetition. The Replacement Liens
granted to Greenwich Capital will be in addition to, and not in
substitution of, any and all security interests, liens,
encumbrances, rights of set-off or other rights of the Funder
currently existing or hereafter arising.
The Court ruled that the Debtor must also maintain insurance
coverage on the personal property, and must remain current on all
post-petition rent obligations, sums due to any taxing
authorities.
The Court will conduct a status hearing on February 23 on the
Debtor's right to continue using cash collateral.
A copy of the interim order is available for free at
https://bit.ly/3BclMrs from PacerMonitor.com.
About Maple Management, LLC
Maple Management, LLC owns and operates a construction-related
business that installs elevators, ramps and lifts for the disabled,
elderly and infirm at their primary residences. Maple Management
operates from the real property commonly known as 245 W Roosevelt
Rd Ste 77, West Chicago, IL 60185-4838. Maple rents this premises.
Its principal is James Mecha.
Maple sought protection under Chapter 11 of the U.S. Bankruptcy
Code (Bankr. N.D. Ill. Case No. 21-02059) on February 17, 2021. In
the petition signed by Mecha, the Debtor disclosed up to $50,000 in
assets and up to $1 million in liabilities.
Judge Janet S. Baer oversees the case.
Ariel Weissberg, Esq., at Weissberg and Associates, Ltd. is the
Debtor's counsel.
MLK BRYANT: March 11 Deadline to File Plan & Disclosures
--------------------------------------------------------
Judge Peter C. McKittrick has entered an order that the deadline
for MLK Bryant, LLC to file a Disclosure Statement and Plan of
Reorganization is March 11, 2022.
The Debtor shall provide to the United States Trustee an
appropriate Schedule C or Schedule E for the Debtor from Meron
Alemseghed's completed and filed 2020 tax returns by March 11,
2022.
About MLK Bryant
MLK Bryant, LLC, a company based in Portland, Ore., filed a
petition for Chapter 11 protection (Bankr. D. Ore. Case No.
21-32459) on Dec. 11, 2021, listing up to $2,101,114 in assets and
up to $1,165,948 in liabilities. Meron Alemseghed, member, signed
the petition. Judge Peter C. Mckittrick oversees the case. The
Debtor tapped Michael D. O'Brien & Associates, P.C., as legal
counsel.
MOHEGAN TRIBAL: Incurs $11.6 Million Net Loss in First Quarter
--------------------------------------------------------------
Mohegan Tribal Gaming Authority filed with the Securities and
Exchange Commission its Quarterly Report on Form 10-Q disclosing a
net loss of $11.61 million on net revenues of $401.96 million for
the three months ended Dec. 31, 2021, compared to a net loss of
$26.76 million on net revenues of $230.78 million for the three
months ended Dec. 31, 2020.
As of Dec. 31, 2021, the Company had $3.03 billion in total assets,
$3.19 billion in total liabilities, and a total capital of
$(164.17) million.
As of Dec. 31, 2021 and Sept. 30, 2021, the Company held cash and
cash equivalents of $154.9 million and $149.8 million,
respectively, of which the MGE Niagara Resorts held $27.1 million
and $25.1 million, respectively. As a result of the cash-based
nature of the Company's business, operating cash flow levels tend
to follow trends in its operating income, excluding the effects of
non-cash charges, such as depreciation and amortization and
impairment charges. Inclusive of letters of credit, which reduce
borrowing availability, the Company had $220.0 million of borrowing
capacity under its senior secured credit facility and line of
credit as of Dec. 31, 2021. In addition, inclusive of letters of
credit, which reduce borrowing availability, the MGE Niagara
Resorts had $72.1 million of borrowing capacity under the MGE
Niagara revolving facility and MGE Niagara swingline facility as of
Dec. 31, 2021, based on limitations under the MGE Niagara credit
agreement in place at that time due to gaming capacity
restrictions.
Cash provided by operating activities increased $98.8 million, or
422.2%, to $75.4 million for the three months ended Dec. 31, 2021
compared with cash used in operating activities of $23.4 million in
the same period in the prior year. The increase in cash provided
by operating activities was driven by an increase in net income,
after factoring in non-cash items reflecting a return to relatively
normal operating conditions at its properties combined with lower
working capital requirements.
Cash used in investing activities increased $117.6 million, or
634.3%, to $136.1 million for the three months ended Dec. 31, 2021
compared with $18.5 million in the same period in the prior year.
The increase in cash used in investing activities was primarily
driven by higher capital expenditures related to Inspire Korea.
Cash provided by financing activities increased $272.9 million, or
413.9%, to $338.9 million for the three months ended Dec. 31, 2021
compared with $65.9 million in the same period in the prior year.
The increase in cash provided by financing activities was primarily
driven by additional borrowings to fund the development of Inspire
Korea.
A full-text copy of the Form 10-Q is available for free at:
https://www.sec.gov/ix?doc=/Archives/edgar/data/0001005276/000100527622000013/mtga-20211231.htm
About Mohegan Gaming
Mohegan Tribal Gaming Authority d/b/a Mohegan Gaming &
Entertainment is a master developer and operator of premier global
integrated entertainment resorts, including Mohegan Sun in
Uncasville, Connecticut, Inspire in Incheon, South Korea and
Niagara Casinos in Niagara, Canada. MGE is owner, developer,
and/or manager of integrated entertainment resorts throughout the
United States, including Connecticut, New Jersey, Washington,
Pennsylvania, Louisiana, as well as Northern Asia and Niagara
Falls, Canada, and coming soon pending regulatory approval, Las
Vegas, Nevada. MGE is owner and operator of Connecticut Sun, a
professional basketball team in the WNBA and New England Black
Wolves, a professional lacrosse team in the National Lacrosse
League. For more information on MGE and its properties, visit
www.mohegangaming.com.
Mohegan Gaming reported a net loss of $162.02 million for the year
ended Sept. 30, 2020, compared to a net loss of $2.37 million for
the year ended Sept. 30, 2019.
* * *
As reported by the TCR on Feb. 4, 2021, Moody's Investors Service
upgraded Mohegan Tribal Gaming Authority's ("MTGA") Corporate
Family Rating to Caa1 from Caa2 and Probability of Default Rating
to Caa1-PD from Caa2-PD. The upgrade considers that on January 26,
MTGA closed on a refinancing that had a meaningful positive impact
on the company's liquidity.
MOTELS OF SUGAR: Taps Integra Realty to Appraise Springhill Hotel
-----------------------------------------------------------------
Motels of Sugar Land, LLP filed an amended application seeking
approval from the U.S. Bankruptcy Court for the Southern District
of Indiana to employ Integra Realty Resources to appraise its
94-suite Springhill Suites and Hotel by Marriott located in
Sugarland, Texas..
The firm will be paid a flat fee of $5,200 with a pre-payment of 50
percent or $2,600 and a final payment of $2,600 upon completion of
the appraisal services. The hourly fee for live testimony is $350.
In addition, the firm requires that the entire amount of the flat
fee be paid before live testimony is given and that an additional
retainer of $5,000 is paid before such testimony.
As disclosed in court filings, Integra Realty neither represents
nor holds interest adverse to the matters upon which it is to be
employed.
The firm can be reached through:
Michael C. Lady
Integra Realty Resources
4981 N, Franklin Rd.
Indianapolis, IN 46226
Phone: (317) 546-4720
Fax: (317) 546-1407
Email: mlady@irr.com
About Motels of Sugar Land
Motels of Sugar Land, LLP owns the 94-suite Springhill Suites and
Hotel by Marriott in Sugarland, Texas, that employs 14 people.
Motels of Sugar Land sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. S.D. Ind. Case No. 21-00371) on Jan. 29,
2021. Motels of Sugar Land President Sanjay Patel signed the
petition. In the petition, the Debtor disclosed $6,396,935 in
assets and $6,455,893 in liabilities.
Judge Robyn L. Moberly oversees the case.
KC Cohen, Lawyer, PC is the Debtor's legal counsel.
MY SIZE: Acquires Israel-Based Omnichannel E-Commerce Platform
--------------------------------------------------------------
MySize, Inc. has acquired Orgad, an Israeli-based omnichannel
e-commerce platform, operating globally, including the U.S. and
Europe.
Orgad generated approximately $2.5 million in revenue in 2021 with
profitable operations. Its team consists of solid operators with
deep understanding and knowledge in e-commerce, supply chain and
technology. Orgad's focus on technology, operations and customer
service to increase efficiencies and revenue growth is structured
on a platform that is able to manage numerous retailers.
Additionally, Orgad will integrate MySizeID into its digital
offerings and platform. Incorporating MySizeID into Orgad's
e-commerce solution is expected to increase its operational profit
by reducing costly returns.
Elad Bretfeld, founder of Orgad, stated, "We look forward to
working with MySize and becoming part of a publicly listed company.
We have identified additional e-commerce global opportunities that
would benefit from our e-commerce platform and digital management
expertise. We look forward to scaling our business and working
with the existing team at MySize."
Similar to Thrasio, Perch and Hour Loop, Orgad is an e-commerce
platform engaged in online retailing in the global market. It
operates as a third-party seller on Amazon.com, eBay and others.
Orgad currently manages more than 1,000 stock-keeping units
("SKUs"), mainly in fashion, apparel and shoes, but is capable of
managing tens of thousands of SKUs.
Under the transaction terms, MySize agreed to pay to the Orgad
sellers cash consideration of up to $1 million in three
installments over a period of three years, equity consideration of
up to 2,790,049 shares of MySize common stock, and certain earn-out
payments upon meeting revenue targets, subject in each case to the
sellers being engaged with Orgad at the time each payment is due
and subject further to post-closing adjustment.
Ronen Luzon, chief executive officer of MySize, commented, "This is
a major strategic move by MySize as we are expanding our business
to also be a direct e-commerce seller. The Orgad team has built a
strong business as a direct seller of clothing and footwear
globally on Amazon.com, eBay and elsewhere. By using MySize
technology Orgad will be able to increase its profitability by
increasing conversion rates and reducing costly returns, which also
improves their sustainability."
Luzon, concluded, "We will continue to evaluate additional proven
e-commerce sellers. Our acquisition strategy is to bring vendors
product selections to our customers. Our infrastructure of R&D and
sales and marketing is in place and ready to increase revenues and
improve margins as we scale. We plan to expand our business
rapidly by increasing the number of business managers, vendors and
SKUs, which can also utilize MySizeID and SizeUP for the DIY
market."
About My Size
Headquartered in Airport City, Israel, My Size, Inc. --
www.mysizeid.com -- is a creator of mobile device measurement
solutions that has developed innovative solutions designed to
address shortcomings in multiple verticals, including the
e-commerce fashion/apparel, shipping/parcel and do it yourself, or
DIY, industries. Utilizing its sophisticated algorithms within its
proprietary technology, the Company can calculate and record
measurements in a variety of novel ways, and most importantly,
increase revenue for businesses across the globe.
My Size reported a net loss of $6.16 million for the year ended
Dec. 31, 2020, compared to a net loss of $5.50 million for the year
ended Dec. 31, 2019. As of Sept. 30, 2021, the Company had $4.97
million in total assets, $1.88 million in total liabilities, and
$3.09 million in total stockholders' equity.
Tel Aviv, Israel-based Member Firm of KPMG International, the
Company's auditor since 2017, issued a "going concern"
qualification in its report dated March 29, 2021, citing that the
Company has incurred significant losses and negative cash flows
from operations and has an accumulated deficit that raises
substantial doubt about its ability to continue as a going concern.
NATHAN'S FAMOUS: Egan-Jones Retains B- Sr. Unsecured Debt Ratings
-----------------------------------------------------------------
Egan-Jones Ratings Company, on January 19, 2022, retained its 'B-'
foreign currency and local currency senior unsecured ratings on
debt issued by Nathan's Famous Inc. EJR also maintained its 'B'
rating on commercial paper issued by the Company.
Headquartered Jericho, New York, Nathan's Famous, Inc. operates,
franchises, and licenses Nathan's Famous, Miami Subs, Kenny Rogers
Roasters, and Arthur Treachers Fish & Chips fast-food restaurants.
NCL CORP: S&P Assigns 'B+' Rating on New 1BB Sr. Secured Notes
--------------------------------------------------------------
S&P Global Ratings assigned its 'B+' issue-level rating and '2'
recovery rating to NCL Corp. Ltd. proposed $1 billion senior
secured notes due 2027. The '2' recovery rating indicates its
expectation of substantial (70%-90%; rounded estimate: 85%)
recovery for noteholders in the event of a payment default.
S&P said, "At the same time, we assigned our 'B-' issue-level
rating and '5' recovery rating to the company's proposed $600
million senior unsecured notes due 2029. The '5' recovery rating
indicates our expectation of modest (10%-30%; rounded estimate:
10%) recovery for noteholders in the event of a payment default."
NCL plans to use proceeds from these notes issuances and the
issuance of new exchangeable notes to redeem the balance of its
12.25% secured notes due 2024 and 10.25% secured notes due 2026, to
make principal payments on debt maturing in the short-term, and to
pay tender premiums, accrued interest, and fees and expenses.
S&P said, "Since the transaction is largely debt for debt, it does
not influence our 'B' issuer credit rating or negative outlook
analysis on NCL. We continue to expect the company's S&P Global
Ratings-adjusted credit measures will remain very weak through 2022
given the ongoing gradual resumption of sailings over the next
several months, which we forecast will entail continued cash burn
(at least through early 2022). NCL originally planned to have all
its ships in service by April 1, 2022. However, as a result of the
surge in virus cases due to the Omicron variant between December
and January, NCL canceled a number of sailings and postponed the
restart of some of its ships. As a result, the company now expects
to have 85% of its berth capacity in service by the end of the
first quarter of 2022 and its full fleet back in operations during
the early part of the second quarter of 2022. NCL will also benefit
from the introduction of its new ship, Norwegian Prima, which is
set to begin sailing in summer 2022. Therefore, we believe the
company's EBITDA will likely turn positive in the second half of
2022, assuming its full fleet is operational, given the company's
overall cumulative booked position for the second half of 2022 is
in line with 2019 levels at higher pricing even when including the
dilutive impact of future cruise credits it issued during the
coronavirus pandemic. Furthermore, we believe NCL has ample
liquidity to weather an ongoing gradual resumption of sailings over
the next few quarters.
"Nevertheless, we believe substantial uncertainty remains around
the company's ultimate recovery path and ability to ramp up its
EBITDA and cash flow to more sustainable levels. The recent surge
in COVID-19 cases, elevated recommendations against cruise travel,
and evolving travel restrictions and safety measures likely caused
some consumers to further delay their travel plans into late 2022
and beyond, lengthening NCL's recovery curve. The emergence of
additional coronavirus variants could introduce further variability
into the cruise industry and NCL's recovery path.
"The recent rapid spread of the Omicron variant highlights the
inherent uncertainties of the pandemic but also the importance and
benefits of vaccines. While the risk of new, more severe variants
displacing Omicron and evading existing immunity cannot be ruled
out, our current base case assumes that existing vaccines can
continue to provide significant protection against severe illness.
Furthermore, many governments, businesses and households around the
world are tailoring policies to limit the adverse economic impact
of recurring COVID-19 waves. Consequently, we do not expect a
repeat of the sharp global economic contraction of 2nd quarter
2020. Meanwhile, we continue to assess how well individual issuers
adapt to new waves in their regions or industry."
Issue Ratings - Recovery Analysis
Key analytical factors:
-- S&P said, "We assigned our 'B+' issue-level rating and '2'
recovery rating to NCL's proposed $1 billion senior secured notes
due 2027. The '2' recovery rating indicates our expectation of
substantial (70%-90%; rounded estimate: 85%) recovery for
noteholders in the event of a payment default."
-- S&P also assigned its 'B-' issue-level rating and '5' recovery
rating to NCL's proposed $600 million senior unsecured notes due
2029. The '5' recovery rating indicates its expectation of modest
(10%-30%; rounded estimate: 10%) recovery for noteholders in the
event of a payment default.
-- S&P's issue-level rating on NCL's $875 million revolver and
$1.5 billion term loan A remains 'BB-'. The recovery rating remains
'1', indicating its expectation of very high (90%-100%; rounded
estimate: 95%) recovery.
-- S&P's 'B-' issue-level rating and '5' recovery rating on NCL's
existing unsecured notes are unchanged.
Simulated default assumptions:
-- S&P said, "Our simulated default scenario contemplates a
payment default by 2025. Our simulated default scenario is driven
by cruise operators' inability to recover from the COVID-19
pandemic such that they generate significantly weaker cash flow and
weaker-than-expected increases in cash flow from new ships
scheduled for delivery over the next several years."
-- S&P assumes any debt maturing between now and its assumed year
of default is extended to the year of default.
-- S&P uses a discrete asset valuation (DAV) approach for NCL
because its debt structure provides certain creditors with priority
claims against specific assets and it expects lenders would pursue
the specific collateral pledged to them.
-- S&P said, "To calculate our DAV, we apply discounts to the
appraised values of NCL's existing ships and to the costs of
planned ships. We apply discounts ranging from 40%-50% to
appraisals depending on the customer segment and age of the ship.
In addition, where no appraisals are available, we apply discounts
to the cost of the ships ranging from 15%-50% depending on when
they were placed in service or are scheduled for delivery and
whether they operate in the contemporary or premium class."
-- S&P includes in its analysis all ships, and associated
financing, to be delivered through 2024, the year prior to its
assumed year of default.
-- S&P's recovery analysis also takes into account additional
tranches of loans entered into by NCL and various export credit
agencies and lenders.
-- S&P assumes administrative claims total 7% of gross DAV because
it expects the complexity of NCL's capital structure, including
multiple classes of debt at the parent and ship financings at
various subsidiaries, which benefit from different collateral
pools, as well as multijurisdictional considerations to result in
higher administrative costs.
-- S&P assume the $875 million revolver is fully drawn at the time
of default.
Simplified waterfall:
-- Gross asset value: $10.9 billion
-- Net asset value (after 7% administrative costs): $10.1 billion
-- Value ascribed to the credit agreement/ship loans/new senior
secured notes: 25%/66%/9%
-- Net value available to the secured credit agreement (including
residual value from unpledged ships after satisfying ship-level
debt): $2.9 billion
-- Secured credit facilities: $2.2 billion
--Recovery expectation: 90%-100%; rounded estimate: 95%
-- Remaining value available to unsecured and pari passu claims:
$0.7 billion
-- Net value available to the proposed $1 billion senior secured
notes due 2027 (including collateral value pledged to the senior
secured notes and a portion of the remaining value after satisfying
claims under the credit agreement): $0.9 billion
-- Senior secured notes due 2027: $1.03 billion
--Recovery expectation: 70%-90%; rounded estimate: 85%
-- Net value available to senior unsecured notes: $0.7 billion
-- Senior notes and convertible notes: $5.5 billion
--Recovery expectation: 10%-30%; rounded estimate: 10%
*All debt amounts include six months of prepetition interest.
NEPHROS INC: Samjo Capital, et al., Report 4.2% Equity Stake
------------------------------------------------------------
Samjo Capital, LLC, Samjo Management, LLC, and Andrew N. Wiener,
the companies' sole managing member, disclosed in an amended
Schedule 13G filed with the Securities and Exchange Commission that
as of Dec. 31, 2021, they beneficially own 425,000 shares of common
stock of Nephros, Inc., representing 4.2 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/1196298/000091957422000710/d9170968_13g-a.htm
About Nephros
South Orange, New Jersey-based Nephros, Inc. -- www.nephros.com --
is a commercial-stage company that develops and sells water
solutions to the medical and commercial markets.
Nephros reported a net loss of $4.53 million for the year ended
Dec. 31, 2020, a net loss of $3.18 million for the year ended Dec.
31, 2019, and a net loss of $3.32 million for the year ended Dec.
31, 2018. As of Sept. 30, 2021, the Company had $17.82 million in
total assets, $2.49 million in total liabilities, and $15.33
million in total stockholders' equity.
NESV ICE: Wins Interim Cash Collateral Access Thru April 21
-----------------------------------------------------------
The U.S. Bankruptcy Court for the District of Massachusetts,
Eastern Division, has authorized NESV Ice, LLC and affiliates to
use cash collateral in the ordinary course of its business
substantially in accordance with the budget, with a 10% variance
through the commencement of the continued hearing on the motion.
The Debtor requires the use of the cash collateral in order to
preserve its operations and the value of its assets.
SHS ACK, LLC asserts a security interest in Ice's property,
including the cash proceeds thereof, and Ice's deposit accounts.
As adequate protection, SHS is granted replacement liens in and to
all property of the kind presently securing the prepetition
obligations of Ice to SHS. The Replacement Liens will only attach
to and be enforceable against the same types of property, to the
same extent, and in the same order of priority as existed
immediately prior to the Petition Date.
Ice is directed to pay the City of Attleboro real estate taxes and
other municipal charges as they become due postpetition, as well as
interest on prepetition amounts. In addition, Ice will maintain its
insurance policies and remain current postpetition on any premiums
that must be paid.
The continued hearing on the motion is scheduled for April 21, 2022
at 1:30 p.m.
A copy of the order and the Debtors' budget is available at
https://bit.ly/3JBoeuT from PacerMonitor.com.
The budget provided for total cash disbursements, on a weekly
basis, as follows:
$34,457 for the week ending January 28, 2022;
$112,948 for the week ending February 4, 2022;
$36,872 for the week ending February 11, 2022;
$50,463 for the week ending February 18, 2022;
$32,257 for the week ending February 25, 2022;
$16,306 for the week ending March 4, 2022;
$36,872 for the week ending March 11, 2022;
$52,463 for the week ending March 18, 2022;
$33,257 for the week ending March 25, 2022;
$17,146 for the week ending April 1, 2022;
$41,861 for the week ending April 8, 2022;
$52,463 for the week ending April 15, 2022; and
$37,086 for the week ending April 22, 2022.
About NESV Ice, LLC
NESV Ice, LLC and affiliates NESV Swim, LLC, NESV Field, LLC, NESV
Hotel, LLC, NESV Tennis, LLC, NESV Land, LLC, and NESV Land East,
LLC, offer fitness and sports training services. The Debtor sought
protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. D.
Mass. Case No. 21-11226) on August 26, 2021. The petitions were
signed by Stuart Silberberg as manager.
Judge Christopher J. Panos oversees the case.
William McMahon, Esq., at Downes McMahon LLP is the Debtor's
counsel.
NETWORK COMMUNICATIONS: Case Summary & 20 Top Unsecured Creditors
-----------------------------------------------------------------
Debtor: Network Communications of Northwest Florida, Inc.
3320 Bill Metzger Ln
Pensacola, FL 32514
Business Description: Network Communications is a cable company in
Pensacola, Florida.
Chapter 11 Petition Date: February 11, 2022
Court: United States Bankruptcy Court
Northern District of Florida
Case No.: 22-30087
Debtor's Counsel: Brian G. Rich, Esq.
BERGER SINGERMAN LLP
313 N. Monroe Street, Suite 301
Tallahassee, FL 32301
Tel: 850-561-3010
Email: brich@bergersingerman.com
Debtor's
Special
Tax Counsel: AUSLEY MCMULLEN
Estimated Assets: $100,000 to $500,000
Estimated Liabilities: $1 million to $10 million
The petition was signed by Timothy G. McDonald as chief executive
officer.
A copy of the Debtor's list of 20 largest unsecured creditors is
available for free at PacerMonitor.com at:
https://www.pacermonitor.com/view/EPVIYQA/Network_Communications_of_Northwest__flnbke-22-30087__0003.0.pdf?mcid=tGE4TAMA
A full-text copy of the petition is available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/HYMEHYQ/Network_Communications_of_Northwest__flnbke-22-30087__0001.0.pdf?mcid=tGE4TAMA
NORDIC AVIATION: Affiliate Taps Katten Muchin Rosenman as Counsel
-----------------------------------------------------------------
NAC Aviation 29 Designated Activity Company, an affiliate in the
Chapter 11 cases of Nordic Aviation Capital Designated Activity
Company, seeks approval from the U.S. Bankruptcy Court for the
Eastern District of Virginia to employ Katten Muchin Rosenman LLP
as legal counsel.
The firm will render these legal services:
(a) review and analyze historical transactions;
(b) analyze potential claims held by NAC 29;
(c) advise on board matters;
(d) investigate and advise the disinterested directors
regarding whether an issue constitutes a conflict matter; and
(e) implement the directions of the disinterested directors
related to conflicts matters.
The hourly rates of the firm's counsel and staff are as follows:
Partner $835 - $1,795
Of Counsel $735 - $1,440
Counsel and Special Staff $460 - $1,230
Associate $300 - $935
Paralegal $90 - $650
In addition, the firm will seek reimbursement for expenses
incurred.
Prior to the petition date, NAC 29 paid in advance a total of
$960,000 retainer to the firm.
The firm provided the following in response to the request for
additional information set forth in Paragraph D.1 of the Revised
U.S. Trustee Guidelines.
Question: Did Katten agree to any variations from, or
alternatives to, Katten's standard billing arrangements for this
engagement?
Answer: No. Katten and NAC 29 have not agreed to any variations
from, or alternatives to, Katten's standard billing arrangements
for this engagement. The rate structure provided by Katten is
appropriate and is not significantly different from (a) the rates
that Katten charges for other non-bankruptcy representations or (b)
the rates of other comparably skilled professionals.
Question: Do any of the Katten professionals in this engagement
vary their rate based on the geographic location of the Debtors'
Chapter 11 cases?
Answer: No. The hourly rates used by Katten in representing the
disinterested directors are consistent with the rates that Katten
charges other comparable Chapter 11 clients, regardless of the
location of the Chapter 11 case.
Question: If Katten has represented NAC 29 in the 12 months
prepetition, disclose Katten's billing rates and material financial
terms for the prepetition engagement, including any adjustments
during the 12 months prepetition. If Katten's billing rates and
material financial terms have changed post-petition, explain the
difference and the reasons for the difference.
Answer: Katten represented NAC 29 during the twelve-month period
before the petition date using the hourly rates listed above. There
has been no change in rates since that time.
Question: Has NAC 29 approved Katten's budget and staffing plan,
and, if so, for what budget period?
Answer: Yes, for the period from December 19, 2021 through March
31, 2022.
Steven Reisman, Esq., a partner at Katten Muchin Rosenman,
disclosed in a court filing that the firm is a "disinterested
person" as that term is defined in Section 101(14) of the
Bankruptcy Code.
The firm can be reached through:
Steven J. Reisman, Esq.
Jerry L. Hall, Esq.
Michael E. Comerford, Esq.
Katten Muchin Rosenman LLP
575 Madison Avenue
New York, NY 10022
Telephone: (212) 940-8800
Facsimile: (212) 940-8776
Email: sreisman@katten.com
jerry.hall@katten.com
michael.comerford@katten.com
About Nordic Aviation Capital
Nordic Aviation Capital is the leading regional aircraft lessor
serving almost 70 airlines in approximately 45 countries. Its fleet
of 475 aircraft includes ATR 42, ATR 72, De Havilland Dash 8,
Mitsubishi CRJ900/1000, Airbus A220 and Embraer E-Jet family
aircraft.
On Dec. 17, 2021, Nordic Aviation Capital Pte. Ltd., NAC Aviation
17 Limited, NAC Aviation 20 Limited, and Nordic Aviation Capital
A/S each filed petitions seeking relief under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. E.D. Va.). On Dec. 19, 2021, Nordic
Aviation Capital Designated Activity Company and 112 affiliated
companies also filed petitions seeking Chapter 11 relief. The lead
case is In re Nordic Aviation Capital Designated Activity Company
(Bankr. E.D. Va. Lead Case No. 21-33693).
Judge Kevin R. Huennekens oversees the cases.
The Debtors tapped Kirkland & Ellis and Kutak Rock, LLP as
bankruptcy counsels and the law firms of Clifford Chance, LLP,
William Fry, LLP and Gorrissen Federspiel as corporate counsels.
N.M. Rothschild & Sons Limited, Ernst & Young, LLP and
PricewaterhouseCoopers, LLP serve as the Debtors' financial
advisor, restructuring advisor and tax advisor, respectively. Epiq
Corporate Restructuring, LLC is the claims and noticing agent.
NORDIC AVIATION: Affiliates Tap Hirschler as Special Counsel
------------------------------------------------------------
NAC Aviation 17 Limited and NAC Aviation 20 Limited, affiliates in
the Chapter 11 cases of Nordic Aviation Capital Designated Activity
Company, seek approval from the U.S. Bankruptcy Court for the
Eastern District of Virginia to employ Hirschler Fleischer, PC as
special counsel.
The Debtors need the assistance of a special counsel to advise
them, at the sole direction of the disinterested directors, solely
with respect to any matters that arise in connection with the
Debtors' restructuring efforts in which a conflict exists between
them and their shareholders, affiliates, directors or officers.
The hourly rates of Hirschler Fleischer's counsel are as follows:
Robert S. Westermann $575
Brittany B. Falabella $365
In addition, the firm will seek reimbursement for expenses
incurred.
The firm provided the following in response to the request for
additional information set forth in Paragraph D.1 of the Revised
U.S. Trustee Guidelines.
Question: Did you agree to any variations from, or alternatives
to, your standard billing arrangements for this engagement?
Answer: No.
Question: Do any of the professionals in this engagement vary
their rate based on the geographic location of the Debtors' Chapter
11 cases?
Answer: No.
Question: If you have represented the NAC 17/20 Debtors in the 12
months prepetition, disclose your billing rates and material
financial terms for the prepetition engagement, including any
adjustments during the 12 months prepetition. If your billing rates
and material financial terms have changed post-petition, explain
the difference and the reasons for the difference.
Answer: Not applicable.
Question: Has your client approved your prospective budget and
staffing plan, and, if so, for what budget period?
Answer: Yes, for the period from January 18, 2022 through March
31, 2022.
Robert Westermann, a shareholder at Hirschler Fleischer, disclosed
in a court filing that the firm is a "disinterested person" as that
term is defined in section 101(14) of the Bankruptcy Code.
The firm can be reached through:
Robert S. Westermann, Esq.
Brittany B. Falabella, Esq.
Hirschler Fleischer, PC
The Edgeworth Building
2100 East Cary Street
Richmond, VA 23223
Telephone: (804) 771-9500
Facsimile: (804) 644-0957
Email: rwestermann@hirschlerlaw.com
bfalabella@hirschlerlaw.com
About Nordic Aviation Capital
Nordic Aviation Capital is the leading regional aircraft lessor
serving almost 70 airlines in approximately 45 countries. Its fleet
of 475 aircraft includes ATR 42, ATR 72, De Havilland Dash 8,
Mitsubishi CRJ900/1000, Airbus A220 and Embraer E-Jet family
aircraft.
