/raid1/www/Hosts/bankrupt/TCR_Public/220304.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Friday, March 4, 2022, Vol. 26, No. 62
Headlines
1917 HEIGHTS: Exclusivity Period Extended to March 31
2999TC ACQUISITIONS: Unsecureds Claims to Recover 50% in Plan
317 NORTH CENTER: Disclosures Inadequate, US Trustee Says
37 CALUMET: Plan Disclosures Inadequate, Bridge Loan Says
42-43 147TH STREET: Case Summary & Six Unsecured Creditors
4E BRANDS: U.S. Trustee Appoints Creditors' Committee
96 WYTHE: Examiner Uncovers at Least $12.5M in Avoidable Transfers
AA FOOD AND COMPANY: Seeks to Tap Eric A. Liepins as Legal Counsel
ACM DEVELOPMENT: U.S. Trustee Unable to Appoint Committee
ACTIVA RESOURCES: Gets OK to Hire Donlin as Claims Agent
ACTIVA RESOURCES: Gets OK to Hire Loeb & Loeb as Bankruptcy Counsel
ADVANCE TRANSPORTATION: Continued Operations to Fund Plan
AFAB SOLUTIONS: Gets OK to Hire Adam Law Group as Legal Counsel
AFAB SOLUTIONS: U.S. Trustee Unable to Appoint Committee
ALDRICH PUMP: Trane Units Ask Court to Limit Asbestos Injury Probe
ALLEN DWARD CROSTHWAIT: Alexander Buying Chickasaw Asset for $1.68M
ALLEN EDWARD CROSTHWAIT: Dendy Buying Houston Property for $125K
ALTO MAIPO: Unsecured Creditors to Get Nothing in Joint Plan
ANDRA'S REDEMPTION: Counsel Backs Bid for Entry of Show Cause Order
ANGLIN CULTURED STONE: Proposes Auction Procedures for Equipment
AREVALO LC FARM: Taps Law Office of Richard G. Hall as Counsel
ASK IMAGE: Surplus Revenue or Disposable Income to Fund Plan
ATLANTIC BROOM: Seeks to Tap Rubin and Rudman as Bankruptcy Counsel
AUTOMOTIVE PARTS: Plan Solicitation Period Extended to April 1
BALANCE POINT: Unsecured Creditors Unimpaired in Subchapter V Plan
BE MORE DEVELOPERS: Seeks to Hire Meridian Law as Legal Counsel
BOY SCOUTS: 3rd Circuit Says Sidley Austin Was Conflicted in Ch. 11
BOY SCOUTS: Plan Has Adverse Effect on Everest's Rights
BRINKER INT'L: Moody's Ups CFR to Ba3 & Sr. Unsecured Notes to B1
BRINKS HOME: Hires PJT to Seek Fresh Capital After Botched Deal
BVM THE BRIDGES: U.S. Trustee Unable to Appoint Committee
CATS ON THE BAY: Seeks to Hire YKAZ CPA PC as Accountant
CEDAR HAVEN: Unsecureds Owed $12.4M to Get $2M in Plan
CENTURI GROUP: S&P Downgrades ICR to 'B+' on Group Status Revision
CHASE MERRITT: Seeks to Hire Douglas Elliman as Real Estate Broker
CITIZENS OF THE WORLD: S&P Assigns 'BB-' on Rev. Bonds
CLOUD49 LLC: Seeks to Hire Chamblee Ryan as Special Counsel
COLDWATER DEV'T: Trustee Sets Bid Process for Beverly Hills Asset
COMPASS POWER: Moody's Rates New $710MM Senior Secured Debt 'Ba3'
CONSTANT CONTACT: Fitch Affirms 'B' LongTerm IDR, Outlook Stable
CORP GROUP: Exclusivity Period Extended to April 25
CORPORATE COLOCATION: Chapter 11 Trustee Appointment Sought
CORPORATE COLOCATION: Exclusivity Period Extended to March 24
CRC BROADCASTING: Wins Interim Cash Collateral Access
CURTISS COURTYARD: Taps Richard R. Robles as Bankruptcy Counsel
DALLAS ELM: Seeks to Tap Sheils Winnubst PC as Bankruptcy Counsel
DENDON INC: Proposes Auction Procedures for Georgia-Virginia Route
DRALA MOUNTAIN: Seeks to Hire Ropes & Gray as Bankruptcy Counsel
DRALA MOUNTAIN: Seeks to Tap Cordes & Company as Financial Advisor
DRALA MOUNTAIN: Taps Markus Williams Young as Local Counsel
ELECTRO SALES: Unsecureds Will be Paid in Full
ENLINK MIDSTREAM: Fitch Alters Outlook on 'BB+' IDR to Positive
ENTEGRIS INC: S&P Lowers Secured Debt Rating to 'BB+'
ENTRUST ENERGY: Judge Isgur Wants More Power Cutoff Blame Evidences
ENTRUST ENERGY: Shell to Test Its Risk Policy in Contract Fight
FAMILY FRIENDLY: Unsecureds be Paid From Litigation Proceeds
GIP III STETSON: Fitch Raises LongTerm IDR to 'B', Outlook Stable
GLENN PATERNOSTER: Mas Buying Henderson Property for $2.25 Million
GLOBAL CARIBBEAN: Plan Solicitation Period Extended to May 31
GOTSPACE DATA: Seeks to Hire Shapiro Dorry Masterson as Counsel
GTT COMMUNICATIONS: Seeks to Extend Exclusivity Period to June 28
GULF COAST HEALTH: Seeks to Extend Exclusivity Period to May 12
H-CYTE INC: Incurs $4.8 Million Net Loss in 2021
HERBERT H. STONE: JSP Buying Mineral Point Property for $4.16-Mil.
HUSCH & HUSCH: Liquidating Agent Selling Harrah Property for $185K
HUSCH & HUSCH: Liquidating Agent Selling Inventory to GS for $90K
IM SERVICES: Seeks to Hire Johnson May as Bankruptcy Counsel
ISTAR INC: Fitch Affirms 'BB' LongTerm IDR, Outlook Stable
JAFFAN INTERNATIONAL: Taps Buddy D. Ford as Bankruptcy Counsel
JEM HOMES: Amends Several Secured Claims Pay Details
JINZHENG GROUP: Unsecured Creditors Seek Chapter 11 Trustee
JOSEPH MARTIN THOMAS: Proposes Auction Sale of Personal Property
JTS TRUCKING: Quality Investment Buying Albertville Asset for $445K
LEAR CAPITAL: Files for Chapter 11 Bankruptcy Protection
LTL MANAGEMENT: Opposes Bid to Delay Talc Committee Reinstatement
MACY'S: S&P Assigns 'BB' Rating on New Senior Unsecured Notes
MAUI MEADOWS: Seeks Approval to Hire Alan Sears as Accountant
MAYA KARAPETROVA: Li & Meng Buying Mountainside Property for $710K
MERIDIAN HIVE: Voluntary Chapter 11 Case Summary
MERIDIAN REDEVELOPMENT: Involuntary Chapter 11 Case Summary
MESOBLAST LTD: Reports $25.9 Million Loss for Second Quarter
MICHAEL L. ZOLLICOFFER: Taps Frost & Associates as Legal Counsel
MICROVISION INC: Incurs $12.6 Million Net Loss in Fourth Quarter
NATIONAL RIFLE: NYAG Fends Off Repeated Moves to Dismiss Fraud Suit
NATIONAL RIFLE: NYAG James Can't Dissolve NRA, Judge Rules
NAVIENT CORP: Fitch Affirms 'BB-' LongTerm IDR, Outlook Stable
NEPHROS INC: Incurs $3.9 Million Net Loss in 2021
NETWORK COMMUNICATIONS: Taps Ausley McMullen as Special Tax Counsel
NICOLAS THOMAS SCOTT: 4T Land Buying Elevator Tract for $188.5K
NIDA ALSHAIKH: PCO Files Second Report
NMDC HOME: Seeks to Hire Meridian Law as Bankruptcy Counsel
NORTHERN OIL: Swings to $6.4 Million Net Income in 2021
NYNY & D3: Unsecured Creditors to Split $3K over 3 Years
OCEAN DEVELOPMENT: Seeks to Hire Shapiro Dorry as New Counsel
PRESIDIO DEVELOPMENT: Court Confirms Reorganization Plan
PRODUCE DEPOT: Case Summary & 20 Largest Unsecured Creditors
PSG MORTGAGE: Selling Sea Cliff Avenue Property for $13 Million
PURDUE PHARMA: Agrees to New Opioid Settlement With U.S. States
PURDUE PHARMA: Kleinberg Kaplan Partner Assists Wash. in Deal
PURDUE PHARMA: Mediators Extends Negotiations to Work on Deal Terms
QUALITY CARE DAYCARE: Taps Samson Properties as Realtor
REWALK ROBOTICS: Incurs $12.7 Million Net Loss in 2021
ROBERT STROUMPOS: Asks Court to Waive PCO Appointment
S-TEK 1 LLC: Seeks Cash Collateral Access Thru Sept 30
SHAW 3RD HOLDINGS: Archdiocese Buying Improved Parcel for $2.5MM
SHE FLIPS TOO: Seeks to Extend Exclusivity Period to July 22
SLM CORP: Fitch Affirms 'BB+' IDR & Alters Outlook to Positive
SM ENERGY: Swings to $36.2 Million Net Income in 2021
STANCE AUTOWORKS: Seeks to Tap LSB Financial Services as Accountant
SUNOCO LP: S&P Upgrades ICR to 'BB', Outlook Stable
TEAM SYSTEMS: Chapter 11 Should Be Tossed, Says U.S. Trustee
TERRA MANAGEMENT: Seeks More Time to File Bankruptcy Plan
TERRAVIA HOLDINGS: Ex-Execs Ink $2.5 Mil. Deal to End Investor Suit
TONY GRECO: VROOM Buying 2017 Audi A8 L30T Vehicle for $37K
TRANQUILITY MED SPA: Seeks to Tap Ronald D. Weiss as Legal Counsel
TROT SERVICE: Trustee Gets OK to Hire Adam L. Rosen as Counsel
TWISTED OAK: Amends Mechanics Bank Secured Claims Pay Details
TWISTED OAK: Plan Confirmation Hearing Continued to April 21
UNITI GROUP: Swings to $124.8 Million Net Income in 2021
UPLAND POINT: No Patient Care Concern, PCO Report Says
VERANO RECOVERY: Addresses Objections to Plan Disclosures
VERSCEND HOLDING II: S&P Corrects 2nd Lien Debt Rating to 'CCC+'
VIPER PRODUCTS: United Fleet Buying Vehicles & Trailers for $200K
WATERLOO AFFORDABLE: Proposes Procedures for Sale of All Assets
WILLCO XII: Court Approves Disclosure Statement
WILMA & FRIEDA'S: Wins Interim Cash Collateral Access
WITCHEY ENTERPRISES: DOJ Watchdog Directed to Appoint Trustee
WITCHEY ENTERPRISES: Enters Asset Purchase Agreement with Superior
WNJ24K LLC: Court Approves Disclosure Statement
[] 2021 Pittsburgh Bankruptcies at Lowest Level in 20 Years
[^] BOOK REVIEW: The Titans of Takeover
*********
1917 HEIGHTS: Exclusivity Period Extended to March 31
-----------------------------------------------------
Judge Eduardo Rodriguez of the U.S. Bankruptcy Court for the
Southern District of Texas extended the exclusivity period for 1917
Heights Hospital, LLC to file a Chapter 11 plan to March 31.
The company can solicit acceptances for the plan until May 31.
About 1917 Heights Hospital
1917 Heights Hospital, LLC sought protection under Chapter 11 of
the Bankruptcy Code (Bankr. S.D. Texas Case No. 21-31811) on June
1, 2021. In its petition, the Debtor listed $100 million to $500
million in assets and $10 million to $50 million in liabilities.
Dr. Dharmesh Patel, manager, signed the petition.
Judge Eduardo V. Rodriguez oversees the case.
Hughes Watters Askanase, LLP is the Debtor's bankruptcy counsel.
2999TC ACQUISITIONS: Unsecureds Claims to Recover 50% in Plan
-------------------------------------------------------------
2999TC Acquisitions, LLC, submitted a Plan and a Disclosure
Statement.
The Plan is a plan of reorganization. The Debtor shall continue
its business after the Confirmation Date. The Debtor owned
approximately 2.47 acres of land which includes an existing 30,000
square foot luxury office project office, located at 2999 Turtle
Creek Blvd. in the City of Dallas, Texas (the "Property"). The
Debtor intends to pay off its Secured Creditors and reacquire the
Property so that it may re-develop all of the Property into a
branded, luxury hotel and residences and/or sell all of the
Property to fund the Plan.
Under the plan, Class 3 Allowed General Unsecured Claims total
$558,912. Class 3 Claims will be paid 50% of such allowed claims in
12 equal monthly installments commencing on the 1st day of the
first calendar month following the Payment in full of Class 1 and 2
Claims and continuing on the first day of each month thereafter
until paid as called for by this Plan. Class is 3 impaired.
No insider claims will be paid under the Plan until all other
Claims are paid in full.
The Plan will be funded by the Debtor through the Debtor
operations, refinance or sale of the Property.
Attorneys for the Debtor:
Joyce W. Lindauer, Esq.
JOYCE W. LINDAUER ATTORNEY, PLLC
1412 Main St., Suite 500
Dallas, TX 75202
Telephone: (972) 503-4033
Facsimile: (972) 503-4034
A copy of the Disclosure Statement dated Feb. 25, 2022, is
available at https://bit.ly/3pmCIqF from PacerMonitor.com.
About 2999TC Acquisitions
Dallas, Texas-based 2999TC Acquisitions, LLC filed its voluntary
petition for Chapter 11 protection (Bankr. N.D. Texas Case No.
21-31954) on Oct. 29, 2021, listing up to $100 million in assets
and up to $50 million in liabilities. Tim Barton, president of
2999TC Acquisitions, signed the petition. Judge Harlin Dewayne Hale
oversees the case. Joyce W. Lindauer, Esq., serves as the Debtor's
legal counsel.
317 NORTH CENTER: Disclosures Inadequate, US Trustee Says
---------------------------------------------------------
The Acting United States Trustee, filed an objection to the 317
North Center Avenue Building, LLC's Proposed Disclosure Statement
dated January 14, 2022.
The US Trustee points that Disclosure Statement inadequately
describes that an executory contract -- an "oral lease" of real
property with Brass Rails Tavern, Inc. -- may be unenforceable
under Montana Statute of Frauds laws.
The Debtor or Brass Rails may raise defenses or exceptions related
to the statute of frauds provisions; nevertheless, the legal issue
should be disclosed to inform creditors of the risk. The Debtor's
Plan of reorganization depends entirely on income from Brass Rails'
lease and payments. Because the lease is crucial, and Debtor's
representatives at prior meetings indicated Debtor intended to put
the lease in writing, issues about validity of the "oral lease"
agreement should be disclosed.
The US Trustee further points out that Disclosure Statement does
not adequately describe the legal status of Debtor, a Montana LLC,
as under involuntary dissolution with the Montana Secretary of
State since December 1, 2018. The Debtor's Disclosure Statement
fails to mention that 317 North Center Ave Building, LLC was
involuntarily dissolved as of December 1, 2018 and has not been
reinstated by the Montana Secretary of State. At the 341(a)
meeting, the Debtor's representative, Anna Hopes, (along with
explanation from Debtor's attorney) described that Debtor planned
to first hire an accountant, then prepare tax returns. This may be
a precursor to get the LLC in good standing with the Montana
Secretary of State.
The U.S. Trustee asserts that Debtor's Disclosure Statement fails
to disclose that Debtor has not filed any tax returns for 2016,
2017, 2018, 2019, or 2020, as stated by the Debtor's representative
at the section 341(a) meeting. The returns for these years are now
overdue. The Disclosure Statement states, "Any tax consequences
arising from the proposed transactions would flow through to the
Debtor's partners because the Debtor is a limited liability
company. Therefore, there are no tax consequences reflected in
this Plan, Disclosure Statement, or the Liquidation Analysis."
About 317 North Center Avenue Building
317 North Center Avenue Building, LLC, filed a petition for Chapter
11 protection (Bankr. D. Mont. Case No. 21-10118) on Oct. 18, 2021,
listing as much as $500,000 in both assets and liabilities.
Patten, Peterman, Bekkedahl & Green, PLLC, serves as the Debtor's
legal counsel.
37 CALUMET: Plan Disclosures Inadequate, Bridge Loan Says
---------------------------------------------------------
Bridge Loan Venture V QV Trust 2019-2 filed an objection to the
Amended Disclosure Statement submitted by 37 Calumet Street, LLC
relating to the Debtor's proposed Amended Plan of Reorganization.