On Dec. 17, 2021, Nordic Aviation Capital Pte. Ltd., NAC Aviation
17 Limited, NAC Aviation 20 Limited, and Nordic Aviation Capital
A/S each filed petitions seeking relief under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. E.D. Va.). On Dec. 19, 2021, Nordic
Aviation Capital Designated Activity Company and 112 affiliated
companies also filed petitions seeking Chapter 11 relief. The lead
case is In re Nordic Aviation Capital Designated Activity Company
(Bankr. E.D. Va. Lead Case No. 21-33693).
Judge Kevin R. Huennekens oversees the cases.
The Debtors tapped Kirkland & Ellis and Kutak Rock, LLP as
bankruptcy counsels and the law firms of Clifford Chance, LLP,
William Fry, LLP and Gorrissen Federspiel as corporate counsels.
N.M. Rothschild & Sons Limited, Ernst & Young, LLP and
PricewaterhouseCoopers, LLP serve as the Debtors' financial
advisor, restructuring advisor and tax advisor, respectively. Epiq
Corporate Restructuring, LLC is the claims and noticing agent.
NORDIC AVIATION: April Hearing on $4.3-Bil. Debt Reduction Plan
---------------------------------------------------------------
Nordic Aviation Capital Designated Activity Company, et al.,
submitted a Modified Chapter 11 Plan of Reorganization and a
Modified Disclosure Statement.
As of the Petition Date, the Debtors are liable for $5.9 billion in
aggregate funded-debt obligations on account of various different
financing and security structures that enable the Group to maximize
tax efficiencies and business flexibility. The primary financing
structures, the substantial majority of which are secured
structures, include: (a) direct facilities; (b) finance leases; (c)
JOLCOs; and (d) swaps.
The Restructuring Transactions embodied by the Restructuring
Support Agreement and Plan will deleverage the Group's balance
sheet by approximately $4.3 billion in debt pursuant to various
equitization and sale transactions, provide the Reorganized
Remaining Debtors with an infusion of approximately $537 million in
new money in the form of an approximately $337 million as an equity
rights offering and a $200 million new revolving credit facility,
and, importantly, preserve customer relationships and the Group's
market leading position in the aircraft leasing industry.
To accommodate the Debtors' diverse creditor constituencies, the
Restructuring Support Agreement, the terms and conditions of which
are embodied by the Plan, reflects a variety of differing
restructuring and recapitalization transactions specific to each
(or multiple) ad hoc group of creditors, as reflected by the
various bespoke term sheets appended thereto. Specifically, the
transactions contemplated under the Restructuring Support Agreement
include, among others:
* DIP Facility: the effectuation of an $170 million
superpriority senior secured DIP credit facility provided by
certain of the Debtors' existing prepetition lenders;
* Option A/D Equitization Restructuring Transaction: the
equitization of approximately $[583 million] in secured note
obligations and facility agreement obligations held by Holders of
NAC 29 Funded Debt Claims, KfW Funded Debt Claims, and DB Nightjar
Funded Debt Claims, in exchange for the issuance of New Ordinary
Shares to such Holders, as well as the issuance of the New NAC 29
Debt (comprised of New NAC 29 Notes and/or New NAC 29 Term Loan
Facility Loans) to the aforementioned classes' funded-debt
claimants and Holders of SMBC Funded Debt Claims (together with the
other restructuring transactions relating to the aforementioned
Holders of Claims, collectively, the "Option A/D Equitization
Restructuring Transaction");
* Rights Offering: the implementation of an approximately $337
million equity rights offering, backstopped by the Backstop
Commitment Parties, representing Holders of NAC 29 Funded Debt
Claims, KfW Funded Debt Claims, DB Nightjar Funded Debt Claims to
fund new aircraft investment and provide go-forward liquidity;
* Option C2 Restructuring Transaction: the amendment and
restatement of that certain prepetition term loan credit agreement,
by and among the Reorganized Investec NAC 27 Debtor and the Holders
of Investec NAC 27 Funded Debt Claims (together with the other
transactions relating to the Investec NAC 27 Debtor and the Holders
of Investec NAC 27 Funded Debt Claims, collectively, the "Option C2
Restructuring Transaction");
* Option E Transactions
-- JOLCO Restructuring Transaction: among other things, (i)
the consensual rejection of the Leveraged Aircraft Leases of the
JOLCO Debtors, (ii) the return of all collateral securing the
financing arrangements under which the JOLCO Debtors are obligated
(including the transfer or, as applicable, surrender and
cancellation of the Debtors' existing shares in the JOLCO Debtors),
and (iii) the complete equitization of certain claims (i.e., the "A
Termination Claims") against the JOLCO Debtors and issuance of new
shares in the JOLCO Debtors to the Holders of A Termination Claims
against the JOLCO Debtors or a third-party buyer, coupled with the
extinguishment and release of other claims against the JOLCO
Debtors (the "B Termination Claims") (together with the other
transactions relating to the JOLCO Debtors and the Holders of
Claims against the JOLCO Debtors, collectively, the "JOLCO
Restructuring Transaction");
-- NAC 8 Restructuring Transaction: among other things, (i)
the amendment and restatement of that certain prepetition term loan
credit agreement, entered into by and among NAC Aviation 8 Limited
and the Holders of Investec NAC 8 Senior Funded Debt Claims, (ii)
the amendment and restatement of that certain prepetition term loan
credit agreement, entered into by and among NAC Aviation 8 Limited
and the Holders of Investec NAC 8 Junior Funded Debt Claims, (iii)
the issuance and transfer of Interests in NAC Aviation 8 Limited to
the Investec NAC 8 Buyer, and (iv) the issuance of the NAC 8 Exit
Facility, (together with the other transactions relating to the
Investec NAC 8 Debtors and the Holders of Investec NAC 8 Funded
Debt Claims, collectively, the "NAC 8 Restructuring Transaction");
-- NAC 33/34 Transactions: the recapitalization of the NAC
33/34 Debtors through the New Money Investment Transaction, which
will result in the (i) surrender and cancellation of the Interests
in NAC 33/34 and (ii) issuance of the New NAC 33/34 Equity to a new
holding company, 90 percent of which holding company will be
indirectly owned by Azorra Aviation Holdings, LLC and/or its
affiliates as the New Money Investors and 10 percent of which will
be owned by the NAC 33/34 Lenders, among other things, which NAC
33/34 Transactions are more fully described herein and in the
Plan;
-- EDC Exiting Restructuring Transactions: among other things,
(i) the servicing and remarketing of twelve CRJ aircraft to
effectuate a consensual termination of the leasing and redelivery
of such aircraft from Garuda and, to the extent not effectuated,
the sale of such aircraft to a third party or the abandonment and
transfer of such aircraft to the nominee of the lenders to the EDC
Debtors, and (ii) the servicing of six additional EDC-financed CRJ
aircraft in compromise of the Debtors' outstanding prepetition debt
in respect of those aircraft, among other things (collectively, the
"EDC Exiting Restructuring Transactions");
-- EDC Reinstating Restructuring Transactions: the amendment
and restatement of the EDC Remaining Facilities entered into by and
between the EDC Debtors and the Holders of EDC Remaining Facilities
Claims (collectively, the "EDC Reinstating Restructuring
Transaction");
* Exit Facility: the entry into a $200 million super senior
revolving credit facility, fully underwritten by Holders of NAC 29
Funded Debt Claims, KfW Funded Debt Claims, SMBC Funded Debt
Claims, and DB Nightjar Funded Debt Claims, or, at the Debtors'
election, and subject to certain conditions, an alternative exit
facility.
In addition to the transactions contemplated under the
Restructuring Support Agreement, the Debtors have continued to
engage with certain non-RSA parties on the terms of bespoke
restructuring transactions that provide for the treatment of such
parties' Claims in these Chapter 11 Cases. Although the Debtors
have not reached definitive agreements on these bespoke
transactions, these transactions would likely include the
following:
* ECA Reinstating Transaction: the amendment and restatement of
the ECA Remaining Facilities entered into by and between the ECA
Debtors and the Holders of ECA Remaining Facilities Claims
(collectively, the "ECA Reinstating Transaction");
* ECA Exiting Transaction: among other things, the enforcement
of security interests over the Aircraft leased under certain leases
to which the ECA Debtors are Lessors and the assignment of the
Debtors' interests in the ECA Leases to Holders of ECA Funded Debt
Claims (Garuda) (among other things, collectively, the "ECA Exiting
Transaction," and together with the ECA Reinstating Transaction,
the "ECA Transactions"); and
* New York Life Transaction: among other things, a modified
version of the Option C2 Restructuring Transaction involving the
issuance of new silo-level debt with the existing NAC DAC guarantee
remaining in effect and an upfront paydown of a portion of the debt
under the NYL Note Purchase Agreement.
The Debtors will continue to negotiate with the ECA and New York
Life lenders and anticipate reaching definitive agreements with
these lenders in the near future.
After months of reviewing alternatives following the Pandemic, the
Debtors and their respective boards of directors determined that
the Restructuring Support Agreement represents the best available
option to the Debtors. Implementing the transactions contemplated
by the Restructuring Support Agreement and Plan will deleverage the
Company's capital structure, preserve the going-concern value of
the Debtors' businesses, maximize recoveries available to all
constituents, provide for an equitable distribution to the Debtors'
stakeholders, and preserve the jobs of the Company's employees.
The formulation of the RSA and Plan is a significant achievement
for the Debtors in the face of an historic, depressed operating
environment precipitated by a once-in-a-century Pandemic. The
Debtors believe that the Plan is in the best interests of the
Debtors' estates, represents the best available alternative, and
provides the best path forward at this time.
Given the Debtors' core strengths, including their modern fleet,
highly-skilled workforce, global reach, and successful operating
track record, the Debtors are confident they can efficiently
implement the restructuring set forth in the Plan to ensure their
long-term viability and success. For these reasons, the Debtors
strongly recommend that Holders of Claims entitled to vote on the
Plan, vote to accept the Plan.
Claims Against / Interests in NAC DAC
Under the Plan, Class C1 NAC DAC Unsecured Funded Debt Claims
totaling $6,291.3 million. Each Holder of an Allowed NAC DAC
Unsecured Funded Debt Claim shall receive, at the option of such
Holder (unless otherwise stated in the Plan), its Pro Rata share of
the NAC DAC Unsecured Funded Debt Claims Recovery Pool, either: (i)
in Cash; or (ii) as a Pro Rata share of the NAC DAC Unsecured
Funded Debt Claims New Ordinary Shares Allocation; provided, that,
notwithstanding the foregoing option, (x) Option A/D Holders shall
receive such Pro Rata share of the NAC DAC Unsecured Funded Debt
Claims Recovery Pool as a Pro Rata share of the NAC DAC Unsecured
Funded Debt Claims New Ordinary Shares Allocation and for the
purposes of the Plan shall be deemed to have elected to receive
such treatment, and (y) Option E Holders shall receive such Pro
Rata share of the NAC DAC Unsecured Funded Debt Claims Recovery
Pool in Cash; provided, further, that, to the extent the NAC DAC
Unsecured Funded Debt Claims New Ordinary Shares Allocation equals
5.00% of the New Ordinary Shares (prior to consummation of the
Rights Offering (including issuance of the Backstop Shares),
payment of the Rights Offering Premiums, and implementation of the
Management Incentive Plan), any remaining balance of the NAC DAC
Unsecured Funded Debt Claims Recovery Pool that is payable to
Holders electing the NAC DAC Unsecured Funded Debt Claims New
Ordinary Shares Allocation shall be paid in Cash to such Holders
electing the NAC DAC Unsecured Funded Debt Claims New Ordinary
Shares Allocation on a pro rata basis. Creditors will recover 0.03%
of their claims. Class C1 is impaired.
Holders of Class C2 General Unsecured Claims Against NAC DAC shall,
at the option of the applicable Debtor, either (i) be Reinstated or
(ii) its Holder shall receive Cash in an amount equal to such
Allowed General Unsecured Claim on the later of (x) the Plan
Effective Date or (y) the date such payment would otherwise be due
in the ordinary course of business in accordance with the terms and
conditions of the particular transaction giving rise to such
Allowed General Unsecured Claim. Creditors will recover 100% of
their claims. Class C2 is unimpaired.
Claims Against NAC 29 Debtors
Holders of Class D2 General Unsecured Claims Against the NAC 29
Debtors shall, at the option of the applicable Debtor, either: (i)
be Reinstated, or (ii) its Holder shall receive Cash in an amount
equal to such Allowed General Unsecured Claim on the later of (x)
the Plan Effective Date or (y) the date such payment would
otherwise be due in the ordinary course of business in accordance
with the terms and conditions of the particular transaction giving
rise to such Allowed General Unsecured Claim. Creditors will
recover 100% of their claims. Class D2 is unimpaired.
Claims Against KfW Debtors
Holders of Class E2 General Unsecured Claims Against the KfW
Debtors shall, at the option of the applicable Debtor, either (i)
be Reinstated, or (ii) its Holder shall receive Cash in an amount
equal to such Allowed General Unsecured Claim on the later of (x)
the Plan Effective Date or (y) the date such payment would
otherwise be due in the ordinary course of business in accordance
with the terms and conditions of the particular transaction giving
rise to such Allowed General Unsecured Claim. Creditors will
recover 100% of their claims. Class E2 is unimpaired.
Claims Against DB Nightjar Debtors
Holders of Class F2 General Unsecured Claims Against the DB
Nightjar Debtors shall, at the option of the applicable Debtor,
either (i) be Reinstated, or (ii) its Holder shall receive Cash in
an amount equal to such Allowed General Unsecured Claim on the
later of (x) the Plan Effective Date or (y) the date such payment
would otherwise be due in the ordinary course of business in
accordance with the terms and conditions of the particular
transaction giving rise to such Allowed General Unsecured Claim.
Creditors will recover 100% of their claims. Class F2 is
unimpaired.
Claims Against SMBC Debtor
Holders of Class G2 General Unsecured Claims Against the SMBC
Debtor shall, at the option of the SMBC Debtor, either (i) be
Reinstated, or (ii) its Holder shall receive Cash in an amount
equal to such Allowed General Unsecured Claim on the later of (x)
the Plan Effective Date or (y) the date such payment would
otherwise be due in the ordinary course of business in accordance
with the terms and conditions of the particular transaction giving
rise to such Allowed General Unsecured Claim. Creditors will
recover 100% of their claims. Class G2 is unimpaired.
Claims Against Investec NAC 27 Debtor
Holders of Class H2 General Unsecured Claims Against the Investec
NAC 27 Debtor shall, at the option of the Investec NAC 27 Debtor,
either (i) be Reinstated; or (ii) its Holder shall receive Cash in
an amount equal to such Allowed General Unsecured Claim on the
later of (x) the Plan Effective Date or (y) the date such payment
would otherwise be due in the ordinary course of business in
accordance with the terms and conditions of the particular
transaction giving rise to such Allowed General Unsecured Claim.
Creditors will recover 100% of their claims. Class H2 is
unimpaired.
Claims Against EDC Debtors
Holders of Class I3 General Unsecured Claims Against the EDC
Debtors shall, at the option of the applicable Debtor, either (i)
be Reinstated, or (ii) its Holder shall receive Cash in an amount
equal to such Allowed General Unsecured Claim on the later of (x)
the Plan Effective Date or (y) the date such payment would
otherwise be due in the ordinary course of business in accordance
with the terms and conditions of the particular transaction giving
rise to such Allowed General Unsecured Claim. Creditors will
recover 100% of their claims. Class I3 is unimpaired.
Claims Against ECA Debtors
Holders of Class J3 General Unsecured Claims Against the ECA
Debtors shall, at the option of the applicable Debtor, either (i)
be Reinstated, or (ii) its Holder shall receive Cash in an amount
equal to such Allowed General Unsecured Claim on the later of (x)
the Plan Effective Date or (y) the date such payment would
otherwise be due in the ordinary course of business in accordance
with the terms and conditions of the particular transaction giving
rise to such Allowed General Unsecured Claim; or (ii) if the
Debtors, the Majority Consenting Equitizing Creditors, and the
Requisite Holders of the ECA Facility Claims do not agree, each
Holder of a General Unsecured Claim against the ECA Debtors shall
receive its Pro Rata share of the Liquidation Recovery. Creditors
will recover 100% of their claims. Class J3 is impaired.
Claims Against NYL Debtors
Holders of Class K2 General Unsecured Claims Against the NYL
Debtors shall, at the option of the applicable Debtor, either (i)
be Reinstated, or (ii) its Holder shall receive Cash in an amount
equal to such Allowed General Unsecured Claim on the later of (x)
the Plan Effective Date or (y) the date such payment would
otherwise be due in the ordinary course of business in accordance
with the terms and conditions of the particular transaction giving
rise to such Allowed General Unsecured Claim; or (ii) if the
Debtors, the Majority Consenting Equitizing Creditors, and the
Requisite Holders of the NYL Financing Claims do not agree, each
Holder of a General Unsecured Claim against the NYL Debtors shall
receive its Pro Rata share of the Liquidation Recovery. Creditors
will recover 100% of their claims. Class K2 is unimpaired.
Claims Against NASL Debtor
Holders of Class L2 General Unsecured Claims Against the NASL
Debtor shall, at the option of the NASL Debtor, either (i) be
Reinstated, or (ii) its Holder shall receive Cash in an amount
equal to such Allowed General Unsecured Claim on the later of (x)
the Plan Effective Date or (y) the date such payment would
otherwise be due in the ordinary course of business in accordance
with the terms and conditions of the particular transaction giving
rise to such Allowed General Unsecured Claim. Creditors will
recover 100% of their claims. Class L2 is unimpaired.
Claims Against Other NAC Debtors
Holders of Class M1 General Unsecured Claims Against the Other NAC
Debtors shall, at the option of the applicable Debtor, either (i)
be Reinstated, or (ii) its Holder shall receive Cash in an amount
equal to such Allowed General Unsecured Claim on the later of (x)
the Plan Effective Date or (y) the date such payment would
otherwise be due in the ordinary course of business in accordance
with the terms and conditions of the particular transaction giving
rise to such Allowed General Unsecured Claim. Creditors will
recover 100% of their claims. Class M1 is unimpaired.
Claims Against / Interests in DB JOLCO Debtors
Holders of Class O3 General Unsecured Claims Against the DB JOLCO
Debtors totaling $4,648.65, will receive its Pro Rata share of the
Liquidation Recovery. Creditors will recover 100% of their claims.
Class O3 is impaired.
Claims Against / Interests in MUFG JOLCO Debtors
Holders of Class P3 General Unsecured Claims Against the MUFG JOLCO
Debtors will receive its Pro Rata share of the Liquidation
Recovery. Class P3 is impaired.
Claims Against / Interests in Investec NAC 8 Debtors
Holders of Class Q3 General Unsecured Claims Against the Investec
NAC 8 Debtors will receive its Pro Rata share of the NAC 8 General
Unsecured Claims Recovery Pool. Creditors will recover $50,000.
Class Q3 is impaired.
Claims Against / Interests in NAC 33/34 Debtors
Holders of Class R4 General Unsecured Claims Against the NAC 33/34
Debtors totaling $6,975.06, will receive Cash in an amount equal to
its Pro Rata share of the NAC 33/34 General Unsecured Recovery Cash
Pool Amount. Creditors will recover 100% of their claims. Class R4
is impaired.
April Plan Hearing Targeted
The voting record date will be on March 5, 2022.
The Disclosure Statement hearing date will be on March 10, 2022.
The solicitation mailing deadline will be on March 15, 2022.
The Plan Supplement filing deadline will be on April 5, 2022, at
5:00 p.m., prevailing Eastern Time, or such other date as the Court
may direct.
The voting deadline will be on April 12, 2022, at 5:00 p.m.,
prevailing Eastern Time.
The confirmation objection deadline will be on April 12, 2022, at
5:00 p.m., prevailing Eastern Time, or such other date as the Court
may direct.
The deadline to file voting report will be on April 18, 2022, at
4:00 p.m., prevailing Eastern Time, or such other date as the Court
may direct.
The Plan confirmation hearing date will be on April 19, 2022, or
such other date as the Court may direct.
Co-Counsel to the Debtors:
Edward O. Sassower, P.C., Esq.
Emily Geier, Esq.
KIRKLAND & ELLIS LLP
KIRKLAND & ELLIS INTERNATIONAL LLP
601 Lexington Avenue
New York, New York 10022
Telephone: (212) 446-4800
Facsimile: (212) 446-4900
- and -
Chad J. Husnick, P.C., Esq.
David R. Seligman, P.C., Esq.
Jaimie Fedell, Esq.
KIRKLAND & ELLIS LLP
KIRKLAND & ELLIS INTERNATIONAL LLP
300 North LaSalle Street
Chicago, Illinois 60654
Telephone: (312) 862-2000
Facsimile: (312) 862-2200
- and -
Michael A. Condyles, Esq.
Peter J. Barrett, Esq.
Jeremy S. Williams, Esq.
KUTAK ROCK LLP
901 East Byrd Street, Suite 1000
Richmond, Virginia 23219-4071
Telephone: (804) 644-1700
Facsimile: (804) 783-6192
A copy of the Disclosure Statement dated Feb. 4, 2022, is available
at https://bit.ly/3Hwq3bL from PacerMonitor.com.
About Nordic Aviation Capital
Nordic Aviation Capital is the leading regional aircraft lessor
serving almost 70 airlines in approximately 45 countries. Its
fleet of 475 aircraft includes ATR 42, ATR 72, De Havilland Dash 8,
Mitsubishi CRJ900/1000, Airbus A220 and Embraer E-Jet family
aircraft.
On Dec. 17, 2021, Nordic Aviation Capital Pte. Ltd., NAC Aviation
17 Limited, NAC Aviation 20 Limited, and Nordic Aviation Capital
A/S each filed petitions seeking relief under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. E.D. Va.). On Dec. 19, 2021, Nordic
Aviation Capital Designated Activity Company and 112 affiliated
companies also filed petitions seeking Chapter 11 relief. The lead
case is In re Nordic Aviation Capital Designated Activity Company
(Bankr. E.D. Va. Lead Case No. 21-33693).
Judge Kevin R. Huennekens oversees the cases.
The Debtors tapped Kirkland & Ellis and Kutak Rock, LLP as
bankruptcy counsels and the law firms of Clifford Chance, LLP,
William Fry, LLP and Gorrissen Federspiel as corporate counsels.
N.M. Rothschild & Sons Limited, Ernst & Young, LLP and
PricewaterhouseCoopers, LLP serve as the Debtors' financial
advisor, restructuring advisor and tax advisor, respectively. Epiq
Corporate Restructuring, LLC is the claims and noticing agent.
NORDSTROM INC: Egan-Jones Keeps B+ Sr. Unsec. Debt Ratings
----------------------------------------------------------
Egan-Jones Ratings Company, on January 18, 2022, maintained its
'B+' foreign currency and local currency senior unsecured ratings
on debt issued by Nordstrom Inc.
Headquartered in Seattle, Washington, Nordstrom, Inc. is a fashion
retailer of apparel, shoes, and accessories for men, women, and
children.
NORTHERN OIL: BlackRock Has 5.4% Equity Stake as of Dec. 31
-----------------------------------------------------------
In a Schedule 13G filed with the Securities and Exchange
Commission, BlackRock, Inc. disclosed that as of Dec. 31, 2021, it
beneficially owns 4,112,572 shares of common stock of Northern Oil
and Gas Inc., representing 5.4 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/1104485/000083423722007346/us6655313079_020422.txt
About Northern Oil and Gas
Northern Oil and Gas, Inc. -- http://www.northernoil.com-- is an
independent energy company engaged in the acquisition, exploration,
development and production of oil and natural gas properties,
primarily in the Bakken and Three Forks formations within the
Williston Basin in North Dakota and Montana.
Northern Oil reported a net loss of $906.04 million for the year
ended Dec. 31, 2020, compared to a net loss of $76.32 million for
the year ended Dec. 31, 2019. As of Sept. 30, 2021, the Company
had $1.24 billion in total assets, $1.40 billion in total
liabilities, and a total stockholders' deficit of $157.71 million.
NS8 INC: Can't Intervene in Ironshore Insurance Suit vs Ex-CFO
--------------------------------------------------------------
Ironshore Indemnity Inc. originally filed the case captioned
Ironshore Indemnity Inc., Plaintiff, v. Eric Kay, Defendant, Case
No. 2:21-cv-01706-JAD-BNW (D. Nev.), seeking a declaratory judgment
that it has no duty to defend or indemnify Adam Rogas and Eric Kay
for insurance claims arising from wrongful acts Rogas allegedly
committed while CEO of NS8, a cyber-fraud company.
NS8, now doing business as Cyber Litigation Inc., seeks to
intervene as a defendant, arguing that its entitlements to the
insurance proceeds will be affected by any such judgment and that
this case should be transferred to the Delaware Bankruptcy Court
where Cyber Litigation is currently involved in bankruptcy
proceedings. Ironshore opposes, contending that Cyber Litigation
has not shown it is entitled to intervention under Federal Rule of
Civil Procedure (FRCP) 24 and that it failed to adhere to the
rule's pleading requirement.
Argonaut Insurance Company -- another of Rogas, Kay, and Cyber
Litigation's insurers -- also seeks to intervene as a plaintiff,
arguing that it does not have to defend or indemnify Rogas or Kay
for the same insurance claims. Rogas, Kay, and Cyber Litigation
oppose Argonaut's motion, contending that it is merely attempting
to evade orders issued by the Delaware Bankruptcy Court. Ironshore
argues that while Argonaut has not met the burden to intervene as
of right, it does meet the permissive-intervention standard.
Since these motions were filed, Ironshore voluntarily dismissed its
claims against Adam Rogas and now seeks judgment on Kay's insurance
claims only. Judge Jennifer A. Dorsey of the United States
District Court for the District of Nevada ordered supplemental
briefing on whether -- and if so, how -- Rogas' dismissal impacts
the pending motions to intervene. Cyber Litigation, Argonaut, and
Kay insist that it has no effect, and Cyber Litigation accuses
Ironshore of dismissing Rogas to "avoid the jurisdiction" of the
Delaware Bankruptcy Court. Ironshore contends that the dismissal
vastly simplifies this action to its dispute with Kay, which can be
quickly resolved by its pending motion for judgment on the
pleadings.
Judge Dorsey denies both motions to intervene because Argonaut and
Cyber Litigation have not met the standards for permissive
intervention or intervention as of right. The judge also denies as
moot Cyber Litigation's motion for leave to file a response to
Ironshore's motion for judgment on the pleadings because I am
denying its intervention motion.
Judge Dorsey finds that Cyber Litigation fails to demonstrate that
Kay's legal representation is incapable of diligently defending
this litigation and raising all arguments that Cyber Litigation
would raise if it were a party. So, because Cyber Litigation has
not overcome the presumption of representation arising from it's
and Kay's shared objectives in this case, it is not entitled to
intervention as of right.
Moreover, Judge Dorsey finds that Cyber Litigation's interest is
not so obvious here. It does not indicate how it would wish to
participate in this case if I were to grant its intervention motion
but deny its transfer motion. While it claims it has "unique
rights" and "different claims" from Kay, its failure to file a
proposed pleading prevents the Court from determining how those
distinct rights and claims relate to the pending action, the judge
points out.
A full-text copy of Judge Dorsey's February 1, 2022 Order is
available at https://tinyurl.com/4mtd4c74 from Leagle.com.
About NS8 Inc.
Las Vegas-based NS8 Inc. -- https://www.ns8.com/ -- is a developer
of a comprehensive fraud prevention platform that combines
behavioral analytics, real-time scoring, and global monitoring to
help businesses minimize risk.
NS8 sought Chapter 11 protection (Bankr. D. Del. Case No. 20-12702)
on Oct. 27, 2020. The petition was signed by Daniel P. Wikel, the
chief restructuring officer.
The Debtor was estimated to have $10 million to $50 million in
assets and $100 million to $500 million in liabilities at the time
of the filing.
The Hon. Christopher S. Sontchi is the case judge.
The Debtor tapped Blank Rome LLP and Cooley LLP as its legal
counsel, and FTI Consulting Inc. as its financial advisor. Stretto
is the claims agent.
* * *
The company changed its name to Cyber Litigation after it sold
substantially all of its assets to Codium Software LLC in December
2020.
O'CONNOR CONSTRUCTION: Seeks to Hire Joseph Postnikoff as Counsel
-----------------------------------------------------------------
O'Connor Construction Group, LLC seeks approval from the U.S.
Bankruptcy Court for the Northern District of Texas to employ the
Law Offices of Joseph F. Postnikoff, PLLC, as its legal counsel.
The firm's services include:
a. advising the Debtor with respect to rights, powers and
duties as Debtor continues to operate and manage the business of
the Debtor;
b. advising the Debtor concerning, and assisting in the
negotiation and documentation of, agreements, debt restructuring,
and related transactions;
c. monitoring transactions proposed by the parties in interest
during the course of this case and advising the Debtor regarding
the same;
d. reviewing the nature and validity of liens asserted against
the property of the Debtor and advising the Debtor concerning the
enforceability of such liens;
e. advising the Debtor concerning the actions that might be
taken to collect and to recover property for the benefit of the
Debtor's estate;
f. reviewing and monitoring the Debtor's ongoing business;
g, preparing on behalf of the Debtor all necessary and
appropriate applications, motions, pleadings, draft orders, notices
and other documents, and reviewing all financial and other reports
to be filed in this chapter 11 case;
h. advising the Debtor concerning, and preparing responses to,
applications, motions, pleadings, notices and other papers that may
be filed and served in this chapter 11 case;
i. advising the Debtor in connection with any suggested or
proposed plan(s) of reorganization;
j. counseling the Debtor in connection with the formulation,
negotiation and promulgation of a plan of reorganization; and
k. performing all other legal services for and on behalf of
the Debtor that may be necessary or appropriate in the
administration of this chapter 11 case.
The firm will be paid at these rates:
Partners $350 to $400 per hour
Associates $250 to $300 per hour
Paraprofessionals $90 per hour
The firm received a retainer in the amount of $50,000.
PostnikoffLaw does not hold or represent any interest adverse to
the Debtor or any creditors in this case, in the matters for which
it is proposed to be retained and is a "disinterested person" as
that term is defined in Section 101(14) of the bankruptcy Code.
according to court filings.
The firm can be reached through:
Joseph F. Postnikoff, Esq.
Kevin G. Herd, Esq.
LAW OFFICES OF JOSEPH F. POSTNIKOFF, PLLC
777 Main Street, Suite 600
Fort Worth, TX 76102
Telephone: 817-335-9400
Email: jpostnikoff@postnikofflaw.com
kherd@postnikofflaw.com
About O'Connor Construction Group, LLC
O'Connor Construction Group, LLC has over 30 years of experience as
a commercial/industrial contractor specializing in food
storage/processing facilities and provides turnkey design,
construction and construction management services for projects
nationwide, but focusing primarily in the South/Southwest.