Bridge Loan asserts that the Amended Disclosure Statement fails to
properly provide for the debts owed to Bridge Loan, or to provide
adequate information regarding the Debtor's ability to make
payments to creditors, including Bridge Loan, on confirmation and
thereafter, or why liquidation is not preferable to the Plan.
Bridge Loan points out that the Debtor's Amended Disclosure
Statement is inadequate, inconsistent with the interests of the
creditors, including Bridge Loan, and is not feasible. The Debtor
has not shown how it will pay Bridge Loan according to the Plan of
Reorganization, nor is it feasible for the Debtor to pay its debt
owed to Bridge Loan via a balloon payment on the maturity date
contemplated thereunder.
Bridge Loan's Attorney:
Peter T. McNulty, Esq.
MURPHY, HESSE, TOOMEY & LEHANE, LLP
300 Crown Colony Drive, Suite 410
Tel: (617) 479-5000
E-mail: pmcnulty@mhtl.com
About 37 Calumet Street
37 Calumet Street LLC filed a voluntary petition for relief under
Chapter 11 of the Bankruptcy Code (Bankr. D. Mass. Case No.
20-12253) on Nov. 19, 2020. The petition was signed by Patricia
Hounsell, its manager. At the time of filing, the Debtor disclosed
$1 million to $10 million in both assets and liabilities.
Judge Frank J. Bailey oversees the case.
Gary W. Cruickshank, Esq., serves as the Debtor's counsel.
42-43 147TH STREET: Case Summary & Six Unsecured Creditors
----------------------------------------------------------
Debtor: 42-43 147th Street LLC
42-02 Marathon Parkway
Little Neck, NY 11363
Business Description: 42-43 147th Street is a Single Asset Real
Estate debtor (as defined in 11 U.S.C.
Section 101(51B)).
Chapter 11 Petition Date: March 2, 2022
Court: United States Bankruptcy Court
Eastern District of New York
Case No.: 22-40413
Judge: Hon. Elizabeth S. Stong
Debtor's Counsel: Elio Forcina, Esq.
ELIO FORCINA, ATTORNEY AT LAW
66-85 73 Place
Middle Village, NY 11374
Tel: 347-528-7044
Email: forcinalaw@gmail.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Konstantina Biscardi as president.
A copy of the Debtor's list of six unsecured creditors is available
for free at PacerMonitor.com at:
https://www.pacermonitor.com/view/IS6RS6Y/42-43_147TH_STREET_LLC__nyebke-22-40413__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/IKDJFKY/42-43_147TH_STREET_LLC__nyebke-22-40413__0001.0.pdf?mcid=tGE4TAMA
4E BRANDS: U.S. Trustee Appoints Creditors' Committee
-----------------------------------------------------
The U.S. Trustee for Region 6 on March 1 appointed an official
committee to represent unsecured creditors in the Chapter 11 case
of 4e Brands North America, LLC.
The committee members are:
1. Infini Distribution LLC
1403 Gillingham Lane, Suite 200
Sugar Land, TX 77478
Attention: Graeme Freeman
Phone: (707) 953-9785
Email: gray@infinidistribution.com
2. Global Impact Innovation
340 Shuman Blvd.
Naperville, IL 60563
Attention: Badal Moradia
Phone: (614) 859-5748
Email: badal@gii.llc
3. Acorn East
16301 NW 15th Ave.
Miami, FL 33169
Attention: Jeffrey Davimos
Phone: (908) 468-5200
Email: jdavimos@acorn-east.com
4. Fenix Servicios Aduanales S.C.
417 Logistic Dr.
Laredo, TX 78045
Attention: Eber Pérez
Phone: (956) 235-4288
Email: eber@corporativofenix.net
5. Sedgwick Claims Management Services, Inc.
8125 Sedgwick Way
Memphis, TN 38125-1128
Attention: Kurt Vollert
Phone: (223) 322-0297
Email: kurt.vollert@sedgwick.com
Official creditors' committees serve as fiduciaries to the general
population of creditors they represent. They may investigate the
debtor's business and financial affairs. Committees have the right
to employ legal counsel, accountants and financial advisors at a
debtor's expense.
About 4e Brands North America
4e Brands North America, LLC is a manufacturer personal care and
hygiene products based in San Antonio, Texas. Its brand name
products include Blumen Hand Sanitizer, Assured Hand Sanitizer, and
various otherhand sanitizers and hand soaps. The Debtor is no
longer operating.
4e Brands North America sought Chapter 11 bankruptcy protection
(Bankr. S.D. Texas Case No. 22-50009) on Feb. 22, 2022. In the
petition filed by David Dunn as chief restructuring officer, 4e
Brands North America listed up to $50,000 in assets and up to $50
million in liabilities.
The case is handled by Judge David R. Jones.
Matthew D. Cavenaugh, Esq., at Jackson Walker, is the Debtor's
legal counsel. Stretto is the claims agent.
96 WYTHE: Examiner Uncovers at Least $12.5M in Avoidable Transfers
------------------------------------------------------------------
Eric Huebscher, the court-appointed examiner in the Chapter 11 case
of 96 Wythe Acquisition LLC, issued a report, dated February 28,
2022, regarding his investigation and assessment on the potential
bankruptcy causes of action of the Debtor.
Mr. Huebscher reported that the investigation uncovered significant
potentially avoidable transfers. More specifically, the
investigation uncovered evidence of a complex scheme to divert and
siphon substantial amounts of money from the Debtor, through a
labyrinth of banking relationships between the Debtor and its
management company, Williamsburg Hotel BK, LLC, and other entities
under common ownership and control of the Debtor's principals,
Michael Lichtenstein and Toby Moskovits. In total, Mr. Huebscher
has identified at least an aggregate net amount of $12.5 million
sent to different entities.
Moreover, despite the fact that approximately $24.5 million was
deposited into -- and approximately $25.5 million was withdrawn
from -- the Debtor's bank accounts from 2017 to 2020, Mr.
Huebscher reported that the Debtor did not file tax returns for
years 2017, 2018 or 2019.
Mr. Huebscher also reported that the Principals obstructed the
investigation, by actions and inactions, including the significant
delays in document production, interference with third-party
subpoenas, and refusal to answer questions regarding thousands of
financial transactions.
As a result of the Principals' actions to delay and obstruct the
examination, coupled with the short time period during which the
investigation was conducted, Mr. Huebscher believes there may be
additional valuable causes of action that he has not yet uncovered,
and further investigation is warranted.
The Examiner's counsel may be reached at:
Stephanie Wickouski, Esq.
Chelsey Rosenbloom, Esq.
LOCKE LORD LLP
Brookfield Place
200 Vesey Street, 20th Floor
New York, NY 10281-2101
About 96 Wythe Acquisition
96 Wythe Acquisition, LLC, a privately held company in Brooklyn,
N.Y., filed a petition for Chapter 11 protection (Bankr. S.D.N.Y.
Case No. 21-22108) on Feb. 23, 2021, disclosing zero assets and
$79,990,206 in liabilities. CRO David Goldwasser signed the
petition.
Judge Robert D. Drain oversees the case.
The Debtor tapped Backenroth Frankel & Krinsky, LLP and Mayer
Brown, LLP as bankruptcy counsels, and Fern Flomenhaft, PLLC as
insurance counsel. Getzler Henrich & Associates, LLC and Hilco Real
Estate, LLC, serve as the Debtor's financial advisors. B. Riley
Advisory Services, is the litigation support consultant.
On November 16, 2021, the court entered an order approving the
appointment of Eric M. Huebscher as the examiner in the case. The
examiner is represented by Stephanie Wickouski, Esq., and Chelsey
Rosenbloom, Esq., at Locke Lord, LLP.
AA FOOD AND COMPANY: Seeks to Tap Eric A. Liepins as Legal Counsel
------------------------------------------------------------------
AA Food and Company, Inc. seeks approval from the U.S. Bankruptcy
Court for the Northern District of Texas to employ Eric A. Liepins,
PC as its legal counsel.
The Debtor requires the assistance of a counsel for the purpose of
orderly liquidating the assets, reorganizing the claims of the
estate, and determining the validity of claims asserted in the
estate.
The hourly rates of the firm's counsel and staff are as follows:
Eric A. Liepins $275
Paralegals and Legal Assistants $30 - $50
In addition, the firm will seek reimbursement for expenses
incurred.
The firm has been paid a retainer of $5,000.
Mr. Liepins, the sole shareholder of the 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:
Eric A. Liepins, Esq.
Eric A. Liepins, PC
12770 Coit Road, Suite 850
Dallas, TX 75251
Telephone: (972) 991-5591
Facsimile: (972) 991-5788
Email: eric@ealpc.com
Email: eric@ealpc.com
About AA Food and Company
AA Food and Company, Inc. is a single asset real estate debtor (as
defined in 11 U.S.C. Section 101(51B)). The Debtor owns a real
estate property located at 425 E. Main Street, Grand Prairie, Texas
valued at $700,000.
AA Food and Company filed a petition for Chapter 11 protection
(Bankr. N.D. Texas Case No. 22-30321) on Feb. 28, 2022, disclosing
$887,000 in assets and $1,086,000 in liabilities. Mumtaz Abbasi,
president, signed the petition.
Eric A. Liepins, Esq., serves as the Debtor's legal counsel.
ACM DEVELOPMENT: U.S. Trustee Unable to Appoint Committee
---------------------------------------------------------
The U.S. Trustee for Region 21, until further notice, will not
appoint an official committee of unsecured creditors in the Chapter
11 case of ACM Development, LLC, according to court dockets.
About ACM Developmen
ACM Development, LLC provides excavation services and is based in
Ocoee, Fla.
ACM Development filed a petition for Chapter 11 protection (Bankr.
M.D. Fla. Case No. 22-00210) on Jan. 20, 2022, listing up to $10
million in assets and up to $50 million in liabilities. Eric R.
Mynhier, manager, signed the petition.
Judge Lori V. Vaughan oversees the case.
The Debtor tapped Latham, Luna, Eden & Beaudine, LLP and Duerr &
Cullen CPAs, P.A. as its legal counsel and accountant,
respectively.
ACTIVA RESOURCES: Gets OK to Hire Donlin as Claims Agent
--------------------------------------------------------
Activa Resources, LLC and Tiva Resources, LLC received approval
from the U.S. Bankruptcy Court for the Western District of Texas to
hire Donlin, Recano & Company, Inc. as the claims, noticing and
solicitation agent.
The firm will oversee the distribution of notices and will assist
in the maintenance, processing and docketing of proofs of claim
filed in the Debtors' Chapter 11 cases.
The firm's hourly rates are as follows:
Executive Management No charge
Senior Bankruptcy Consultant $140 - $164 per hour
Case Manager $128 - $140 per hour
Consultant/ Analyst $104 - $124 per hour
Technology/Programming Consultant $76 - $96 per hour
Clerical $35 - $45 per hour
Donlin will also be reimbursed for out-of-pocket expenses
incurred.
Nellwyn Voorhies, executive director of Donlin, disclosed in court
filings that the firm is a "disinterested person" as the term is
defined in Section 101(14) of the Bankruptcy Code.
Donlin can be reached at:
Nellwyn Voorhies
Donlin, Recano & Company, Inc.
6201 15th Avenue
Brooklyn, NY 11219
Tel: (800) 591-8236
About Activa Resources and Tiva Resources
Activa Resources, LLC and Tiva Resources, LLC, are in the oil and
gas extraction industry. Both companies operate in San Antonio,
Texas.
On Feb. 3, 2022, Activa Resources and Tiva Resources sought
protection under Chapter 11 of the Bankruptcy Code (Bankr. W.D.
Texas Lead Case No. 22-50117). In the petitions signed by John
Hayes, president, Activa Resources disclosed as much as $50 million
in both assets and liabilities while Tiva Resources disclosed up to
$10 millionn in assets and up to $50 million in liabilities.
Bernard R. Given II, Esq., at Loeb and Loeb LLP, is the Debtors'
legal counsel. Donlin, Recano & Company, Inc. is the claims,
noticing and solicitation agent.
ACTIVA RESOURCES: Gets OK to Hire Loeb & Loeb as Bankruptcy Counsel
-------------------------------------------------------------------
Activa Resources, LLC and Tiva Resources, LLC received approval
from the U.S. Bankruptcy Court for the Western District of Texas to
hire Loeb & Loeb, LLP to serve as legal counsel in their Chapter 11
cases.
The firm's services include:
a. advising the Debtors with respect to their powers and
duties in the continued management and operation of businesses and
properties;
b. advising and consulting on the conduct of the cases,
including all of the legal and administrative requirements of
operating in Chapter 11;
c. attending meetings and negotiating with representatives of
creditors and other parties in interest;
d. taking all necessary actions to protect and preserve the
Debtors' estates including prosecuting actions on the Debtors'
behalf, defending any action commenced against the Debtors and
representing the Debtors in negotiations concerning litigation in
which they are involved;
e. preparing pleadings;
f. advising the Debtors in connection with any potential sale
of assets or investment by a third party;
g. appearing before the bankruptcy court and any appellate
courts;
h. advising the Debtors regarding tax matters;
i. negotiating, preparing and seeking approval of a disclosure
statement and confirmation of a Chapter 11 plan; and
j. performing all other necessary legal services for the
Debtors.
The firm's services will be provided mainly by Bernard Given, Esq.,
and Bethany Simmons, Esq., who charge $8950 per hour and $775 per
hour, respectively.
Mr. Given disclosed in a court filing that his firm is a
"disinterested person" within the meaning of Section 101(14) of the
Bankruptcy Code.
Loeb & Loeb can be reached through:
Bernard R. Given II
Loeb & Loeb LLP
10100 Santa Monica Boulevard, Suite 2200
Los Angeles, CA 90067
Tel: 310-282-2000
Fax: 310-282-2200
Email: bgiven@loeb.com
About Activa Resources and Tiva Resources
Activa Resources, LLC and Tiva Resources, LLC, are in the oil and
gas extraction industry. Both companies operate in San Antonio,
Texas.
On Feb. 3, 2022, Activa Resources and Tiva Resources sought
protection under Chapter 11 of the Bankruptcy Code (Bankr. W.D.
Texas Lead Case No. 22-50117). In the petitions signed by John
Hayes, president, Activa Resources disclosed as much as $50 million
in both assets and liabilities while Tiva Resources disclosed up to
$10 millionn in assets and up to $50 million in liabilities.
Bernard R. Given II, Esq., at Loeb and Loeb LLP, is the Debtors'
legal counsel. Donlin, Recano & Company, Inc. is the claims,
noticing and solicitation agent.
ADVANCE TRANSPORTATION: Continued Operations to Fund Plan
---------------------------------------------------------
Advance Transportation Services Incorporated filed with the U.S.
Bankruptcy Court for the Western District of Texas a Small Business
Plan of Reorganization dated Feb. 28, 2022.
Advance Transportation was formed on September 5, 2019 with the
intention of taking over the business operations of a Wyoming
corporate called ATSI, Inc. whose registered agent Abraham Wardy
resided at 12308 Red Sun Dr., El Paso, Texas 79938.
The Texas corporation filed for Chapter 11 relief on November 20,
2021, in hopes of still exercising the options to purchase the
rental vehicles that were contained in the Penske Lease Service
Agreement.
The Debtor has continued in business since using its older leased
trailers, as well as hiring some owner-operators, drivers who own
their own tractors and drive on as independent contractors to had
ATSI's tractors. Current demand for trucking services is strong. If
it stays that way, a reorganization should be feasible.
Class 7 consists of general unsecured claims filed or scheduled in
amounts of $5,000.00 or more. These claims shall be paid pro rata
in a pool that is to grow to $100,000 as the Debtor contributes to
it in 50 monthly payments of $2,000 each, to commence on the first
anniversary of effective confirmation date.
Class 8 consists of Administrative Convenience Class. The Trustee
shall pay the claims of any general unsecured creditors under
$5,000.00 a total dividend of 50 percent of their allowed amounts,
in two equal payments on the 70th and 140th day after Confirmation
Effective Date. This is an administrative convenience class.
This Plan shall reach its conclusion on the fifth anniversary of
Confirmation Effective Date. General unsecured creditors' estimated
recovery percentage is 11.6% of the allowed amounts of their
claims.
The plan provides that all of the projected disposable income of
the debtor to be received in the 3-year period, or such longer
period not to exceed 5 years as the court may fix, beginning on the
date that the first payment is due under the plan will be applied
to make payments under the plan.
A full-text copy of the Small Business Plan of Reorganization dated
Feb. 28, 2022, is available at https://bit.ly/3tk5GZr from
PacerMonitor.com at no charge.
Attorney for the Debtor:
E.P. Bud Kirk, Esq.
Law Office of E.P. Bud Kirk
600 Sunland Park Drive, Suite 400
El Paso, TX 79912
Tel: (915) 584-3773
Fax: (915) 581-3452
Email: budkirk@aol.com
About Advance Transportation Services
Advance Transportation Services, Inc., filed its voluntary petition
for Chapter 11 protection (Bankr. W.D. Tex. 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 Law Office of E.P. Bud Kirk is the Debtor's legal counsel.
AFAB SOLUTIONS: Gets OK to Hire Adam Law Group as Legal Counsel
---------------------------------------------------------------
Afab Solutions, LLC received approval from the U.S. Bankruptcy
Court for the Middle District of Florida to hire Adam Law Group,
P.A. to serve as legal counsel in its Chapter 11 case.
The firm's services include:
(a) advising the Debtor with respect to its powers and
duties;
(b) preparing all necessary pleadings associated with the
administration of the case;
(c) representing the Debtor at all court proceedings;
(d) protecting the interests of the Debtor in all matters
pending before the court; and
(e) representing the Debtor in negotiations with creditors and
in the preparation of its disclosure statement and plan of
reorganization.
Thomas Adam, Esq., the firm's attorney who will be providing the
services, will be paid at an hourly rate of $350.
The Debtor paid $5,000 to the law firm as a retainer fee.
Mr. Adam disclosed in a court filing that he is a "disinterested
person" as the term is defined in Section 101(14) of the Bankruptcy
Code.
Mr. Adam can be reached at:
Thomas C. Adam, Esq.
Adam Law Group, P.A.
326 N. Broad St., Suite 208
Jacksonville, FL 32202
Tel: (904) 329-7249
Fax: (904) 615-6561
Email: tadam@adamlawgroup.com
About Afab Solutions
Afab Solutions, LLC sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. M.D. Fla. Case No. 22-00110) on Jan. 18,
2022. In the petition signed by Alexis Rengel, owner, the Debtor
disclosed up to $100,000 in assets and up to $500,000 in
liabilities.
Judge Jacob A. Brown oversees the case.
Thomas C. Adam, Esq., at The Adam Law Group P.A. is the Debtor's
Legal counsel.
AFAB SOLUTIONS: U.S. Trustee Unable to Appoint Committee
--------------------------------------------------------
The U.S. Trustee for Region 21, until further notice, will not
appoint an official committee of unsecured creditors in the Chapter
11 case of AFAB Solutions, LLC, according to court dockets.
About Afab Solutions
Afab Solutions, LLC sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. M.D. Fla. Case No. 22-00110) on Jan. 18,
2022. In the petition signed by Alexis Rengel, owner, the Debtor
disclosed up to $100,000 in assets and up to $500,000 in
liabilities.
Judge Jacob A. Brown oversees the case.
Thomas C. Adam, Esq., at The Adam Law Group P.A. is the Debtor's
Legal counsel.
ALDRICH PUMP: Trane Units Ask Court to Limit Asbestos Injury Probe
------------------------------------------------------------------
Two Trane Technologies Plc spinoffs asked a bankruptcy court to
limit a probe by a group of asbestos injury victims into Trane's
use of a corporate maneuver that's come under public scrutiny.
Ireland-based Trane performed a reverse merger and offloaded its
asbestos liability to the spun-off units, Aldrich Pump LLC and
Murray Boiler LLC, placing them in Chapter 11. A bankruptcy judge
in New Jersey recently upheld Johnson & Johnson's use of the same
move, known as the Texas Two-Step.
Aldrich Pump LLC and Murray Boiler LLC on Feb. 15, 2022, filed a
motion asking the Court for entry of an order to further define the
scope of the Court's January 27, 2022 oral ruling (the "Derivative
Standing Ruling") on the Motion of the Official Committee of
Asbestos Personal Injury Claimants for Entry of an Order Granting
Leave, Standing, and Authority to Investigate, Commence, Prosecute,
and to Settle Certain Causes of Action (the "Derivative Standing
Motion").
The Debtors submit that they undertook the prepetition corporate
restructuring that created the Debtors ("Corporate Restructuring"),
in good faith, with the stated goal of seeking a permanent
resolution of their asbestos liabilities. Similarly, the Corporate
Restructuring permitted the filing of a much simpler, and
dramatically less complicated and expensive, bankruptcy case than
would have been possible otherwise, to the benefit of all parties
in interest. Postpetition, the (a) agreement reached with the
future claimants' representative, which would fund a trust with
$545 million for the payment of asbestos liabilities, and (b)
recently approved $270 million qualified settlement fund trust,
which is a committed funding source for asbestos claimants, both
demonstrate that asbestos claimants have direct access to more than
enough assets to fully pay their claims and also demonstrate
progress towards the goal of a global resolution of the Debtors'
asbestos liabilities through a confirmed plan of reorganization.
The Debtors believe these actions reinforce the reality that the
Corporate Restructuring and subsequent bankruptcy filings were
proper and executed in good faith.
In response to the objection by the ACC, the Debtors clarify that
that they are not trying to relitigate the Derivative Standing
Motion. Rather, the Debtors have taken up the Court's invitation to
file a motion to define the scope of the relief granted to the ACC
in the Derivative Standing Ruling.
"The ACC's assertion that the Debtors have waived certain arguments
by not raising them before or during argument on the Derivative
Standing Motion is irrelevant and ignores the Court's comments,"
the Debtors tell the Court.
"Further, recent developments in the LTL Management, LLC
proceedings in New Jersey underscore the propriety of the Court
taking the opportunity now to control the direction in which these
cases will proceed, and set the parties on a path toward plan
confirmation and payments to claimants without unnecessary,
wasteful, and time-consuming collateral litigation. The recent
decision denying the motions to dismiss the chapter 11 case of
LTL Management in New Jersey demonstrates the reality that these
cases, too, were filed in good faith, for a proper purpose, after a
valid prepetition restructuring under Texas law, and highlights the
fact that bare rhetoric surrounding the Corporate Restructuring and
subsequent
bankruptcy filing are insufficient to undermine the validity of the
transaction or the good faith of involved parties. Armed with
nothing but empty rhetoric, the foundation the ACC uses to assert
claims in its Opposition rings hollow and falls short of the
legally required burden, which requires such claims, in order to be
"colorable," to survive a motion to dismiss."
About Aldrich Pump
Aldrich Pump LLC and Murray Boiler LLC are U.S. subsidiaries of
Trane Technologies, a publicly traded company. Ireland's Trane
Technologies, formerly as Ingersoll Rand plc, is a global climate
innovator that brings efficient and sustainable climate solutions
to buildings, homes, and transportation. The North American
headquarters of Trane Technologies are located in Davidson, North
Carolina.
Aldrich Pump and Murray Boiler sought Chapter 11 protection (Bankr.
W.D.N.C. Lead Case No. 20-30608) on June 18, 2020. The Hon. Craig
J. Whitley oversees the cases.
In the petition signed by Allan Tananbaum, chief legal officer, the
Debtor was estimated to have $100 million to $500 million in both
assets and liabilities.
The Debtors tapped Rayburn Cooper & Durham, P.A. and Jones Day as
legal counsel; Bates White, LLC, Evert Weathersby Houff, and K&L
Gates, LLP as special counsel; AlixPartners, LLP as financial
advisor; and Kurtzman Carson Consultants, LLC as claims and
noticing agent.
The Office of the U.S. Trustee appointed a committee of asbestos
personal injury claimants. The asbestos committee tapped Robinson
& Cole, LLP and Caplin & Drysdale, Chartered as its bankruptcy
counsel. The committee also selected FTI as its financial advisor
and Legal Analysis Systems, Inc. as its asbestos consultant.
On Oct. 14, 2020, the Court entered the order appointing Joseph W.
Grier, III, as legal representative for future asbestos claimants
(FCR). He tapped Orrick, Herrington & Sutcliffe LLP and Grier
Wright Martinez, PA as counsel; Anderson Kill P.C., as special
insurance counsel; and Ankura Consulting Group, LLC as asbestos
claims consultant and financial advisor.
ALLEN DWARD CROSTHWAIT: Alexander Buying Chickasaw Asset for $1.68M
-------------------------------------------------------------------
Allen Edward Crosthwait asks the U.S. Bankruptcy Court for the
Northern District of Mississippi to authorize the sale outside the
ordinary course of business of approximately 560 acres located in
Chickasaw County, Mississippi, to Alexander Holding Co., LLC, for
$1.68 million.
In the exercise of his best business judgment, the Debtor has made
the decision to liquidate certain real property in an effort to
generate credits to pay the indebtedness of secured creditors. It
is the Property the Debtor desires to sell. A description of the
Property is described within the Purchase and Sale Agreement.
The decision to liquidate the Property is in the best interest of
all creditors and parties-in-interest. The purchase price for the
Property is its fair market value. The Purchaser is a good faith
purchaser and the sale transaction is an arms-length transaction.
The ad valorem taxes will be prorated at closing on the real
property based on possession as between the Purchaser and the
Debtor.
The Debtor seeks authority of the Court to execute such deed,
transfer of title or other related documents which are reasonably
necessary to consummate and close the sale of the Property.
He seeks to sell the Property free and clear of liens, claims and
interests with the exception of ad valorem tax claims which will be
prorated based upon possession, and paid at closing, with the valid
liens and claims of BancorpSouth Bank to attach to the sales
proceeds. The first, and only, consensual lien is held by
BancorpSouth.
Upon closing, all funds from the closing, less ad valorem real
estate taxes and reasonable closing costs, will be paid directly to
BancorpSouth who, as noted, holds a deed of trust on the Property.
The Debtor requests that the Court approves the sale for the fair,
reasonable, and appropriate contract price of $1.68 million.
Other grounds to be assigned upon a hearing of the Motion.
A copy of the Agreement is available at
https://tinyurl.com/mvdwje83 from PacerMonitor.com free of charge.
Allen Edward Crosthwait sought Chapter 11 protection (Bankr. N.D.
Miss. Case No. 21-10391) on March 2, 2021.
ALLEN EDWARD CROSTHWAIT: Dendy Buying Houston Property for $125K
----------------------------------------------------------------
Allen Edward Crosthwait asks the U.S. Bankruptcy Court for the
Northern District of Mississippi to authorize the sale outside the
ordinary course of business of the real property that was formerly
the residence of his mother consisting of a house and surrounding
approximately 23 acres of land located at 808 South Jackson Street,
in Houston, Mississippi, to Brett Dendy for $125,000.
In the exercise of his best business judgment, the Debtor has made
the decision to liquidate certain real property in an effort to
generate credits to pay the indebtedness of secured creditors. It
is the Property the Debtor desires to sell. A description of the
Property is described within the Purchase Contract.
The decision to liquidate the Property is in the best interest of
all creditors and parties-in-interest. The purchase price for the
Property is its fair market value. The Purchaser is a good faith
purchaser and the sale transaction is an arms-length transaction.
The ad valorem taxes will be prorated at closing on the real
property based on possession as between the Purchaser and the
Debtor.
The Debtor seeks authority of the Court to execute such deed,
transfer of title or other related documents which are reasonably
necessary to consummate and close the sale of the Property.
He seeks to sell the Property free and clear of liens, claims and
interests with the exception of ad valorem tax claims which will be
prorated based upon possession, and paid at closing, with the valid
liens and claims of BancorpSouth Bank to attach to the
sales proceeds. The first, and only, consensual lien is held by
BancorpSouth.
Upon closing, all funds from the closing, less ad valorem real
estate taxes and reasonable closing costs, will be paid directly to
BancorpSouth who, as noted, holds a deed of trust on the Property.
The Debtor requests that the Court approves the sale for the fair,
reasonable, and appropriate contract price of $125,000.
Other grounds to be assigned upon a hearing of the Motion.
A copy of the Contract is available at https://tinyurl.com/49zcf7ec
from PacerMonitor.com free of charge.
Allen Edward Crosthwait sought Chapter 11 protection (Bankr. N.D.
Miss. Case No. 21-10391) on March 2, 2021.
ALTO MAIPO: Unsecured Creditors to Get Nothing in Joint Plan
------------------------------------------------------------
Alto Maipo SpA and Alto Maipo Delaware LLC filed with the U.S.
Bankruptcy Court for the District of Delaware a Joint Chapter 11
Plan of Reorganization and Disclosure Statement dated Feb. 28,
2022.
The Plan constitutes a separate Plan for each Debtor for the
resolution of outstanding Claims and Interests pursuant to the
Bankruptcy Code, although proposed jointly for administrative
purposes. The Debtors seek to consummate the Restructuring
Transactions on the Effective Date of the Plan.
The Plan will treat claims as follows:
* Class 1 consists of all Alto Maipo Senior Secured
Obligations. On the Effective Date, each Holder of an Allowed Alto
Maipo Senior Secured Obligation shall receive, without setoff or
recoupment by any Debtor or Reorganized Debtor, its Pro Rata Share
of the 1L Secured Obligations and Amended & Restated 2L Secured
Obligations.
* Class 2 consists of all Secured Claims. Each Holder of an
Allowed Secured Claim shall receive, at the option of the Debtors,
either (i) Cash in an amount equal to such Allowed Secured Claim or
(ii) the collateral securing such Allowed Secured Claim, on or as
soon as reasonably practicable after the later of the date such
Claim is Allowed and the Effective Date.
* Class 3 consists of all Priority Claims. Each Holder of an
Allowed Priority Claim shall receive treatment in a manner
consistent with section 1129(a)(9) of the Bankruptcy Code.
* Class 4 consists of General Unsecured Claims. On the
Effective Date, each Holder of a General Unsecured Claim, whether
subordinated or unsubordinated, shall have its Claim cancelled,
released, and discharged and without any distribution. Class 4 is
Impaired and Holders of General Unsecured Claims are conclusively
deemed to have rejected the Plan.
* Class 5 consists of all DIP Claims. On the Effective Date,
all Allowed DIP Claims shall be exchanged for, or paid with the
proceeds of, the Amended & Restated Secured Exit Financing
Facility. Additionally, in consideration for, inter alia, certain
deferrals from the Sponsor; an increase in the size of the Amended
& Restated Secured Exit Financing Facility; and the impairment of
the DIP Claims, AES Andes or its designee shall receive the New
Common Equity, as provided in the Restructuring Term Sheet.
* Class 6 consists of Strabag's Other Claims. In consideration
of Strabag's Other Claims, which, subject to entry of the
Confirmation Order, are Allowed, the Tunneling Contract shall be
assumed pursuant to the Plan and Strabag shall be paid in full in
Cash, without setoff or recoupment, the following Cure Cost (less
any post-Petition Date payments on account of any such items made
prior to the Effective Date, and subject to any terms or deferrals
that may be negotiated between the Debtors and Strabag).
* Class 7 consists of all Intercompany Claims. On the
Effective Date, each Holder of an Allowed Intercompany Claim shall
have its Claim: (a) Reinstated or (b) cancelled, released, and
extinguished and without any distribution, in each case, at the
Company's election with the consent of the Required Consenting
Creditors.
* Class 8 consists of all Existing Equity Interests. On the
Plan Effective Date, to the maximum extent enforceable under
applicable law, each Holder of an Existing Equity Interest shall
have such Interest cancelled, released, and discharged and without
any distribution, in each case, at the Company's election and to
the extent permitted under local law. In order to effectuate such
cancellation, release and discharge, as of the Effective Date,
Strabag shall, upon request and at the direction of the Debtors or
the Reorganized Debtors, re-deliver its shares to AES Andes or such
other entity as is designated by AES Andes.
The Debtors shall fund distributions under the Plan with (1) Cash
on hand, including Cash from operations; and (2) the Amended &
Restated Secured Obligations. Cash payments to be made pursuant to
the Plan will be made by the Reorganized Debtors. Subject to the
terms of the Definitive Documents, the Reorganized Debtors shall be
entitled to transfer funds between and among themselves as they
determine to be necessary or appropriate to enable the Reorganized
Debtors to satisfy their obligations under the Plan.
A full-text copy of the Disclosure Statement dated Feb. 28, 2022,
is available at https://bit.ly/3tpmuy6 from PacerMonitor.com at no
charge.
Counsel for Debtors:
Pauline K. Morgan, Esq.
Sean T. Greecher, Esq.
S. Alexander Faris, Esq.
Young Conaway Stargatt & Taylor, LLP
Rodney Square
1000 North King Street
Wilmington, DE 19801
Telephone: (302) 571-6600
Facsimile: (302) 571-1253
Email: pmorgan@ycst.com
sgreecher@ycst.com
afaris@ycst.com
Pauline K. Morgan, Esq.