O'Connor's primary office is located at 173 County Road 3850,
Poolville, Texas 76487 and its workforce currently consists of
twenty-four employees.
O'Connor sought protection under Chapter 11 of the U.S. Bankruptcy
Code (Bankr. N.D. Tex. Case No. 22-40187-11) on January 28, 2022.
In the petition signed by Paul O'Connor, member and manager, the
Debtor disclosed up to $10 million in assets and up to $50 million
in liabilities.
The Law Offices of Joseph F. Postnikoff, PLLC serves as the
Debtor's legal counsel.
OCULAR THERAPEUTIX: Bruce Peacock to Quit as Director
-----------------------------------------------------
Bruce A. Peacock notified Ocular Therapeutix, Inc. on Feb. 3, 2022,
that he planned to resign as a member of the Board of Directors on
the date of the company's annual meeting of stockholders to be held
this year.
About Ocular Therapeutix
Headquartered in Bedford, MA, Ocular Therapeutix, Inc. --
http://www.ocutx.com-- is a biopharmaceutical company focused on
the formulation, development, and commercialization of innovative
therapies for diseases and conditions of the eye using its
proprietary bioresorbable hydrogel-based formulation technology.
Ocular Therapeutix's first commercial drug product, DEXTENZA, is
FDA-approved for the treatment of ocular inflammation and pain
following ophthalmic surgery.
Ocular Therapeutix reported a net loss and comprehensive loss of
$155.64 million for the year ended Dec. 31, 2020, a net loss and
comprehensive loss of $86.37 million for the year ended Dec. 31,
2019, a net loss and comprehensive loss of $59.98 million for the
year ended Dec. 31, 2018, and a net loss and comprehensive loss of
$63.38 million for the year ended Dec. 31, 2017. As of Sept. 30,
2021, the Company had $217.74 million in total assets, $130.40
million in total liabilities, and $87.34 million in total
stockholders' equity.
OMEROS CORP: Ingalls & Snyder Has 7.1% Equity Stake as of Dec. 31
-----------------------------------------------------------------
Ingalls & Snyder, LLC disclosed in a Schedule 13G/A filed with the
Securities and Exchange Commission that as of Dec. 31, 2021, it
beneficially owns 4,464,492 shares of common stock of Omeros
Corporation, representing 7.1 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/1041885/000104188522000005/Omeros13gaisdec2021.txt
About Omeros Corporation
Seattle, Washington-based Omeros -- www.omeros.com -- is a
commercial-stage biopharmaceutical company committed to
discovering, developing and commercializing small-molecule and
protein therapeutics for large-market and orphan indications
targeting inflammation, complement-mediated diseases, disorders of
the central nervous system and immune-related diseases, including
cancers.
Omeros reported a net loss of $138.06 million for the year ended
Dec. 31, 2020, compared to a net loss of $84.48 million for the
year ended Dec. 31, 2019. As of June 30, 2021, the Company had
$145.39 million in total assets, $47.70 million in total current
liabilities, $31.41 million in lease liabilities (non-current),
$312.59 million in unsecured convertible senior notes, and a total
shareholders' deficit of $246.30 million.
ORIGINAL TILE: Gets Interim Cash Collateral Access Mar 4
--------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Georgia,
Rome Division, has authorized Original Tile Source, LLC to use cash
collateral on an interim basis in accordance with the budget, with
a 10% variance through March 4, 2022.
The Debtor requires the use of cash collateral to continue its
operations.
First Bank of Dalton alleges that the Debtor is indebted to First
Bank under several loan agreements including a Commercial
Promissory Note in the original principal amount of $200,560 dated
December 17, 2019.
AV Industries, LLC alleges that as of the Petition Date, the Debtor
was indebted to AVI in an amount that exceeded $1,230,000 pursuant
to two promissory notes in the aggregate principal amount of
$1,300,000, dated November 15, 2019.
The Debtor is in default under the various loans, notes and
accounts for failing to make payments to FBD as and when due.
AVI alleges that Debtor is in default for failing to make payments
to AVI as and when due.
As adequate protection, FBD and AVI are granted continuing,
additional replacement liens and security interests in and to all
of the now existing or hereafter arising or after-acquired assets
of the Debtor.
FBD and AVI will have the right to inspect their collateral during
normal business hours and upon reasonable notice to Debtor.
As additional adequate protection to FBD, on or before February 5,
2022 and on the fifth day of each month thereafter, the Debtor will
pay to FBD the amount of $2,805.
A continued hearing on the matter is scheduled for March 2 at 11
a.m.
A copy of the order and the Debtor's budget for the period from
January to April 2022 is available at https://bit.ly/3BgMUWA from
PacerMonitor.com.
The Debtor projects $86,793 in total sales and $51,826 in total
expenses for February 2022.
About Original Tile Source
Original Tile Source, LLC, a tile store owner in Dalton, Ga., filed
its voluntary petition for Chapter 11 protection (Bankr. N.D. Ga.
Case No. 21-41554) on Dec. 21, 2021, listing up to $100 million in
assets and up to $10 million in liabilities.
Judge Barbara Ellis-Monro oversees the case.
Brian R. Cahn, Esq., at Brian R. Cahn And Associates, LLC,
represents the Debtor as legal counsel.
First Bank of Dalton, as lender, is represented by:
Lisa Wolgast, Esq,
Talia B. Wagner, Esq.
Morris, Manning & Martin, LLP
1600 Atlanta Financial Center
3343 Peachtree Road, N.E.
Atlanta GA 30326
Tel No: (404) 233-7000
OXFORD INDUSTRIES: Egan-Jones Hikes Unsecured Debt Ratings to BB+
-----------------------------------------------------------------
Egan-Jones Ratings Company, on January 20, 2022, upgraded the
foreign currency and local currency senior unsecured ratings on
debt issued by Oxford Industries Inc. to BB+ from B+.
Headquartered in Atlanta, Georgia, Oxford Industries, Inc. operates
as an international apparel design, sourcing, and marketing
company.
PALADIN ENERGY: Coverage Claims Remain for Trial in POGO Suit
-------------------------------------------------------------
Magistrate Judge Irma Carrillo Ramirez of the United States
District Court for the Northern District of Texas, Dallas Division,
denied in part and granted in part Defendant St. Paul Fire and
Marine Insurance Company's Motion for Partial Summary Judgment and
Plaintiff's Affirmative Motion for Partial Summary Judgment on its
Declaratory Judgment and Breach of Contract Claims in the case
captioned POGO RESOURCES, LLC, Plaintiff, v. ST. PAUL FIRE AND
MARINE INSURANCE COMPANY, A MEMBER COMPANY OF THE TRAVELERS GROUP
OF INSURERS, Defendant, Civil Action No. 3:19-CV-2682-BH (N.D.
Tex.).
This is an insurance coverage dispute between Pogo Resources and
St. Paul Fire and Marine Insurance Company.
Defendant issued Plaintiff a commercial general liability policy
and an umbrella excess protection insurance policy for its oil and
gas operations, effective March 1, 2017 to March 1, 2018.
Defendant also issued Paladin a CGL policy and an Umbrella policy,
effective from July 1, 2016 through July 1, 2017, which provide
insurance coverage for, among other things, bodily injury and
property damage and for pollution clean-up costs.
On May 15, 2017, Paladin and Plaintiff executed a Stalking Horse
Purchase and Sale Agreement, effective May 1, 2017, for the
purchase of substantially all of Paladin's oil and gas property,
including, among other things, "any interests related to insurance
policies that may be in place to cover any liability outlined in or
related to" the environmental obligations assumed by Plaintiff, and
"[a]ll Claims arising from acts, omissions or events, or damage to
or destruction of" such property "whether on or after the Effective
Date, and all related rights, titles, claims and interests of"
Paladin.
In February 2017, saltwater spills occurred at two of Paladin's
well sites in New Mexico (Spill A). On June 11, 2017, a spill
occurred at another Paladin well site in New Mexico (Spill B).
Paladin's damage claim for Spill A was settled but Defendant denied
coverage for Spill B.
The magistrate holds that the undisputed evidence shows that
Plaintiff reported Spill B under the Pogo Policy to Defendant more
than three years after the spill. The "Pollution clean-up costs"
provision provides clearly and unambiguously that compliance with
the 90-day notice requirement is a condition of coverage. Because
strict compliance with this notice provision is required, and it is
undisputed that Plaintiff failed to comply with this requirement,
the summary judgment evidence would not permit a reasonable trier
of fact to find that Defendant breached the Pogo Policy by denying
coverage for pollution clean-up costs, the magistrate says. Because
it has met its summary judgment burden to show a failure of proof
regarding the breach of the Pogo Policy, its motion on this claim
is granted. Plaintiff has failed to meet its burden, and its motion
for summary judgment on this claim is denied, the magistrate adds.
The magistrate holds that Plaintiff is not entitled to pollution
clean-up costs coverage under the Pogo Policy for Spill B. Even
though Spill B occurred in 2017, the summary judgment evidence
shows that Plaintiff did not submit a claim under the Pogo Policy
until on or about August 18, 2020, and that a month after the
formal claim under the Pogo Policy was submitted, Defendant denied
the claim in a letter to Plaintiff dated September 18, 2020.
Plaintiff fails to explain how this time line of events evinces the
extreme conduct necessary for bad faith where an insurance claim
has been properly denied, the magistrate adds. The majority of
Plaintiff's bad faith allegations concern its claim for Spill B
under the Paladin Policy, and are relevant to its
separately-asserted claims for bad faith under the Paladin Policy.
The magistrate also holds that Plaintiff fails to allege or provide
summary judgment evidence to raise a genuine issue of fact that it
suffered an injury independent of its policy claim under the Pogo
Policy because of extreme conduct by Defendant.
The magistrate finds that Plaintiff is entitled to summary judgment
on the liability portion of its breach of contract claim under the
Paladin Policy. Plaintiff's claims for breach of contract,
declaratory judgment, and bad faith under the Pogo Policy are
dismissed with prejudice. Remaining for trial are Plaintiff's
claims under the Paladin Policy for declaratory judgment and bad
faith, as well as the issue of damages for the breach of contract
claim.
A full-text copy of the Memorandum Opinion and Order dated January
31, 2022, is available at https://tinyurl.com/bdcny6d4 from
Leagle.com.
About Paladin Energy
Paladin Energy Corp. sought chapter 11 protection (Bankr. N.D.
Tex.
Case No. 16-31590) on Apr. 21, 2016. The Debtor is represented by
Davor Rukavina, Esq., at Munsch, Hardt, Kopf & Harr, P.C., in
Dallas, Texas. The Debtor estimated assets ranging from $10
million to $50 million and estimated debts ranging from $10
million
to $50 million.
PANHANDLE PAWN: Seeks to Hire Bruner Wright as Legal Counsel
------------------------------------------------------------
Panhandle Pawn & Gun, LLC seeks approval from the U.S. Bankruptcy
Court for the Northern District of Florida to employ Bruner Wright,
P.A. to serve as legal counsel in its Chapter 11 case.
The firm's hourly rates are as follows:
Robert Bruner, Esq. $400 per hour
Byron Wright III, Esq. $300 per hour
Paralegal $150 per hour
Bruner Wright was paid a retainer of $14,500, of which $1,020 was
used to pay the firm's pre-bankruptcy services while $1,738 was
used to pay the filing fee.
Byron Wright III, Esq., the firm's attorney who will be providing
the services, disclosed in a court filing that he does not
represent any interests directly adverse to the Debtor.
The firm can be reached through:
Byron Wright III, Esq.
Bruner Wright, P.A.
2810 Remington Green Circle
Tallahassee, FL 32308
Office: (850) 385-0342
Email: twright@brunerwright.com
About Panhandle Pawn & Gun
Panhandle Pawn & Gun, LLC filed its voluntary petition for relief
under Chapter 11 of the Bankruptcy Code (Bankr. N.D. Fla. Case No.
22-50007) on Jan. 26, 2022. At the time of filing, the Debtor
estimated $500,001 to $1 million in both assets and liabilities.
Byron Wright, III, Esq, at Bruner Wright, P.A. serves as the
Debtor's counsel.
PANIOLO CABLE: March 1 Hearing in Suit vs. Sandwich Isles
---------------------------------------------------------
On December 17, 2021, the U.S. Bankruptcy Court for the District of
Hawaii issued a Recommendation to Withdraw Reference regarding the
United States' Motion to Quash Pau Loa Ventures, Inc.'s Writ of
Execution in the case captioned MICHAEL KATZENSTEIN, as Chapter 11
Trustee, Plaintiff, v. SANDWICH ISLES COMMUNICATIONS, INC.,
Defendant, Civ. No. 21-00499 JMS-WRP (D. Hawaii). No party has
objected to the Recommendation, and the court agrees that the
reference should be withdrawn and decided by the District Court.
Accordingly, Chief District Judge J. Michael Seabright adopts the
Recommendation to withdraw the reference.
The Motion to Quash is fully briefed. Accordingly, the court sets a
hearing on the Motion for March 1, 2022 at 9:00 a.m. Given the
current public health crisis, the court will notify the parties in
due course whether the hearing will be in person, by video
conference, or whether -- after review of the filings -- the court
will submit the matter without the hearing under Local Rule
7.1(c).
A full-text copy of the Order dated January 31, 2022, is available
at https://tinyurl.com/2p85fy7r from Leagle.com.
About Paniolo Cable Company
Paniolo Cable Company, LLC, owns a fiber optic network connecting
five major Hawaiian Islands.
Paniolo Cable Company filed a Chapter 11 petition (Bankr. D.
Hawaii
Case No. 18-01319) on Nov. 13, 2018, and was represented by Andrew
V. Beaman, Esq., in Honolulu, Hawaii.
Michael Katzenstein was appointed as the Chapter 11 Trustee of
Paniolo Cable Company. Ducera Partners LLC is the Trustee's
investment banker.
PB-6 LLC: Agoura Hills to Provide $1.15M Financing Facility
-----------------------------------------------------------
PB-6 LLC, a California limited liability Company, submitted a
Second Amended Disclosure Statement describing its First Amended
Chapter 11 Plan dated Feb. 8, 2022.
This is a reorganizing plan. In other words, the Debtor seeks to
accomplish payments under the Plan by a new value contribution,
periodic payments and a $1,150,000 financing facility from Agoura
Hills Financial. The Effective Date of the proposed Plan is 30
days after the Bankruptcy Court enters the Order approving the
Debtor's chapter 11 plan.
Class 2 consists of the Secured Claim of Fundrise Lending, LLC.
Alleged claim amount is approximately $4,658,371, claimant has not
yet filed a Proof of Claim. The Debtor is informed and believes
that Fundrise asserts a pre-Petition claim in the approximate
amount of $4,658,371.01; but that Fundrise maintains a reserve of
$1,000,000 and that certain payments made to, or on behalf of,
Fundrise are recoverable by the estate as avoidable transfers;
therefore, the claim amount shall be determined via agreement
between the Debtor and Fundrise or the Bankruptcy Court.
Like in the prior iteration of the Plan, general unsecured
claimants shall be paid a total of 100% of their allowed claims,
with no interest, on the first day of the 40th month after the
Effective Date of the Plan.
The Plan will be funded by the following: $50,000.00 new value
contribution by the Debtor's members in proportion to their
ownership interests. The Debtor's members shall also make payments
to secured classes 1 and 2 as they come due. The $50,000
contribution and payments to classes 1 and 2 shall constitute the
new value contributions by Class 4 interest holders.
The Agoura Facility is sufficient to pay for Los Angeles Unified
School District development fees and obtain permits for completion
of the homes, (including all developer fees) complete the
foundation work, sewer tie-ins, underground plumbing and
electrical. As a result of the use of the Agoura Facility, Colfax
Villas will consist of home ready pads and a significant increase
in value of the Debtor's asset.
A full-text copy of the Second Amended Disclosure Statement dated
Feb. 8, 2022, is available at https://bit.ly/3JilKkB from
PacerMonitor.com at no charge.
Attorneys for Debtor:
JEFFREY S. SHINBROT, ESQ.
(SBN 155486)
jeffrey@shinbrotfirm.com
JEFFREY S. SHINBROT, APLC
15260 Ventura Blvd., Suite 1200
Sherman Oaks, CA 91403
Telephone: (310) 659-5444
Fax: (310) 878-8304
About PB 6 LLC
PB 6, LLC, a privately held company in Newbury Park, Calif., sought
protection under Chapter 11 of the Bankruptcy Code (Bankr. C.D.
Cal. Case No. 21-10293) on Feb. 23, 2021. At the time of the
filing, the Debtor disclosed assets of between $1 million and $10
million and liabilities of the same range. Judge Maureen Tighe
oversees the case. Jeffrey S. Shinbrot, APLC is the Debtor's
counsel.
PENN TRAFFIC: Dismissal of Syracuse Fund's Claim vs C&S Affirmed
----------------------------------------------------------------
The appellate case styled NEW YORK STATE TEAMSTERS CONFERENCE
PENSION AND RETIREMENT FUND, by its Trustees, Michael S. Scalzo,
Sr., John Bulgaro, Daniel W. Schmidt, Tom J. Ventura, Bob
Schaeffer, Brian Hammond, Mark May and Paul Markwitz,
Plaintiff-Appellant, v. C&S WHOLESALE GROCERS, INC.,
Defendant-Appellee, No. 20-1185-cv (2d Cir.), presents four
questions:
(1) whether the United States District Court for the Northern
District of New York (Frederick J. Scullin, Jr., Judge) erred in
dismissing the claim of Plaintiff New York State Teamsters
Conference Pension and Retirement Fund that Defendant C&S Wholesale
Grocers "evaded and avoided" withdrawal liability under the
Employee Retirement Income Security Act;
(2) whether the District Court erred in dismissing the Fund's
claim that C&S was subject to withdrawal liability under a theory
of "common control";
(3) whether the District Court erred in not finding that C&S was
subject to withdrawal liability as an "employer"; and
(4) whether the District Court erred in granting C&S's motion
for summary judgment on the Fund's claim that C&S was subject to
withdrawal liability as a "successor" under the
"substantial-continuity doctrine."
Penn Traffic Company operated two warehouses -- one in Syracuse and
one in DuBois, Pennsylvania. At its Syracuse warehouse, Penn
Traffic employed approximately 450 members of the Teamsters Local
317 union under a collective bargaining agreement that required
Penn Traffic to contribute to the Fund. The Fund, the
Plaintiff-Appellant in this action, is organized as a
"multiemployer plan" regulated by ERISA, under which Penn Traffic
was subject to significant "withdrawal liability" if it ceased to
make contributions. Briefly, if Penn Traffic "withdrew" from the
Fund by ceasing to make contributions to it, Penn Traffic was
liable to the Fund for its share of the Fund's unfunded vested
benefits.
In March 2008, C&S began investigating a possible acquisition of
Penn Traffic. C&S did not want to acquire Penn Traffic's Syracuse
warehouse because of the pension withdrawal liability associated
with it. C&S therefore attempted to structure its $43 million
acquisition transaction, executed in December 2008, in such a way
as to limit its exposure to that liability: C&S acquired "Penn
Traffic's wholesale distribution contracts, customers, equipment,
files, records, goodwill, intellectual property, accounts
receivable, and employees dedicated to Penn Traffic's wholesale
distribution division who were not members of Teamsters Local 317."
And C&S did not purchase the Syracuse warehouse.
Following the transaction, Penn Traffic continued to run its
Syracuse warehouse and distributed products to both its own stores
and the independent stores that were now C&S customers based on the
December 2008 transaction. This activity was governed by a
third-party logistics agreement that created an independent
contractor relationship between Penn Traffic and C&S. Penn Traffic
retained responsibility for "all employees, [f]acility and storage
leases, material handling and transportation equipment, contracts
and all other liabilities associated with" the Syracuse warehouse.
The Logistics Agreement made clear that Penn Traffic was still
responsible for employees at the Syracuse warehouse.
After Penn Traffic filed for protection under Chapter 11 of the
Bankruptcy Code, C&S purchased the DuBois warehouse. A Penn Traffic
competitor and longtime C&S client purchased many of Penn Traffic's
retail stores. The Syracuse warehouse closed in May 2010,
triggering the claimed withdrawal liability for which the Fund
filed a $63.6 million claim in Penn Traffic's bankruptcy
proceeding. The bankruptcy estate was able to cover only $5 million
of that amount. The Fund then sought the remainder of the
withdrawal liability -- about $58 million -- from C&S in this
action, alleging various theories under which Penn Traffic's
withdrawal liability was either transferred to, or jointly shared
with, C&S.
A three-judge panel composed of Judges Cabranes, Raggi, and Carney
of the United States Court of Appeals for the Second Circuit holds
that the District Court did not err in dismissing the claims based
on the first two liability theories or in failing to find that C&S
was an "employer." The Second Circuit also holds that while a
"successor" can be subject to withdrawal liability under ERISA, the
District Court, in the circumstances presented here, did not err in
granting the Defendant's motion for summary judgment as to that
claim. Accordingly, the Second Circuit affirms the District Court's
order and judgment.
Withdrawal Liability
The Fund argues C&S acted intentionally to "evade or avoid"
withdrawal liability by structuring its 2008 acquisition of Penn
Traffic's distribution business in such a way as to never assume
control of the Syracuse warehouse or its employees. According to
the Fund, C&S can therefore be held liable under 29 U.S.C. Section
1392(c), a provision of the MPPAA which establishes
"evade-or-avoid" liability.
The Second Circuit agrees with what the First Circuit has held in a
similar context: that Section 1392 "requires courts to put the
parties in the same situation as if the offending transaction never
occurred; that is, to erase that transaction. It does not, by
contrast, instruct or permit a court to take the affirmative step
of writing in new terms to a transaction or to create a transaction
that never existed."
This is not to say that non-employers cannot be liable for
withdrawal liability under an "evade or avoid" theory simply
because they were not the original employer subject to that
liability. UE AFL-CIO Pension Fund v. Herrmann and the law of the
Circuit are clearly to the contrary, Circuit Judge Jose A.
Cabranes, who writes the opinion, says. But it is the exceptional
circumstance -- involving fraud, or an employer who is otherwise
working with a non-employer to make recovery on withdrawal
liability unavailable -- that brings the collaborating employers
and non-employers together "within the reach" of Section 1392.
A non-employer cannot be said to evade or avoid liability merely by
declining to assume that liability in the first place. To hold
otherwise would be to paradoxically and imprudently encumber with
liability the perfectly sensible business decision precisely not to
purchase an encumbered asset. The District Court therefore properly
dismissed the Fund's claim for "evade or avoid" liability.
Common Control Liability
The Fund argues separately that Penn Traffic and C&S were under
"common control," and that C&S is therefore liable for withdrawal
liability.
Reviewing the Fund's amended complaint, the Second Circuit finds
nothing to suggest that Penn Traffic and C&S satisfied any part of
this regulatory definition for common control. In fact, the Fund
does not plead that C&S and Penn Traffic had any common owners.
The Second Circuit agrees with the District Court that the Fund has
"not even remotely" pleaded facts that would sustain a claim under
Section 1301(b). The District Court was therefore correct to
dismiss the "common control" count.
Employer Liability
Next, the Fund argues C&S used its Logistics Agreement as a
"subterfuge" to mask the fact that it was actually the "employer"
of the Syracuse warehouse Teamsters, and that C&S is therefore
subject to withdrawal liability.
According to Circuit Judge Cabranes, at the outset, it is important
to distinguish this argument from the fourth count of the Fund's
amended complaint. Under that count, the Fund argued that C&S was
subject to withdrawal liability as an "employer" under the "joint
employer" doctrine, and the District Court dismissed that count
under Rule 12(b)(6) in its May 1, 2017 order. On appeal, the Fund
abandons that argument and the associated count of its amended
complaint.
By contrast, the Fund first articulated a version of its
"subterfuge" argument in its opposition to C&S's motion for summary
judgment. Therefore, on appeal, the "subterfuge" argument can only
be properly understood as an appeal of some error made by the
District Court in its summary judgment order of March 18, 2020,
even though that order dealt only with the "successor" liability
count of the amended complaint (the District Court having already
dismissed the other three counts). In effect, therefore, the Fund
in its "subterfuge" argument attempts to shoe-horn an "employer"
theory of liability (that might have been more appropriate under
the dismissed and abandoned fourth count of the Fund's amended
complaint, or under a separate count entirely) into its appeal of
the District Court's treatment of the separate but sole-surviving
first count of its amended complaint, i.e., successor liability,
the Second Circuit says.
The Fund submits that because agreements such as the Logistics
Agreement were "not part of the ordinary course of C&S's business,"
the agreement was therefore the type of "subterfuge" contemplated
in the Circuit Court's footnote in Division 1181 A.T.U.-New York
Employees Pension Fund By Cordiello v. City of New York Department
of Education. This somewhat vague suggestion runs up against the
Circuit Court's actual holding in Division 1181, and solid caselaw
from its sister circuits more broadly, that an obligation to
reimburse an independent contractor for contributions to a pension
plan is not the same as an obligation to contribute directly to
that plan: "[R]eimbursement and contribution are distinct concepts
under the MPPAA" and therefore "no obligation to contribute" to a
multiemployer pension plan "aris[es] under . . . contracts" that
require non-employers to reimburse an employer's contributions
under such a plan, Circuit Judge Cabranes says.
C&S entered into a well-recognized form of contractual agreement in
which C&S reimbursed Penn Traffic for certain expenses that Penn
Traffic incurred as an independent contractor operating the
Syracuse warehouse. The fact of a reimbursement arrangement alone
-- even for a company that may not frequently enter into such
arrangements -- does not a "subterfuge" make, the Second Circuit
holds.
In sum, the Fund failed to allege that C&S was an "employer" based
on its "subterfuge" theory, and the District Court committed no
error in this regard.
Successor Liability
The Fund's final theory of liability is that, based on its
acquisition of Penn Traffic's wholesale and distribution business,
C&S was the "successor" to Penn Traffic and therefore C&S assumed
Penn Traffic's withdrawal liability. In allowing this theory to
proceed past the motion-to-dismiss stage, the District Court held
that successor liability could apply to withdrawal liability under
ERISA.
The Second Circuit has previously applied successor liability to
delinquent pension fund contributions under ERISA. In Stotter
Division of Graduate Plastics Co. v. District 65, the Second
Circuit considered the purchase of the assets of one plastic goods
manufacturer ("Stotter") by another ("GPC"). The district court
applied the Supreme Court's decision in John Wiley & Sons, Inc. v.
Livingston, which held that an arbitration provision in a
predecessor's CBA was enforceable against a successor where there
was "substantial continuity of identity in the business
enterprise." The district court held that successor liability had
therefore been properly applied to Stotter's delinquent ERISA
contributions, and the Second Circuit affirmed
To be sure, the facts presented in Stotter differ from those
presented here, Judge Cabranes notes. Most importantly, and as C&S
emphasizes, GPC had agreed to be bound by Stotter's CBA. Still, the
logic of Stotter rested on Wiley, in which the successor had not
agreed to be bound by the predecessor's CBA -- indeed, Wiley stands
for the very proposition that a successor "which did not itself
sign the collective bargaining agreement on which [a] [u]nion's
claim to arbitration depends" can still be "bound" by that
arbitration provision. Based on Stotter, at a minimum, the Second
Circuit says it is confident that ERISA is precisely the sort of
statute -- embodying the sort of federal labor relations policy
goals -- to which the successor liability doctrine can legitimately
apply.
But the Second Circuit has never held that successor liability can
be applied to withdrawal liability under ERISA. Both the Seventh
and Ninth Circuits have considered that question squarely, and both
have concluded that it can.
The Second Circuit sees no reason why the successorship doctrine
should not apply to withdrawal liability under the Multiemployer
Pension Plan Amendments Act just as it does to the obligation to
make delinquent ERISA contributions. The primary reason for making
a successor responsible for its predecessor's delinquent ERISA
contributions is that, absent the imposition of successor
liability, present and future employer participants in the union
pension plan will bear the burden of the predecessor's failure to
pay its share, which will threaten the health of the plan while the
successor reaps a windfall. That rationale applies with equal, if
not greater, force to a predecessor's MPPAA withdrawal liability.
Relying on its decision in Stotter and persuaded by the rationale
of Resilient Floor, the District Court, in its May 1, 2017 order,
held that "the theory of successor liability is applicable to
withdrawal liability under ERISA," the Second Circuit agrees.
As to the continuity of workforce and management, the record
demonstrates that C&S did not acquire any of the relevant Union
employees from Penn Traffic (because they remained employed by Penn
Traffic). Similarly, as to the continuity of facilities and
equipment, C&S did not acquire the Syracuse warehouse or the
equipment there. And as to the continuity of customers, it is
enough to note -- and Penn Traffic does not materially dispute --
that about 70% of the volume of product distributed by Penn Traffic
from the Syracuse warehouse was to Penn Traffic's own retail
stores, not to the wholesale customers acquired by C&S. This is a
large enough majority, for the purpose of a substantial continuity
analysis, to tip the customer continuity question in C&S's favor.
In other words, given the structure of the 2008 transaction, we
agree with the District Court's conclusion that C&S did not
"substantially continue" Penn Traffic's business.
Finally, even if, as the Fund suggests, 30% of the customers
receiving groceries from the warehouse were, after the 2008
transaction, buying those groceries from C&S, this does not tip the
balance back towards substantial continuity, the Second Circuit
says. Penn Traffic was still performing the warehousing and
distribution of C&S's groceries for those customers, which is the
relevant "business" to consider with reference to the Syracuse
warehouse and its Union employees.
In sum, then, C&S did not take over any significant part of -- much
less "substantially continue" -- Penn Traffic's relevant business:
the Syracuse warehouse or the employment of its Union employees.
C&S therefore is not subject to Penn Traffic's withdrawal liability
under a theory of successor liability.
A full-text copy of the Opinion dated January 27, 2022, is
available at https://tinyurl.com/2p8k3r66 from Leagle.com.
EDWARD J. MEEHAN -- emeehan@groom.com -- (Mark C. Neilsen --
mnielsen@groom.com -- Samuel I. Levin -- slevin@groom.com -- on the
brief), Groom Law Group, Chartered, Washington, D.C. ( Vincent M.
DeBella , Paravati, Karl, Green & DeBella, LLP, Utica, NY, on the
brief), for Plaintiff-Appellant.
YAAKOV M. ROTH -- yroth@jonesday.com -- (Evan Miller --
emiller@jonesday.com -- Stephen J. Petrany, on the brief), Jones
Day, Washington, D.C., for Defendant-Appellee.