Sean T. Greecher, Esq.
S. Alexander Faris, Esq.
Young Conaway Stargatt & Taylor, LLP
Rodney Square
1000 North King Street
Wilmington, DE 19801
Telephone: (302) 571-6600
Facsimile: (302) 571-1253
Email: pmorgan@ycst.com
sgreecher@ycst.com
afaris@ycst.com
About Alto Maipo
Alto Maipo owns the Alto Maipo Hydroelectric Project, outside
Santiago, Chile, which is currently under construction. The project
comprises two run-of-the-river plants with a combined installed
capacity of 531 megawatts. The run-of-the-river project is a joint
venture between U.S. utility subsidiary AES Gener and Chilean
mining company Antofagasta Minerals (AMSA).
Alto Maipo Delaware LLC and Alto Maipo SpA sought Chapter 11
protection (Bankr. D. Del. Lead Case No. 21-11507) on Nov. 17,
2021. Javier Dib, board president and chief restructuring officer,
signed the petitions. At the time of the filing, Alto Maipo
Delaware LLC estimated between $1 billion and $10 billion in both
assets and liabilities.
The cases are handled by Judge Karen B. Owens.
The Debtors tapped Young Conaway Stargatt & Taylor, LLP and Cleary
Gottlieb Steen & Hamilton LLP as legal counsel; Nelson Contador
Abogados & Consultores SpA as local Chilean counsel; AlixPartners,
LLP as financial advisor; and Lazard Freres & Co. LLC and Lazard
Chile SpA as investment banker. Prime Clerk, LLC is the claims,
noticing and administrative agent.
ANDRA'S REDEMPTION: Counsel Backs Bid for Entry of Show Cause Order
-------------------------------------------------------------------
Bruce Weiner, counsel for Andra's Redemption, Inc., filed with the
U.S. Bankruptcy Court for the Eastern District of New York an
affirmation in support of the Debtor's motion for entry of Order to
Show Cause, directing the Debtor's principal, Andra Indarmattie, to
sign all papers necessary for the Debtor to close on the sale of
the real property at 94-19 104th Street aka 104-01/104-97 95th
Avenue, in Ozone Park, New York.
Weiner a member of the firm of Rosenberg Musso & Weiner, LLP, makes
the affirmation is in support of the Debtor's motion for an order
directing the Debtor's principal, Andra Indarmattie, to sign all
papers necessary for the Debtor to close on the sale of the
Property and if she refuses to sign the papers, authorizing Weiner,
as attorney for the Debtor, to sign all papers necessary to close
on the sale of the Property.
The application is being brought by order to show cause because the
closing on the sale of the Property is scheduled for March 7, 2022,
and Ms. Indarmattie told the Debtor's counsel that she will not
sign the papers and at the hearing on Feb. 17, 2022 she did not say
that she would sign. The Court is very familiar with the long
history of the case which has been pending in the Court for almost
five years and the many issues concerning the Property including
charges that the Debtor's counsel only became aware of recently.
If the sale of the Property does not close on March 7, 2022, it is
likely it will be sold at a foreclosure sale with creditors other
than the
mortgage holder and the holders of real estate tax liens receiving
nothing from the sale.
Weiner respectfully requests that the Court service be ordered to
be made Ms. Indarmattie, upon Bruce Minkoff, Esq., the attorney for
JFA Holdings, upon the Office of the United Trustee, and upon the
attorneys for the City of New York overnight mail or by email, and
that such service be deemed adequate notice of the hearing on the
motion.
The Debtor requests entry of the Order to Show Cause scheduling an
hearing on its motion, and granting such other relief as is just
and proper.
About Andra's Redemption
Andra's Redemption, Inc., owner of a mixed-use building in Ozone
Park, N.Y., filed a Chapter 11 petition (Bankr. E.D.N.Y. Case No.
17-40825) on Feb. 24, 2017. Andra Indarmattie, president, signed
the petition. The Debtor reported $1.02 million in total assets
and $493,000 liabilities as of the bankruptcy filing. Judge Nancy
Hershey Lord oversees the case. Bruce Weiner, Esq., at Rosenberg,
Musso & Weiner, serves as the Debtor's bankruptcy counsel.
ANGLIN CULTURED STONE: Proposes Auction Procedures for Equipment
----------------------------------------------------------------
David M. Klauder, the Subchapter V Trustee for the bankruptcy
estates of Anglin Cultured Stone Products, LLC, and Champion
Property Holdings, LLC, seeks approval from the U.S. Bankruptcy
Court for the District of Delaware of the auction procedures in
connection with the sale of various items of equipment and
machinery used in its construction business.
A hearing on the Motion is set for March 9, 2022, at 10:00 a.m.
(ET). The Objection Deadline was March 2, 2022, at 4:00 p.m.
(ET).
Anglin owns the Assets used in its construction business. The
Assets are of value to the Bankruptcy Estates, and as such, the Sub
V Trustee seeks to liquidate the Assets for the benefit of
creditors.
The Sub V Trustee proposes to sell the Assets through an on-line,
public auction. Because of the nature of the Auction, there is no
stalking horse bidder for the Assets. As noted, the Sub V Trustee
has selected Solid Resources, a highly qualified liquidator and
auctioneer, to notice, market and conduct the Auction. Solid
Resources will conduct the auction pursuant to the Auction
Procedures.
The Auction and the bidding for the Assets will be subject to the
following terms: (a) no portion of the Assets will be sold or
withdrawn prior to the Auction unless specific Court approval is
sought and obtained; (b) bids by proxy will be permitted, provided
all auction terms are satisfied; (c) the Assets will be sold "As
Is, Without Warranty"; and (d) cash, certified check or wire
transfer at closing on the Sale of the Assets.
Solid Resources will conduct the Auction at a date and time to be
determined once Court approval of the Motion is obtained. As set
forth in the Application, Solid Resources has budgeted $24,005 for
advertising and promotion expenses.
The following compensation and associated fees will be assessed
and/or paid to the Solid Resources:
a. The Sub V Trustee will pay to Solid Resources an 8%
commission on the proceeds resulting from the sale of the Assets.
b. In addition to the Sale Fee, the Sub V Trustee will
reimburse Solid Resources for its actual and documented advertising
and direct expenses directly attributable to the Sale2, including,
but not limited to, advertising production and placement, Sale
supervisors, laborers, and staff. Solid Resources and the Sub V
Trustee agree that the Expenses incurred will not exceed $24,005
without mutual consent in advance of incurring such excess. All
Expenses will be reimbursed to Solid Resources from Sale proceeds,
provided that the Expenses do not exceed the Expense Budget.
Expenses in excess of the Expense Budget which are not mutually
agreed upon in advance of incurring such excess (if any) will be
the responsibility of Solid Resources.
c. Agent will collect and retain in its entirety a buyer's
premium from the online auction purchaser(s) of the Assets. The
Buyer's Premium will equal 15% of the sale price of each Asset
sold.
The Auction will be conducted openly, and each bidder will be
informed of the terms of the previous bid. Each bidder is expected
to confirm at the Auction that it has not engaged in any collusion
with respect to the bidding or the sale.
The Sub V Trustee, in conjunction with its professional advisors,
will determine in its business judgment at the Auction the highest
and best offer for the Assets. Absent irregularities in the
conduct of the Auction, or reasonable and material confusion during
the bidding, the Court will not consider bids made after the
Auction has been closed.
The Sub V Trustee respectfully submits that it is appropriate to
sell the Assets free and clear of all liens, claims, interests, and
encumbrances, with all such interests attaching to the net sale
proceeds of the Assets to the extent applicable.
About Anglin Cultured Stone Products
Anglin Cultured Stone Products, LLC
--https://www.anglinconstruction.com -- is a family-owned and
operated small business in Delaware that specializes in
residential
construction, commercial and industrial construction, and cultured
marble manufacturing. It has been serving Delaware, Maryland,
Pennsylvania and New Jersey since 2005.
Anglin Cultured Stone Products sought protection under Chapter 11
of the Bankruptcy Code (Bankr. D. Del. Case No. 21-10389) on Feb.
8, 2021. In the petition signed by Stuart L. Anglin, sole member
and manager, the Debtor disclosed assets of $100,000 to $500,000
and liabilities of $1 million to $10 million.
Judge John T. Dorsey oversees the case.
Charles J. Brown, III, Esq., at Gellert Scali Busenkell & Brown,
LLC, represents the Debtor as legal counsel.
AREVALO LC FARM: Taps Law Office of Richard G. Hall as Counsel
--------------------------------------------------------------
Arevalo Lc Farm LLP seeks approval from the U.S. Bankruptcy Court
for the Eastern District of Virginia to hire the Law Office of
Richard G. Hall to serve as legal counsel in its Chapter 11 case.
The firm's services include:
a. advising and consulting with the Debtor concerning
questions arising in the administration of the estate, the Debtor's
rights and remedies with regard to the estate's assets, and the
claims of creditors and other parties in interest;
b. appearing for, prosecuting, defending and representing the
Debtor's interest in suits arising in or related to the case;
c. investigating and prosecuting preference and other actions
arising under the Debtor's avoiding powers;
d. assisting in the preparation of pleadings; and
e. preparing and filing a Chapter 11 plan and disclosure
statement, seeking confirmation of the plan, and preparing a final
report and accounting.
The hourly rates charged by the firm's attorneys and
paraprofessionals are as follows:
Attorneys $425
Paraprofessionals $200
The firm will also be reimbursed for out-of-pocket expenses
incurred.
Richard Hall, Esq., a partner at the Law Office of Richard G. Hall,
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.
Richard G. Hall can be reached at:
Richard G. Hall, Esq.
Law Office of Richard G. Hall
601 King Street, Suite 301
Alexandria, VA 22314
Phone: (703)256-7159
Fax: 703-941-0262
Email: Richard.Hall33@verizon.net
About Arevalo Lc Farm
Arevalo Lc Farm, LLP is a merchant wholesaler of grocery and
related products in Alexandria, Va.
Arevalo Lc Farm filed its voluntary petition for relief under
Chapter 11 of the Bankruptcy Code (Bankr. E.D. Va. Case No.
22-10174) on Feb. 17, 2022, listing up to $50,000 in assets and up
to $10 million in liabilities. Luis Ramos, a partner at Arevalo Lc
Farm, signed the petition.
The Law Office of Richard G. Hall serves as the Debtor's legal
counsel.
ASK IMAGE: Surplus Revenue or Disposable Income to Fund Plan
------------------------------------------------------------
Ask Image Enterprises, LLC, filed with the U.S. Bankruptcy Court
for the District of Maryland a Chapter 11 Plan under Subchapter V
dated Feb. 28, 2022.
The Debtor's business was formed in Maryland on September 21, 2021.
The Debtor runs a barbershop. Its income is based on renting barber
chairs out to independent contractor barbers.
The Debtor was performing well before the Covid-19 pandemic, though
it did have some financial issues. Its only consistent debt was
with its landlords, and prior to the pandemic it was steadily
working out methods to handle said debts. Unfortunately, the Debtor
was handling its books and finances without the support of an
accountant, and it was financially disorganized. However, it was
steadily gaining ground as all of their barber chairs were rented
and business was doing well.
The Covid-19 pandemic disrupted the business. The Chapter 11 was
filed in an attempt to reorganize its debt and the only actual debt
was with the Groffs Mill landlord. Besides handling the arrears,
the Debtor was hoping that it could extend the lease with the
landlord, as the lease's term expired on October 31, 2022.
Debtor's disposable income is obtained through the rental of barber
chairs. It currently has 9 such chairs and each independent
contractor barber pays approximately $200 per week per chair. Prior
to the Covid-19 Pandemic, the Debtor was charging at least $250 to
$300 per week per chair.
As demonstrated by the Monthly Operating Reports filed thus far,
the Debtor is collecting cash receipts of approximately $10,521.30
per month. The Debtor's only actual expense, outside of regular
monthly expenses, is the rent paid to IRPF Owings Mills New Town,
LLC for $3,214.23. Debtor believes that it will have at least
$5,000 per month available, since the only actual debt is its
landlord, IRPF Owings Mills.
In dedicating the money to rent and regular monthly expenses, there
will be surplus revenue that the Debtor will dedicate to the
Subchapter V Plan.
The value of the property to be distributed under the Plan during
the term of the Plan is not less than the Debtor's projected
disposable income for that same period. Unsecured creditors holding
allowed claims will receive distributions. The Plan also provides
for the payment of administrative claims in accordance with the
Bankruptcy Code.
During the term of this Plan, the Debtor shall submit all of its
surplus revenue or disposable income (or value of such disposable
income) necessary for the performance of this plan to the
Subchapter V Trustee (the "Trustee") and shall pay the Trustee.
The term of this Plan begins on the date of confirmation of this
Plan and ends on the 60th month subsequent to that date.
Except as provided in this Plan or the order confirming this Plan,
all of the property of the estate, pursuant to §§ 1141(b) and
1141(c) of the Bankruptcy Code, vests in the Debtor as of the
Effective Date free and clear of any claim or interest of any
creditor provided for by this Plan.
A full-text copy of the Subchapter V Plan dated Feb. 28, 2022, is
available at https://bit.ly/35kGslH from PacerMonitor.com at no
charge.
Attorney for the Debtor:
Marc A. Ominsky, Esq.
Law Offices of Marc A. Ominsky, LLC
10632 Little Patuxent Pkwy, Suite 249
Columbia, MD 21044
Tel: (443) 539-8712
Email: info@mdlegalfirm.com
About Ask Image
Ask Image Enterprises, LLC filed a petition for Chapter 11
protection (Bankr. D. Md. Case No. 21-17504) on Nov. 30, 2021,
listing up to $100,000 in assets and up to $500,000 in liabilities.
Safari Charles, owner, signed the petition.
Judge David E. Rice oversees the case.
The Debtor tapped Marc A. Ominsky, Esq. as legal counsel and Frank
J. Giarratano, CPA as accountant.
ATLANTIC BROOM: Seeks to Tap Rubin and Rudman as Bankruptcy Counsel
-------------------------------------------------------------------
Atlantic Broom Service, Inc. seeks approval from the U.S.
Bankruptcy Court for the District of Massachusetts to employ the
law firm of Rubin and Rudman LLP as its bankruptcy counsel.
Rubin and Rudman will render these legal services:
(a) advise the Debtor regarding its rights, powers and duties
in the continued operation and management of its assets;
(b) advise the Debtor with respect to any plan of
reorganization;
(c) represent the Debtor at all hearings and matters
pertaining to its affairs as debtor and debtor-in-possession;
(d) prepare legal papers;
(e) advise the Debtor with respect to the negotiation and
documentation of, financing agreements, debt and cash collateral
orders and related transactions;
(f) review and analyze the nature and validity of any liens
asserted against the Debtor's property and advise the Debtor
concerning the enforceability of such liens;
(g) advise the Debtor regarding its ability to initiate
actions to collect and recover property for the benefit of its
estate;
(h) advise and assist the Debtor in connection with the
potential disposition of any property;
(i) advise the Debtor concerning executory contract and
unexpired lease assumptions, lease assignments, rejections,
restructurings and recharacterization of contracts and leases;
(j) review and analyze the claims of the Debtor's creditors,
the treatment of such claims and the preparation, filing or
prosecution of any objections to claims;
(k) commence and conduct any and all litigation necessary or
appropriate to assert rights held by the Debtor, protect assets of
the Debtor's Chapter 11 estate or otherwise further the goal of
completing the Debtor's successful reorganization; and
(l) perform all other legal services and provide all other
necessary legal advice to the Debtor.
The firm will seek compensation based upon its normal and usual
hourly billing rates, and will seek reimbursement of expenses.
Prior to the petition date, the Debtor provided the firm with a
security retainer in the amount of $10,000.
Joseph Bodoff, Esq., an attorney at Rubin and Rudman, 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:
Joseph S.U. Bodoff, Esq.
Rubin and Rudman LLP
53 State Street
Boston, MA 02109
Telephone: (617) 330-7038
Email: jbodoff@rubinrudman.com
About Atlantic Broom Service
Atlantic Broom Service, Inc. offers roadway maintenance products,
including replacement street sweeper brooms, blades and supplies
for snow plows or traffic and highway signage for towns, cities,
contracting companies, property management firms and more.
Atlantic Broom Service filed its voluntary petition for relief
under Chapter 11 of the Bankruptcy Code (Bankr. D. Mass. Case No.
22-10173) on Feb. 15, 2022, listing up to $500,000 in assets and up
to $10 million in liabilities. Clement G. Kilcy, president, signed
the petition.