About Penn Traffic
Syracuse, New York-based The Penn Traffic Company -- dba P&C
Foods, Bi-Lo Foods, and Quality Markets -- operates supermarkets
in Pennsylvania, upstate New York, Vermont, and New Hampshire
under the Bilo, P&C and Quality trade names. The Company filed
for Chapter 11 bankruptcy protection on November 18, 2009 (Bankr.
D. Del. Case No. 09-14078). Ann C. Cordo, Esq., and Gregory W.
Werkheiser, Esq., at Morris, Nichols, Arsht & Tunnell assist the
Company in its restructuring effort. Donlin Recano is the
Company's claims agent. The Company disclosed $150,347,730 in
assets and $136,874,394 in liabilities as of May 4, 2009.
The Company's affiliates also filed separate Chapter 11 petitions
-- Sunrise Properties, Inc.; Pennway Express, Inc.; Penny Curtiss
Baking Company, Inc.; Big M Supermarkets, Inc.; Commander Foods
Inc.; P and C Food Markets, Inc. of Vermont; and P.T. Development,
LLC.
Following a bankruptcy court-sanctioned auction, Tops Markets LLC
purchased almost all of Penn Traffic's stores as a going concern
by paying $85 million cash. The sale was structured so Penn
Traffic avoided a $72 million claim for pension plan termination
and a $27 million claim by the principal supplier.
On Oct. 29, 2010, the U.S. Bankruptcy Court for the District of
Delaware entered an order confirming the Company's Chapter 11 plan
of liquidation, which became effective on Nov. 1, 2010. On the
effective date of the Plan, all existing equity interests in the
Company, including the Preferred Stock and the Common Stock, were
canceled and extinguished without consideration.
PG&E CORP: District Court Junks PwC Appeal from Subpoena
--------------------------------------------------------
In the Chapter 11 case of PG&E Corporation, Judge Haywood S.
Gilliam, Jr., of the United States District Court for the Northern
District of California denies PricewaterhouseCoopers LLP's motion
for leave to appeal an order of the Bankruptcy Court that compels
PwC to comply with a subpoena.
In March 2020, before PG&E's bankruptcy-exit plan was confirmed,
the Official Committee of Tort Claimants served a subpoena on PwC
in accordance with Fed. R. Bankr. P. 2004, demanding production of
certain documents. After the Plan was confirmed, the Bankruptcy
Court ordered that the Fire Victim Trust, through its Trustee,
assume the TCC's rights and responsibilities to enforce the Rule
2004 Subpoena.
PwC objected to the Rule 2004 Subpoena on overbreadth, burden, and
privilege grounds, which resulted in several discovery conferences
before the Bankruptcy Court. On August 11, 2021, the Bankruptcy
Court entered an order compelling PwC to comply with the Rule 2004
Subpoena and produce certain categories of documents requested by
the Trustee. The August 11 Order also directed the parties to
submit letter briefs regarding the Trustee's request for PwC's
documents "relating to the General Rate Case, meaning PwC's work
product generated in connection with that engagement, including
advice, recommendations, analysis, and/or reports to PG&E, during
the time period 2013 through March 17, 2020."
On August 24, 2021, the Bankruptcy Court entered an order
compelling PwC to produce the GRC Documents. Shortly afterwards,
PwC filed a motion for leave to appeal the August 24 Order and a
motion for stay pending appeal. The Bankruptcy Court denied PwC's
Motion for Stay and directed PwC to comply with its August 24
Order.
According to Judge Gilliam, for the Court to hear PwC's appeal one
of two conditions must be met. Either the August 24 Order is a
final order appealable as of right, or this Court must, in its
discretion, grant leave to appeal an interlocutory order. Because
neither of these conditions is met, the Court declines to hear
PwC's appeal.
Judge Gilliam notes that the August 24 Order is not a final order
that PwC may appeal as of right. Rather, it is a run-of-the-mill
discovery order that compels the production of documents but does
not resolve or seriously affect substantive rights.
Judge Gilliam also holds there is no basis to grant interlocutory
review because PwC's appeal plainly does not raise a controlling
question of law as to which a substantial ground of difference of
opinion exists, Judge Gilliam adds. A substantial ground for
difference of opinion exists, for instance, "where the circuits are
in dispute on the question and the court of appeals of the circuit
has not spoken on the point, if complicated questions arise under
foreign law, or if novel and difficult questions of first
impression are presented," the judge points out, citing Couch v.
Telescope Inc., 611 F.3d 629, 633 (9th Cir. 2010). PwC's challenge,
by contrast, clearly turns on the granular and fact-intensive (but
entirely routine) question of whether the documents sought are
sufficiently related to the alleged substantive claims to be
discoverable. And far from serving judicial economy, granting PwC
leave to appeal would further delay an already prolonged discovery
dispute, Judge Gilliam holds. In short, this ordinary discovery
dispute does not present the kind of "exceptional circumstance"
that warrants interlocutory review. The Court accordingly declines
to exercise its discretion to hear PwC's appeal.
A full-text copy of the Order dated February 2, 2022, is available
at https://tinyurl.com/mr38zfs5 from Leagle.com.
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.
PHOENIX PROPERTIES: Files Emergency Bid to Use Cash Collateral
--------------------------------------------------------------
Phoenix Properties of Savannah, LLC asks the U.S. Bankruptcy Court
for the Southern District of Georgia, Savannah Division, for
authority to use cash collateral and for approval of monies already
spent.
The Debtor requires the use of cash collateral to pay its employees
and fund the cost of necessary repairs.
Wilmington Savings Fund Society, FSB, d/b/a Christiana Trust,
solely as Trustee of Cherrywood SB Commercial Mortgage Loan Trust
2016-1, is the holder of a first in priority Deed to Secure Debt in
and to 36 parcels of residential real property located in Savannah,
Chatham County, Georgia, all of which are owned by the Debtor.
About 29 of the Properties are currently being rented. The rents
are cash collateral belonging to Wilmington Savings.
Since the petition date, the Debtor has used cash collateral to pay
necessary expenses related to the Properties which amounted to
$8,856.
The Debtor requests the Court to grant retroactive approval for
these payments the same as if authorized in advance.
The Debtor asserts that authorization for the use of cash
collateral will not prejudice Wilmington, whose interest is
adequately protected by the value of its collateral which the
Debtor believes to be not less than $5,700,000. Further, the
balance on deposit in the fiduciary account containing collected
rents (as of February 8, 2022), is $182,795.
A copy of the motion is available at https://bit.ly/3szpJCB from
PacerMonitor.com.
About Phoenix Properties of Savannah
Phoenix Properties of Savannah, LLC is a Savannah, Ga.-based
company engaged in renting and leasing real estate properties.
Phoenix Properties of Savannah filed a petition for Chapter 11
protection (Bankr. S.D. Ga. Case No. 21-40785) on Dec. 2, 2021,
listing as much as $10 million in both assets and liabilities.
Judge Edward J. Coleman, III oversees the case.
James L. Drake, Jr., PC serves as the Debtor's legal counsel.
PLATINUM GROUP: Franklin Resources, et al. Own 13.1% Equity Stake
-----------------------------------------------------------------
Franklin Resources, Inc., Charles B. Johnson, Rupert H. Johnson,
Jr., and Franklin Advisers, Inc. disclosed in a Schedule 13G/A
filed with the Securities and Exchange Commission that as of Dec.
31, 2021, they beneficially own 10,072,900 common shares of
Platinum Group Metals Ltd., representing 13.1 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/38777/000003877722000052/plat21a10.htm
About Platinum Group Metals
Headquartered in British Columbia, Canada, Platinum Group Metals
Ltd. -- http://www.platinumgroupmetals.net-- is a platinum and
palladium focused exploration, development and operating company
conducting work primarily on mineral properties it has staked or
acquired by way of option agreements or applications in the
Republic of South Africa and in Canada.
Platinum Group reported a loss of $13.06 million for the year ended
Aug. 31, 2021, a loss of $7.13 million for the year ended Aug. 31,
2020, and a loss of $16.78 million for the year ended Aug. 31,
2019.
PLAYA HOTELS: Goldman Sachs Entities Own 7.3% of Ordinary Shares
----------------------------------------------------------------
The Goldman Sachs Group, Inc. and Goldman Sachs & Co. LLC disclosed
in a Schedule 13G filed with the Securities and Exchange Commission
that as of Dec.31, 2021, they beneficially own 12,016,713 ordinary
shares of Playa Hotels & Resorts N.V., representing 7.3 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/1692412/000076999322000129/PLAYA_HOTELS.txt
About Playa Hotels & Resorts
Playa Hotels & Resorts is an owner, operator and developer of
all-inclusive resorts in prime beachfront locations in popular
vacation destinations in Mexico and the Caribbean. As of Sept. 30,
2021, Playa owned and/or managed a total portfolio consisting of 22
resorts (8,366 rooms) located in Mexico, Jamaica, and the Dominican
Republic. In Mexico, Playa owns and manages Hyatt Zilara Cancun,
Hyatt Ziva Cancun, Panama Jack Resorts Cancun, Panama Jack Resorts
Playa del Carmen, Hilton Playa del Carmen All-Inclusive Resort,
Hyatt Ziva Puerto Vallarta, and Hyatt Ziva Los Cabos. In Jamaica,
Playa owns and manages Hyatt Zilara Rose Hall, Hyatt Ziva Rose
Hall, Hilton Rose Hall Resort & Spa, Jewel Grande Montego Bay
Resort & Spa and Jewel Paradise Cove Beach Resort & Spa. In the
Dominican Republic, Playa owns and manages the Hilton La Romana
All-Inclusive Family Resort, the Hilton La Romana All-Inclusive
Adult Resort, Hyatt Zilara Cap Cana and Hyatt Ziva Cap Cana.
Playaowns two resorts in the Dominican Republic that are managed by
a third-party and manages five resorts on behalf of third-party
owners.
Playa reported a net loss of $262.37 million for the year ended
Dec. 31, 2020, compared to a net loss of $4.36 million for the year
ended Dec. 31, 2019. As of Sept. 30, 2021, the Company had $2.02
billion in total assets, $1.39 billion in total liabilities, and
$623.95 million in total shareholders' equity.
* * *
As reported by the TCR on Sept. 21, 2021, S&P Global Ratings
revised its outlook on Playa Hotels & Resorts N.V. to positive from
negative and affirmed its 'CCC+' issuer credit rating. At the same
time, S&P affirmed its 'CCC+' issue-level rating on the company's
secured debt. S&P said, "The positive outlook reflects our
expectation that Playa will maintain adequate liquidity. In
addition, it indicates that we could raise our rating on the
company if the significant recent improvement in travel volumes to
Mexico and the Caribbean is sustained and its package average daily
rates (ADRs), which are currently significantly elevated relative
to 2019 levels, do not moderate materially. Specifically, we could
raise our rating if Playa increases its revenue and EBITDA such
that it sustains EBITDA coverage of interest expense of more than
1.5x, which would indicate it is able to sustain its capital
structure over the long term."
PLAYA HOTELS: Wellington Entities Report 6.07% Equity Stake
-----------------------------------------------------------
In a Schedule 13G filed with the Securities and Exchange
Commission, these entities and individuals reported beneficial
ownership of shares of common stock of Playa Hotels & Resorts N.V.
as of Dec. 31, 2021:
Shares
Percent
Beneficially of
Reporting Person Owned
Class
---------------- ------------
--------
Wellington Management Group LLP 9,964,247
6.07%
Wellington Group Holdings LLP 9,964,247
6.07%
Wellington Investment Advisors Holdings LLP 9,964,247
6.07%
Wellington Management Company LLP 9,055,931
5.51%
A full-text copy of the regulatory filing is available for free
at:
https://www.sec.gov/Archives/edgar/data/902219/000167885822000090/SEC13G_Filing.htm
About Playa Hotels & Resorts
Playa Hotels & Resorts is an owner, operator and developer of
all-inclusive resorts in prime beachfront locations in popular
vacation destinations in Mexico and the Caribbean. As of Sept. 30,
2021, Playa owned and/or managed a total portfolio consisting of 22
resorts (8,366 rooms) located in Mexico, Jamaica, and the Dominican
Republic. In Mexico, Playa owns and manages Hyatt Zilara Cancun,
Hyatt Ziva Cancun, Panama Jack Resorts Cancun, Panama Jack Resorts
Playa del Carmen, Hilton Playa del Carmen All-Inclusive Resort,
Hyatt Ziva Puerto Vallarta, and Hyatt Ziva Los Cabos. In Jamaica,
Playa owns and manages Hyatt Zilara Rose Hall, Hyatt Ziva Rose
Hall, Hilton Rose Hall Resort & Spa, Jewel Grande Montego Bay
Resort & Spa and Jewel Paradise Cove Beach Resort & Spa. In the
Dominican Republic, Playa owns and manages the Hilton La Romana
All-Inclusive Family Resort, the Hilton La Romana All-Inclusive
Adult Resort, Hyatt Zilara Cap Cana and Hyatt Ziva Cap Cana.
Playaowns two resorts in the Dominican Republic that are managed by
a third-party and manages five resorts on behalf of third-party
owners.
Playa reported a net loss of $262.37 million for the year ended
Dec. 31, 2020, compared to a net loss of $4.36 million for the year
ended Dec. 31, 2019. As of Sept. 30, 2021, the Company had $2.02
billion in total assets, $1.39 billion in total liabilities, and
$623.95 million in total shareholders' equity.
* * *
As reported by the TCR on Sept. 21, 2021, S&P Global Ratings
revised its outlook on Playa Hotels & Resorts N.V. to positive
from
negative and affirmed its 'CCC+' issuer credit rating. At the same
time, S&P affirmed its 'CCC+' issue-level rating on the company's
secured debt. S&P said, "The positive outlook reflects our
expectation that Playa will maintain adequate liquidity. In
addition, it indicates that we could raise our rating on the
company if the significant recent improvement in travel volumes to
Mexico and the Caribbean is sustained and its package average daily
rates (ADRs), which are currently significantly elevated relative
to 2019 levels, do not moderate materially. Specifically, we could
raise our rating if Playa increases its revenue and EBITDA such
that it sustains EBITDA coverage of interest expense of more than
1.5x, which would indicate it is able to sustain its capital
structure over the long term."
PLAYER'S POKER: Obtains Court OK to Reject Hofer Lease
------------------------------------------------------
Player's Poker Club, Inc., filed a motion for approval of its
rejection, under Bankruptcy Code section 365(a), of a
nonresidential real property lease and parking area license under
which Hofer Properties, LLC, is the lessor and licensor. The Debtor
requests approval of the rejection as of the petition date, or,
alternatively, the day after the petition date, which is when the
Debtor filed the Motion. In other words, the Debtor requests an
order with retroactive effect, i.e., on a date prior to when the
Motion is granted and an order is entered by the court.
Hofer objects to the Motion, arguing that rejection of the lease
and license lacks a reasonable business justification. Hofer also
argues the Debtor improperly filed this case in bad faith, for the
sole purpose of rejecting the Hofer Lease and License.
The Court held a hearing and approved the Motion in open court. In
a Memorandum Of Decision, Judge Martin R. Barash of the United
States Bankruptcy Court for the Central District of California,
Northern Division, explains that the Debtor's decision to reject
the Hofer Lease and License under Bankruptcy Code section 365(a)
constitutes an appropriate exercise of business judgment, which the
court will not disturb. Judge Barash notes that the court on the
record is unable to conclude that the Debtor's rejection of the
Hofer Lease and License was manifestly unreasonable or based on bad
faith, whim, or caprice. On the petition date, the Debtor not only
had ceased operations at the premises, but vacated those premises,
conducted a walk-through with the landlord, and returned the keys.
Under these circumstances, it makes no business sense not to reject
the Hofer Lease and License and expose the estate to potential
administrative expenses for rent, Judge Barash holds.
Judge Barash also finds that the Court has the authority to grant
retroactive approval of such a rejection, notwithstanding the
Supreme Court's decision in Roman Catholic Archdiocese of San Juan
v. Acevedo Feliciano, 140 S.Ct. 696 (2020) (per curiam). The judge
points out that as a threshold matter, the opinion in Acevedo
Feliciano does not announce any new rule of law. The short,
unsigned opinion applies a well-established limitation on the
inherent powers of a court to use nunc pro tunc relief: i.e., a
court may not use it to create jurisdictional facts that did not
exist at the relevant time, the judge says. This limitation is
reflected in Supreme Court precedents going back over 100 years.
The court, according to Judge Barash, must assume that when the
Ninth Circuit decided In re At Home Corp.: (1) it did so with
knowledge of these precedents and (2) it concluded that they were
not relevant to its analysis. It would be presumptuous -- to say
the least -- for this court to assume otherwise, Judge Barash
holds. Even so, the decision in Acevedo Feliciano is not clearly
inconsistent and is readily reconciled with the decision in In re
At Home Corp., Judge Barash concludes.
Judge Barash further holds that cause exists to enter a nunc pro
tunc order approving the Debtor's rejection of the Hofer Lease and
License, retroactive to the date on which the Motion was filed and
served. Based on the totality of the circumstances, the Court finds
that it would be equitable and appropriate to approve Debtor's
rejection of the Hofer Lease and License nunc pro tunc to April 7,
2021. It is undisputed that on March 31, 2021, the Debtor vacated
the premises, conducted a lease-end walk-through with the
landlord's representative, and returned the keys. The Debtor
commenced its chapter 11 case on April 6, 2021, and filed and
served its Motion requesting approval of its decision to reject on
the following day. On this record, the Court finds the Debtor acted
diligently, and that rejection of the lease should be approved nunc
pro tunc. Although the Debtor requested, in the alternative,
rejection effective as of the petition date, and the court
originally was inclined to use that date, the court is not
persuaded that this is the appropriate date. The date on which the
Debtor filed and served the Motion is the date on which it
communicated its unequivocal intention to reject the Hofer Lease
and License under Bankruptcy Code section 365(a). Of the two
possible dates, the Court concludes that the date on which the
Motion was filed, April 7, 2021, is the most appropriate.
A full-text copy of the decision dated February 4, 2022, is
available at https://tinyurl.com/2p93vvtu from Leagle.com.
About Player's Poker Club
Ventura, Calif.-based Player's Poker Club, Inc. filed a petition
for Chapter 11 protection (Bankr. C.D. Calif. Case No. 21-10357) on
April 6, 2021, listing $3,061,422 in assets and $3,500,852 in
liabilities. Patrick Berry, general manager, signed the petition.
Judge Martin R. Barash oversees the case.
The Debtor tapped Kogan Law Firm APC as bankruptcy counsel, Falk &
Sharp APC as special counsel, and Kallman + Logan & Company LLP and
RubinBrown LLP as accountants.
PREFERRED READY-MIX: Makes Non-Material Changes to Plan
-------------------------------------------------------
Preferred Ready-Mix LLC submitted a First Modification to Plan of
Reorganization Under Subchapter V of Chapter 11.
The changes proposed are neither material nor adverse to any party
and should be made a part of the Plan approved in this case and are
set forth as follows:
Liabilities of the Debtor
According to Debtor's Schedules and the Proof of Claims filed in
this Case, the Debtor's liabilities (excluding Administrative
Expense Claims) total $968,195.97 as of the Petition Date. The
Debtor's liabilities, both Disputed and Undisputed, are summarized
as follows:
a. Administrative Expense Claims. The Estate will be liable for
certain Administrative Expense Claims pursuant to Bankruptcy Code
§503(b) through the Confirmation Date, including Fee Claims of
Joyce W. Lindauer Attorney, PLLC as the Debtor's bankruptcy
counsel, the Sub V Trustee, and $7,000.00 to Robert Berleth (if
Allowed after objection). Before the Debtor pays any Fee Claims,
the Bankruptcy Court will have determined that such Claim should be
Allowed and is reasonableness as to such fees and expenses.
Treatment of Unclassified Claims, Administrative Expense Claims,
Priority Tax Claims, and U.S. Trustee Fees
b. Administrative Expense Claims. Each holder of an Administrative
Expense Claim under Bankruptcy Code § 503 shall receive either:
(i) with respect to Administrative Expense Claims which are Allowed
Claims on the Effective Date, the amount of such holder's Allowed
Claim in one cash payment, within ten (10) days after the Effective
Date, from the Debtor; (ii) with respect to Administrative Expense
Claims which become Allowed Claims after the Effective Date, the
amount of such holder's Allowed Claim, in one cash payment from the
Debtor within ten (10) days after such Claim becomes an Allowed
Administrative Expense Claim; or (iii) such other treatment agreed
upon by the Debtor and such holder. The Plan shall provide for the
submission of all or such portion of the future income of the
Debtor as required to make the payments called for by the Plan to
the supervision and control of the Subchapter V Trustee as is
necessary for the execution of the Plan in the event the Plan is
not determined to be consensual.
Treatment of Classified Claims and Interests Under the Plan
Class 1 Claims: Allowed Secured Claims of Bank Direct Capital
Finance and Wayne C. Tyson in the amount of $56,856.14. All Class 1
Claims shall be paid in full in 60 equal monthly installments of
principal plus interest at the rate of 6.5% per annum. The payments
shall begin on the first day of the first month following the
Effective Date and continue on the first day of each subsequent
month until each Claim is paid in full under the Plan.
This Claimant shall retain its pre-Petition Date Liens securing
these Claims. These Claims are IMPAIRED.
Vesting of Property
On the Confirmation Date of the Plan, all property of the Estate
shall vest in the Debtor pursuant to sections 1141(b) and (c) of
the Bankruptcy Code, free and clear of all Claims and interests
except as otherwise provided in this Plan. If the Debtor defaults
in performing under the provisions of the Plan and the Chapter 11
case is converted to Chapter 7, all property vested in the Debtor
and all subsequently acquired property owned as of or after the
conversion date shall revest and constitute property of the
bankruptcy estate in the Chapter 7 case. This Plan will evidence
the release of any and all Liens or encumbrances against all
property dealt with by the Plan, unless such Lien or encumbrance is
specifically retained in the Plan.
Modification of the Plan
a. Prior to Confirmation. The Debtor may modify this Plan at any
time prior to Confirmation, provided the modification complies with
the requirements of sections 1122 and 1123 of the Bankruptcy Code.
Upon the filing of any such modifications with the Bankruptcy
Court, the Plan, as modified, becomes the Plan.
b. After Confirmation. The Debtor may modify the Plan at any time
after Confirmation. The Debtor or its attorney shall provide notice
of any such proposed modification to all Creditors and other
parties in interest in these Chapter 11 proceedings. If, in the
opinion of the Bankruptcy Court, the modification does not
materially and adversely affect the interest of the Creditors, the
Bankruptcy Court may modify the Plan without notice to Creditors,
or may modify the Plan upon notice only to those Creditors that the
Bankruptcy Court deems to be materially and adversely affected.
Distributions to Creditors by Subchapter V Trustee.
Distributions will be made in accordance with the payment
calculations provided by the Debtor. The Trustee is not responsible
for calculating or correcting the payment amounts due under the
Plan. Within seven (7) business days of the expiration of objection
period applicable to a Quarterly Report, the Subchapter V Trustee
shall disburse such funds received from the Reorganized Debtor
according to the Plan. Funds from any disbursement check written by
the Subchapter V Trustee, where the check remains unnegotiated for
more than 60 days, may be redistributed pro rata to other Class 1
unsecured creditors, as provided for under the Plan, or may be
placed with this Court's unclaimed funds register pursuant to 28
U.S.C. 2042, at the discretion of the Subchapter V Trustee. In the
event the Subchapter V Trustee has insufficient funds to make any
distribution under the Plan approved by this Order, Plan Payments
may be adjusted during the life of the Plan without further order
of the Court to account for any Plan Payment adjustments. Any
disbursements made by the Subchapter V Trustee following entry of
this Order on account of a claim which is a satisfaction of claim
are deemed authorized disbursements, and the Subchapter V Trustee
shall have no liability for these disbursements. The Reorganized
Debtor will pursue the recovery of any disbursements made on
account of a claim which is subsequently withdrawn and/or
satisfied.
A copy of the Plan dated Feb. 4, 2022, is available at
https://bit.ly/34jEf9C from PacerMonitor.com.
Attorney for the Debtor:
Joyce W. Lindauer, Esq.
JOYCE W. LINDAUER ATTORNEY, PLLC
1412 Main Street, Suite 500
Dallas, Texas 75202
Telephone: (972) 503-4033
Facsimile: (972) 503-4034
About Preferred Ready-Mix
Preferred Ready-Mix, LLC, filed a petition for Chapter 11
protection (Bankr. S.D. Tex. Case No. 21-33369) on Oct. 14, 2021,
listing as much as $1 million in both assets and liabilities.
Lincoln M. Catchings, III, vice president, signed the petition.
Judge Jeffrey P. Norman oversees the case.
The Debtor tapped Joyce W. Lindauer Attorney, PLLC, as legal
counsel.
PREFERRED READY-MIX: Texas Court Mulls Stay of Foran Suit
---------------------------------------------------------
On January 27, 2022, Judge Julie Countiss of the Court of Appeals
of Texas, First District, Houston, advised the parties in the case
captioned Robert Foran, v. Cameron Roesle and Robert W. Berleth,
No. 01-21-00556-CV (Tex. App.), the court could not determine
whether an automatic stay as to the instant appeal was in effect in
light of the bankruptcy of Preferred Ready-Mix LLC, which filed a
chapter 11 bankruptcy petition, Cause No. 21-33369 in the U.S.
Bankruptcy Court for the Southern District of Texas, Houston
Division. The Court asked the parties to respond within 10 days,
explaining whether this appeal should be stayed in light of the
bankruptcy.
On January 31, 2022, Cameron Roesle filed an "Emergency Motion to
Extend Time," requesting an extension of time in which to respond
to the Court's January 27 notice. Appellee advised that a February
23 hearing in bankruptcy court may affect this appeal.
Accordingly, the Court grants Appellee's motion. The deadline for
the parties to respond to this Court's notice is February 28.
A full-text copy of the Order dated February 3, 2022, is available
at https://tinyurl.com/ycksty6a from Leagle.com.
About Preferred Ready-Mix
Preferred Ready-Mix, LLC, filed a petition for Chapter 11
protection (Bankr. S.D. Tex. Case No. 21-33369) on Oct. 14, 2021,
listing as much as $1 million in both assets and liabilities.
Lincoln M. Catchings, III, vice president, signed the petition.
Judge Jeffrey P. Norman oversees the case.
The Debtor tapped Joyce W. Lindauer Attorney, PLLC, as legal
counsel.
QUANTUM CORP: Incurs $11.1 Million Net Loss in Third Quarter
------------------------------------------------------------
Quantum Corporation filed with the Securities and Exchange
Commission its Quarterly Report on Form 10-Q disclosing a net loss
of $11.06 million on $95.34 million of total revenue for the three
months ended Dec. 31, 2021, compared to a net loss of $2.67 million
on $98.02 million of total revenue for the three months ended Dec.
31, 2020.
For the nine months ended Dec. 31, 2021, the Company reported a net
loss of $24.47 million on $277.62 million of total revenue compared
to a net loss of $17.99 million on $257.15 million of total revenue
for the nine months ended Dec. 31, 2020.
As of Dec. 31, 2021, the Company had $187.64 million in total
assets, $310.42 million in total liabilities, and a total
stockholders' deficit of $122.78 million.
The Company had cash and cash equivalents of $4.0 million as of
Dec. 31, 2021, which consisted primarily of bank deposits and money
market accounts.
"We consider liquidity in terms of the sufficiency of internal and
external cash resources to fund our operating, investing and
financing activities. Our principal sources of liquidity include
cash from operating activities, cash and cash equivalents on our
balance sheet and amounts available under our PNC Credit Facility.
We require significant cash resources to meet obligations to pay
principal and interest on our outstanding debt, provide for our
research and development activities, fund our working capital
needs, and make capital expenditures. Our future liquidity
requirements will depend on multiple factors, including our
research and development plans and capital asset needs. We are
subject to the risks arising from COVID-19 which have caused
substantial financial market volatility and have adversely affected
both the U.S. and the global economy. We believe that these social
and economic impacts have had a negative effect on sales due to
disruptions in our supply chain and a decline in our customers'
ability or willingness to purchase our products and services. We
have also been impacted by significant increases in the procurement
cost of certain materials which has negatively impacted our
margins. The extent of the impact will depend, in part, on how long
the negative trends in customer demand and supply chain levels will
continue. We expect the impact of COVID-19 to continue to have a
significant impact on our liquidity and capital resources," Quantum
said.
"We are subject to various debt covenants under our Credit
Agreements. Our failure to comply with our debt covenants could
materially and adversely affect our financial condition and ability
to service our obligations. As of December 31, 2021, we were in
compliance with our debt covenants. However, we believe the
challenges that we have experienced in recent periods with our
supply chain, including challenges sourcing components for our
products and increased costs, will continue to negatively impact
our results of operations and liquidity for the foreseeable future.
As a result, we are working with our lenders to address any
potential future covenant compliance issues as well as any
potential need for additional liquidity. We believe this is the
prudent course to take at this time to address any potential issues
as we attempt to work through and address the temporary headwinds
from supply chain," the Company said.
A full-text copy of the Form 10-Q is available for free at:
https://www.sec.gov/ix?doc=/Archives/edgar/data/0000709283/000070928322000005/qtm-20211231.htm
About Quantum Corp.
Based in San Jose, California, Quantum Corp. (NYSE:QTM) --
http://www.quantum.com-- provides technology and services that
stores and manages video and video-like data delivering the
industry's top streaming performance for video and rich media
applications, along with low cost, high density massive-scale data
protection and archive systems. The Company helps customers
capture, create and share digital data and preserve and protect it
for decades.
Quantum reported a net loss of $35.46 million for the year ended
March 31, 2021, compared to a net loss of $5.21 million for the
year ended March 31, 2020. As of Sept. 30, 2021, the Company had
$198.46 million in total assets, $314.45 million in total
liabilities, and a total stockholders' deficit of $115.99 million.
QUOTIENT LIMITED: BlackRock Has 5.3% Equity Stake as of Dec. 31
---------------------------------------------------------------
BlackRock disclosed in a Schedule 13G filed with the Securities and
Exchange Commission that as of Dec. 31, 2021, it beneficially owns
5,430,015 shares of common stock of Quotient Limited, representing
5.3 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/1364742/000083423722007156/je00blg2zq72_020422.txt
About Quotient Limited
Penicuik, United Kingdom-based Quotient Limited is a
commercial-stage diagnostics company committed to reducing
healthcare costs and improving patient care through the provision
of innovative tests within established markets. With an initial
focus on blood grouping and serological disease screening, Quotient
is developing its proprietary MosaiQTM technology platform to offer
a breadth of tests that is unmatched by existing commercially
available transfusion diagnostic instrument platforms. The
Company's operations are based in Edinburgh, Scotland; Eysins,
Switzerland and Newtown, Pennsylvania.