Rubin and Rudman LLP serves as the Debtor's legal counsel.
AUTOMOTIVE PARTS: Plan Solicitation Period Extended to April 1
--------------------------------------------------------------
Judge Edward Morris of the U.S. Bankruptcy Court for the Northern
District of Texas extended to April 1 the deadline for APDI
Liquidation LLC, formerly known as Automotive Parts Distribution
International, LLC, to solicit acceptances for its Chapter 11 plan
of liquidation.
The additional time will enable APDI to solicit votes for the plan
on the timeline also agreed to by the official unsecured creditors'
committee, which is working with the company to confirm the plan.
The timeline provides for APDI's swift exit from bankruptcy while
also providing time between objection deadlines and hearing dates
to further consensual resolution of potential issues, according to
court filings.
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.
The Debtor and the unsecured creditors' committee jointly filed a
Chapter 11 plan of liquidation on Jan. 10, 2022.
BALANCE POINT: Unsecured Creditors Unimpaired in Subchapter V Plan
------------------------------------------------------------------
Balance Point LLC, et al., filed with the U.S. Bankruptcy Court for
the District of Delaware a Subchapter V Plan of Reorganization
dated Feb. 28, 2022.
MECTA was formed when Gorham and Robin Nicol purchased assets from
Custom Systems Associated Inc. in 1980, and since then, MECTA has
become the leading marketer, manufacturer, and distributor of ECT
devices worldwide. BP was formed to hold, maintain, develop and
license intellectual property supporting the medical devices used
in the treatment of mental illness.
The Plan is designed to permit Debtors to resolve all Claims,
whether manifested or unmanifested, including, without limitation,
SpECTrum Claims, of all Claimants, whether known or unknown. Thus,
the Insurance Settlement, which was the result of substantial arms'
length settlement negotiations among the Settlement Parties, is a
critical component of this Plan.
Since the Petition Date, Debtors, with the support of the
Subchapter V Trustee, have engaged in good faith efforts and arms'
length settlement negotiations with SpECTrum Insurer and have
commenced discussions with Holders of SpECTrum Claims. As a result,
the Insurance Settlement is inextricably tied to the Plan and
critical to the success of the Subchapter V Cases. Among other
things, the Insurance Settlement (i) provides an immediate and
significant source of recovery for Holders of SpECTrum Claims, (ii)
facilitates a mechanism through which SpECTrum Claims will be
efficiently resolved, and (iii) resolves a material dispute between
Debtors and SpECTrum Insurer with respect to the extent of the
Settlement Parties' obligations under the SpECTrum Insurance
Policy.
This Plan will permit the Holders of Equity Interests to preserve
Debtors' going concern value while maintaining Debtors' business
operations and their Equity Interests. Indeed, the Plan provides
for payment of Allowed (a) unclassified Claims, including,
Administrative Expense Claims, Professional Fee Claims, and
Priority Tax Claims in full on the later of the (i) Effective and
(ii) the date such obligation comes due and owing; and (b) General
Unsecured Claims in full on the Effective Date or as soon
thereafter as reasonably practicable.
Class 1 consists of all Priority Unsecured Claims. Each Holder of
an Allowed Priority Unsecured Claim shall receive, in full and
complete satisfaction, settlement, discharge, and release of, and
in exchange for, its Allowed Priority Unsecured Claim: (i) payment
in full, in Cash, on the later of the Effective Date and the date
on which such Priority Unsecured Claim becomes Allowed; (ii)
payment in the ordinary course of business between Debtors or
Reorganized Debtors, as applicable, and the Holder of such Allowed
Priority Unsecured Claim; or (iii) such other treatment as Debtors
or Reorganized Debtors, as applicable and the Holder of such
Allowed Priority Unsecured Claims may agree. Distributions to
Holders of Class 1 Claims shall be made in full and complete
satisfaction, settlement, discharge, and release of the Allowed
Priority Unsecured Claims. Class 1 is Unimpaired.
Class 2 consists of all General Unsecured Claims. Each Holder of an
Allowed General Unsecured Claim shall be paid in full, in Cash,
upon the later of the Effective Date, or as soon as reasonably
practicable thereafter and the date on which such Class 2 Claim
becomes Allowed. Distributions to Holders of Class 2 Claims shall
be made in full and complete satisfaction, settlement, discharge,
and release of the Allowed General Unsecured Claims. Class 2 is
Unimpaired.
Class 3 consists of all Equity Interests in Debtors. Holders of
Equity Interests shall retain such Equity Interests. Class 3 is
Unimpaired.
Debtors and SpECTrum Insurer have entered into the Insurance
Settlement for the sole purpose of settling and resolving any and
all claims, disputes, and issues by and among the Debtors and
SpECTrum Insurer related to: (i) the SpECTrum Insurance Policy;
(ii) Debtors' obligations under the SpECTrum Insurance Policy;
(iii) SpECTrum; (iv) the SpECTrum Claims; (v) SpECTrum Insurer's
proofs of claim filed in the Subchapter V Cases; (vi) SpECTrum
Insurer's investigation, handling, administration, estimation,
adjustment, settlement, payment and/or resolution of the SpECTrum
Claims (collectively, "Insurer Claims Administration"); and (vii)
Debtors' investigation, handling, administration, estimation,
adjustment, settlement, payment and/or resolution of the SpECTrum
Claims and/or Debtors' allocation, distribution and/or payment of
the Insurance Settlement Amount to the Holders of SpECTrum Claims
and/or any other Person (collectively, "Debtor Claims
Administration").
Debtors anticipate that all Distributions made under the Plan will
be funded from Debtors' Cash on Hand. For the avoidance of doubt,
no Holder of a settled SpECTrum Claim will recover under the Plan
as such SpECTrum Claim will have been fully satisfied in accordance
with the agreed upon settlement terms, which shall be submitted
through the Plan Supplement and/or motion(s) pursuant to Bankruptcy
Code section 105 and Bankruptcy Rule 9019.
A full-text copy of the Subchapter V Plan of Reorganization dated
Feb. 28, 2022, is available at https://bit.ly/3KcJo2H from
PacerMonitor.com at no charge.
Counsel to Debtors:
Shanti M. Katona, Esq.
Polsinelli PC
222 Delaware Avenue, Suite 1101,
Wilmington, Delaware 19801
Tel.: 302.252.0924
Fax: 302.252.0921
Email: skatona@polsinelli.com
- and -
Jeremy R. Johnson
600 3rd Avenue, 42nd Floor
New York, New York 10016
Telephone: (212) 684-0199
Facsimile (212) 684-0197
Email: jeremy.johnson@polsinelli.com
About Balance Point and MECTA
Tualatin, Ore.-based Balance Point, LLC was formed to hold,
maintain, develop and license intellectual property supporting the
medical devices used in the treatment of mental illness. It is a
wholly owned subsidiary of MECTA Corporation, a marketer,
manufacturer, and distributor of Electroconvulsive Therapy (ECT)
devices. As of the petition date, MECTA has a non-exclusive license
to all of Balance Point's patents, trademarks, copyrights, trade
secrets, and other intellectual property, which it uses in
connection with the business.
Balance Point and MECTA filed petitions for Chapter 11 protection
(Bankr. D. Del. Case No. 21-11279) on Sept. 30, 2021. MECTA
President Robin H. Nicol signed the petitions. At the time of the
filing, Balance Point listed up to $10 million in assets and up to
$50,000 in liabilities while MECTA listed as much as $10 million in
both assets and liabilities.
Judge J. Kate Stickles oversees the cases.
The Debtors tapped Polsinelli, PC and Wyse Advisors, LLC as legal
counsel and financial advisor, respectively. Stretto, Inc. is the
Debtors' claims and noticing agent and administrative advisor while
Arrow Advisory Group, LLC serves as the Debtor's accountant.
BE MORE DEVELOPERS: Seeks to Hire Meridian Law as Legal Counsel
---------------------------------------------------------------
Be More Developers LLC seeks approval from the U.S. Bankruptcy
Court for the District of Maryland to employ Meridian Law, LLC to
handle its Chapter 11 case.
Meridian Law will be paid at the hourly rate of $300 plus
reasonable and customary disbursements.
Aryeh Stein, Esq., the principal of Meridian Law, 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:
Aryeh E. Stein, Esq.
Meridian Law, LLC
5141 Virginia Way, Ste. 320
Brentwood, TN 37027
Telephone: (615) 229-7499
Facsimile: (615) 229-7498
Email: astein@meridianlawfirm.com
About Be More Developers
Be More Developers LLC sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. D. Md. Case No. 22-10786) on Feb. 16, 2022,
listing as much as $1 million in both assets and liabilities.
Michael Coleman, member, signed the petition.
Aryeh E. Stein, Esq., at Meridian Law, LLC serves as the Debtor's
legal counsel.
BOY SCOUTS: 3rd Circuit Says Sidley Austin Was Conflicted in Ch. 11
-------------------------------------------------------------------
Jeannie O'Sullivan of Law360 reports that a Chubb Ltd. unit told
the Third Circuit on Wednesday, March 2, 2022, that Sidley Austin
LLP's former concurrent representation of the Boy Scouts of America
and the organization's liability insurers marked a conflict of
interest because the firm's reorganization strategy for BSA would
take money from "its own client's pockets.
"Boy Scouts of America sought Chapter 11 protection in February
2020 as it shouldered the weight of escalating sexual abuse
settlements. An insurance company claims there was "unambiguously"
a conflict of interest when Sidley Austin concurrently represented
BSA and the organization's liability insurers in bankruptcy
proceedings.
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: Plan Has Adverse Effect on Everest's Rights
-------------------------------------------------------
Everest National Insurance Company filed this supplemental
reservation of rights and objection to the Third Modified Fifth
Amended Chapter 11 Plan of Reorganization filed by Boy Scouts of
America and Delaware BSA, LLC on February 15, 2022.
Everest points out that the Plan should not be confirmed because it
has a potential adverse impact on Everest's legal, equitable, and
contractual rights, interests, defenses, and obligations under the
Everest Excess Policies.
The February 15 Modifications, however, do just that -- altering in
several ways Everest's contractual obligations as they existed
prepetition under the various policies:
* First, the February 15 Modifications seek findings by this
Court as to inflated claim values. In particular, in Article IX,
Section A of the Plan, the Debtors make it a Condition Precedent to
Confirmation that this Court "shall have made such findings and
determinations regarding the Plan," including that "the Base Matrix
Values in the Trust Distribution Procedures are based on and
consistent with the Debtors' historical abuse settlements and
litigation outcomes." This position appears to be at odds with the
Debtors' own expert, who has opined that the TDP claim values are
overstated. Any such finding may implicate consideration of
coverage issues and increase Everest's potential exposure and
likelihood of liability.
* Second, Article XIII of the Plan contemplates an Independent
Review Option that provides certain Direct Abuse Claimants may seek
to enhance their Allowed Claim Amount following a review by a
purported "Neutral" third party selected from a panel of retired
judges maintained by the Settlement Trust. This process
purportedly seeks to replicate "to the extent possible the amount a
reasonable jury might award for the Direct Abuse Claim." This
process may result in claim amounts of up to five times higher than
the maximum amounts allowed under the TDP, which are already
inflated.
Counsel to Everest National Insurance Company:
Nader A. Amer, Esq.
CARLTON FIELDS, P.A.
2 Miami Central, 700 NW 1st Ave., Suite 1200
Miami, Florida 33136-4118
Telephone: (305) 539-7205
Facsimile: (305) 530-0055
E-mail: namer@carltonfields.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.
BRINKER INT'L: Moody's Ups CFR to Ba3 & Sr. Unsecured Notes to B1
-----------------------------------------------------------------
Moody's Investors Service upgraded Brinker International, Inc.'s
corporate family rating to Ba3 from B1 and probability of default
rating to Ba3-PD from B1-PD. In addition, Moody's upgraded
Brinker's guaranteed senior unsecured notes to B1 from B2 and its
senior unsecured non-guaranteed notes to B2 from B3. Brinker's
speculative grade liquidity rating remains SGL-2. The outlook
remains positive.
"The upgrade and positive outlook reflects Brinker's continued
improvement in operating performance that has resulted in a
significant strengthening of credit metrics despite ongoing
inflationary headwinds," stated Bill Fahy, Moody's Senior Credit
Officer. Over the LTM period ending December 29, 2021, Brinker's
leverage improved to about 4.0 times from about 5.8 times in the
same prior year period. "Even though operating performance is
expected to moderate as inflationary pressures persist Moody's
believe steady consumer demand, selective price increases, costs
saving initiatives and a continued focus on debt reduction over and
above required amortization will drive stronger credit metrics
while maintaining good liquidity," Fahy added.
Upgrades:
Issuer: Brinker International, Inc.
Corporate Family Rating, Upgraded to Ba3 from B1
Probability of Default Rating, Upgraded to Ba3-PD from B1-PD
Gtd Global Notes, Upgraded to B1 (LGD4) from B2 (LGD4)
Senior Global Notes, Upgraded to B2 (LGD5) from B3 (LGD6)
Outlook Actions:
Issuer: Brinker International, Inc.
Outlook, Remains Positive
RATINGS RATIONALE
Brinker's Ba3 CFR benefits from its high level of brand awareness,
meaningful scale, improved cost structure, good product pipeline
and technology initiatives that are expected to drive incremental
traffic and mitigate inflationary pressures over the longer term.
The ratings are constrained by the earnings concentration with
Chili's, which requires this core brand to generate profitable same
restaurant sales trends on a consistent basis. In addition, the
uncertainty with regards to the ability and willingness of
consumers to maintain or increase their spend on food away from
home remains a concern as ongoing inflationary pressures negatively
impact purchasing power as price increases are likely throughout
the industry.
The positive outlook reflects Moody's view that earnings and credit
metrics will gradually improve despite inflationary pressures as
consumer demand remains steady and management focuses on debt
reduction over and above required amortization. The outlook also
anticipates that Brinker follows a prudent financial policy towards
dividends and share repurchases and maintains at least good
liquidity.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
An upgrade would require a continued strengthening of operating
performance that resulted in improved credit metrics with debt to
EBITDA sustained below 4.0 times and EBIT coverage of interest
sustained above 2.75 times. A higher rating would also require
maintaining at least good liquidity and a moderate financial
policy.
Ratings could be downgraded should there be a sustained
deterioration in credit metrics with debt to EBITDA exceeding 4.75
times or EBIT coverage of interest below 2.0 times. A sustained
deterioration in liquidity for any reason could also result in a
downgrade.
Brinker's board of directors is a good mix of industry veterans, as
well as directors with large company experience and relatively
varied periods of board tenure. Brinker's board has 10 members, 9
of which are independent and separate Chairman and CEO roles.
Brinker is a publicly traded company.
Restaurants by their nature and relationship with regards to
sourcing food and packaging, as well as having an extensive labor
force and constant consumer interaction are deeply entwined with
sustainability, social and environmental concerns. To this end,
Brinker requires its suppliers to adhere to its supplier code of
conduct, which sets forth its expectations on business integrity,
food safety and food ingredients, animal welfare and
sustainability. While these may not directly impact the credit,
these factors could impact consumers view of the brand overall.
Brinker International, Inc. ("Brinker") owns, operates and
franchises the casual dining concepts Chili's Grill & Bar (Chili's)
and Maggiano's Little Italy. As of December 29, 2021, Brinker had
about 1,182 company-owned restaurants and approximately 471
franchised restaurants. For the LTM period ending December 29, 2021
revenues were approximately $3.64 billion.
The principal methodology used in these ratings was Restaurants
published in August 2021.
BRINKS HOME: Hires PJT to Seek Fresh Capital After Botched Deal
---------------------------------------------------------------
Rachel Butt of Bloomberg Law reports that Brinks Home Security, an
alarm company operated by Monitronics International Inc., has
tapped PJT Partners to help raise capital, according to people with
knowledge of the situation.
The hiring came after Brinks pulled a $1.1 billion junk bond deal
in October 2021.
Brinks failed to attract investor interest despite offering roughly
10% yield for the bond sale, which would have pushed out its debt
maturity.
Brinks is expected to face liquidity strains due to upgrade of
telecom technology and earnout payments tied to bulk subscriber
purchases, Moody's Investors Service wrote on Dec. 14, 2021.
About Brinks Home Security
Brinks Home Security, formerly known as Monitronics International
Inc. is headquartered in the Dallas-Fort Worth area. It provides
security alarm monitoring services to approximately 900,000
residential and commercial customers as of March 31, 2019. Ascent
Capital Group, Inc. is a holding company that owns Monitronics,
doing business as Brinks Home Security.
Monitronics International and certain of its domestic subsidiaries
sought Chapter 11 protection (Bankr. S.D. Tex. Lead Case No.
19-33650) on June 30, 2019. The Hon. David R Jones was the case
judge.
The Debtors tapped HUNTON ANDREWS KURTH LLP and LATHAM & WATKINS
LLP as counsel; FTI CONSULTING, INC. as financial advisor; and
MOELIS & COMPANY LLC as investment banker in the Chapter 11 cases.
* * *
Monitronics International officially exited Chapter 11 bankruptcy
on Aug. 30, 2019, paving the way for the completion of its merger
with non-debtor parent Ascent Capital Group Inc.
In early August 2019, Monitronics and certain subsidiaries won
approval of their joint partial prepackaged plan of reorganization.
The Plan eliminated $885 million of debt, including $585 million
aggregate principal amount of the Company's 9.125% Senior Notes due
2020, $250 million of the Company's term loans and $50 million of
the Company's revolving loans. Approximately 14% of the Company's
9.125% Senior Notes due 2020 received cash and the remainder, along
with $100 million of the Company's term loans, were converted into
equity. Approximately $823 million of the Company's term loans were
converted into a new term loan facility. Upon emergence, the
Company also gained access to $295 million of additional liquidity
under new exit financing (consisting of a $150 million term loan
facility, and a $145 million revolving facility) to support its
continued growth and ensure it can continue to execute on its
strategic plan.
BVM THE BRIDGES: U.S. Trustee Unable to Appoint Committee
---------------------------------------------------------
The U.S. Trustee for Region 21, until further notice, will not
appoint an official committee of unsecured creditors in the Chapter
11 cases of BVM The Bridges, LLC and BVM Coral Landing, LLC,
according to court dockets.
About BVM The Bridges
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.
BVM The Bridges and its affiliate, BVM Coral Landing, LLC, sought
protection under Chapter 11 of the Bankruptcy Code (Bankr. M.D.
Fla. Lead Case No. 22-00345) on Jan. 28, 2022. In the petitions
signed by John Bartle, president, the Debtors disclosed up to $10
million in assets and up to $50 million in liabilities.
Judge Michael G. Williamson oversees the cases.
Alberto F. Gomez, Jr, Esq. at Johnson, Pope, Bokor, Ruppel & Burns,
LLP is the Debtors' legal counsel.
CATS ON THE BAY: Seeks to Hire YKAZ CPA PC as Accountant
--------------------------------------------------------
Cats On The Bay, Inc. seeks approval from the U.S. Bankruptcy Court
for the Eastern District of New York to employ YKAZ CPA, PC as its
accountant.
The firm will render these services:
(a) gather and verify all pertinent information required to
compile and prepare monthly operating reports; and
(b) prepare monthly operating reports for the Debtor in
Bankruptcy Case No. 1-21-42368-ess.
The expected estimate monthly cost of the firm's services is
between $350 and $400.
Yulia Koroshikh, a certified public accountant at YKAZ CPA,
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:
Yulia Koroshikh, CPA
YKAZ CPA, PC
137 Quentin Rd.
Brooklyn, NY 11223
Telephone: (718) 449-4876
About Cats On The Bay
Cats On The Bay, Inc. filed its voluntary petition for relief under
Chapter 11 of the Bankruptcy Code (Bankr. E.D.N.Y. Case No.
21-42368) on Sept. 20, 2021, listing under $1 million in both
assets and liabilities. Elina Khanukov, president, signed the
petition.
Judge Elizabeth S. Stong oversees the case.
The Debtor tapped the Law Offices of Alla Kachan, PC as bankruptcy
counsel and YKAZ CPA, PC as accountant.
CEDAR HAVEN: Unsecureds Owed $12.4M to Get $2M in Plan
------------------------------------------------------
Cedar Haven Acquisition, LLC submitted a Combined Disclosure
Statement and Chapter 11 Plan of Reorganization that provides for a
reorganization for the Debtor.
The Combined Plan and Disclosure Statement provides that on the
Effective Date: (a) the Class 4 Landlord Claim will be allowed in
the amount of $1,566,692 and satisfied in full pursuant to the Term
Sheet (defined herein); (b) the Amended Lease will be assumed; (c)
all property comprising the Estate shall vest in the Reorganized
Debtor free and clear of all Liens, Claims, charges, and other
encumbrances; (d) the Equity Interests will be reinstated; and (e)
the establishment of the GUC Pool, as discussed herein, and the
appointment of the GUC Administrator. There are two (2) impaired
classes identified in the Combined Plan and Disclosure Statement
that are entitled to vote to accept the Combined Plan and
Disclosure Statement: (i) Class 4 Landlord Claim, and (ii) Class 5
General Unsecured Claims. Class 4 and 5 are the only Classes
entitled to vote on the Combined Plan and Disclosure Statement.
Under the Plan, holders of Class 5 Allowed General Unsecured Claim
will receive such Holder's Pro Rata Share of the GUC Pool as full
and complete satisfaction of their Claims, which Claims shall not
be assumed by, and are extinguished and discharged against the
Reorganized Debtor. The Debtor estimates that the aggregate amount
of Allowed General Unsecured Claims will be approximately
$12,391,328 based on the Debtor's Schedules and Claims asserted
against the Estates. The Blalack Loan shall be allowed as a Class
5 Claim in the amount of $3,103,379, and Stone Barn's pre-petition
deferred management fee claims shall be allowed as a Class 5 Claim
in the amount of $1,494,500. Class 5 is impaired.
"GUC Pool" means up to $2,000,000, to be funded by the Reorganized
Debtor through contributions of Retained Excess Cash from time to
time on a quarterly basis, as further described in Article IV.D of
the Combined Plan and Disclosure Statement.
All consideration necessary to make all monetary payments in
accordance with the Combined Plan and Disclosure Statement shall be
obtained from the Exit Financing, Cash and cash equivalents of the
Debtor or the Reorganized Debtor, as applicable, including the
consideration to fund the GUC Pool and payments to the Landlord.
The voting procedures hearing objection deadline March 9, 2022 at
4:00 pm (ET). The voting procedures and interim Disclosure
Statement hearing will be on March 16, 2022 at 1:00 p.m. (ET). The
deadline for Creditors to file Rule 3018 Motions will be on March
30, 2022 at 4:00 p.m. (ET). The deadline for Debtor to respond to
Rule 3018 Motions will be on April 6, 2022 at 4:00 p.m. (ET). The
voting deadline for the Combined Plan and Disclosure Statement will
be on April 13, 2022 at 4:00 p.m. (ET). The Combined Plan and
Disclosure Statement objection deadline will be on April 13, 2022
at 4:00 p.m. (ET). The combined hearing on the Plan and Disclosure
Statement will be on April 21, 2022 at 10:00 a.m. (ET).
Counsel for the Debtor:
William E. Chipman, Jr., Esq.
Mark L. Desgrosseilliers, Esq.
Mark D. Olivere, Esq.
CHIPMAN BROWN CICERO & COLE, LLP
Hercules Plaza, 1313 North Market St., Suite 5400
Wilmington, Delaware 19801
Telephone: (302) 295-0191
Facsimile: (302) 295-0199
Email: chipman@chipmanbrown.com
desgross@chipmanbrown.com
olivere@chipmanbrown.com
A copy of the Disclosure Statement dated Feb. 25, 2022, is
available at https://bit.ly/3K7jGg1 from Amazonaws, the claims
agent.
About Cedar Haven Acquisition
Cedar Haven Acquisition, LLC -- https://cedarhaven.healthcare/ --
is a licensed skilled nursing facility located in Lebanon, Pa.,
that offers professionally supervised nursing care and related
medical and health services to persons whose needs are such that
they can only be met in a nursing facility on an inpatient basis
because of age, illness, disease, injury, convalescence or physical
or mental infirmity. It was formed in 2014 through the sale of
Cedar Haven Healthcare Center by the Lebanon County Commissioners
to Cedar Haven.
Cedar Haven Acquisition and its affiliates filed Chapter 11
petitions (Bankr. D. Del. Lead Case No. 19-11736) on August 2,
2019. At the time of the filing, Cedar Haven Acquisition estimated
assets of between $1 million and $10 million and liabilities of
between $10 million and $50 million.
The cases are assigned to Judge Christopher S. Sontchi. William E.
Chipman Jr., Esq., at Chipman Brown Cicero & Cole, LLP, represents
the Debtors. Stretto is the Debtor's claims agent.
Andrew Vara, the acting U.S. trustee for Region 3, appointed a
committee of unsecured creditors on Aug. 20, 2019. The committee
tapped Potter Anderson & Corroon LLP as its legal counsel and
Ryniker Consultants LLC as its financial advisor.
CENTURI GROUP: S&P Downgrades ICR to 'B+' on Group Status Revision
------------------------------------------------------------------
S&P Global Ratings lowered its issuer credit rating on Centuri
Group Inc. to 'B+' from 'BB-'.
S&P said, "At the same time, we lowered our rating on Centuri's
first-lien term loan to 'B+' from 'BB-'. Our recovery rating on the
term loan remains '3' and indicates our expectation of meaningful
(50%-70%; rounded estimate: 55%) recovery in the event of a payment
default."
Centuri's parent company, Southwest Gas Holdings Inc. (SWX),
recently announced its intention to separate Centuri from SWX.
S&P said, "The CreditWatch placement reflects the material
uncertainty surrounding the separation structure and future capital
structure, which could result in our assessment of Centuri's credit
quality as stronger, weaker, or it may not affect credit quality at
all.
"The downgrade of Centuri's ratings reflects our group rating
methodology and a revision of Centuri's group status to
nonstrategic from moderately strategic.
"The recent announcement by SWX to separate its subsidiary Centuri
leads us to believe that it is unlikely Centuri would receive
extraordinary support from SWX--particularly in times of severe
stress. As such, we are revising the group status of Centuri to
nonstrategic from moderately strategic, which removes the one notch
uplift that previously benefitted Centuri's ratings.
"We continue to assess our SACP on Centuri as 'b+'.
"This incorporates our view of Centuri's weak business risk, which
reflects its position in the highly fragmented and competitive
utility services industry, and its aggressive financial risk, which
reflects weaker free operating cash flow (FOCF) to debt following
its mid-2021 acquisition of Riggs Distler & Co. Inc. (Riggs). Under
our base case scenario, we expect FOCF to debt between 5%-10% and
our adjusted debt to EBITDA between 3.5x-4x in 2022.
"The developing CreditWatch reflects the material uncertainty
surrounding the separation and future capital structure, which
could result in our assessment of Centuri's credit quality as
stronger, weaker, or it may not affect credit quality at all. We
expect to resolve the CreditWatch placement during the next several
months when additional information is available and will reassess
the ratings based on our view of Centuri's standalone ownership and
capital structure, financial policy, and business strategy."
CHASE MERRITT: Seeks to Hire Douglas Elliman as Real Estate Broker
------------------------------------------------------------------
Chase Merritt Global Fund, LLC seeks approval from the U.S.
Bankruptcy Court for the Central District of California to hire
Douglas Elliman Real Estate to market for sale its real property
located at 10332 Mira Vista Drive, Santa Ana, Calif.
The firm will receive, upon consummation of a sale, a commission
equal to 6 percent of the purchase price if sold within 30 days of
listing being active on MLS, and a 5 percent commission of the
purchase price if sold after the first 30 days.
Douglas Elliman Real Estate, and Mr. Szigeti are "disinterested
persons" as that term is defined in section 101(14) of the
Bankruptcy Code, according to court filings.
The firm can be reached through:
Josef Szigeti
Douglas Elliman Real Estate
12 Corporate Plaza Dr., Suite 250
Newport Beach, CA 92660
Tel: (949) 981-3310
Email: josef.szigeti@elliman.com
About Chase Merritt
Chase Merritt Global Fund, LLC sought protection under Chapter 11
of the Bankruptcy Code (Bankr. C.D. Calif. Case No. 21-10135) on
Jan. 20, 2021, listing $2.7 million in assets and $1.315 million in
liabilities. Paul Nguyen, manager, signed the petition.
Judge Scott C. Clarkson oversees the case.
The Debtor is represented by the Law Office of W. Derek May.
CITIZENS OF THE WORLD: S&P Assigns 'BB-' on Rev. Bonds
-------------------------------------------------------
S&P Global Ratings assigned its 'BB-' rating to California School
Finance Authority's series 2022A and 2022B charter school revenue
bonds, issued for Citizens of the World Charter Schools-Los Angeles
(CWCLA). The outlook is stable.
"We assessed CWCLA's enterprise profile as adequate, characterized
by healthy enrollment growth and solid academics, coupled with a
veteran management team," said S&P Global Ratings credit analyst
Peter Murphy. S&P assessed CWCLA's financial profile as highly
vulnerable, reflecting the impact of the planned debt on the
school's coverage metrics and increased burden, offset by liquidity
that is acceptable for the rating level.
The rating reflects S&P's view of CWCLA's:
-- Thin pro forma maximum annual lease-adjusted debt service
coverage of 0.51x based on audited fiscal 2021 operations, which
will necessitate increased enrollment and operating performance.
Management projections for annual debt service coverage, however,
are acceptable and above 1.0x, reflecting the current growth
strategy;
-- Rising debt burden as a result of the planned issuance, which
could moderate over the near term given the rapid enrollment
projections and revenues associated with additional students; and
-- The inherent uncertainty associated with charter schools that
the charter can be revoked or not renewed for failure to perform
under its terms, and since the final maturity of the loan in 2062
exceeds the existing charter's term.
These weaknesses are somewhat offset by:
-- Success in replicating CWCLA's educational model over the past
decade, resulting in significant enrollment growth since inception
that is projected to double from current levels by 2027;
-- Acceptable liquidity position for the rating level, and cash
levels that will need to keep pace with growth of operations;
-- Stable market position, as demonstrated by solid academics,
good demand despite a very nominal waitlist, and a positive
authorizer relationship; and
-- Proactive and experienced management team coupled with active
support from a diverse and independent 12-member board.
S&P said, "We view the risks posed by the COVID-19 pandemic and any
emerging coronavirus variants to public health and safety as an
elevated social risk for the sector under our environmental,
social, and governance factors, given the potential impact on modes
of instruction and state funding, on which charter schools depend
to support operations. For CWCLA, the recent increase in per pupil
funding and ongoing enrollment growth have helped to mitigate some
near-term risk, although we will continue to monitor the impact of
the pandemic on the budgets of the State of California and the
network. Environmental risks in California are typically elevated
given the state's exposure to extreme weather conditions like
drought and wildfires, in addition to elevated seismic risk;
however, this is mitigated, in our view, by the network's urban
location, and the ability to operate its schools remotely. We
believe the school's environmental and governance risk are in line
with our view of the sector as a whole.
"The stable outlook reflects our expectation that CWCLA will
experience rapid enrollment growth meeting current projections, and
sustain good academic outcomes and adequate financial metrics over
time, although we acknowledge significant risk exists during the
initial phases of the expansion plan. We do not expect CWCLA to
issue additional debt during our outlook period.
"We could lower the rating if enrollment projections are not met
and operations, liquidity, and debt coverage ultimately weaken
beyond expected levels.
"Conversely, and likely not within our one-year outlook horizon, we
could raise the rating if enrollment meets or exceeds projections,
which results in significant improvement in financial performance,
maximum annual debt service coverage, and liquidity relative to
anticipated levels."
CLOUD49 LLC: Seeks to Hire Chamblee Ryan as Special Counsel
-----------------------------------------------------------
Cloud49, LLC seeks approval from the U.S. Bankruptcy Code for the
Western District of Texas to hire Chamblee Ryan, P.C. as its
special counsel.
The Debtor requires legal assistance in an ongoing state court
litigation (AP No. 22-01010-tmd) in which it asserts claims for
fraud, tortious interference with existing contracts, among other
things.
The attorney who will be primarily responsible is William Chamblee,
Esq., whose current hourly rate is $500. Paralegals, administrative
staff and other attorneys will charge $100 to $200 per hour. The
attorneys will also be entitled to reimbursement of expenses.
As disclosed in court filings, Chamblee Ryan does not have interest
adverse to the Debtor's estate.
The firm can be reached through:
William Chamblee, Esq.
Chamblee Ryan, P.C.
2777 N. Stemmons Fwy, Suite 1257
Dallas, TX 75207
Phone: 214-905-2003
Fax: 214-905-1213
Email: wchamblee@cr.law
About Cloud49 LLC
Cloud49, LLC sought protection for relief under Chapter 11 of the
Bankruptcy Code (Bankr. W.D. Texas Case No. 22-10085) on Feb. 11,
2022, listing as much as $1 million in both assets and liabilities.
Judge Tony M. Davis oversees the case.