Quotient Limited reported a net loss of $108.47 million for the
year ended March 31, 2021, a net loss of $102.77 million for the
year ended March 31, 2020, and a net loss of $105.38 million for
the year ended March 31, 2019. As of Sept. 30, 2021, the Company
had $249.60 million in total assets, $334.92 million in total
liabilities, and a total shareholders' deficit of $85.33 million.
RAMBUS INC: Posts $6.1 Million Net Income in Fourth Quarter
-----------------------------------------------------------
Rambus, Inc. reported net income of $6.11 million on total revenue
of $91.78 million for the three months ended Dec. 31, 2021,
compared to a net loss of $12.06 million on total revenue of $61.91
million for the three months ended Dec. 31, 2020.
For the year ended Dec. 31, 2021, the Company reported net income
of $18.33 million on total revenue of $328.30 million compared to a
net loss of $40.47 million on total revenue of $246.32 million for
the year ended Dec. 31, 2020.
As of Dec. 31, 2021, the Company had $1.23 billion in total assets,
$267.27 million in total current liabilities, $102.98 million in
total long-term liabilities, and $862.40 million in total
stockholders' equity.
"Rambus delivered an outstanding fourth quarter contributing to an
exceptionally good year, driven by excellent execution and record
product revenue," said Luc Seraphin, chief executive officer of
Rambus. "The record cash generation fuels our ongoing strategic
investment in scaling the business, returning value to
stockholders, and extending our product roadmap to enable continued
profitable growth."
Cash, cash equivalents, and marketable securities as of Dec. 31,
2021 were $485.6 million, an increase of $65.9 million as compared
to Sept. 30, 2021, mainly due to cash provided by operating
activities of approximately $72.2 million. Cash provided by
operating activities for the year ended Dec. 31, 2021 was $209.2
million, an increase of $23.7 million or 13%, from the same period
in the prior year.
For the first quarter of 2022, the Company expects licensing
billings to be between $64 million and $70 million. The Company
also expects royalty revenue to be between $30 million and $36
million, product revenue to be between $43 million and $49
million and contract and other revenue to be between $12 million
and $18 million. Revenue is not without risk and achieving revenue
in this range will require that the Company sign customer
agreements for various product sales and solutions licensing, among
other matters.
The Company also expects operating costs and expenses to be between
$84 million and $80 million. Additionally, the Company expects
non-GAAP operating costs and expenses to be between $73 million and
$69 million. These expectations also assume non-GAAP interest and
other income (expense), net, of ($1 million), tax rate of 24% and
diluted share count of 115 million, and exclude stock-based
compensation expense ($7 million), amortization expense ($4
million), non-cash interest expense on convertible notes ($2
million) and interest income related to the significant financing
component from fixed-fee patent and technology licensing
arrangements ($2 million).
A full-text copy of the press release is available for free at:
https://www.sec.gov/Archives/edgar/data/917273/000091727322000004/exhibit991earningsreleaseq.htm
About Rambus Inc.
Rambus -- rambus.com -- produces products and innovations that
address the fundamental challenges of accelerating data. The
Company makes chips and IP that enable critical performance
improvements for data center and other growing markets.
Rambus reported a net loss of $43.61 million in 2020, a net loss of
$90.42 million in 2019, and a net loss of $157.96 million in 2018.
As of Sept. 30, 2021, the Company had $1.20 billion in total
assets, $354.82 million in total liabilities, and $847.84 million
in total stockholders' equity.
* * *
This concludes the Troubled Company Reporter's coverage of Rambus
Inc. until facts and circumstances, if any, emerge that demonstrate
financial or operational strain or difficulty at a level sufficient
to warrant renewed coverage.
REAL GRANITE: Wins Final Cash Collateral Access
-----------------------------------------------
The U.S. Bankruptcy Court for the Western District of Texas, San
Antonio Division, has authorized Real Granite, Inc. to use cash
collateral to pay the permitted expenses for the period beginning
February 7, 2022 through confirmation of a plan of reorganization.
The Debtor is unable to pay the reasonable expenses of its ongoing
operations without permission for use of collateral and cash
collateral in which security interests and liens are held by Frost
Bank.
The Bank claims a first and prior security interest in the assets
of the Debtor including, but not limited to, the Debtor's accounts,
accounts receivable, inventory, furniture, fixtures, equipment,
accessions, additions, replacements, and proceeds thereof.
The Lender acknowledges and agrees that SureTec Insurance Company
has issued surety bonds for the benefit of the Debtor for certain
projects, including the Comal County Sheriff's office renovation.
The Lender acknowledges and agrees that the right of SureTec to
receive, possess and use project funds payable by any obligee on
the Bonded Projects will be superior to the replacement liens
granted to the Lender, subject to all rights, claims, and defenses
under applicable law of any party to the Order.
As adequate protection, the Lender is granted a lien upon all of
the Pre-Petition Collateral, all of the Post-Petition Collateral,
and all of the Accounts subordinate only to the rights of SureTec
under applicable law in the Bonded Projects DIP Account and the
project funds associated therewith.
The replacement liens granted will have the same priority as its
prepetition security interests and liens.
All liens granted or to be granted to the Lender are deemed
perfected and no further notice, filing, recording, control
agreement, bailment arrangement, or order will be required to
effect such perfection under other State or Federal law.
A copy of the order and the Debtor's budget for 2022 is available
at https://bit.ly/3JlVHJm from PacerMonitor.com.
The Debtor projects $861,141 in total revenue for February 2022.
About Real Granite Inc.
Real Granite, Inc. specializes in commercial tile and stone
installation, residential granite, marble and stone fabrication and
installation. The company is based in San Antonio, Texas.
Real Granite filed its voluntary petition for relief under Chapter
11 of the Bankruptcy Code (Bankr. W.D. Texas Case No. 22-50050) on
Jan. 18, 2022, listing $2,596,812 in assets and $2,843,279 in
liabilities. Roland Martinez, president of Real Granite, signed
the petition.
Judge Craig A. Gargotta presides over the case.
David S. Gragg, Esq., and William R. Davis Jr., Esq., at Langley &
Banack, Inc. serve as the Debtor's attorneys.
Frost Bank, as lender, is represented by:
Leslie M. Luttrell, Esq.
Luttrell + Carmody Law Group
100 N.E. Loop 410, Suite 615
San Antonio, TX 78216
Tel: (210) 426-3600
Fax: (210) 426-3610
Email: luttrell@lclawgroup.net
ROSCOE GUITARS: Unsecureds to Get 25% Dividend in 60 Months
-----------------------------------------------------------
Roscoe Guitars, Inc., filed with the U.S. Bankruptcy Court for the
District of North Carolina an Amended Plan of Reorganization for
Small Business dated Feb. 8, 2022.
Roscoe Guitars was established in 2003. The President and sole
shareholder is Keith B. Roscoe, who started the company.
This Plan reflects the Debtor's attempt to achieve a consensual
plan of reorganization. The Debtor projects that the Plan will
achieve a 25% dividend to general unsecured creditors based on
filed claims and undisputed non-insider scheduled claims.
The Plan shall be funded by cash flow from future operations. The
Plan Proponent's financial projections show that the Debtor will
have projected disposable income of $114,911.
The final plan payment is expected to be paid on January 15, 2027.
Non-priority unsecured creditors holding allowed claims will
receive distributions, which the proponent of this Plan has valued
at approximately 25 cents on the dollar. This Plan also provides
for the payment of administrative and priority claims.
Class 3 consists of Non-priority unsecured creditors. The Debtor
commits its future earnings for the distribution to general
unsecured claims. Over the life of the Plan that general unsecured
claims will receive a 25% dividend. The Debtor anticipates that
the allowed Class 3 Unsecured Claims will total approximately
$350,000 which includes the General Unsecured Claim of the Internal
Revenue Service and the Unsecured portions of the two FNB Claims.
The Debtor proposes to pay a minimum of 25% of the allowed
unsecured claims. The claims shall be paid over 60 months, paid in
equal monthly installments of $1,458 beginning on the 15th day of
the month thereafter for a period of 60 months. The Debtor
reserves the right to prepay the Claims in full.
Due to the nature of the Debtor's business as a guitar
manufacturer, it is necessary for the Debtor to maintain a cash
reserve of $30,000. This reserve is necessary to cover expenses in
the ordinary course of business and unexpected expenses such as the
repair of the equipment.
Each holder of an allowed nonpriority unsecured claim, exclusive of
insiders, shall receive a promissory note which provides that each
holder shall receive 25% of its claim to be paid monthly over a 60
month period with no interest paid. In the event of a default, the
holders of the note may pursue all remedies under North Carolina
law.
Class 4 Equity security holders of the Debtor shall retain
interests.
The Debtor will fund payments under the Plan from continued
business operations.
A full-text copy of the Amended Plan of Reorganization dated Feb.
8, 2022, is available at https://bit.ly/3BgybLi from
PacerMonitor.com at no charge.
Attorney for the Plan Proponent:
Dirk W. Siegmund, Esq.
Ivey, McClellan, Siegmund, Brumbaugh & McDonough, LLP
Post Office Box 3324
Greensboro, NC 27402
Telephone: (336) 274-4658
Facsimile: (336) 274-4540
Email: dws@iveymcclellan.com
About Roscoe Guitars
Roscoe Guitars, Inc., established in 2003, is in the business of
manufacturing and selling guitars, with emphasis on bass guitars.
The company sought protection under Subchapter V of Chapter 11 of
the Bankruptcy Code (Bankr. M.D.N.C. Case No. 21-10520) on
September 27, 2021, listing $100,000 to $500,000 in assets and
$500,000 to $1,000,000 in liabilities. Keith B. Roscoe, its
president, signed the petition.
Judge Lena M. James is assigned to the case.
Ivey, McClellan, Siegmund, Brumbaugh & McDonough, LLP is tapped as
the Debtor's counsel.
The firm may be reached through:
Dirk W. Siegmund, Esq.
Ivey, McClellan, Siegmund, Brumbaugh & McDonough, LLP
100 S. Elm St, Ste. 500
Greensboro, NC 27401
Telephone: (336) 274-4658
Email: dws@iveymcclellan.com
ROSCOE GUITARS: Wins Access to Cash Collateral Thru March 1
-----------------------------------------------------------
The U.S. Bankruptcy Court for the Middle District of North Carolina
has authorized Roscoe Guitars, Inc. to use cash collateral on an
interim basis in the ordinary course of business in accordance with
the budget.
The Debtor is permitted to use the cash collateral through the
earliest of:
(i) the entry of a final order authorizing the use of cash
collateral;
(ii) the entry of a further interim order authorizing the use
of cash collateral;
(iii) March 1, 2022;
(iv) the entry of an order denying or modifying the use of cash
collateral; or
(v) the occurrence of a Termination Event.
The Debtor is only authorized to use cash collateral for the actual
and necessary expenses of operating the Debtor's business and
maintaining the cash collateral pursuant to the Budget.
First National Bank (FNB), successor in interest to Yadkin Bank,
asserts an interest in the cash collateral under certain
prepetition loans, secured by a lien on co-borrower Wolftone, LLC's
buildings; the house and equipment of the Debtor's principal, Keith
Roscoe; and the Debtor's inventory and accounts.
As adequate protection for the Debtor's use of cash collateral, the
Secured Party is granted a post-petition replacement lien in the
Debtor's post-petition property of the same type which secured the
indebtedness of the Secured Party pre-petition, with such liens
having the same validity, priority, and enforceability as the
Secured Party had against the same type of such collateral as of
the Petition Date.
The security interests and liens granted to the Secured Party: (i)
are and will be in addition to all security interests, liens and
rights of set-off existing in favor of the Secured Party on the
Petition Date, if any; and (ii) will secure the payment of the
indebtedness owing to the Secured Party in an amount equal to the
aggregate cash collateral used or consumed by the Debtor.
During the Usage Period the Debtor will make an adequate protection
payment to the Secured Party in the amount of $1,500 on or before
February 15, 2022. The Debtor will also preserve, protect, maintain
and adequately insure the cash collateral.
As additional adequate protection, the Debtor will keep all of its
personal property insured for no less than the amounts of the
pre-petition insurance.
As further adequate protection, the Secured Party is allowed
super-priority administrative expense claim pursuant to Sections
503(b) and 507(a)(2) of the Bankruptcy Code.
A further hearing on the matter is scheduled for March 1 at 1:30
p.m.
A copy of the order and the Debtor's budget for February and March
2022 is available at https://bit.ly/34RFAEE from PacerMonitor.com.
The Debtor projects $35,000 in total income and $23,556 in total
expenses for February 2022.
About Roscoe Guitars, Inc.
Roscoe Guitars, Inc., established in 2003, is in the business of
manufacturing and selling guitars, with emphasis on bass guitars.
The company sought protection under Subchapter V of Chapter 11 of
the Bankruptcy Code (Bankr. M.D.N.C. Case No. 21-10520) on
September 27, 2021, listing $100,000 to $500,000 in assets and
$500,000 to $1,000,000 in liabilities. Keith B. Roscoe, its
president, signed the petition.
Judge Lena M. James is assigned to the case.
Ivey, McClellan, Siegmund, Brumbaugh & McDonough, LLP is tapped as
the Debtor's counsel.
ROYAL ALICE: District Court Won't Stay Order on Sale, AMAG Deal
---------------------------------------------------------------
Royal Street Bistro, LLC, and Picture Pro, LLC, as lessees, and
Susan Hoffman, the sole equity holder of debtor Royal Alice
Properties, LLC, filed a motion for a stay of the enforcement of
the bankruptcy court's order dated November 30, 2021, and the
subsequent orders issued on January 10, 2022, pending appeal of the
November 30 order. Dwayne M. Murray, the Chapter 11 Trustee for the
bankruptcy estate, opposes the motion.
On July 28, 2021, the Trustee filed a motion in the bankruptcy
court to approve (i) a settlement with secured creditor AMAG, Inc.,
and (ii) a sale of the debtor's real property as part of that
settlement. At issue are three parcels of real property on Royal
Street in New Orleans, currently occupied by Tenants RSB and
Picture Pro, which lease the properties for business use, and the
debtor's sole equity holder, Susan Hoffman, who uses the property
as her residence. In its motion, the Trustee sought approval of a
settlement and sale that would allow the bankruptcy estate to
receive and sell the properties, free and clear of appellants'
leases, at private auction within 45 days after the bankruptcy
court's approval of the sale motion and a separately filed
bid-procedures motion.
On September 3, 2021, Tenants RSB and Picture Pro filed a motion
for adequate protection of their interest in the property, under 11
U.S.C. Section 363(e). Specifically, the Tenants sought to remain
in possession of the property through the end of their purported
20-year leases, i.e., through December 31, 2038. Tenants also asked
the court to require the debtor to explicitly assume or reject the
leases, because a rejection would trigger statutory protection of
the Tenants' possessory interests under Section 365(h).
On November 30, 2021, the bankruptcy court granted the Trustee's
motion, approving the settlement and sale, and denied the Tenants'
motion for adequate protection and for a requirement that the
debtor assume or reject the leases. On December 9, 2021, the
Tenants and Ms. Hoffman filed a notice of appeal of the bankruptcy
court's November 30 order, thereby initiating proceedings in this
Court. They simultaneously filed a motion in the bankruptcy court
to stay enforcement of the November 30 order, pending appeal. On
January 10, 2022, the bankruptcy court entered final orders
approving the settlement and proposed sale of the property,
approving the bid procedures, and setting the auction sale of the
property for February 22, 2022. Two days later, the bankruptcy
court held a hearing on the Tenants' and Ms. Hoffman's motion to
stay, and denied the motion for reasons stated on the record.
On January 19, 2022, the Tenants and Ms. Hoffman filed an emergency
motion in this Court, seeking to stay the bankruptcy's court's
orders pending appeal. Appellants contend that a stay is warranted
because the sale will cause irreparable harm to Tenants and Ms.
Hoffman, and because they have demonstrated a substantial case as
to the merits of the appeal. Appellee, the Trustee, opposes the
motion, arguing that appellants should not be granted a stay
because, inter alia, they have not shown that the sale will cause
them irreparable harm, and because they are not likely to succeed
on the merits. The parties also dispute the adequacy of the
security offered by appellants in support of their request for a
stay.
Judge Sarah S. Vance of the United States District Court for the
Eastern District of Louisiana, in an Order and Reasons dated
February 3, 2022, denies the motion for stay, holding that while
movants face a real risk of dispossession of their property and
that this type of deprivation is serious, and cannot be easily
"undone through monetary remedies," granting a stay poses a
substantial risk of harm to the other parties, including the
bankruptcy estate and AMAG, the secured creditor.
Judge Vance explains that with the sale, the Trustee seeks to
settle AMAG's secured claim against the estate, which totals over
$6 million. A stay would delay the sale of the property and,
thereby, the effectuation of that settlement, allowing interest,
legal fees, and administrative costs to accrue all the while, the
judge points out. And critically, the movants' litigation conduct
throughout these proceedings does not inspire confidence that their
appeal will be efficient or inexpensive for the Trustee or AMAG,
the judge further points out. The movants are prone to excessive
motion practice and, at times, obstructive behavior, including,
most recently, an attempt to deny prospective buyers access to the
contested property unless and until this Court denies their motion
to stay -- a maneuver that required emergency intervention by the
bankruptcy court, Judge Vance notes. The Court finds that staying
enforcement of the bankruptcy court's order would "substantially
harm the other parties."
Furthermore, granting the stay does not serve the public interest,
which lies in "seeing the bankruptcy process not just run its
course but to do so with due speed," Judge Vance further holds. As
another section of the Court has explained in denying a stay
pending a bankruptcy appeal, "the public is . . . served by
meaningful relief to creditors when warranted under the law and
facts of a particular case," the judge says, citing 18 Audubon
Place, LLC, 2018 WL 5831231, at *5.
Accordingly, the Court finds that the balance of equities does not
weigh in favor -- much less "heavily" in favor -- of granting a
stay.
A full-text copy of the order is available at
https://tinyurl.com/5992tsx3 from Leagle.com.
About Royal Alice Properties
Royal Alice Properties, LLC, owns, manages and rents the building
and real estate located on the 900 block of Royal Street in the
French Quarter, New Orleans, Louisiana. The condominium units are
located at 906, 910-12 Royal St. New Orleans, LA 70116.
Royal Alice Properties sought protection under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. E.D. La. Case No. 19-12337) on Aug.
29, 2019. In the petition signed by Susan Hoffman, member/manager,
the Debtor was estimated $1 million to $10 million in both assets
and liabilities.
The case is assigned to Judge Meredith S. Grabill.
Leo D. Congeni, Esq., at Congeni Law Firm, LLC, represents the
Debtor.
Dwayne M. Murray was appointed as Chapter 11 Trustee. He retained
Louis M. Phillips, Esq., at Kelly Hart & Pitre as counsel.
RUM RUNNERS: Court Orders Revisions; Confirmation Hearing March 31
------------------------------------------------------------------
Rum Runners PA, LLC, filed with the U.S. Bankruptcy Court for the
Western District of Pennsylvania a Disclosure Statement to
accompany Chapter 11 Plan of Reorganization. On Feb. 8, 2022,
Judge Gregory L. Taddonio ordered that:
* The Disclosure Statement is approved for solicitation by
the Debtor, provided that an amended Disclosure Statement
containing the correction is filed on or before February 18, 2022.
* March 31, 2022 at 11:00 A.M. in Courtroom A, United States
Bankruptcy Court for the Western District of Pennsylvania, 54th
Floor U.S. Steel Tower, 600 Grant Street, Pittsburgh, Pennsylvania
15219 is the hearing to consider confirmation of the Plan.
* March 24, 2022 is the deadline to file objections to
confirmation of the Plan.
* March 24, 2022 is the balloting deadline for voting on the
Plan.
* March 28, 2022 is the deadline for the Debtor to file a
Ballot Summary.
On or before February 18, 2022, the Debtor shall file an amended
Disclosure Statement that modifies the liquidation analysis to
indicate that only $700,000 of the $1,000,000 sales proceeds is
being directed into the bankruptcy estate, with $300,000 going to
the Debtor's affiliate holding title to the personal property. The
Court deems this modification as a non-material amendment to the
Disclosure Statement.
A full-text copy of the order dated Feb. 8, 2022, is available at
https://bit.ly/3LtMbGc from PacerMonitor.com at no charge.
About Rum Runners PA
Gibsonia, Pa.-based Rum Runners PA, LLC sought protection under
Chapter 11 of the Bankruptcy Code (Bankr. W.D. Pa. Case No.
21-20369) on Feb. 23, 2021. Mark E. Baranowski, member, signed the
petition. In the petition, the Debtor disclosed assets of between
$1 million and $10 million and liabilities of the same range. Judge
Gregory L. Taddonio oversees the case. Robert O Lampl Law Office
is the Debtor's legal counsel.
SAFE FLEET: Moody's Assigns B2 Rating to New First Lien Debt
------------------------------------------------------------
Moody's Investors Service assigned a B2 rating to Safe Fleet
Holdings LLC's new first lien credit facilities consisting of a
$595 million first lien term loan and a $50 million revolving
credit facility. Proceeds will be used to refinance the existing
debt, fund a small acquisition of $22 million and pay transaction
fees and expenses. There is no change to the company's B3 corporate
family rating, B3-PD probability of default rating or Caa2 rating
on the company's second lien term loan. The B2 rating on the
existing first lien facilities will be withdrawn at transaction
close. The ratings outlook is stable.
The refinancing transaction is largely leverage neutral but will
extend the company's debt maturity profile. Safe Fleet is
refinancing its capital structure following the failure to receive
early termination under Hart-Scott-Rodino for the sale of the
company to Madison Industries. Both Safe Fleet and Madison have
mutually agreed to terminate the agreement of sale.
Assignments:
Issuer: Safe Fleet Holdings LLC
Senior Secured 1st Lien Term Loan, Assigned B2 (LGD3)
Senior Secured 1st Lien Revolving Credit Facility, Assigned B2
(LGD3)
RATINGS RATIONALE
Safe Fleet's B3 CFR reflects the company's high leverage with
adjusted debt-to-EBITDA (leverage) in excess of 7.0x (as of
December 2021). With revenues of close to $500 million, the
company's scale is modest, reflecting its niche market focus as a
manufacturer of safety and productivity products for fleet
vehicles. Moody's believes that Safe Fleet's focus on acquisitive
growth will constrain future deleveraging and sustain leverage at
elevated levels.
The ratings are supported by the mission critical nature of Safe
Fleet's products. A large installed base generates a sizeable
aftermarket business (47% of revenue) that is relatively more
stable and commands higher margins than the original equipment
business. Safe Fleet's strong EBITDA margins of close to 20% and
low capital requirements supports healthy cash generation.
Liquidity is good, supported by $55 million of cash estimated at
transaction close and full availability under its $50 million
revolving credit facility.
The stable outlook reflects Moody's expectation that demand across
Safe Fleet's end markets will drive modest EBITDA growth over the
next 12-18 months, resulting in debt/EBITDA declining below 7.0x
with good liquidity.
Environmental and social risks are not material to the credit
profile. Governance risk is high given the company's private equity
ownership and history of debt-financed acquisitions.
The new credit facilities are expected to provide covenant
flexibility that if utilized could negatively impact creditors. The
first lien credit agreement contains provisions for incremental
debt capacity subject to a ratio test. Expected terms allow the
release of guarantees when any subsidiary ceases to be wholly
owned. There are no express "blocker" provisions which prohibit the
transfer of specified assets to unrestricted subsidiaries; such
transfers are permitted subject to carve-out capacity and other
conditions.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Ratings could be downgraded if deterioration in market conditions,
loss of a customer or competitive pressure weakens earnings or cash
flow. Quantitatively, adjusted debt-to-EBITDA sustained above 7.5x
or weakened liquidity could prompt a rating downgrade.
Ratings could be upgraded if the company's scale increases and
profit margins are maintained such that adjusted debt-to-EBITDA is
sustained below 6.5x and free cash flow to debt increases to the
high single-digit percent range.
Headquartered in Belton, Missouri, Safe Fleet Holdings LLC
manufactures safety and productivity products for fleet vehicles
including school and transit buses, fire EMS and law enforcement
vehicles, work trucks, truck & trailers used in various industries
and military vehicles. Among Safe Fleet's products are cameras and
surveillance systems, ladder racks, ramps and platforms, nozzles
and valves, and stop signs and crossing arms for school buses. The
company is majority-owned by Oak Hill Capital Partners. Sales for
fiscal 2021 were close to $500 million.
The principal methodology used in these ratings was Manufacturing
published in September 2021.
SEALED AIR: Egan-Jones Retains BB- Senior Unsecured Ratings
-----------------------------------------------------------
Egan-Jones Ratings Company on January 21, 2022, retained its 'BB-'
foreign currency and local currency senior unsecured ratings on
debt issued by Sealed Air Corporation.
Headquartered in Charlotte, North Carolina, Sealed Air Corporation
manufactures packaging and performance-based materials and
equipment systems that serve food, industrial, medical, and
consumer applications.
SEMPER UTILITIES: Case Summary & Seven Unsecured Creditors
----------------------------------------------------------
Debtor: Semper Utilities, LLC
93 Cooper Road
Suite 300
Voorhees, NJ 08043
Business Description: Semper Utilities offers a wide variety of
powerline services.
Chapter 11 Petition Date: February 11, 2022
Court: United States Bankruptcy Court
District of New Jersey
Case No.: 22-11128
Debtor's Counsel: Jeffrey Kurtzman, Esq.
KURTZMAN | STEADY, LLC
2 Kings Highway West
Suite 102
Haddonfield, NJ 08033
Tel: (215) 883-1600
Fax: (609) 482-8011
Email: kurtzman@kurtzmansteady.com
Estimated Assets: $50 million to $100 million
Estimated Liabilities: $10 million to $50 million
The petition was signed by Sotero Diaz as manager.
A full-text copy of the petition is available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/ERSZFAQ/Semper_Utilities_LLC__njbke-22-11128__0001.0.pdf?mcid=tGE4TAMA
List of Debtor's Seven Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
1. Chyn IV Ventures, LLC $3,150,000
c/o Law Offices of
Douglas T. Tabachnik
Woodhull House, Suite C
63 West Main Street
Freehold, NJ 07728
2. Diane Turner $2,692
3423 Avalon Court
Voorhees, NJ 08043
3. Edison Power $5,570,083
Constructors, Inc.
c/o Edward J.
Altabet, Esquire
Cohen Seglias, et al.
55 Broadway, Suite 901
New York, NY 1000
4. Guadalupe Diaz $8,000
18212 Summit
Pointe Dr
Dumfries, VA 22026
5. TruConTra Power $890,413
3120 W Carefree Highway
Phoenix, AZ 85086
6. Union LocAL 126 $766,492
3455 Germantown Pike
Collegeville, PA 19426
7. Union Local 70 $100,000
3606 Forest Road
Forestville, MD
20747
SPEED INDUSTRIAL: Seeks to Hire Kean Miller as Legal Counsel
------------------------------------------------------------
Speed Industrial Gas, LLC seeks approval from the U.S. Bankruptcy
Court for the Western District of Texas to employ Kean Miller, LLP
as its legal counsel.
Kean Miller will render these legal services:
(a) represent the Debtor in carrying out its duties;
(b) prepare legal documents;
(c) advise and consult with the Debtor for the preparation
and/or amendment of all necessary schedules, disclosure statements,
and plans of reorganization related to the Chapter 11 case;
(d) perform any and all legal services on behalf of the Debtor
arising out of or related to the Chapter 11 case;
(e) perform any and all other legal services for the Debtor in
the operation of its business and the management of its assets and
financial affairs; and
(f) perform all other legal services required by the Debtor
during the Chapter 11 case and related proceedings.
The hourly rates of Kean Miller's counsel and staff are as
follows:
Lloyd Lim $595
Rachel Kubanda $495
Other Attorneys $230 - $520
Law clerks $130
Paralegals $140 - $220
In addition, the firm will seek reimbursement for expenses
incurred.
Lloyd Lim, Esq., an attorney at Kean Miller, disclosed in a court
filing that the firm is a "disinterested person" as that term is
defined in section 101(14) of the Bankruptcy Code.
The firm can be reached through:
Lloyd A. Lim, Esq.
Rachel T. Kubanda, Esq.
Kean Miller LLP
711 Louisiana Street
Suite 1800 South Tower
Houston, TX 77002
Telephone: (713) 844-3070
Email: lloyd.lim@keanmiller.com
rachel.kubanda@keanmiller.com
About Speed Industrial Gas
Speed Industrial Gas, LLC, is a San Antonio, Texas-based company
that offers welding supplies, industrial and specialty gas
products.
Speed Industrial Gas filed a petition for Chapter 11 protection
(Bankr. W.D. Tex. Case No. 21-51297) on Oct. 22, 2021, listing as
much as $10 million in both assets and liabilities. Ernest W.
Speed, III, owner and sole member of Speed Industrial Gas, signed
the petition.
Judge Craig A. Gargotta oversees the case.
Lloyd A. Lim, Esq., at Balch & Bingham, LLP serves as the Debtor's
legal counsel.
STAPLES INC: Moody's Cuts CFR to B3, Alters Outlook to Stable
-------------------------------------------------------------
Moody's Investors Service downgraded Staples, Inc.'s corporate
family rating and probability of default rating to B3 and B3-PD
from B2 and B2-PD respectively. Additionally Moody's also
downgraded the rating of the company's senior secured term loan and
senior secured notes to B3 from B2 and its senior unsecured notes
to Caa2 from Caa1. The outlook was changed to stable.
Downgrades:
Issuer: Staples, Inc.
Corporate Family Rating, Downgraded to B3 from B2
Probability of Default Rating, Downgraded to B3-PD from B2-PD
Gtd Senior Secured 1st Lien Term Loan, Downgraded to B3 (LGD3)
from B2 (LGD3)
Gtd Senior Secured Global Notes, Downgraded to B3 (LGD3) from B2
(LGD3)
Gtd Senior Unsecured Global Notes, Downgraded to Caa2 (LGD5) from
Caa1 (LGD6)
Outlook Actions:
Issuer: Staples, Inc.
Outlook, Changed To Stable From Negative
"Staples' topline and profitability have been negatively impacted
by lower demand for its office supply products as a large swath of
the population continues to work from home or work in some hybrid
arrangement", Moody's Vice President Mickey Chadha stated.
"Although the company's Pro segment that includes facilities
supplies, breakroom products, furniture and related installations
has held up relatively well, it has not been enough to completely
offset the negative impact of the softness in office supplies
segment. The downgrade reflects that the weakened operating
performance has resulted in a meaningful deterioration in credit
metrics", Chadha further said.
RATINGS RATIONALE
Staples' B3 rating reflects its currently very weak credit metrics,
with debt/EBITDA of over 9.0 times and EBITA/interest of under 1.0
times for the LTM period ending October 30, 2021, good liquidity,
the scale of its delivery-only B2B business, loyal commercial
relationships with high retention rates, and well established
supply chain and distribution capabilities. Staples' revenues have
suffered from lower demand from its core corporate clients as
employees continue to work at home due to COVID-19. This weakness
and resulting pressure on profitability has not been sufficiently
offset by demand increases in the Pro Segment and Staples.com.
Although profitability is showing signs of improvement, the
company's high fixed costs make it difficult to lower expenses
enough to completely offset lower sales volumes. Moody's expects
lease adjusted leverage to improve but remain high in the 7.5 to
8.0 times range for the next 12 months with EBITA/interest
remaining around 1.0 to 1.25 times. The rating also reflects
financial strategy risks inherent in a sponsor-owned company,
including potential for leveraging extractions of equity and debt
financed acquisitions.
The stable outlook reflects Moody's expectation that the company
will maintain good liquidity including positive free cash flow and
that credit metrics will continue to improve over the next 12
months.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Ratings could be upgraded if operating performance improves,
liquidity remains good, debt/EBITDA can be sustained below 6.5
times, EBITA/ interest expense is sustained above 1.5 times and
financial strategies are supportive of maintaining credit metrics
at these levels.
Ratings could be downgraded if Staples cannot make progress in the
next 12 months sufficient to ensure that it can improve debt/EBITDA
to below 7.5 times with EBITA/interest above 1.0 times including
any potential refinancing transaction or if liquidity weakens, or
financial strategies become detrimental to creditors.
Headquartered in Framingham, MA, Staples, Inc. is a leading
provider of contract office supplies to corporations, with LTM
October 30, 2021 revenues of around $10 billion. The company was
acquired and taken private by affiliates of Sycamore Partners, a
private equity company, in September 2017.
The principal methodology used in these ratings was Distribution &
Supply Chain Services Industry published in June 2018.
STONEWAY CAPITAL: Unsecureds to Recover 100% in Joint Plan
----------------------------------------------------------
Stoneway Capital Ltd., and its Affiliated Debtors filed with the
U.S. Bankruptcy Court for the Southern District of New York a
Disclosure Statement for Joint Chapter 11 Plan dated Feb. 10,
2022.
The Plan represents a compromise and settlement of various
intercreditor disputes (the "Compromise and Settlement") among the
Ad Hoc Steering Committee and Term Loan Lenders.
The restructuring term sheet (the "Restructuring Term Sheet"), sets
forth the key terms of the Plan, and is the product of the Debtors'
arm's-length negotiations with the steering committee of that
certain ad hoc group of holders (the "Ad Hoc Steering Committee")
of approximately 80.0% of the total principal amount of the
Debtors' 10.000% senior secured notes due 2027 (the "Senior Notes")
and the lenders under both the Debtors' prepetition term loan
facility (the "Term Loan Facility" and the lenders thereunder, the
"Term Loan Lenders") and $16.5 million super priority secured
debtor-in-possession financing facility (the "DIP Facility" and the
lenders, the "DIP Lenders"), who are also the holders of
approximately $1.36 million in unsecured prepetition promissory
notes issued by the Debtors (the "Promissory Notes").
Although, in the interest of time, the Debtors, the Ad Hoc Steering
Committee, and the Term Loan Lenders elected not to enter into a
binding restructuring support agreement in respect of the
Restructuring Term Sheet, the Debtors believe that that
Restructuring Term Sheet—and, therefore, the Plan—have the
overwhelming support of the holders of the Senior Notes (the
"Senior Noteholders") and the Term Loan Lenders.
The primary purpose of the Plan is to implement one or more sale
transactions, pursuant to which the Buyer will acquire the business
enterprise of the Debtors, including substantially all of the
assets of SCC and all of the partnership interests in SEI and SELP,
in exchange for consideration to be distributed to the Estates of
the Debtors under the Plan (the "Sale Transactions"). The Sale
Transactions, which, together with the other restructuring
transactions (the "Restructuring Transactions") contemplated by the
Plan, will be implemented in accordance with the Restructuring
Steps Plan (the "Restructuring Steps Plan") annexed hereto as
Exhibit D and, with respect to certain Canadian aspects of the
Plan, in accordance with the CBCA Plan of Arrangement.
In general terms, and subject to the specific provisions of the
Plan, the Plan, if consummated, will result in the following:
* the consummation of the Sale Transactions, which will
involve a sale of substantially all of the Debtors' assets,
including all of the assets of SCC and Stoneway Capital, and
potentially certain assets of other Debtors, free and clear of
Claims and Liens, to a newly formed entity ("SCC UK") and, as
directed by SCC UK, one or more of SCC UK's subsidiaries (any such
entities, together with SCC UK, collectively, the "Buyer"), which
will be a subsidiary of a holding company ("SCC UK Parent") that
will hold directly or indirectly 100% of the common equity (the
"SCC UK Common Equity") of SCC UK;
* each Holder of an Allowed Senior Notes Claim that is an
Eligible Holder receiving from SCC a pro rata distribution of the
following (collectively, the "Senior Notes Distributable Pool"):
(i) $300 million aggregate principal amount of first-lien secured
notes to be issued by SCC UK (in such capacity, the "Issuer") under
an indenture, which will be included in the Plan Supplement (the
"New Secured Notes Indenture") with the key terms set forth in the
Restructuring Term Sheet (the "New First Lien Notes"); and (ii)
$162.5 million aggregate principal amount of second-lien secured
notes to be issued by SCC UK under the New Secured Notes Indenture
with the key terms set forth in the Restructuring Term Sheet (the
"New Second Lien Notes");
* each Holder of an Allowed Term Loan Facility Claim that is
an Eligible Holder4 receiving from one of the Parent Group Debtors
a pro rata share of (i) $10 million aggregate principal amount of
the New First Lien Notes (the "Distribution First Lien Notes"),
which the recipients thereof may assign to any of their designees
(which may include former equity interest holders of the Debtors)
and (ii) non-convertible preferred equity of SCC UK as set forth in
the Restructuring Term Sheet (the "New Preferred Stock");
* the payment in full in Cash of each Allowed General
Unsecured Claim against the Debtors' estates within 90 days after
the later of (i) the Effective Date and (ii) the date such Allowed
General Unsecured Claim comes due under applicable law or in the
ordinary course of business, except for General Unsecured Claims
against GRM, Stoneway Capital, SGLP, and Stoneway Power (the
"Parent Group Debtor General Unsecured Claims"), which shall
receive no recovery under the Plan; and
* the post-Effective Date wind down and dissolution of GRM,
Stoneway Capital, SGLP, and SCC Amalco (the "Non-Acquired
Debtors").
Class 6 consists of General Unsecured Claims. Each Holder of an
Allowed General Unsecured Claim shall receive payment in full in
Cash within 90 days after the later of (i) the Effective Date and
(ii) the date such Allowed General Unsecured Claim comes due under
applicable law or in the ordinary course of business in accordance
with the terms and conditions of the particular transaction,
agreement, conduct, or judgment giving rise to such Allowed General
Unsecured Claim. This Class will receive a distribution of 100% of
their allowed claims.
Class 7 consists of Parent Group Debtor General Unsecured Claims.
On the Effective Date, each Allowed Parent Group Debtor General
Unsecured Claim will be discharged and released and each Holder of
such Allowed Parent Group Debtor General Unsecured Claims shall not
receive or retain any distribution, property, or other value on
account of its Allowed Parent Group Debtor General Unsecured
Claim.
Class 12 consists of Intercompany Interests and GRM Interests. On
the Effective Date, each Allowed Intercompany Interest and GRM
Interests shall be Reinstated. Any Intercompany Interest not
included among the Purchased Assets and any GRM Interest shall not
receive a distribution under the Plan and shall be cancelled or
liquidated pursuant to the Wind Down.
The Sale Transactions are an integral part of the Plan. Through the
Sale Transactions, the Buyer will acquire the business enterprise
of the Debtors in exchange for consideration to be distributed to
the Estates of the Debtors under the Plan.
SCC UK will be the issuer of the New Secured Notes and the New
Preferred Stock. As such, SCC UK will be responsible for satisfying
all of the obligations under the New Secured Notes and the New
Preferred Stock.
All Cash required for the payments to be made hereunder shall
solely be obtained from (a) Excluded Cash and (b) any proceeds of
the BNYM Reserve Account Balance obtained by the Debtors, and, for
the avoidance of doubt, the Post-Sale Company shall have no
obligations to fund any amounts required to be paid hereunder.
Counsel to the Debtors:
Fredric Sosnick, Esq.
Ned S. Schodek
Jordan A. Wishnew
Shearman & Sterling, LLP
599 Lexington Avenue
New York, NY 10022
Tel: (212) 848-4000
Fax: (646) 848-8174
Email: fsosnick@shearman.com
ned.schodek@shearman.com
jordan.wishnew@shearman.com
About Stoneway Capital Corp.
Stoneway Capital Corporation is a limited corporation incorporated
in New Brunswick, Canada, formed for the purpose of owning and
operating, through its Argentine subsidiaries, power generation
projects that will provide electricity to the wholesale electricity
markets in Argentina. The Argentine subsidiaries operate four
power-generating plants in Argentina that provide electricity to
the wholesale electricity market in Argentina.
Stoneway is 100% owned by GRM Energy Investment Limited.
On Oct. 8, 2020, the Company commenced proceedings under the Canada
Business Corporations Act (the "CBCA"). The Debtors were well on
the way toward closing the consensual restructuring when on Dec. 4,
2020, the Argentine Supreme Court issued a decision in an ongoing
noise discharge dispute involving one of the Generation Facilities
located in Pilar, Argentina. The Argentine Supreme Court Decision
created significant uncertainty as it overturned a decision of the
federal appeals court in San Martin, Buenos Aires.
As a result of the looming expiration of the informal standstill
arrangement, the Debtors commenced chapter 11 cases in the U.S. in
order to put the automatic stay in place, maintain the status quo
pending resolution of the various issues in Argentina, and ensure
that neither the Indenture Trustee nor the Argentine Trustee takes
any action that could be detrimental or value destructive to the
Company.
Stoneway Capital Ltd. and five related entities, including Stoneway
Capital Corp., sought Chapter 11 bankruptcy protection (Bankr.
S.D.N.Y. Case No. 21-10646) on April 7, 2021. Stoneway estimated
liabilities of $1 billion to $10 billion and assets of $500 million
to $1 billion.
Judge James L. Garrity, Jr., oversees the cases.
The Debtors tapped Shearman & Sterling LLP as bankruptcy counsel,
Bennett Jones LLP as Canadian counsel, Lazard Freres & Co. LLC as
investment banker, and RSM Canada LLP as tax services provider.
Prime Clerk, LLC is the claims agent and administrative advisor.
SUDBURY PROPERTY: Seeks to Tap Greater Boston Commercial as Broker
------------------------------------------------------------------
Sudbury Property Management, LLC seeks approval from the U.S.
Bankruptcy Court for the District of Massachusetts to employ
Greater Boston Commercial Properties, Inc. as its real estate
broker.
The Debtor needs a broker to market its real property located at
260 East Main St., Marlborough, Mass.
The broker will receive 5 percent of the property's gross selling
price payable at closing of title.
Bret O'Brien, president of Greater Boston Commercial Properties,
disclosed in a court filing that the firm is a "disinterested
person" as that term is defined in section 101(14) of the
Bankruptcy Code.
The firm can be reached through:
Bret O'Brien
Greater Boston Commercial Properties, Inc.
44 Bearfoot Road
Northborough, MS 01532
Telephone: (508) 281-4811
Facsimile: (508) 281-4728
Email: info@greaterbostoncp.com
About Sudbury Property Management
Sudbury Property Management, LLC is a privately held company in the
nonresidential building construction industry. The company is
headquartered in Marlborough, Mass.
Sudbury Property Management filed a petition for Chapter 11
protection (Bankr. D. Mass. Case No. 21-40913) on Dec. 14, 2021,
listing as much as $10 million in both assets and liabilities.
Padraig O'Beime, member, signed the petition.
Judge Christopher J. Panos oversees the case.
The Debtor tapped Francis C. Morrissey, Esq., at Morrissey, Wilson
& Zafiropoulos, LLP as legal counsel.
TECHNICAL COMMUNICATIONS: Incurs $613K Net Loss in First Quarter
----------------------------------------------------------------
Technical Communications Corporation filed with the Securities and
Exchange Commission its Quarterly Report on Form 10-Q disclosing a
net loss of $613,361 on net revenue of $423,481 for the three
months ended Dec. 25, 2021, compared to a net loss of $342,111 on
net revenue of $166,925 for the three months ended Dec. 26, 2020.
As of Dec. 25, 2021, the Company had $1.83 million in total assets,
$2.09 million in total liabilities, and a total stockholders'
deficit of $256,296.
For the fiscal years ended Sept. 25, 2021 and Sept. 26, 2020, the
Company generated net losses of $1,088,386 and $910,650,
respectively. Although the Company generated $631,425 of net
income in the fiscal year ended Sept. 28, 2019, the Company
suffered recurring losses from operations during the prior seven
year period from fiscal 2012 to fiscal 2018 and had an accumulated
deficit of $4,767,328 at Dec. 25, 2021. The Company said these
factors continue to raise substantial doubt about the Company's
ability to continue as a going concern.
"We anticipate that our principal sources of liquidity, including
the recent line of credit, will be sufficient to fund our
activities through March 2022. In order to have sufficient cash to
fund our operations beyond that point, we will need to secure new
customer contracts, raise additional equity or debt capital, and
reduce expenses, including payroll and payroll-related expenses
through another employee furlough and/or separations," Technical
Communications said.
"In order to have sufficient capital resources to fund operations,
the Company has been working diligently to secure several large
orders with new and existing customers. The receipt of these
orders has been significantly delayed and will continue to be
difficult to predict due to the impact of the COVID-19 pandemic on
our customers as a result of their operations being reduced or shut
down. TCC has been able to maintain its operations during this
sustained period of disruption, but a continuation of the
disruption in either our customers' operations or those of the
Company will continue to have a material adverse impact on sales
activity and revenue," the Company said.
A full-text copy of the Form 10-Q is available for free at:
https://www.sec.gov/ix?doc=/Archives/edgar/data/96699/000117184322000864/tcco20211225_10q.htm
About Technical Communications
Concord, Massachusetts-based Technical Communications Corporation
-- http://www.tccsecure.com-- specializes in secure communications
systems and customized solutions to protect highly sensitive voice,
data and video transmitted over a wide range of networks, serving
government entities, military agencies, and corporate enterprises.
Technical Communications Corporation reported a net loss of $1.09
million for the year ended Sept. 25, 2021 compared to a net loss of
$910,650 for the year ended Sept. 26, 2020.
Stowe & Degon LLC, in Westborough, Massachusetts, the Company's
auditor since 2019, issued a "going concern" qualification in its
report dated Dec. 28, 2020, citing that the Company has an
accumulated deficit, has suffered significant net losses and
negative cash flows from operations and has limited working capital
that raises substantial doubt about its ability to continue as a
going concern.
THOMASBORO LANDCO: Voluntary Chapter 11 Case Summary
----------------------------------------------------
Debtor: Thomasboro Landco, LLC
d/b/a Stone Farm Landco, LLC
11118 U.S. Hwy 31
Spanish Fort, AL 36527-5647
Chapter 11 Petition Date: February 11, 2022
Court: United States Bankruptcy Court
Southern District of Alabama
Case No.: 22-10260
Debtor's Counsel: Edward J. Peterson, Esq.
STICHTER, RIEDEL, BLAIN & POSTLER, P.A.
110 E. Madison St.
Suite 200
Tampa, FL 33602
Tel: (813) 229-0144
E-mail: epeterson@srbp.com
Estimated Assets: $10 million to $50 million
Estimated Liabilities: $10 million to $50 million
The petition was signed by J. Marion Uter as manager.
The Debtor stated it has no creditors holding unsecured claims.
A full-text copy of the petition is available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/Q5VTIWA/Thomasboro_Landco_LLC__alsbke-22-10260__0001.0.pdf?mcid=tGE4TAMA
TOUCHPOINT GROUP: Converts 30K Preferred Shares to Common Shares
----------------------------------------------------------------
As a result of the filing of the Certificate of Amendment to the
Certificate of Incorporation of Touchpoint Group Holdings Inc., the
30,000 shares of the Series A Convertible Preferred Stock of the
Company currently outstanding were automatically converted into
30,000,000 shares of common stock.
On Feb. 3, 2022, Touchpoint Group filed a Certificate of Amendment
to its Certificate of Incorporation increasing the number of shares
of common stock, par value $0.0001 per share it is authorized to
issue to 1,750,000,000.
About Touchpoint Group
Headquartered in Miami, Florida, Touchpoint Group Holdings Inc. --
http://touchpointgh.com-- is engaged in media and digital
technology, primarily in sports entertainment and related
technologies that bring fans closer to athletes and celebrities.
Touchpoint Group reported a net loss of $3.54 million for the year
ended Dec. 31, 2020, compared to a net loss of $6.63 million for
the year ended Dec. 31, 2019. As of Sept. 30, 2021, the Company
had $1.77 million in total assets, $3.52 million in total
liabilities, $605,000 in temporary equity, and a total
stockholders' deficit of $2.36 million.
Tampa, Florida-based Cherry Bekaert, LLP, the Company's auditor
since 2016, issued a "going concern" qualification in its report
dated April 9, 2021, citing that the Company has recurring losses
and negative cash flows from operations that raise substantial
doubt about its ability to continue as a going concern.
TOWNHOUSE HOTEL: March 28 Plan & Disclosure Hearing Set
-------------------------------------------------------
On Feb. 10, 2022, debtor Townhouse Hotel, LLC, filed with the U.S.
Bankruptcy Court for the Southern District of Florida a Combined
Disclosure Statement and Plan (Liquidation). Judge Robert A. Mark
ordered that:
* March 28, 2022, at 2:00 p.m. via video conference is the
hearing on approval of the disclosure statement and confirmation of
the plan.
* March 21, 2022, is fixed as the last day for filing written
acceptances or rejections of the plan.
* March 14, 2022, is fixed as the last day to file objections
to claims.
* March 25, 2022, is fixed as the last day to file objections
to confirmation.
* March 25, 2022, is fixed as the last day to file objections
to approval of the Disclosure Statement.
A full-text copy of the order dated Feb. 10, 2022, is available at
https://bit.ly/33lQW3m from PacerMonitor.com at no charge.
Counsel to Debtor:
SCOTT ALAN ORTH, ESQ.
Florida Bar No. 436313
LAW OFFICES OF SCOTT ALAN ORTH, P.A.
3860 Sheridan Street, Suite A
Hollywood, FL 33021
305.757.3300 / 305.757.0071 Fax
E-mail: scott@orthlawoffice.com
service@orthlawoffice.com (primary)
eserviceSAO@gmail.com (secondary)
About Townhouse Hotel
Townhouse Hotel, LLC, sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. S.D. Fla. Case No. 20-19997) on Sept. 16,
2020. The petition was signed by Abraham Kramer, manager of G & A
Miami LLC, manager of Townhouse Hotel LLC. At the time of the
filing, the Debtor disclosed estimated assets of $1 million to $10
million and estimated liabilities of $500,000 to $1 million. Judge
Robert A. Mark oversees the case. Scott Alan Orth, Esq., at Law
Offices of Scott Alan Orth, P.A. serves as the Debtor's counsel.
TOWNHOUSE HOTEL: Unsecured Creditors to Recover 35% to 46% in Plan
------------------------------------------------------------------
Townhouse Hotel, LLC, filed with the U.S. Bankruptcy Court for the
Southern District of Florida a Combined Disclosure Statement and
Plan (Liquidation) dated Feb. 10, 2022.
The Debtor operated a hotel in Miami Beach on premises that were
leased, and the hotel operation and all its assets have now been
sold pursuant to the Bankruptcy Court's Order allowing same.
The Debtor sold and assigned its leasehold and physical assets for
$1,400,000, gross and a net of $827,590. Those sums are secured to
the insiders that paid off a $2,000,000 bank loan prepetition.
After payment of administrative expenses approved by the Court,
including an additional rent claim of the Landlord (for fees for
litigation) there is only $795,194 remaining in the Estate.
Accordingly, all of the remaining funds are the collateral of the
secured creditors.
Eight (8) creditors have filed unsecured proofs of claim. Two of
those claims have been resolved, and the Debtor has filed
objections to four other claims. The 41 scheduled undisputed
unsecured creditors have claims that total less than $74,000. The
remaining filed claims total $210,548.39 on their face but if
objections are sustained, these claims would total $142,838. The
total claims at the maximum amount is $285,000 and at the minimum
$216,000 (approx.).
THH proposes to pay creditors of the Debtor from existing funds.
All assets have been liquidated pursuant to the sale of the Hotel
and leasehold. At this point in time, it is estimated that there
will be sufficient funds after administrative claims to pay the
secured creditor its agreed amount and to distribute a pro-rata
dividend among allowed unsecured creditors.
Upon Confirmation, the Debtor will pay any and all US Trustee's
fees applicable and will apply for and pay, as ordered by the
Court, payment to its counsel for the final Plan work and
potentially the filing of Debtor's final tax returns. These amounts
will be surcharged against amounts otherwise distributable to the
secured creditor.
Other than a carve-out of $100,000, the remaining funds will be
paid to the secured creditors and administrative claims. The amount
of the carve out will be paid in pro-rata shares to unsecured
creditors with allowed claims until paid in full without interest.
Based on the $100,000 carve out, the distribution to unsecured
creditors is expected to be at least 35% and up to 46% of the
allowed amounts of each claim.
This Plan is a plan to distribution the proceeds of the sale of
assets previously approved by the Court and concluded.
Claims and interests shall be treated as follows under this Plan:
* The Secured SBA loan in Class 1 will be paid in full.
* Class 2 consists of Pre-petition Secured Creditors. Secured
Creditors will receive the net from available cash, less the
$100,000 carve-out for unsecured claims, less the surcharge for
administrative claims and costs incident to execution of the plan.
* Class 3 Unsecured Creditors will only receive a pro-rata
distribution of the carve-out amount of $100,000 (which would
otherwise be payable to the secured creditor). Through counsel's
continuing efforts to contest the 6 claims that are not agreed,
counsel will attempt to make the pro-rata distribution greater for
the other unsecured creditors.
* Former equity holders will not retain any property or
receive any payment under the Plan, except the ownership of the
Debtor and any tax carryovers associated therewith.
The Plan will be funded by cash in the estate and existing claims
or collections to be pursued in the name of the Debtor. The Debtor
will transfer the entire proceeds of the operations and Sale to the
Trust account of the Court Approved counsel for the Debtor in
possession. Said counsel will make all distributions required by
the plan and file a report of distributions no later than 30 days
after the last payment distribution clears.
The carve-out amount for unsecured creditors will be held in the
trust account of counsel for the Debtor in possession pending the
resolution of claim objections. There will be a single distribution
after claim objections are resolved. Counsel will be the disbursing
agent.
A full-text copy of the Combined Disclosure Statement and Plan
dated Feb. 10, 2022, is available at https://bit.ly/33lQW3m from
PacerMonitor.com at no charge.
Counsel to Debtor:
SCOTT ALAN ORTH, ESQ.
LAW OFFICES OF SCOTT ALAN ORTH, P.A.
3860 Sheridan Street, Suite A
Hollywood, FL 33021
Tel: 305.757.3300
Fax: 305.757.0071
E-mail: scott@orthlawoffice.com
service@orthlawoffice.com (primary)
eserviceSAO@gmail.com (secondary)
About Townhouse Hotel
Townhouse Hotel, LLC, sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. S.D. Fla. Case No. 20-19997) on September
16, 2020. The petition was signed by Abraham Kramer, manager of G &
A Miami LLC, manager of Townhouse Hotel LLC. At the time of the
filing, the Debtor disclosed estimated assets of $1 million to $10
million and estimated liabilities of $500,000 to $1 million. Judge
Robert A. Mark oversees the case. Scott Alan Orth, Esq., at Law
Offices of Scott Alan Orth, P.A. serves as the Debtor's counsel.
TPT GLOBAL: Unit to Start Marketing New 4G+/5G Services
-------------------------------------------------------
TPT Global Tech, Inc.'s telecommunications subsidiary "TPT Speed
Connect" has completed enough of its build-out to start marketing
its 4G+/5G network builds in the States of Texas, Idaho and
Arizona.
The new network deployment is the Company's continuing efforts to
upgrade its Mid-American overall network for rural broadband and
position itself for faster market share growth. Now that the
Company is starting its marketing efforts to bring on new customers
in Texas, Idaho, and Arizona, its 4G+/5G upgrades will be
concentrated in the remaining TPT SpeedConnect states of Montana,
Minnesota, South Dakota, Michigan, Iowa, Illinois, and Nebraska.
The installation of this new technology will allow the Company to
offer improved speeds and further enhanced services to its rural
customers.
The proposed marketing program will consist of aggressive social
media paid placements, direct mail, collateral material, local TV
commercials, and print placements.
Upon completion of the full network, the Company will be in a
position to service and manage up to 30,000 customers across 10
states. The advertising and marketing campaign will showcase the
more reliable and improved speeds TPT SpeedConnect will have to
offer as it seeks to substantially and rapidly grow its customer
base. To date, the feedback from customers that have experienced
the new network has been even better than was expected.
"Managing these upgrades across our 10 State Middle American Rural
Broadband network has been challenging during the Covid 19
Pandemic, but hats off to the engineering team at TPT SpeedConnect
for all of their hard work. We, as a company, are excited about
the new products and faster broadband speeds that TPT SpeedConnect
can now offer its customers within these markets," said Stephen
Thomas, CEO of TPT Global Tech. "
About TPT Global Tech
TPT Global Tech Inc. (OTC:TPTW) based in San Diego, California, is
a technology-based company with divisions providing
telecommunications, medical technology and product distribution,
media content for domestic and international syndication as well as
echnology solutions. TPT Global Tech offers Software as a Service
(SaaS), Technology Platform as a Service (PAAS), Cloud-based
Unified Communication as a Service (UCaaS). It offers carrier-grade
performance and support for businesses over its
private IP MPLS fiber and wireless network in the United States.
TPT's cloud-based UCaaS services allow businesses of any size to
enjoy all the latest voice, data, media and collaboration features
in today's global technology markets. TPT Global Tech also
operates as a Master Distributor for Nationwide Mobile Virtual
Network Operators (MVNO) and Independent Sales Organization (ISO)
as a Master Distributor for Pre-Paid Cell phone services, Mobile
phones Cell phone Accessories and Global Roaming Cell phones.
TPT Global reported a net loss attributable to the Company's
shareholders of $8.07 million for the year ended Dec. 31, 2020,
compared to a net loss attributable to the company's shareholders
of $14.03 million for the year ended Dec. 31, 2019. As of Sept.
30, 2021, the Company had $11.77 million in total assets, $42.75
million in total liabilities, $5.03 million in total mezzanine
equity, and a total stockholders' deficit of $36 million.
Draper, Utah-based Sadler, Gibb & Associates, LLC, the Company's
auditor since 2016, issued a "going concern" qualification in its
report dated April 15, 2021, citing that the Company has suffered
recurring losses from operations and has insufficient cash flows
from operations to support working capital requirements. These
factors raise substantial doubt about the Company's ability to
continue as a going concern.
TROJE'S TRASH: Vermillion Entitled to Damages Against Tennis
------------------------------------------------------------
The case styled Vermillion State Bank, Respondent, v. Tennis
Sanitation, LLC, Appellant, No. A19-1421 (Minn.) asks the Supreme
Court of Minnesota to decide, among other issues, whether an oral
hybrid contract for the sale of goods and intangible non-goods is
subject to its predominant purpose test -- the test used to
determine whether the provisions of the Uniform Commercial Code
(UCC) or the common law govern the contract as a whole.
Appellant Tennis Sanitation, LLC, repudiated an alleged oral
contract it negotiated with respondent Vermillion State Bank for
its purchase of certain assets of a trash collection business in
bankruptcy, Troje's Trash Pick-up, which included tangible assets
such as garbage trucks and intangible assets such as customer
routes. Vermillion, after selling the assets to another company at
a significantly lesser price following Tennis's repudiation, sued
Tennis for breach of contract, seeking monetary relief.
At trial, the jury returned a unanimous verdict finding that the
parties entered an oral contract; the predominant factor of that
oral contract was for the sale of the trash collection business'
customer routes, not its physical assets; Tennis breached the
contract; and as a result of the breach, Vermillion suffered $1.92
million in damages. After the district court adopted the jury's
verdict as its findings, Tennis made post-trial motions based on
numerous alleged errors, asserting that the district court should
have divided the contract into its component parts and applied the
UCC to the goods portion of the contract; that a clear and
convincing evidence standard applies as to the formation of the
contract; that there was insufficient evidence to support the
jury's finding that an oral contract existed; that the district
court issued erroneous jury instructions; and that the statutory
postjudgment rate of 10% imposed on judgments greater than $50,000
violates the Equal Protection Clause. The district court denied
Tennis's motions, the court of appeals affirmed, and the state
Supreme Court granted Tennis's petition for review.
"Because we hold that hybrid contracts involving goods and
non-goods should be interpreted based on the predominant purpose of
the contract, and otherwise find no error in the decision of the
court of appeals -- including as to the constitutionality of the
postjudgment statute -- we affirm," the state Supreme Court holds
in an opinion dated February 2, 2022, a full-text copy of which is
available at https://tinyurl.com/ym8xnrak from Leagle.com.
Mark R. Bradford -- mbradford@bassford.com -- Lewis A. Remele, Jr.
-- lremele@bassford.com -- Steven M. Sitek -- ssitek@bassford.com
-- Bassford Remele, P.A., Minneapolis, Minnesota, for respondent.
Kay Nord Hunt ,-- kay@lommen.com -- Michelle K. Kuhl --
mkuhl@lommen.com -- Barry A. O'Neil -- barry@lommen.com -- Lommen
Abdo, P.A., Minneapolis, Minnesota; and
Steven R. Coon , Law Offices of Steven Coon, Minneapolis,
Minnesota, for appellant.
About Troje's Trash Pick-Up
Troje's Trash Pick-Up Inc. is a trash hauler with a principal place
of business at 6010 S. Concord Blvd., Inver Grove Heights,
Minnesota. It also conducts a roll-off business.
Troje's Trash Pick-Up filed a Chapter 11 petition (Bankr. D. Minn.
Case No. 16-30037) on Jan. 7, 2016. The petition was signed by
Dennis Troje, president.
The Debtor is represented by Steven Nosek, Esq., at Steven B.
Nosek, P.A. The case is assigned to Judge Kathleen H. Sanberg.