Todd Brice Headden, Esq., at Hayward, PLLC and Chamblee Ryan, P.C.
represent the Debtor as bankruptcy counsel and special counsel,
respectively.
COLDWATER DEV'T: Trustee Sets Bid Process for Beverly Hills Asset
-----------------------------------------------------------------
Sam Leslie, the Chapter 11 trustee for Coldwater Development, LLC,
and Lydda Lud, LLC, seeks approval from the U.S. Bankruptcy Court
for the Central District of California of proposed bid procedures
in connection with the auction sale of six highly prized, vacant,
residential estate lots, totaling approximately 65.63 acres located
in the Santa Monica Mountains above Beverly Hills, California,
identified by Assessor's Parcel Number 4387-021-018 and
4387-021-019, 4387-022-001, 4387-022-002, 4387-020-001,
4387-020-009, as set forth in the Terms and Conditions of Sale.
A hearing on the Motion was set for March 2, 2022, at 10:00 a.m.
The Debtors collectively own the Property. More specifically, the
Coldwater Debtor owns two (2) lots identified by Assessor's Parcel
Number 4387-021-018 and 4387-021-019, and the Lydda Debtor owns
four (4) lots identified as Assessor's Parcel Number 4387-022-001,
4387-022-002, 4387-020-001, 4387-020-009.
On Feb. 9, 2022, the Court approved the Trustee's retention of
ThreeSixty Asset Advisors, LLC and WFS Inc., doing business as
Tranzon Asset Strategies to serve as auctioneers for the marketing
and sale of the Property. With the assistance of the Auctioneers,
the Trustee has formulated the Terms and Conditions of Sale. The
Bid Procedures contemplates approximately six weeks of marketing
efforts, followed by an auction sale, followed shortly thereafter
by a hearing to confirm the sale to the successful bidder, which
the Court previously reserved as March 30, 2022, at 10:00 a.m.
The Trustee is aware the Give Back, LLC holds a claim secured by
the Property. On March 9, 2021, Give Back filed a motion for
relief from the automatic stay, in which Give Back claims it is
owed nearly $30 million on account of its lien. The Debtor has
disputed the amount of the secured claim in the past. The Trustee
is informed that, as between Give Back and the Debtor, the
stipulated or undisputed amount of Give Back’s claim was
$27,265,211.02. The Trustee will not object to Give Back
exercising its rights under section 363(k) to credit bid up to the
undisputed amount of $27,265,211.02. The Trustee reserves all
rights to challenge the remainder of Give Back's claim if
appropriate.
The salient terms of the Bidding Procedures are:
1. The auction sale will take place on March 24, 2022,
concurrently online and in-person.
2. The properties being offered for are identified by
Assessor's Parcel Number 4387-021-018 and 4387-021-019,
4387-022-001, 4387-022-002, 4387-020-001, 4387-020-009. Interested
parties may submit a bid for all, one, or some of the Properties.
3. Requirement of Bid Deposit:
a. Onsite Bidders - Bids on the Properties will be
accepted only from persons who attend the Auction, have in their
possession a cashier's check in the amount of $250,000, payable to
Sam Leslie, Chapter 11 Trustee, and register with the Auctioneer
prior to the Auction. Only Qualified Bidders will be permitted to
attend the auction.
b. Online Bidders - A bid deposit in the amount of
$250,000, payable to Sam Leslie, Chapter 11 Trustee will be
required in order to bid. The deposit will be required in the form
of a Cashier's Check, remitted to the Seller no later than 48 hours
prior to the auction date, which the Seller may hold until the
completion of bidding and for a reasonable period of time to allow
for the release of any such deposit and/or the return of any such
funds after the conclusion of the auction. Online bidders will
also be required to complete bidder registration forms as supplied
by the Auctioneer, which will contain further instructions for
remitting the deposit.
4. Suggested Opening Bids and Offering: The Properties will be
offered with Suggested Opening Bid amounts. Auctioneer may offer
the Properties for sale as individual parcels, in parcel groupings,
and/or in their entirety. Auctioneer may reopen bidding over
multiple rounds, whereby Qualified Bidders will be provided the
opportunity to increase their bids and alter the parcel combination
of their bids if such increases and alterations bring a better
result to the Seller. The auction sale will not be deemed closed
on any parcel or combination of parcels until Auctioneer announces
the conclusion of the auction and determination of the highest and
best bids. At such time, Seller, in his sole discretion, will have
the authority to accept or reject the high bids established by the
Auctioneer.
5. Opening Bid Incentive: Auctioneer and Seller, in their sole
discretion, may offer a Qualified Bidder who agrees to open the
auction for one or more parcels at a bid amount acceptable to
Auctioneer and Seller, minimum overbid protection of approximately
3% of their opening bid.
6. Sale Subject to Confirmation: The auction sale is subject
to confirmation of the Seller in his sole and absolute discretion,
who is selling solely in his capacity as Trustee and the high
bidder only becomes the purchaser upon confirmation and acceptance
by the Seller, and approval by the bankruptcy court following
conclusion of the auction. The Seller is unconditionally
authorized to decline to confirm the sale of the Properties and to
cancel the sale of the Properties through close of escrow.
7. Bid Increments: Once a bid is received by the Auctioneer,
advances on that bid must be made in increments at least as great
as those which the Auctioneer, at his sole discretion, will
designate as being necessary to surpass the last bid acknowledged
by the Auctioneer. Should there be any dispute among competitive
bidders for the Properties, the Auctioneer may reopen bidding on he
Properties or he may, at his sole discretion, designate one of the
bidders as the "High Bidder."
8. Buyer's Premium: A buyer's premium of 3% will be added to
the High Bidder's high bid price and become part of the total
purchase price to be paid by the High Bidder.
9. Earnest Money Deposit: At the conclusion of bidding on the
Properties, the High Bidder will be required to confirm its bid
amount and tender its $250,000 cashier's check as deposit. The
High Bidder(s) will also be required to tender any necessary
additional deposit to bring its total deposit to an amount equal to
ten percent (10%) of the total purchase price, payable within 24
hours following the auction. The additional deposit may be by
cashier's check or wire transfer. The Earnest Money Deposit will be
held by Sam Leslie, Chapter 11 Trustee until close of escrow.
10. Purchase Contract: The High Bidder(s) will be required to
sign a Purchase Contract immediately upon the completion of the
auction.
11. High Bidder's Default: If the High Bidder fails to close
in a timely manner for any reason, the Earnest Money Deposit will
be immediately forfeited and released to Seller as liquidated
damages and not as a penalty.
12. "AS-IS" Sale: All bidders are encouraged to personally
inspect the Properties and documentation relating thereto. The
Properties are being sold "as-is, where is" with no representations
or warranties whatsoever. The sale is not contingent upon
inspection and will not be extended for that purpose.
13. Due Diligence: It is bidder's responsibility to obtain and
read the Property Information Package relating to the Properties
being sold at the auction, as well as any and all other information
made available by the Auctioneer relating to the auction and the
Properties being sold at the auction.
14. Title: The sale will be fee simple title by Quitclaim
Deed, as is, with a standard overage title policy provided by
Seller subject only to current taxes, assessments, easements,
rights-of-way, conditions, restrictions, other matters of record
and any printed exceptions specified in the preliminary title
report except monetary liens.
15. Close of Escrow: All sales must close within 30 days but
no sooner than 14 days following entry of the Court Order
confirming the sale. If a High Bidder fails to close in a timely
manner for any reason, the High Bidder's deposit(s) will be
immediately forfeited and released to Seller as liquidated damages
and not as a penalty.
16. Closing Costs: Property taxes will be pro-rated as of the
date of Close of Escrow. The High Bidder will be required to pay
their own closing costs, including, but not limited to escrow fees,
document preparation fees, transfer taxes, recording fees, and
property tax prorations. The Seller will pay standard coverage
title insurance fees and their portion of the escrow fees.
17. Broker Participation: Broker participation is welcomed. A
commission of 1% of the Buyer's Premium on the high bid price will
be paid to the licensed California real estate broker whose
prospect pays the entire purchase price, including Buyer's Premium,
and closes on the Properties. Referral fees will only be paid upon
closing and receipt of commissions by Auctioneer.
The Debtors ask the Court to set the following scheduling for a
motion to approve the sale of the Property:
a. March 24, 2022 - Auction Sale
b. March 25, 2022 - Deadline for Trustee to file and serve
motion to confirm the sale of the Property to successful bidder
c. March 29, 2022 - Deadline for any parties in interest to
file and serve any oppositions to the Sale Motion Orally at the
hearing Deadline for any parties in interest to file and serve any
replies to any oppositions to the Sale Motion
d. March 30, 2022, at 10:00 a.m. - Hearing on the Sale Motion
The Trustee respectfully requests that the Court enters an order
granting the Motion, approving the Bid Procedures, approving the
Sale Motion Scheduling, and granting such other and further relief
as the Court deems just and proper under the circumstances.
A copy of the Terms of Sale is available at
https://tinyurl.com/3644th7p from PacerMonitor.com free of charge.
About Coldwater Development
Los Angeles-based Coldwater Development, LLC and its affiliate
Lydda Lud, LLC filed Chapter 11 petitions (Bankr. C.D. Calif. Lead
Case No. 21-10335) on Jan. 15, 2021. In the petitions, both
Debtors
disclosed $50 million to $100 million in assets and $10 million to
$50 million in liabilities. Judge Sheri Bluebond presides over the
cases.
Arent Fox, LLP serves as the Debtors' bankruptcy counsel.
Sam S. Leslie is the Chapter 11 trustee appointed in the Debtors'
cases. David Seror, Esq., at Brutzkus Gubner and LEA Accountancy,
LLP serve as the trustee's legal counsel and accountant,
respectively.
COMPASS POWER: Moody's Rates New $710MM Senior Secured Debt 'Ba3'
-----------------------------------------------------------------
Moody's Investors Service assigned a Ba3 rating to Compass Power
Generation, LLC's proposed $710 million senior secured credit
facilities consisting of a 7-year $650 million senior secured term
loan B facility and a 5-year $60 million senior secured revolving
credit facility. Concurrently, Moody's affirmed the Ba3 rating
assigned to Compass' existing term loan due December 2024 (CUSIP:
20451VAD5) and revolving credit facility due December 2022
(collectively, the "existing credit facilities"). The rating
outlook is stable.
Proceeds from the new term loan B will be used to (1) repay
Compass' existing term loan (approximately $633 million
outstanding) and (2) pay transaction related fees and expenses.
Moody's intends to withdraw the Ba3 rating on the existing credit
facilities upon the closing of Compass' new credit facilities.
Compass owns three electric generating facilities: Marcus Hook
Energy Center (Marcus Hook: 921MW in PJM), Milford Power Plant
(Milford: 217MW in ISO-NE) and Dighton Power Plant (Dighton: 187MW
in ISO-NE). Compass is owned 50/50 by subsidiaries of Starwood
Energy Group (Starwood) and JERA Co., Inc (JERA). JERA is an equal
joint venture of two Japanese electric companies, Tokyo Electric
Power Company Holdings, Inc. (Ba1) and Chubu Electric Power
Company, Incorporated (A3).
Affirmations:
Issuer: Compass Power Generation, LLC
Senior Secured Bank Credit Facilities, Affirmed Ba3
Assignments:
Issuer: Compass Power Generation, LLC
Senior Secured Term Loan B, Assigned Ba3
Senior Secured Revolving Credit Facility, Assigned Ba3
Outlook Actions:
Issuer: Compass Power Generation, LLC
Outlook, Remains Stable
RATINGS RATIONALE
The primary factors supporting Compass' Ba3 rating are the high
degree of capacity revenue certainty, the competitive generating
profile of Marcus Hook, an improved outlook for spark spreads and
energy margins over at least the near-term and the extension of the
term loan maturity to 7 years from financial close. The rating,
however, is tempered by the significant amount of consolidated
leverage, the portfolio's reliance on the merchant power markets as
a vehicle for deleveraging, lenders second lien position on the
Marcus Hook asset and the potential for a significant amount of
debt outstanding at the end of the financing term.
The majority of Compass' highly certain revenue is attributable to
a 685 MW capacity contract between Long Island Power Authority
(LIPA: A2, stable) and Marcus Hook that extends through June 2030.
The LIPA contract is anticipated to generate approximately $48
million of revenue in 2022 and escalates by approximately 2%
annually. Capacity in excess of the 685 MW's contracted with LIPA
has been bid and accepted into PJM capacity auctions and is
anticipated to provide incremental annual revenue.
Compass' two other assets, Dighton and Milford, have bid their
respective capacity into the ISO-NE capacity auction. Milford
cleared 53MW's of incremental capacity in the Forward Capacity
Auction 11 (FCA-11, effective June 1, 2020) associated with an
uprate project completed in 2019. Under ISO-NE market rules, since
the uprate cleared the FCA, existing and incremental capacity at
Milford qualifies as a new resource and has the option to receive
the FCA-11 clearing price ($5.30 kW-month) for up to seven years
(through May 2027), a positive consideration in light of downward
pricing trend in recently completed auctions.
While the level of annual capacity revenues provide a reliable and
meaningful source of cash flow that anchors Compass' credit
quality, Moody's note that the aggregate annual amount of capacity
revenue in each year does not fully cover historical non-fuel
operating expenses (approximately $40 million over the trailing
twelve months ended September 30, 2021) and mandatory debt service
(approximately $50 million). As such, there remains reliance on the
merchant energy markets each year to satisfy Compass' annual
payment obligations and incremental debt reduction.
The rating considers an improved regional pricing environment for
wholesale power owing to higher demand and higher natural gas
prices. On a trailing twelve month basis through September 30,
2021, Compass earned approximately $45 million in energy margin
compared $35 million in 2020 and less than $30 million in 2019.
While Moody's expect the improved pricing environment in the
near-term, Moody's are less certain about the sustainability of the
higher margins beyond the next 12 to 18 months.
Second lien position on Marcus Hook
Compass' rating considers a second lien on Marcus Hook, the most
valuable asset. Specifically, Marcus Hook has a $97 million senior
secured letter of credit facility and a $27 million non-amortizing
senior secured term loan that are each senior to Compass' senior
secured credit facilities. Lenders under these facilities have been
granted a first lien security interest in Marcus Hook while
Compass' lenders have a second lien position in Marcus Hook, a
credit negative. Upon repayment of the Marcus Hook facilities, all
of the assets and equity interest in Marcus Hook spring to a
first-priority lien
Expected financial performance
Moody's Base Case suggests key financial metrics that are adequate
for the low Ba rating category. Specifically, Moody's expect
Compass' debt-to-EBITDA to decline to approximately 6.0x by
year-end 2024 from approximately 8.0x on an pro forma basis driven
by cash flow generation and a mandatory 75% excess cash flow sweep
requirements and the ratio of consolidated project cash from
operations to consolidated debt in a range of 7-9% over the same
timeframe.
The rating recognizes that under the Moody's Base Case a meaningful
amount of term loan debt may remain outstanding at maturity.
Specifically, Moody's Base Case suggests that an amount in excess
of $450 million could remain outstanding under Compass' term loan
at maturity. Refinancing at that time will be influenced by the
scheduled 2030 expiry of the capacity contract with LIPA. While
Moody's believe that LIPA views favorably the optionality of the
contract from a reliability perspective, Moody's do not anticipate
the capacity contract to be extended at the current terms.
RATING OUTLOOK
The stable outlook reflects Moody's expectation for continued
stable operational and financial performance, including financial
performance in line with the Moody's Base Case.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The rating could be upgraded should Compass repay substantially
greater debt than expected or if financial metrics improve
dramatically such as consolidated project cash from operations to
consolidated debt at 15% or higher and debt-to-EBITDA at less than
5x on a sustained basis.
The rating could be downgraded should Compass' debt-to-EBTDA exceed
7.5x and consolidated project cash from operations to consolidated
debt ratio decline to below 6% on a sustained basis.
Compass owns three electric generating facilities: Marcus Hook,
Milford and Dighton. Compass is owned 50/50 by subsidiaries of
Starwood and JERA.
The principal methodology used in these ratings was Power
Generation Projects Methodology published in January 2022.
CONSTANT CONTACT: Fitch Affirms 'B' LongTerm IDR, Outlook Stable
----------------------------------------------------------------
Fitch Ratings has affirmed Constant Contact, Inc.'s Long-Term
Issuer Default Rating (IDR) at 'B'. Fitch has also affirmed the
company's secured revolving credit facility (RCF), the first-lien
secured term loan, and the first-lien delayed draw term loan at
'BB-'/'RR2'. Constant Contact's second-lien secured term loan is
affirmed at 'CCC+'/'RR6'. The Rating Outlook is Stable.