The Debtor estimated assets and liabilities in the range of
$1 million to $10 million.
UNITED AIRLINES: Egan-Jones Hikes Senior Unsecured Ratings to B-
----------------------------------------------------------------
Egan-Jones Ratings Company, on January 18, 2022, upgraded the
foreign currency and local currency senior unsecured ratings on
debt issued by United Airlines Inc. to B- from CCC+. EJR also
maintained its 'C' rating on commercial paper issued by the
Company.
Headquartered in Chicago, Illinois, United Airlines, Inc. provides
commercial airline services.
US ECOLOGY: Moody's Puts Ba3 CFR Under Review for Upgrade
---------------------------------------------------------
Moody's Investors Service placed the ratings of US Ecology
Holdings, Inc. ("US ECOL") on review for upgrade following an
announcement by Republic Services, Inc. ("Republic") that it has
entered into a definitive agreement to acquire US ECOL. The ratings
affected by the review for upgrade include the Ba3 corporate family
rating, Ba3-PD probability of default rating, Ba3 senior secured
revolving credit facility and the Ba3 senior secured first lien
term loan. The outlook is revised to ratings under review from
negative. The SGL-3 rating is unchanged at this time.
The all-cash transaction, with an offer of $48.00 per share, values
the total enterprise at approximately $2.2 billion, including net
debt of $0.7 billion. Republic plans to fund the transaction with
new and existing debt. Moody's believes all of the outstanding debt
of US ECOL will be repaid at transaction close, which is expected
to occur by the end of the second quarter of 2022, subject to
customary closing conditions and regulatory approvals. Moody's will
withdraw the ratings of US ECOL if the debt is repaid.
The review for upgrade reflects Moody's expectation that, should
the acquisition by Republic close, US ECOL will become an important
part of a larger, more diverse and conservatively capitalized
company.
On Review for Upgrade:
Issuer: US Ecology Holdings, Inc.
Corporate Family Rating, Placed on Review for Upgrade, currently
Ba3
Probability of Default Rating, Placed on Review for Upgrade,
currently Ba3-PD
Senior Secured 1st Lien Term Loan, Placed on Review for Upgrade,
currently Ba3 (LGD4)
Senior Secured Revolving Credit Facility, Placed on Review for
Upgrade, currently Ba3 (LGD4)
Outlook Actions:
Issuer: US Ecology Holdings, Inc.
Outlook, Changed to Rating Under Review from Negative
RATINGS RATIONALE/FACTORS THAT COULD LEAD TO AN UPGRADE OR
DOWNGRADE OF THE RATINGS
Aside from the review prompted by the acquisition announcement, US
ECOL's current rating benefits from a regulation-driven operating
model, technical expertise in niche sectors of the waste disposal
industry, unique high-value assets and a track record of steady but
modest free cash flow. The company holds a solid market position in
specialty and industrial waste services. However, scale remains
relatively modest considering the narrow focus and lower volumes
associated with specialty and hazardous waste streams. Revenue is
susceptible to volatility from the company's treatment and disposal
(T&D) event-driven business, which has experienced delays and
deferrals from the effects of the pandemic, and fluctuations in
large scale emergency response projects. While demand is improving
in other segments (e.g. energy waste), customer spending is likely
to remain cautious in the near term. Given these factors,
debt-to-EBITDA (near 5x) will likely remain elevated, although
expected to moderate gradually through 2022 with improving
fundamentals and pricing actions.
The principal methodology used in these ratings was Environmental
Services and Waste Management Companies published in April 2018.
US Ecology Holdings, Inc., publicly traded under ECOL and a
subsidiary of US Ecology, Inc., provides treatment, disposal and
recycling of hazardous, non-hazardous and radioactive waste, as
well as a wide range of complementary field and industrial
services. With the late 2019 addition of NRC Group Holding Corp.,
the company also provides recurring environmental and compliance
services, remediation, cleaning, decontamination, maintenance and
inspection to the marine and rail transportation, general
industrial and energy markets. The Sprint Energy Services segment
provides waste management services to the upstream and midstream
energy markets. Revenue for the last twelve months that ended
September 30, 2021 was $968 million.
US ECOLOGY: S&P Places 'BB-' ICR on CreditWatch Positive
--------------------------------------------------------
S&P Global Ratings placed all of its ratings on US Ecology Inc.,
including its 'BB-' issuer credit rating, on CreditWatch with
positive implications.
S&P plans to resolve the CreditWatch listing upon the completion of
the transaction.
Republic Services Inc. announced that it signed a definitive
agreement to acquire US Ecology Inc. for about $2.2 billion
(including net debt of about $700 million).
The CreditWatch placement follows Republic Services announcement
that it signed a definitive agreement to acquire US Ecology for
about $2.2 billion (including assumed net debt). S&P said, "We
expect the transaction to close by the end of the second quarter of
2022. At that time, we will likely raise our rating on US Ecology,
to equalize it with our rating on Republic Services, and then
withdraw all of our ratings on the company assuming its debt has
been fully repaid."
S&P said, "We expect to resolve the CreditWatch placement following
the completion of the transaction. We will monitor any developments
related to the transaction, including the receipt of necessary
shareholder approvals and regulatory clearances. We expect the
transaction will be positive for US Ecology's credit quality given
our much stronger investment-grade rating on Republic Services and
its significantly larger scale. If the transaction is completed, we
will likely raise our rating on US Ecology to equalize it with our
rating on Republic Services. We will the withdraw our ratings on US
Ecology upon the close of transaction after Republic Services
repays its debt.
"If the transaction does not close as contemplated, we will likely
affirm our 'BB-' rating on US Ecology, remove our ratings from
CreditWatch, and assign a negative outlook, assuming the company's
operating performance and credit measures remain within our
expectations."
VAIL RESORTS: Egan-Jones Keeps B+ Sr. Unsecured Debt Ratings
------------------------------------------------------------
Egan-Jones Ratings Company, on January 18, 2022, maintained its
'B+' foreign currency and local currency senior unsecured ratings
on debt issued by Vail Resorts Inc.
Headquartered in Broomfield, Colorado, Vail Resorts, Inc. operates
resorts in Colorado.
VETERAN HOLDINGS: Unsecured Creditors to Have 100% Recovery in Plan
-------------------------------------------------------------------
Veteran Holdings NY LLC filed with the U.S. Bankruptcy Court for
the Eastern District of New York a Disclosure Statement for Plan of
Reorganization dated Feb. 8, 2022.
The Debtor is a limited liability company currently under contract,
via an assignment, to purchase the real property located at
2925-2965 Veteran Roads West, Staten Island, New York.
Seller and Alpha Equity Group, LLC entered into the Contract of
Sale dated November 1, 2021 to sell the Property for a purchase
price of $47,000,000. The Contract was subsequently amended to
substitute the Debtor as the purchaser and reduce the purchase
price to $45,600,000.
The Debtor filed this chapter 11 case to avoid defaulting under the
contract to acquire the Property and potentially lose its rights,
including its contract deposit. Since the Debtor's filing, the
Debtor has been seeking sufficient funding to close on the sale of
the Property under the Veterans Holdings Contract of Sale.
South to East, the holder of the Debtor's Existing Equity Interest
has entered into the Veterans Center Purchase and Sale Agreement to
sell its Existing Equity Interests to Veterans Center for
$59,000,000. The $59,000,000 Sale Proceeds will be used to fund the
balance of the purchase price due under the Veterans Holdings
Contract of Sale and payment of Claims under the Plan.
As of the filing of the Plan and Disclosure Statement, Veterans
Center has deposited $500,000 into the Disbursing Agent's escrow in
accordance with the terms of the Veterans Center Purchase and Sale
Agreement. Prior to the Confirmation Hearing, Veterans Center will
deposit an additional $1,000,000 into escrow.
In order to effectuate the transfer of the Property to the Debtor,
the Plan proposes two contemporaneous closings under the Veterans
Holdings Contract of Sale and the Veterans Center Purchase and Sale
Agreement. At the Veterans Center Closing, the Sale Proceeds from
the Veterans Center Purchase and Sale Agreement will be used to pay
the balance of the purchase price due under the Veterans Holdings
Contract of Sale.
The Plan will treat claims as follows:
* Class 1 consists of the Allowed JBBNY Secured Claim. On the
Effective Date, the holder of the JBBNY Secured Claim shall
receive, in full and final satisfaction of such Claim, Cash in the
unpaid principal balance of the JBBNY Note amount plus interest at
the rate specified in the JBBNY Note payable from the Sale
Proceeds. This Class will receive a distribution of 100% of their
allowed claims. Class 1 is Unimpaired.
* Class 2 consists of General Unsecured Claims against the
Debtor. Each holder of an Allowed General Unsecured Claim shall
receive on the Effective Date, in full and final satisfaction of
such Claim, Cash from the Sale Proceeds in an amount equal to the
Allowed amount of such Claim, plus interest at the federal judgment
rate payable from the Sales Proceeds. The allowed unsecured claims
total $46,361,778.00. This Class will receive a distribution of
100% of their allowed claims. Class 2 is Unimpaired.
* Class 3 consists of Existing Equity Interests in the Debtor.
On the Effective Date, the holder of the Class 3 Existing Equity
Interests shall receive the consideration provided for under the
Veterans Center Purchase and Sale Agreement. Class 3 is
Unimpaired.
The Debtor shall take all necessary steps, and perform all
necessary acts, to consummate the terms and conditions of the Plan
including but not limited to: (a) assuming the Veterans Holdings
Contract of Sale and contemporaneously closing the sale of its
membership interests under the Veterans Center Purchase and Sale
Agreement in order to effectuate a sale of the Property from the
Seller to the Debtor and (b) distributing the Sale Proceeds to pay
Claims under the Plan.
A full-text copy of the Disclosure Statement dated Feb. 8, 2022, is
available at https://bit.ly/3GBuzEA from PacerMonitor.com at no
charge.
Attorneys for the Debtor:
Fred B. Ringel, Esq.
Robinson Brog Leinwand Greene Genovese & Gluck PC
875 Third Avenue
New York, NY 10022
Telephone: (212) 603-6300
Email: fbr@robinsonbrog.com
About Veteran Holdings NY
Veteran Holdings NY LLC, a real estate business in Brooklyn, New
York, filed its voluntary petition for relief under Chapter 11 of
the Bankruptcy Code (Bankr. E.D.N.Y. Case No. 22-40052) on Jan. 12,
2022. Pearl Schwartz, managing member, signed the petition. At the
time of the filing, the Debtor disclosed $10 million to $50 million
in both assets and liabilities.
Judge Elizabeth S. Stong oversees the case.
Robinson Brog Leinwand Greene Genovese & Gluck PC serves as the
Debtor's counsel.
VIASAT INC: Fitch Affirms 'B+' IDR, Outlook Positive
----------------------------------------------------
Fitch Ratings has affirmed Viasat, Inc.'s Issuer Default Rating
(IDR) at 'B+', first lien senior secured notes at 'BB+'/'RR1' and
unsecured notes at 'BB-'/'RR3'. Viasat Technologies Limited's 'B+'
IDR has also been affirmed. Other ratings have been affirmed as
listed at the end of this release. The Rating Outlook is Positive.
Fitch has also assigned a 'BB+'/'RR1' rating to the company's new
$700 million first lien senior secured term loan due 2029. The
company plans to use the proceeds to repay all the outstanding
borrowings on its revolving credit facility and for general
corporate purposes.
Viasat's rating and Positive Outlook reflect strong revenue growth
prospects and moderate leverage for the rating, balanced against
high capital intensity and FCF deficits, as the company funds its
satellite build program. Fitch believes an upgrade is possible
following a successful launch and deployment of the first of these
satellites.
KEY RATING DRIVERS
Solid EBITDA Growth: Revenues grew 26% in the first nine months of
fiscal 2022 (ending Dec. 31, 2021) over the prior year period due
the continuing recovery of the satellite services business, growth
due to acquisitions, and higher commercial networks revenue. Fitch
anticipates revenues and Fitch-calculated EBITDA will grow
approximately 21% and 20%, respectively, in fiscal 2022.
Through the first nine months of fiscal 2022, satellite services
revenues grew 38%, compared with the 5% growth in fiscal 2021, with
growth arising from higher levels of air traffic, the onboarding of
Delta Air Lines and the return of inactive aircraft to service.
Residential broadband revenues, which grew during the pandemic, may
grow slower until the ViaSat-3 launch, as the company manages its
operations to accommodate accelerating demand from inflight
connectivity applications.
Inmarsat Merger: Viasat plans to merge with Connect Topco Limited
(Inmarsat) in a cash and stock transaction that is anticipated to
close by the end of 2022. The merger is subject to Viasat
shareholder and regulatory approvals and other customary closing
conditions. The merger will further diversify Viasat's revenue, and
increase the amount of recurring revenue in Viasat's revenue mix.
Fitch believes the proposed merger will be neutral to Viasat's
credit profile. Fitch estimates consolidated gross leverage will
rise to just over 5x for fiscal 2023, or approximately 0.5x over
Fitch's prior forecast for fiscal 2023. Continued expected positive
operating momentum and improved FCF prospects once the second
ViaSat-3 satellite is launched will lead to relatively rapid
delevering thereafter, causing leverage metrics to approach Fitch's
positive sensitivity threshold.
Near-Term Leverage Expectations: Fitch estimates Viasat's gross
leverage will approximate 3.9x at FYE 2022 (net leverage of 3.4x)
as an increase in debt is only partly offset by EBITDA growth
approximately of 20%. Gross leverage and net leverage were 3.4x and
2.9x, respectively, at FYE 2021.
FCF Deficits from High Capex: Viasat is in the midst of a high
capex period, as it is building three third-generation,
high-throughput satellites at related ground infrastructure at a
total cost of $2 billion or more. The first, ViaSat-3 (Americas),
is expected to be launched in late summer 2022, with ViaSat-3
(EMEA) to be launched about six months later. ViaSat-3 (APAC) is
expected to follow six to nine months after the EMEA satellite. The
company has indicated as a frame of reference that on a stand-alone
basis, positive FCF may follow about three quarters after the
launch of the second ViaSat-3 satellite.
Execution Risk: To sustain EBITDA and cash flow growth, Viasat must
successfully execute in the satellite construction phase as well as
on growth strategies once the satellites are in service. The
company is expected to benefit from a strong revenue backlog, as
well as the additional global markets opened up by the ViaSat-3
satellites. Once completed, the three satellites will provide
approximately 8x the capacity of Viasat's existing fleet.
Revenue Backlog: Viasat had a $2.1 billion backlog at Dec. 31, 2021
(down 10% over the prior year), of which a little over one-half is
expected to be delivered over the next 12 months. The company does
not include amounts in backlog if the company does not have
purchase orders. The backlog does not include anticipated purchase
orders for commercial aircraft IFC systems or service revenues
under agreements.
At the end of December 2021, the company provided in-flight
internet services to 1,800 active commercial aircraft (another 80
remained inactive due to the pandemic). In addition, the company
anticipated another roughly 860 aircraft would be put into service
under existing agreements. A majority of the company's contracts
can be terminated at the convenience of its customers for little or
no penalty.
Strong Competitive Position: Viasat benefits from vertical
integration, which drives cost efficiencies. The company operates
from a strong competitive position within certain business
segments, primarily the satellite services segment (fixed
residential broadband and IFC) where existing competitors may have
weaker financial profiles or technology positions. Its share in the
North American narrow-body market has grown significantly over the
past several years.
The company is expected to face competition in satellite services
from low-earth orbit (LEO) satellite networks in development.
Viasat is expected to have a material advantage in cost/ bit of
capacity and leveraging its existing business platform, while being
disadvantaged in terms of latency.
In the government systems and commercial networks segments, Viasat
has a relatively strong competitive position with its product
portfolio, but faces competition from higher rated companies with
stronger and more diversified businesses.
Parent-Subsidiary Relationship: Fitch links the ratings of Viasat
and Viasat Technologies, based on a strong parent/weak subsidiary
approach. The linkage incorporates high strategic and operational
incentives, and low legal incentives under Fitch's criteria. Thus
the IDRs are equalized.
DERIVATION SUMMARY
In the Government Systems and Commercial Systems segments, Viasat
competes against higher rated companies that have access to much
greater resources. In the Government Systems segment, there are
numerous competitors, but major competitors in the manufacture of
defense electronic against which Viasat competes include BAE
Systems plc (BBB/Stable) and Collins Aerospace.
In the Commercial Networks segment, the company also competes
against much larger companies, included Airbus SE ('BBB+'/Stable),
General Dynamics, L3Harris Technologies (BBB+/Stable) and MAXAR
Technologies.
In the satellite services business, as a provider of communications
infrastructure, comparable businesses to Viasat would include
Intelsat Jackson Holdings S.A. (B+[EXP]/Positive) and several
companies unrated by Fitch, such as Telesat Canada, SBA
Communications and Zayo Group Holdings. Unlike some of these
companies, Viasat provides services directly to consumers in its
satellite services segment. Given its vertically integrated
strategy, which not only includes satellite services, but the
development and manufacture of equipment, the company's EBITDA
margins are lower than the pure service providers. Fitch believes
the company's vertical integration provides a competitive advantage
over pure services providers.
In the in-flight connectivity segment, Viasat competes against
Intelsat, which acquired GoGo Inc., Anuvu (formerly Global Eagle
Entertainment) and Panasonic Avionic Corporation.
KEY ASSUMPTIONS
-- Fitch assumes revenue grows just over 20% in fiscal 2022
primarily due acquisitions and a recovery in inflight
connectivity revenues. Stand-alone Viasat revenues grow in the
mid-teens in fiscal 2023 and moderate thereafter.
-- Fitch calculated EBITDA margins for Viasat on a stand-alone
basis are in the low 20% range for fiscal 2023 as certain
costs increase prior to the launch of the ViaSat-3 satellite.
-- The first ViaSat-3 launch is completed around late summer
2022; Fitch assumes the pacing is in line with Viasat's
guidance of the second satellite following six months later,
and the third satellite following in a six-to-nine month
interval.
-- Over fiscal 2023-2024, on a stand-alone basis capex totals
over $2 billion, with a peak in fiscal 2023.
-- Pro forma for Inmarsat, Fitch estimates fiscal 2023 revenues
exceed $4.6 billion and EBITDA approximates $1.5 billion.
Recovery:
Fitch contemplates a scenario in which default is the result of one
or a combination of a number of scenarios, such as revenue and
EBITDA pressure from new or existing competitors that have managed
to reduce Viasat's cost advantage in the satellite business, delays
in satellite launches, or an increase in competition in the
government systems business. Fitch assumes Viasat would be
successfully reorganized.
Recovery assumptions are based on the company's strong cost
position, with very low space capital costs in millions of U.S.
dollars per gigabits per second (Gbps)and high capacity and strong
backlog in its three business segments, and patterns of consistent
adjusted EBITDA growth in the mid-teens over the past decade. These
strengths are balanced against the execution risk posed by its
planned satellite launches, including the potential for delays, and
the longer-term development of competitors.
Under this scenario, Fitch estimates a going-concern EBITDA
run-rate of $480 million, which is $148 million below projected
EBITDA for fiscal 2022. Fiscal 2022 expectations currently include
improvement for its IFC business following a stressed fiscal 2021,
and relatively strong growth in other business lines.
Fitch included 10% of the potential value from satellites under
construction, which had a book value of $1.7 billion as of Dec. 31,
2021 and would provide significant liquidation value, even if
materially discounted. Fitch believes some value can be reasonably
included, as the first of its high-capacity satellites near
completion and launch.
Fitch assumes Viasat will receive a going-concern recovery multiple
of 6.0x EBITDA under this scenario, which is supported by the
following:
Comparable Reorganizations: In the 2020 Industrial, Manufacturing,
Aerospace and Defense Bankruptcy Enterprise Values and Creditor
Recoveries case study, Fitch noted that the three aerospace and
defense defaulting companies had exit multiples between 4.8x and
6.9x.
The 2021 Telecom, Media and Technology Bankruptcy Enterprise Values
and Creditor Recoveries case study includes SpeedCast International
Limited, a satellite communications and network service provider.
Speedcast emerged from bankruptcy in early 2021 with a multiple of
8.7x. Unlike Viasat, SpeedCast does not own its own satellites and
had a less diversified revenue stream. A significant percentage of
its customers are in the maritime and oil and gas industries, and
faced headwinds and impacts from the coronavirus pandemic that
greatly affected its liquidity position.
Fitch forecasts a going-concern valuation of $3.05 billion and
recovery multiple of 6.0x, which results in a post-reorganization
enterprise value of $2.75 billion, after the deduction of expected
administrative claims (10%). Viasat's first-lien debt, assuming a
fully drawn revolver, is fully recovered, leading to a 'BB+'/'RR1'
rating, and the recovery on the unsecured debt equates to a
'BB-'/'RR3' rating.
Although the Ex-Im facility is at an entity that generates only 1%
of revenues, Fitch assumes that the facility is fully recovered as
under the "best interests" test whereby the recovery on a class of
claims in a going-concern reorganization would be no less than it
would be under a Chapter 7 liquidation. The Ex-Im facility is
secured by significant collateral value as the satellite at that
entity provides approximately two-thirds of the company's capacity
that supports an approximately $1.5 billion (fiscal 3Q22
annualized) revenue stream for satellite services and government
systems services.
RATING SENSITIVITIES
Factor that could, individually or collectively, lead to positive
rating action/upgrade:
-- Gross debt leverage sustained below 5.0x, combined with the
successful launch and deployment of service on the first
ViaSat-3 satellite.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
-- Gross debt leverage sustained above 6.0x;
-- Material delays or issues with respect to anticipated
satellite launches, or delays in achieving revenue and EBITDA
growth from future satellites.
BEST/WORST CASE RATING SCENARIO
International scale credit ratings of Non-Financial Corporate
issuers have a best-case rating upgrade scenario (defined as the
99th percentile of rating transitions, measured in a positive
direction) of three notches over a three-year rating horizon; and a
worst-case rating downgrade scenario (defined as the 99th
percentile of rating transitions, measured in a negative direction)
of four notches over three years. The complete span of best- and
worst-case scenario credit ratings for all rating categories ranges
from 'AAA' to 'D'. Best- and worst-case scenario credit ratings are
based on historical performance.
LIQUIDITY AND DEBT STRUCTURE
Liquidity: Viasat's liquidity is relatively strong given
availability on its revolver and available cash balances, and is
partly offset by FCF deficits. At Dec. 31, 2021, cash and cash
equivalents amounted to $166 million.
At Dec. 31, 2021, Viasat had approximately $271 million of capacity
on its $700 million revolver, after $59 million in letters of
credit. Viasat also had $79 million outstanding under an Ex-Im
credit facility, a senior secured direct loan facility.
The company had originally fully drawn $362 million under the Ex-Im
credit facility, and of the amount borrowed, approximately $321
million, was used to finance up to 85% of the cost of construction,
launch and insurance of the ViaSat-2 satellite and related costs.
Upon the receipt of the insurance proceeds related to ViaSat-2, the
entire proceeds of $188 million received in fiscal 2019 and fiscal
2020 were used to pay down the facility, as required.
The company is required by the terms of its senior secured credit
facilities to have insurance on 75% of the net book value of
certain covered satellites. The company has in-orbit insurance on
ViaSat-2, ViaSat-1, WildBlue-1 and the Anik F2 satellites.
ISSUER PROFILE
Viasat, Inc. is a vertically integrated technology provider, with
an end-to-end platform of high-capacity satellites, ground
infrastructure and user terminals. By being vertically integrated,
the company can provide cost effective and high-speed broadband
solutions through a broad market consisting of enterprise,
government and consumer users.
ESG CONSIDERATIONS
Unless otherwise disclosed in this section, the highest level of
ESG credit relevance is a score of '3'. This means ESG issues are
credit-neutral or have only a minimal credit impact on the entity,
either due to their nature or the way in which they are being
managed by the entity.
VIASAT INC: Moody's Rates New $700MM First Lien Secured Loan 'Ba3'
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Moody's Investors Service assigned a Ba3 rating to Viasat, Inc.'s
proposed $700 million first lien senior secured term loan B. The
company's B2 corporate family rating, B2-PD probability of default
rating, Ba3 senior secured notes rating, Caa1 senior unsecured
notes rating, SGL-3 speculative grade liquidity rating, and stable
outlook remain unchanged.
Net proceeds from the new term loan will be used to repay amounts
outstanding under the company's revolving credit facility and to
fund capital expenditures associated with its Viasat-3 satellites.
Assignments:
Issuer: Viasat, Inc.
Senior Secured Bank Credit Facility, Assigned Ba3 (LGD3)
LGD Adjustments:
Issuer: Viasat, Inc.
Senior Secured Regular Bond/Debenture, Unchanged at Ba3 (LGD3)
from (LGD2)
RATINGS RATIONALE
Viasat's B2 CFR is constrained by: (1) ongoing negative free cash
flow generation due to periodic construction of satellites; (2)
rising business risk from technological change and increasing
supply of satellites; and (3) rising leverage (adjusted
Debt/EBITDA) as the metric will increase by 0.6x to 4.8x for LTM
ended December 31, 2021 with the debt transaction and will further
increase by more than 1x when the acquisition of Inmarsat closes.
The rating benefits from: (1) good market position as the second
largest player in the North American consumer satellite internet
market; (2) a vertically integrated business model that has good
growth prospects; and (3) adequate liquidity.
As proposed, the new credit facility is expected to provide
covenant flexibility that if utilized could negatively impact
creditors. Notable terms include the following: (1) incremental
debt capacity up to the sum of (a) the greater of (i) $600 million
or after completion of the Inmarsat acquisition, $1,420 million and
(ii) an amount equal to 100% of pro forma consolidated EBITDA, plus
(b) available capacity under the general debt basket (an additional
amount up the greater of $300 million (or after completion of the
Inmarsat acquisition, $710 million) and an amount equal to 50% of
pro forma consolidated EBITDA), plus (c) an unlimited amount as
would not result in the first lien net leverage ratio exceeding 4x
(on a pari passu basis). The maturity date of any incremental term
loan shall be no earlier than the latest maturity date of existing
term loan, provided that up to the greater of $300 million (or
after completion of the Inmarsat acquisition, $710 million) and an
amount equal to 50% of pro forma consolidated EBITDA may have a
maturity date that is earlier than the maturity of the initial term
loan; (2) there are no express "blocker" provisions which prohibit
the transfer of specified assets to unrestricted subsidiaries; such
transfers are permitted subject to carve-out capacity and other
conditions; (3) only material US subsidiaries must provide
guarantees whether or not wholly-owned, eliminating the risk that
guarantees will be released because they cease to be wholly-owned;
and (4) there are no express protective provisions prohibiting an
up-tiering transaction. The above are proposed terms and the final
terms of the credit agreement may be materially different.
Viasat has adequate liquidity (SGL-3). Sources approximate $1.2
billion while it has uses of about $320 million in the next four
quarters. Sources include $496 million of cash when the transaction
closes and full availability under its $700 million revolving
credit facility due in January 2024. Cash uses are comprised of
Moody's expected free cash flow consumption of about $300 million
through the next four quarters, mainly due to capital spending on
ViaSat-3, and about $20 million amortization payment on Viasat's
Export-Import (Ex-Im) Bank of the United States facility due in
October 2025, which helped fund ViaSat-2. The company is subject to
leverage and coverage covenants and cushion is expected to exceed
20% in the next four quarters. Viasat has limited flexibility to
generate liquidity from asset sales.
Viasat's ESG Credit Impact Score is Highly Negative (CIS-4). ESG
attributes have some negative impact on the rating currently due to
high exposure to governance risks. Social risks reflect the
classified or sensitive information the company handles and the
resulting exposure to cyber/data breaches but are tempered by good
demand for connectivity in rural/remote areas, which can be
satisfied with satellite technology. Governance risks include the
company's tolerance for higher leverage from time to time.
The outlook is stable because Moody's expects good operating
performance, maintenance of adequate liquidity, and leverage
sustained below 5x through the next 12 to 18 months as the company
constructs and launches its three Viasat-3 satellites. The stable
outlook also incorporates Moody's expectation that while leverage
will increase by more than 1x when the acquisition of Inmarsat
closes, deleveraging towards pre-transaction level should occur
within 24 months of closing.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Viasat's rating could be upgraded if the company successfully
constructs and launches Viasat-3 satellites, generates consistent
positive free cash flow, and sustains leverage below 4x (4.8x for
LTM Q3/2022, pro forma for the debt transaction).
The rating could be downgraded if Viasat sustains leverage above
5.5x (4.8x for LTM Q3/2022, pro forma for the debt transaction) or
if liquidity becomes weak.
The principal methodology used in these ratings was Communications
Infrastructure Methodology published in August 2021.
Viasat, Inc., headquartered in Carlsbad, California, operates a
consumer satellite broadband internet business, an in-flight
connectivity business, and provides satellite and related
communications, networking systems and services to government and
commercial customers. Revenue for the last twelve months ended
December 31, 2021 was $2.7 billion.
VIASAT INC: S&P Affirms 'BB-' ICR, Outlook Stable
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S&P Global Ratings affirmed its 'BB-' issuer credit rating on
Viasat Inc. and removed the ratings from CreditWatch, where S&P
placed them with negative implications on Nov. 9, 2021.
S&P said, "At the same time, we assigned our 'BB' issue-level
rating and '2' recovery rating to Viasat's proposed $700 million
secured term loan to repay revolver borrowings and fund capital
expenditures (capex) associated with its Viasat-3 constellation. We
also lowered the existing secured debt ratings one notch to 'BB' to
account for the incremental secured claims.
"The stable outlook incorporates our view that the acquisition of
Inmarsat in the second half of 2022 is unlikely to result in a
downgrade, despite the increase in leverage. If the acquisition
does not close, we believe Viasat has ample cushion in the rating
to absorb debt-financed capital expenditures in 2022, which was
already factored into the rating.
"We plan to loosen our leverage triggers for the rating upon the
closing of the Inmarsat acquisition because it will improve
Viasat's scale and diversity while accelerating its global coverage
plans. Inmarsat's business focuses on satellite services primarily
in the mobility and government sectors, with capacity offerings in
both the high-throughput Ka-band and lower frequency L-band, which
we believe aligns well with ViaSat's goal of diversifying away from
residential broadband in the coming years. While ViaSat has
established itself as a leading provider of Ka-band services in
North America, Inmarsat will bring significant experience in global
markets and new verticals like maritime. In addition, the company
has a substantial in-flight connectivity (IFC) backlog that should
allow ViaSat to more than double its airplane count and grow
revenue in this segment in the coming years.
"We expect pro forma credit metrics to be stretched for the rating
in calendar year 2022, with a credible deleveraging path beyond
that. Viasat plans to raise an additional $1.6 billion in debt in
2022 to fund the purchase of Inmarsat and capital expenditures,
resulting in pro-forma S&P-adjusted debt to EBITDA of about 5.5x at
the end of 2022 (assuming a full year of Inmarsat earnings) from
the mid-3x area in 2021. However, successful launches of upcoming
satellites will provide substantially more network capacity and
geographic reach. Therefore, we expect the company to increase
EBITDA in the mid-teens percent area each year in 2023-2025. In the
event of a launch failure, the company will carry both launch and
in-orbit insurance to mitigate credit risk."
Elevated capital expenditures are likely to result in negative free
operating cash flow (FOCF) through 2023 before turning positive in
2024. Both companies are amid peak capital spending to fund the
launch of new high throughput satellites. On a combined basis,
there are 9 satellites planned for launch over the next three
years. More specifically, Viasat plans three Viasat-3 satellites,
with one each in North America, Europe, and Asia-Pacific. Each
satellite will have total throughput of more than 1,000 gigabytes
per second (GBps) compared with 140 GBps on Viasat-1 and 260 GBps
on Viasat-2, likely resulting in 8x more network capacity by 2024.
Inmarsat also plans to expand its fleet with four geosynchronous
equatorial orbit (GEO) Ka satellites and two highly elliptical
orbit (HEO) satellites for polar coverage. However, Inmarsat tends
to procure less expensive and lower capacity satellites than
Viasat. For example, Inmarsat expects the upcoming GX satellites to
have only 10%-20% throughput of each Viasat-3 satellite. The
combined capacity on the existing global GX fleet of five
satellites is about 100 GBps and the new satellites will have about
6 times the capacity compared with the existing fleet.
The combined company will continue to have large exposure to
government systems (40% total revenue), which provides long-term
earnings stability. The acquisition of Inmarsat will provide more
balance between government service revenue (45%) and products
(55%). While product sales can be lumpier quarter to quarter, S&P
believes Viasat is well positioned in high-priority areas of the
U.S. Defense budget such as C4ISR. Furthermore, the company has
good program diversity, with no major concentration in any single
platform.
The acquisition of Inmarsat strengthens Viasat's position in growth
verticals. Mobility will account for about 28% of combined revenue,
split between IFC and maritime, up from about 12% on a stand-alone
basis. S&P believes IFC presents a significant long-term
opportunity, particularly with the exponential increase in global
capacity expected to come online that could allow the company to
serve more airlines, potentially at a higher average revenue per
plane. Viasat currently serves about 1,880 commercial aircraft,
with about 860 additional aircraft in the backlog. Furthermore,
Inmarsat currently serves about 800 commercial aircraft, with about
1,000 more aircraft under contract.
S&P said "Most international airlines still do not have an
in-flight wifi provider. We believe the merger with Inmarsat, which
has more established global experience and customer relations, may
help Viasat secure new contracts in Europe and Asia. For example,
Inmarsat currently provides narrowband (L-band) cockpit and safety
communications on thousands of planes globally, which we view as
complementary to Viasat's high-throughput (Ka-band) passenger IFC
business."
However, IFC connectivity revenue is highly correlated to levels of
commercial air traffic, which has been uneven by region. Domestic
travel numbers have rebounded well in North America (which
constitutes most of Viasat's existing business) and Asia but
international travel remains very depressed. S&P Global Ratings
believes the long-anticipated air traffic recovery may be pushed
well into 2022 or later, particularly if intercontinental travel
remains subdued, vulnerable as it is to pandemic-related
restrictions and sluggish business travel.
S&P said, "On the maritime side, Inmarsat is the global leader in
satellite communications services, with an even mix between L-Band
and Ka-band services. It is experiencing heightened competition
from Iridium within its lower-priced legacy L-band services (dubbed
"FleetBroadband"). However, this customer churn is being offset by
growth in its higher-priced, higher throughput Ka-band service
(dubbed "FleetExpress"). We believe the merger could allow the
combined company to offer enhanced service for existing customers
while also opening the door to entering adjacent markets, such as
cruises, by leveraging Inmarsat's end-to-end customer solutions
experience with Viasat's incremental capacity."
The merger reduces Viasat's exposure to North American residential
broadband to about 20% (from about 30%), which is likely to become
more competitive. Viasat currently serves about 600,000 U.S. homes
with internet, primarily in rural areas, competing almost
exclusively with Hughes (which has roughly double the number of
customers). Both companies are currently capacity constrained, with
demand exceeding supply. S&P estimates that there are currently
about 10 million-15 million homes in the U.S. that do not have
land-based high-speed internet availability. However, the
addressable market for satellite internet is likely to shrink
considerably over the next five years as more terrestrial
alternatives are built out. The recently passed infrastructure bill
includes an unprecedented $42 billion for subsidized high-speed
internet, likely enabling cable operators and other fiber providers
to expand into rural markets that otherwise could not justify a
stand-alone investment. Funds could begin to be allocated in 2023
(after the Federal Communications Commission updates its broadband
maps) but it will likely take several years for these projects to
be completed.
S&P said, "However, we believe the integration of Inmarsat will
heighten Viasat's execution risk around expansion . We anticipate
the company's expansion into new regions and service verticals will
elevate its execution risk at a time when it is already facing
heightened risks related to its upcoming satellite launches. While
Inmarsat will also provide it with experience and established
customer relationships in key markets, it is unclear how the
combined business' management responsibilities will be allocated.
Decisions regarding the management of the combined company will be
made as part of the integration planning process. We believe there
is some potential for this deal to split management's focus while
the industry faces a shifting competitive landscape."
The acquisition synergies are relatively modest and do not involve
any immediate plans for fleet consolidation. Management has
identified $80 million of cost savings (about 3% of operating
expenses) related to the elimination of network and overhead
redundancies. In addition, it expects about $110 million of capital
investment savings annually from the rationalization of ground
infrastructure, software, and back office systems spending. While
S&P believes there is a relatively high probability that Viasat
will realize these synergies, it may take a few years to achieve
them.
However, there are no immediate plans to alter the company's 10
satellite launches planned over the next three years even though
Viasat's network is interoperable with Inmarsat's. Specifically,
Viasat will be expanding its capacity to support the expansion of
in-flight connectivity by launching three Viasat-3 satellites, one
each over North America, Europe, and the Asia-Pacific region.
Inmarsat also plans to expand its global capacity by launching
seven high-throughput Global Express satellites by 2023. Still,
longer term, there may be opportunities for management to realize
some satellite fleet capital efficiencies.
S&P said, "We believe new LEO constellations pose a longer-term
threat to Viasat. While we continue to view the company as a
technology leader, with its ViaSat-3 fleet expected to lead peers
in terms of cost per GBps, the industry outlook is growing
increasingly complex, with new LEO entrants expected to invest
several billion dollars in the coming years. Several of these
companies have strong access to capital (SpaceX and Amazon Kuiper)
or significant government support (OneWeb, Telesat Lightspeed),
which may allow them to subsidize losses for the foreseeable
future. We believe that most of these new constellations will
target Viasat's end markets of residential broadband, aviation, and
maritime. However, there are several challenges to the LEO business
model, including stranded capacity over the oceans, high terminal
costs and a shorter satellite lifecycle that could prevent LEOs
from becoming disruptive.
"The stable outlook incorporates our view that the acquisition of
Inmarsat in the second half of 2022 is unlikely to result in a
downgrade, despite increased leverage. If the acquisition does not
close, we believe Viasat has ample cushion in the rating to absorb
debt-financed capital expenditures in 2022, which was already
factored into the rating.
"Although unlikely, we could lower our rating over the next year if
debt to EBITDA rose above 5x on a stand-alone basis due to elevated
churn and pricing pressure. Upon the closing of the acquisition, we
are likely to loosen this trigger to reflect the diversification
benefits provided by Inmarsat.
"An upgrade is unlikely over the next year due to negative FOCF to
support new satellite launches, but we could raise the rating
longer term if debt to EBITDA fell below 4x with positive cash
generation. Upon the closing of the acquisition, we are likely to
loosen this trigger but would also require meaningfully positive
FOCF for an upgrade."
VIRGINIA TRUE: Cipollones Lose Bid to Remand Suit to State Court
----------------------------------------------------------------
Presently before Senior District Judge Frederic Block of the United
States District Court for the Eastern District of New York is a
motion to remand the case captioned ANTHONY CIPOLLONE, et al.,
Plaintiffs, v. ALLAN APPLESTEIN, et al., Defendants, Case No.
1:20-cv-01614-FB-MMH (E.D.N.Y.) to the Circuit Court of Richmond
County where plaintiffs Anthony Cipollone and Domenick Cipollone
originally filed the case.
Defendants Allan Applestein, Diatomite Corporation of America,
Howard Kleinhendler, and Benito Fernandez, who are former business
associates of the Cipollones, oppose on the basis that this case is
related to Virginia True Corporation's bankruptcy proceeding
pending in the United States Bankruptcy Court for the Eastern
District of New York. Judge Block agrees.
The Cipollones' action asserts these claims: (1) fraudulent
inducement to contract against Fernandez and Kleinhendler, (2)
tortious interference with contract against Applestein and
Diatomite, and (3) conspiracy against all Defendants. Principally,
the Cipollones allege that the Defendants conspired to curtail
recourse provided to the Cipollones in a stockholders' agreement
through the secret execution of a side agreement. After the
Cipollones filed this action in the Virginia state court,
Kleinhendler successfully moved to transfer it to the United States
Bankruptcy Court for the Eastern District of Virginia and
subsequently to the District Court.
Judge Block points out that while the Cipollones' claims do not
arise under the Bankruptcy Code, since they are state law tort
claims, they are related to the New York Bankruptcy Case. A civil
proceeding is related to a bankruptcy case if the action's "outcome
might have any 'conceivable effect' on the bankruptcy estate."
Judge Block says the outcome of the present action may impact the
administration of Virginia True's bankruptcy estate. Although the
Cipollones brought their case against the individual Defendants and
not Virginia True, the bylaws of Virginia True require the
indemnification of Kleinhendler and Fernandez for expenses related
to this adversary proceeding if they are found to have been acting
on behalf of the company. Therefore, this case is related to the
New York Bankruptcy Case and it is not remanded to Virginia state
court, Judge Block concludes.
A full-text copy of the Memorandum and Order dated February 2,
2022, is available at https://tinyurl.com/2nem65zw from
Leagle.com.
MICHAEL LACY -- michael.lacy@troutman.com -- Troutman Pepper
Hamilton Sanders LLP, Richmond, VA.
STEPHEN JAY STEINLIGHT -- stephen.steinlight@troutman.com --
Troutman Pepper Hamilton Sanders LLP. New York, NY, For the
Plaintiffs.
CAROLINE P. GATELY -- cpgately@Venable.com -- Venable LLP,
Washington, D.C.
NICHOLAS M. DEPALMA -- nmdepalma@Venable.com -- Venable LLP Tysons
Corner, VA.
VERNON EUGENE INGE, JR. -- vinge@wtplaw.com -- MICHAEL HUGH BRADY
-- mbrady@wtplaw.com -- and STEPHEN MATTHEW FARACI, SR. --
faraci@wtplaw.com -- Whiteford, Taylor & Preston, L.L.P., Richmond,
VA, For the Defendants.
About Virginia True Corp
Virginia True Corporation, a New York-based golf resort owner and
developer, sought protection under Chapter 11 of the Bankruptcy
Code (Bankr. E.D.N.Y. Case No. 19-42769) on May 3, 2019. At the
time of the filing, the Debtor disclosed assets of between $10
million and $50 million and liabilities of the same range. Judge
Nancy Hershey Lord oversees the case. Pick & Zabicki LLP is the
Debtor's legal counsel.
VISTAGEN THERAPEUTICS: BlackRock Has 6% Equity Stake as of Dec. 31
------------------------------------------------------------------
In a Schedule 13G filed with the Securities and Exchange
Commission, BlackRock, Inc. disclosed that as of Dec. 31, 2021, it
beneficially owns 11,894,193 shares of common stock of VistaGen
Therapeutics, Inc., representing 6 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/1411685/000083423722007125/us92840h2022_020422.txt
About VistaGen
Headquartered in San Francisco, California, VistaGen Therapeutics
-- http://www.vistagen.com-- is a biopharmaceutical company
committed to developing and commercializing innovative medicines
with the potential to go beyond the current standard of care for
anxiety, depression, and other CNS disorders.
VistaGen reported a net loss and comprehensive loss of $17.93
million for the fiscal year ended March 31, 2021, a net loss and
comprehensive loss of $20.77 million for the year ended March 31,
2020, and a net loss and comprehensive loss of $24.59 million for
the year ended March 31, 2019. As of Sept. 30, 2021, the Company
had $100.50 million in total assets, $19.84 million in total
liabilities, and $80.66 million in total stockholders' equity.
VISTAGEN THERAPEUTICS: Franklin Resources, et al., Own 5.1% Stake
-----------------------------------------------------------------
In a Schedule 13G filed with the Securities and Exchange
Commission, these entities and individuals reported beneficial
ownership of 10,117,999 shares of common stock of VistaGen
Therapeutics, Inc., representing 5.1 percent of the shares
outstanding:
* Franklin Resources, Inc.
* Charles B. Johnson
* Rupert H. Johnson, Jr.
* Franklin Advisers, Inc.
A full-text copy of the regulatory filing is available for free
at:
https://www.sec.gov/Archives/edgar/data/0001411685/000003877722000034/vist21in.htm
About VistaGen
Headquartered in San Francisco, California, VistaGen Therapeutics
-- http://www.vistagen.com-- is a biopharmaceutical company
committed to developing and commercializing innovative medicines
with the potential to go beyond the current standard of care for
anxiety, depression, and other CNS disorders.
VistaGen reported a net loss and comprehensive loss of $17.93
million for the fiscal year ended March 31, 2021, a net loss and
comprehensive loss of $20.77 million for the year ended March 31,
2020, and a net loss and comprehensive loss of $24.59 million for
the year ended March 31, 2019. As of Sept. 30, 2021, the Company
had $100.50 million in total assets, $19.84 million in total
liabilities, and $80.66 million in total stockholders' equity.
VOLZ FORESTRY: Seeks to Tap Swenson Law Group as Legal Counsel
--------------------------------------------------------------
Volz Forestry, Inc. seeks approval from the U.S. Bankruptcy Court
for the Western District of Wisconsin to employ the Swenson Law
Group, LLC as its legal counsel.
The firm will render these legal services:
(a) prepare schedules, statements, and plan of
reorganization;
(b) prepare legal papers;
(c) attend related hearings; and
(d) perform all other necessary legal services in connection
with this Chapter 11 case.
The hourly rates of the firm's counsel and staff are as follows:
Attorney $300
Paralegal $125
Evan Swenson, Esq., an attorney at the Swenson Law Group, disclosed
in a court filing that the firm is a "disinterested person" as that
term is defined in section 101(14) of the Bankruptcy Code.
The firm can be reached through:
Evan M. Swenson, Esq.
Swenson Law Group, LLC
118 E. Grand Avenue
Eau Claire, WI 54701
Telephone: (715) 835-7779
Facsimile: (715) 835-2573
Email: evan@swensonlawgroup.com
About Volz Forestry
Volz Forestry, Inc. filed a voluntary petition for relief under
Chapter 11 of the Bankruptcy Code (Bankr. W.D. Wis. Case No.
22-10136) on Feb. 3, 2022. Adam Volz, president, signed the
petition.
Judge Catherine J. Furay oversees the case.
Evan M. Swenson, Esq., at Swenson Law Group, LLC serves as the
Debtor's legal counsel.
WATERLOO AFFORDABLE: Gets Approval to Hire Real Estate Brokers
--------------------------------------------------------------
Waterloo Affordable Housing LLC received approval from the U.S.
Bankruptcy Court for the District of Nebraska to employ Levental
Realty, LLC, doing business as SVN Affordable Levental Realty, and
SVN Northco Real Estate Services, LLC as real estate brokers.
The brokers will assist the Debtor in the listing and sale of its
101-unit facility located in Waterloo, Iowa.
The brokers will be paid a commission of 4 percent of the
property's purchase price.
Frank Jermasek, president of SVN Northco Real Estate Services,
disclosed in a court filing that the firms are "disinterested
persons" as that term is defined in section 101(14) of the
Bankruptcy Code.
The firms can be reached through:
Frank Jermasek
SVN Northco Real Estate Services, LLC
1660 Highway 100 S, Suite 330
Minneapolis, MN 55416
Telephone: (952) 820-1615
Email: frank.jermusek@svn.com
- and –
SVN Affordable Levental Realty
525 Vine Street, Suite 200
Cincinnati, OH 45202
Telephone: (513) 321-7589
Facsimile: (513) 297-4569
About Waterloo Affordable Housing
Waterloo Affordable Housing, LLC, a lessor of real estate in Omaha,
sought protection under Chapter 11 of the Bankruptcy Code (Bankr.
D. Neb. Case No. 19-81610) on Oct. 30, 2019. At the time of the
filing, the Debtor disclosed up to $10 million in both assets and
liabilities. Judge Thomas L. Saladino oversees the case.
Robert Vaughan Ginn, Esq., and Theodore R. Boecker, Jr., Esq.,
serve as the Debtor's bankruptcy attorney and special litigation
attorney, respectively.
WESTBANK HOLDINGS: Seeks to Hire Derbes Law Firm as Legal Counsel
-----------------------------------------------------------------
Westbank Holdings, LLC seeks approval from the U.S. Bankruptcy
Court for the Eastern District of Louisiana to employ The Derbes
Law Firm, L.L.C. as its counsel.
The firm's services include:
(a) providing legal advice with respect to its powers and
duties as debtor-in-possession in the continued management of its
business and property;
(b) attending meetings with representatives of its creditors
and other parties in interest;
(c) taking all necessary action to protect and preserve the
Debtor's estate, including the prosecution of actions on the
Debtor's behalf, the defense of any action commenced against the
Debtor, negotiations concerning litigation in which the Debtor is
or may become involved, and objections to claims to be filed by the
estate;
(d) preparing on behalf of the Debtor motions, applications,
answers, orders, reports, and papers necessary to the
administration of the estate;
(e) negotiating and preparing on the Debtor's behalf a plan of
reorganization, disclosure statement, and all related agreements
and/or documents, and taking any necessary action on behalf of the
Debtor to obtain confirmation of such plan;
(f) appearing before this Court to protect the interests of
the Debtor before this Court;
(g) performing all other necessary legal services and provide
all necessary legal advice to the Debtor in connection with this
Chapter 11 case;
(h) advising the Debtor concerning executory contract and
unexpired lease assumptions, assignments and rejections and lease
restructuring and recharacterizations; and
(i) commencing and conducting litigation necessary and
appropriate to assert rights held by the Debtor, protect assets of
the Debtor's Chapter 11 estate or otherwise further the goal of
completing the Debtor's successful reorganization.
The firm's hourly rates are as follows:
Attorneys $250 to $425
Paralegals $80
Legal Assistant $60
Derbes Law Firm received from the Debtor a retainer in the amount
of $50,842.50. The firm will also be reimbursed for out-of-pocket
expenses incurred.
Frederick Bunol, Esq., a partner at Derbes Law Firm, disclosed in a
court filing that his firm is a "disinterested person" as the term
is defined in Section 101(14) of the Bankruptcy Code.
The firm can be reached at:
Frederick L. Bunol, Esq.
THE DERBES LAW FIRM, LLC
3027 Ridgelake Drive
Metairie, LA 70002
Tel: (504) 837-1230
Fax: (504) 832-0327
Email: fbunol@derbeslaw.com
About Westbank Holdings
Westbank Holdings is primarily engaged in renting and leasing real
estate properties.
Westbank Holdings, LLC, filed its voluntary petition for relief
under Chapter 11 of the Bankruptcy Code (Bankr. E.D. La. Case No,
22-10082 ) on Jan. 27, 2022. The petition was signed by Joshua
Bruno as manager. At the of filing, the Debtor estimated $10
million to $50 million in both assets and liabilities.
Judge Meredith S. Grabill oversees the case.
Frederick L. Bunol, Esq. at THE DERBES LAW FIRM, LLC serves as the
Debtor's counsel.
WHISPER LAKE: Creditors to Get Proceeds From Liquidation
--------------------------------------------------------
Whisper Lake Developments, Inc., filed with the U.S. Bankruptcy
Court for the Western District of Washington a Plan of Liquidation
and/or Reorganization dated Feb. 8, 2022.
Whisper Lake is a Washington corporation formed in November 1993.
In 2014, Renee Richter ("Richter") became the sole shareholder of
Whisper Lake.
At the time of Richter's acquisition of the shares of Whisper Lake,
Whisper Lake owned a 38- acre parcel of undeveloped real property
located in Blaine, Washington (the "Blaine Property").
The Debtor owns 100% of the membership interests in Alderson Road
Developments, LLC ("Alderson Road Developments") which, in turn,
owns the Alderson Road Property. These parcels are adjacent to the
Blaine Road Property. The Debtor estimates the fair market value of
the Alderson Road Property to be approximately $450,000. The
property is currently encumbered by (i) real property taxes in the
amount of $6,207, (ii) a deed of trust in favor of Cross Border
Investments securing an asserted obligation of $800,000.
Additionally, there are two lis pendens recorded against the
property in connection with claims in the Lilly Litigation and the
Thor Litigation.
Dirt Works, a construction contractor with a deed of trust on the
Property securing unpaid amounts due under its contract with
Whisper Lake, commenced foreclosure proceedings against the
Property and a foreclosure sale was ultimately scheduled for
November 11, 2021.
Whisper Lake filed this Bankruptcy Case on November 10, 2021 to
stay the foreclosure in order to ensure that the steps necessary to
complete development of Division A and obtain final recordation of
the Division A plat could be undertaken, and then to sell Division
A in a sale that will maximize the return of unsecured creditors'
claims.
Class 13 consists of Allowed General Unsecured Claims (each, a
"Class 13 Claim"). Each Holder of Class 13 Claim shall be paid its
Pro Rata portion of the Unsecured Creditors Fund. The allowed
unsecured claims total $235,095.81+.
All funds of the Estate (the "Estate Funds") held by the Post
Confirmation Debtor from the Net Proceeds of the liquidation of
Estate Property after (a) payment of Claims in Classes 1-12 in
accordance with the Plan, or appropriate reserve therefor, and (b)
payment of Estate Post-Confirmation Expenses, or appropriate
reserve therefor, shall constitute the "Unsecured Creditors Fund."
Class 14 consists of Allowed Interests (each, a "Class 14
Interest"). In the event all Estate Property has been liquidated
and all distributions required under the Plan have been made and
Holders of Claims in Classes 1 through 13 have not been paid in
full, all Class 14 Interests shall be extinguished. To the extent
all Holders of Claims in Classes 1 through 13 have been fully
satisfied, Class 14 Interests shall retain such Interests. No
distributions shall be made to the Holder(s) of Class 14 Interests
on account of such Interests until such time as Classes 1 through
13 have been fully satisfied.
The distributions under the Plan shall be made from the Estate
Property Proceeds, provided, however, that Non-Debtor Funds may be
used to make distributions required under the Plan.
To the extent relief from stay has not already been granted to
allow the Lilly Litigation to proceed to final adjudication so that
(a) any monetary claim of Lilly can be adjudicated by the State
Court (the amount, as adjudicated, the "Adjudicated Lilly Claim
Amount") and (b) any ownership rights of Westerra in the Arnie Road
Property, the Grandview Property, the Alderson Road Property and/or
the Cross Border Property can be determined. The Lilly Adjudicated
Claim, if any, shall be a Class 13 Claim.
If the Adjudicated Lilly Claim Amount, plus the cumulative amount
of the other Class 13 Claims (asserted to be approximately
$235,000), is less than the value of the unencumbered portion of
the Estate Assets, the Debtor will only be required to sell the
Estate Assets to the extent necessary to ensure full payment of
Classes 1-13. The Debtor will be unable to make this determination
until the State Court determines the Adjudicated Lilly Claim
Amount.
Similarly, because Lilly Plaintiffs' asserted $16,938,420 million
Claim is far greater than the estimated value of the unencumbered
portion of all of the Estate Assets, distributions to Holders of
Class 13 Claims must await a determination of the Adjudicated Lilly
Claim Amount which could comprise approximately 99% of the Class 13
Claims.
A full-text copy of the Plan of Liquidation and/or Reorganization
dated Feb. 8, 2022, is available at https://bit.ly/3sAwm7I from
PacerMonitor.com at no charge.
Attorneys for the Debtor:
Thomas A. Buford, Esq.
Christine M. Tobin-Presser
Bush Kornfeld LLP
601 Union St., Suite 5000
Seattle, WA 98101-2373
Tel.: (206) 292-2110
Fax: (206) 292-2104
Email: ctobin@bskd.com
About Whisper Lake Developments
Whisper Lake Developments, Inc., is a Ferndale, Wash.-based company
engaged in activities related to real estate. It is the owner of
five real properties in Washington having a total current value of
$9.53 million.
Whisper Lake Developments sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. W.D. Wash. Case No. 21-12060) on Nov. 10,
2021, disclosing $9,666,063 in assets and $5,562,777 in
liabilities. Judge Timothy W. Dore oversees the case.
Thomas A. Buford, Esq., at Bush Kornfield, LLP and Tousley Brain
Stephens, PLLC, serve as the Debtor's bankruptcy counsel and
special counsel, respectively. Orse & Co. is the Debtor's
restructuring advisor.
WYNN RESORTS: Egan-Jones Keeps CCC+ Senior Unsecured Ratings
------------------------------------------------------------
Egan-Jones Ratings Company, on January 21, 2022, maintained its
'CCC+' foreign currency and local currency senior unsecured ratings
on debt issued by Wynn Resorts Ltd. EJR also maintained its 'B'
rating on commercial paper issued by the Company.
Headquartered in Las Vegas, Nevada, Wynn Resorts, Limited owns and
operates luxury hotels and destination casino resorts in Las Vegas,
Nevada, Macau, and China.
[^] BOND PRICING: For the Week from February 7 to 11, 2022
----------------------------------------------------------
Company Ticker Coupon Bid Price Maturity
------- ------ ------ --------- --------
AMC Entertainment Holdings AMC 10.5 107.984 4/24/2026
AMC Entertainment Holdings AMC 10.5 102.909 4/24/2026
AMC Entertainment Holdings AMC 10.5 107.976 4/24/2026
Accelerate Diagnostics Inc AXDX 2.5 73.05 3/15/2023
American Honda Finance HNDA 0.606 99.893 2/15/2022
BPZ Resources Inc BPZR 6.5 3.017 3/1/2049
Basic Energy Services Inc BASX 10.75 4.881 10/15/2023
Basic Energy Services Inc BASX 10.75 4.881 10/15/2023
Buffalo Thunder
Development Authority BUFLO 11 50 12/9/2022
Commercial Metals Co CMC 5.375 104.396 7/15/2027
Diamond Sports Group LLC /
Diamond Sports Finance DSPORT 6.625 25.087 8/15/2027
Diamond Sports Group LLC /
Diamond Sports Finance DSPORT 6.625 25.581 8/15/2027
EnLink Midstream Partners ENLK 6 78 N/A
Endo Finance LLC /
Endo Finco Inc ENDP 5.375 71.813 1/15/2023
Endo Finance LLC /
Endo Finco Inc ENDP 5.375 71.813 1/15/2023
Energy Conversion Devices ENER 3 7.875 6/15/2013
Energy Future Competitive
Holdings Co LLC TXU 1.30643 0.072 1/30/2037
Energy Transfer LP ET 4.65 99.898 2/15/2022
GNC Holdings Inc GNC 1.5 0.488 8/15/2020
GTT Communications Inc GTTN 7.875 13.55 12/31/2024
GTT Communications Inc GTTN 7.875 13.75 12/31/2024
General Electric Co GE 4 90.125 N/A
General Electric Co GE 5.6 99.897 2/15/2022
General Electric Co GE 5.5 99.797 2/15/2022
General Electric Co GE 5.55 99.735 2/15/2022
General Electric Co GE 4.6 99.838 2/15/2022
Goodman Networks Inc GOODNT 8 46.5 5/11/2022
MAI Holdings Inc MAIHLD 9.5 19.171 6/1/2023
MAI Holdings Inc MAIHLD 9.5 19.171 6/1/2023
MAI Holdings Inc MAIHLD 9.5 19.171 6/1/2023
MBIA Insurance Corp MBI 11.50129 7.044 1/15/2033
MBIA Insurance Corp MBI 11.50129 7.044 1/15/2033
National Rural Utilities
Cooperative Finance Corp NRUC 2.35 99.758 2/15/2022
National Rural Utilities
Cooperative Finance Corp NRUC 2.55 99.761 2/15/2022
National Rural Utilities
Cooperative Finance Corp NRUC 3 99.76 2/15/2022
National Rural Utilities
Cooperative Finance Corp NRUC 2.5 99.755 2/15/2022
Nestle Purina PetCare Co NESNVX 8.625 99.872 2/15/2022
Nine Energy Service Inc NINE 8.75 42.619 11/1/2023
Nine Energy Service Inc NINE 8.75 43.584 11/1/2023
Nine Energy Service Inc NINE 8.75 43.467 11/1/2023
OMX Timber Finance
Investments II LLC OMX 5.54 0.836 1/29/2020
Renco Metals Inc RENCO 11.5 24.875 7/1/2003
Revlon Consumer Products REV 6.25 43.322 8/1/2024
Ruby Pipeline LLC RPLLLC 8 88 4/1/2022
Ruby Pipeline LLC RPLLLC 8 87.071 4/1/2022
Sears Holdings Corp SHLD 6.625 0.397 10/15/2018
Sears Holdings Corp SHLD 6.625 0.692 10/15/2018
Sears Roebuck Acceptance SHLD 6.5 1.017 12/1/2028
Sears Roebuck Acceptance SHLD 7 1.055 6/1/2032
Sears Roebuck Acceptance SHLD 7.5 0.808 10/15/2027
Sears Roebuck Acceptance SHLD 6.75 1.075 1/15/2028
Sempra Texas Holdings Corp TXU 5.55 13.5 11/15/2014
Talen Energy Supply LLC TLN 9.5 84.047 7/15/2022
Talen Energy Supply LLC TLN 9.5 84.047 7/15/2022
Talen Energy Supply LLC TLN 6.5 43.75 9/15/2024
Talen Energy Supply LLC TLN 6.5 43.75 9/15/2024
TerraVia Holdings Inc TVIA 5 4.644 10/1/2019
Trousdale Issuer LLC TRSDLE 6.5 33.15 4/1/2025
*********
Monday's edition of the TCR delivers a list of indicative prices
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obtained by TCR editors from a variety of outside sources during
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S U B S C R I P T I O N I N F O R M A T I O N
Troubled Company Reporter is a daily newsletter co-published
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