Constant Contact's Long-Term IDR of 'B' is supported by its stable
recurring sales and strong cash generative qualities. The IDR also
reflects the fragmented email marketing industry with several
competing brands and products, and substantial exposure to the
small to midsize business (SMB) market with greater volatility. In
addition, as a private equity owned entity, financial leverage is
likely to remain at moderate levels as shareholders prioritize ROE
maximization limiting debt reduction.
KEY RATING DRIVERS
Recurring Revenue and Strong Profitability: Substantially all of
Constant Contact's revenues are recurring providing some comfort
about future revenue streams. Net revenue retention for Constant
Contact is in the 80's, which is lower than some enterprise
software peers that can have net retention rates in the 90s or
higher. The company has maintained stable subscribers while growing
average revenue per subscriber (ARPS) from its installed base
despite the relatively high churn in the SMB segment. Constant
Contact has consistently demonstrated strong free flow
characteristics with strong EBITDA and FCF margins.
Growth via Acquisitions: In September 2021, Constant Contact
acquired SharpSpring for approximately $240 million in cash. It
funded this acquisition with its $180 million delayed draw term
loan, revolver borrowings and cash. SharpSpring expands Constant
Contact's offerings with the acquisition since SharpSpring
specializes in customer relationship management software. In
January 2022, Constant Contact announced it agreed to acquire
Australian-based Vision6, which is an SMS and email marketing
company. This is a relatively small acquisition which will expand
the company's international presence. Fitch believes the company
may continue to be acquisitive in the forecast years.
SMB Exposure: Constant Contact, Inc. offers products addressing the
email marketing needs of SMB customers that have limited technical
or marketing resources dedicated to launching, managing, and
monitoring their online marketing campaigns. The SMB segment
generally has high failure rates resulting in high subscriber
churn. This results in the need for Constant Contact to maintain
sales by replacing churned customers with new ones and growing
ARPS. Exposure to SMB customers also results in exposure to the
cyclical impact of economic cycles, which could potentially lead to
cash flow volatility during periods of economic stress.
Fragmented Industry: The SMB email marketing industry is
fragmented, with over 200 market participants. Barriers to entry
are low and incumbent market share is not protected. Switching
costs are low, as it is not costly or complicated to switch
marketing software vendors. Constant Contact is the #2 player in
the market serving over 480,000 subscribers, with the market leader
(Mailchimp) estimated to have over a third of market share among
SMB email marketing companies. Beyond the top two competitors, no
other peers command over 10% market share. Several companies offer
a broad spectrum of solutions to customers with various needs, as
well as competitors offering narrower point solutions to SMBs with
limited scope.
Market Position Facilitates Customer Acquisition: Over 50% of
Constant Contact's customer acquisitions are direct-to-site and
considered organic acquisitions. The company attributes the strong
organic customer acquisition to its strong brand awareness and
market position within the SMB segment. Fitch views the high
organic customer acquisition as an important factor for profitable
subscriber growth in the SMB segment and fragmented industry.
Elevated Leverage: Fitch estimates Constant Contact's pro forma
leverage to be approximately 6.2x at the end of 2021 (pro forma for
the SharpSpring acquisition). With cost reductions and modest
EBITDA growth, leverage may decline to fall just under 6.0x by YE
2022 and longer term, margin expansion will be dependent on
management's ability to optimize costs. Fitch projects deleveraging
in the forecast horizon supported by the company's FCF generation.
However, Constant Contact's private equity ownership would likely
prioritize ROE through growth via debt funded acquisitions and
dividend payments.
DERIVATION SUMMARY
Constant Contact's 'B' Long-Term IDR reflects its strong market
position as a software vendor in the fragmented SMB email marketing
industry. The company provides SMBs the means to launch, analyze,
and manage their own email marketing campaigns. Demand for email
marketing is expected to grow as SMBs seek to maximize their reach
to customers and continues to offer better ROI than other marketing
channels. Constant Contact's operating profile is also strengthened
by the high recurring nature of its revenues supported by the
subscription model. Limitations to Constant Contact's rating
include its SMB exposure that could result in revenue volatility
during extended economic weakness.
Fitch expects Constant Contact to maintain some level of financial
leverage as a private equity owned company as equity owners
optimize capital structure to maximize ROE. Constant Contact
operated as the core of Endurance International's Digital Marketing
segment. Following the spin-off transaction, Constant Contact will
operate as a standalone company. Constant Contact's market
position, revenue scale, SMB exposure, and leverage profile are
consistent with the 'B' rating category.
KEY ASSUMPTIONS
Fitch's key assumptions within its rating case for the issuer
include:
-- Pro forma for the SharpSpring acquisition, Fitch assumes low
double-digit revenue growth in 2021 followed by low single
digit growth, driven by modest net subscriber adds and higher
ARPS;
-- Adjusted EBITDA margins in the low 40's in 2021 and with
modest expansion after that reflecting cost optimization of
the SharpSpring acquisition;
-- The acquisition of Australian-based Vision6 closes in early
1Q22 and is relatively small;
-- Under $200 million spent on acquisitions through 2025 largely
funded with FCF;
-- Mid-single digit capital intensity.
KEY RECOVERY RATING ASSUMPTIONS
The recovery analysis assumes that Constant Contact would be
reorganized as a going concern in bankruptcy rather than
liquidated. A 10% administrative claim is assumed.
Going-Concern (GC) Approach
In the event of a bankruptcy reorganization, Fitch assumes that
Constant Contact would continue to execute on its cost reduction
plan as part of the reorganization plan. In such a scenario, the
recovery analysis assumes sales pressure in the form of declining
net subscriber retention from not adding new customers and slowing
ARPS growth. Constant Contact's GC EBITDA is assumed to be
approximately 20% below pro forma 2021 EBITDA and that there are
10% administrative claims.
An enterprise value (EV) multiple of 6x EBITDA is applied to the GC
EBITDA to calculate a post-reorganization EV. The choice of this
multiple considered the following factors:
-- The historical bankruptcy case study exit multiples for
technology peer companies ranged from 2.6x-10.8x;
-- Of these companies, only three were in the Software sector:
Allen Systems Group, Inc.; Avaya, Inc.; and Aspect Software
Parent, Inc., which received recovery multiples of 8.4x, 8.1x,
and 5.5x, respectively.
-- Constant Contact's stable sales profile, brand recognition and
position as the #2 player in the fragmented SMB email
marketing industry.
Fitch estimates strong recovery prospects for the first lien term
loans and revolver and rates them 'BB-'/'RR2', or two notches above
Constant Contact's 'B' IDR. Prospects for recovery are poor for the
second lien term loan and it is rated 'CCC+'/'RR6'.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
-- Fitch's expectation of total debt with equity credit/operating
EBITDA sustaining below 5.0x; and
-- Cash from operations-capex/total debt with equity credit above
7.5%.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
-- Fitch's expectation of total debt with equity credit/operating
EBITDA sustaining above 6.5x;
-- Cash from operations-capex/total debt with equity credit below
5.0%;
-- Operating EBITDA/interest paid below 2.0x;
-- Deterioration in key operating metrics, including subscriber
growth, churn and profitability.
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
Strong Liquidity: As of Sept. 30, 2021, the company had $35 million
of cash on the balance sheet and full availability of its $125
million revolver. Internal cash generation with strong margins also
supports the liquidity profile, as Fitch expects Constant Contact
to consistently generate FCF margins in the low to mid-teens.
ISSUER PROFILE
Constant Contact, Inc. is an online marketing company focused on
small businesses. It is the second largest player in the email
marketing space with over 480,000 subscribers.
CORP GROUP: Exclusivity Period Extended to April 25
---------------------------------------------------
Judge J. Kate Stickles of the U.S. Bankruptcy Court for the
District of Delaware extended the exclusivity period for Corp Group
Banking S.A. and its affiliates to file a Chapter 11 plan to April
25 or seven days following conclusion of the hearing on
confirmation of their proposed joint plan of liquidation, whichever
is later.
In the event that the plan is not confirmed, within seven days of
the court issuing its confirmation ruling, the Debtors may file any
motion to further extend the exclusivity periods.
The official unsecured creditors' committee has 14 days to respond
to any subsequent motion. Alternatively, the committee may file a
motion to terminate the exclusivity period and have that motion
heard within 10 days, according to the court order.
About Corp Group Banking S.A.
Corp Group Banking SA, a Chilean financial holding company
controlled by billionaire Alvaro Saieh, and Inversiones CG
Financial Chile Dos SpA filed voluntary petitions for relief under
Chapter 11 of the Bankruptcy Code (Bankr. D. Del. Lead Case No.
21-10969) on June 25, 2021. At the time of the filing, Corp Group
Banking disclosed $500 million to $1 billion in assets and $1
billion to $10 billion in liabilities.
Judge J. Kate Stickles oversees the cases.
The Debtors tapped Simpson Thacher & Bartlett, LLP and Young
Conaway Stargatt & Taylor, LLP as legal counsel. Prime Clerk, LLC
is the Debtors' claims and noticing agent and administrative
advisor.
The U.S. Trustee for Region 3 appointed an official committee of
unsecured creditors on July 20, 2021. The committee tapped Morgan,
Lewis & Bockius, LLP as lead bankruptcy counsel, Robinson & Cole
LLP as Delaware counsel, and NLD Abogados as special Chilean
counsel. FTI Consulting, Inc., serves as the committee's financial
advisor.
The Debtors filed their joint Chapter 11 plan of liquidation and
disclosure statement on Dec. 27, 2021.
CORPORATE COLOCATION: Chapter 11 Trustee Appointment Sought
-----------------------------------------------------------
530 6th Street, LLC, asks the U.S. Bankruptcy Court for the Central
District of California to enter an order appointing a Chapter 11
trustee in the bankruptcy case of Corporate Colocation Inc.
530 6th Street submits the appointment of a Chapter 11 trustee is
necessary to protect the assets of the estate and all
parties-in-interest, including creditors, from the incompetence,
continued mismanagement, and self-dealing by the Debtor's current
management, Victor and Jonathan Goodman.
530 6th Street explains the Goodmans caused the Debtor to make no
less than $1,843,220 of Prepetition Transfers that either: (a) were
paid directly to the Goodmans, the Affiliate, or other insiders of
the Debtor; (b) appear to have been used to pay for the personal
expenses of the Goodmans, the Affiliate, or other insiders of the
Debtor; or (c) are questionable as whether they were for legitimate
business expenses of the Debtor.
530 6th Street further notes that dismissal without any oversight
as to the Debtor's affairs would not benefit any creditor because,
upon dismissal, the Goodmans would be re-vested with the ability to
manage the Debtor incompetently and dishonestly.
Therefore, 530 6th Street believes the Court should appoint a
Chapter 11 trustee who can investigate the Insider Claims, protect
and preserve the Debtor's assets, and attempt to move the case
along.
About Corporate Colocation Inc.
Corporate Colocation Inc. -- https://www.corporatecolo.com/ --
operates a large server farm that provides website services to
about 25 subtenants that is located at 530 West Sixth Street, Suite
502 et seq., Los Angeles, California 90014. Corporate Colocation
sought protection under Chapter 11 of the U.S. Bankruptcy Code
(Bankr. C.D. Calif. Case No. 21-12812) on April 7, 2021. In the
petition signed by Jonathan Goodman, president, the Debtor
disclosed $2,284,042 in assets and $5,041,445 in liabilities.
Judge Ernest Robles oversees the case.
Robert M. Yaspan, Esq., at Law Offices of Robert M. Yaspan is the
Debtor's counsel.
530 6th Street, LLC, as landlord, is represented by Jeffrey Lee
Costell, Esq. at Costell & Adelson Law Corporation.
CORPORATE COLOCATION: Exclusivity Period Extended to March 24
-------------------------------------------------------------
Judge Ernest Robles of the U.S. Bankruptcy Court for the Central
District of California approved the stipulation between Corporate
Colocation, Inc. and its landlord, 530 6th Street, LLC, extending
the exclusivity period for the company to file a Chapter 11 plan to
March 24.
About Corporate Colocation Inc.
Corporate Colocation Inc. operates a large server farm that
provides website services to about 25 subtenants located at 530
West Sixth St., Suite 502, in Los Angeles.
Corporate Colocation filed a petition for Chapter 11 protection
(Bankr. C.D. Calif. Case No. 21-12812) on April 7, 2021, disclosing
$2,284,042 in assets and $5,041,445 in liabilities. Judge Ernest
Robles oversees the case.
Robert M. Yaspan, Esq., at the Law Offices of Robert M. Yaspan and
Goodkin Law Group, APC serve as the Debtor's bankruptcy counsel and
special counsel, respectively. Hahn Fife & Company, LLP is the
Debtor's accountant.
CRC BROADCASTING: Wins Interim Cash Collateral Access
-----------------------------------------------------
The U.S. Bankruptcy Court for the District of Arizona has
authorized CRC Broadcasting Company, Inc. to use cash collateral on
an interim basis pursuant to the budget, with a 5% variance.
In consideration for the use of cash collateral, Desert Financial
Federal Credit Union is granted replacement liens on all of the
Debtor's property after the Petition Date, to the extent of
diminution in value of Desert Financial's interest in the estate
property. Desert Financial also is granted a superpriority
administrative expense claim to the extent the replacement liens
are not adequate to protect for any diminution of collateral.
Moreover, Desert Financial is granted a superpriority
administrative expense claim under Bankruptcy Code section 507(b)
(without the need to file or request any such claim with the
Bankruptcy Court or otherwise), to the extent Replacement Liens
above do not adequately protect Desert Financial for any diminution
of collateral, including Cash Collateral.
The Debtor owes Desert Financial under certain loan documents no
less than $1,477,964 resulting from its own debts and the debts of
affiliated debtor, CRC Media West, LLC that it guaranteed and
secured.
Crestmark Vendor Finance, a division of MetaBank, has asserted a
perfected, first priority purchase money security interest in
certain specified collateral pursuant to Equipment Finance
Agreement # 153522 entered into between Regents Capital Corporation
and CRC Media West, LLC, which Equipment Finance Agreement was
subsequently assigned by Regents Capital to Crestmark.
A copy of the order and the Debtor's budget for March 2022 is
available for free at https://bit.ly/3vwNjmM from
PacerMonitor.com.
The Debtor projects $25,000 in total monthly expenses.
About CRC Broadcasting Co.
CRC Broadcasting Company, Inc., a broadcast media company based in
Scottsdale, Ariz., filed a voluntary petition under Chapter 11 of
the Bankruptcy Code (Bankr. D. Ariz. Case No. 20-02349) on March 6,
2020, listing under $1 million in both assets and liabilities.
Affiliate CRC Media West, LLC also filed for Chapter 11 petition
(Bankr. D. Ariz. Case No. 20-02352) on March 6, 2020, listing under
$1 million in both assets and liabilities.
The cases are jointly administered.
Judge Paul Sala oversees both cases.
Allan D. NewDelman, Esq., at Allan D. NewDelman, P.C., is the
Debtors' legal counsel.
Squire Patton Boggs (US)LLP represents Desert Financial Federal
Credit Union, secured creditor.
Desert Financial Federal Credit Union, as secured creditor, is
represented by Squire Patton Boggs (US) LLP.
CURTISS COURTYARD: Taps Richard R. Robles as Bankruptcy Counsel
---------------------------------------------------------------
Curtiss Courtyard, LLC seeks approval from the U.S. Bankruptcy
Court for the Southern District of Florida to hire the Law Offices
of Richard R. Robles, P.A. to serve as legal counsel in its Chapter
11 case.
The firm's services include:
(a) giving advice to the Debtor with respect to its powers and
duties;
(b) advising the Debtor with respect to its responsibilities
in complying with the U.S. Trustee's Operating Guidelines and
Reporting Requirements and with the rules of the court;
(c) preparing legal documents;
(d) protecting the interest of the Debtor in all matters
pending before the court; and
(e) representing the Debtor in negotiation with its creditors
in the preparation of a Chapter 11 plan.
The firm will bill these hourly fees:
Managing Attorney $400
Senior Attorney $325
Junior Attorney $275
Associate Attorney $225
Juris Doctor $150
Law Clerk $120
Paralegal $90
The Law Offices of Richard R. Robles requires a $15,000 retainer
and $1,738 for the filing fee.
As disclosed in court filings, the Law Offices of Richard R. Robles
is a "disinterested person" within the meaning of Section 101(14)
of the Bankruptcy Code.
The firm can be reached through:
Richard R. Robles, Esq.
Law Offices of Richard R. Robles, P.A.
905 Brickell Bay Drive, Suite 228
Miami, FL 33131
Phone: (305) 755-9200
Email: rrobles@roblespa.com
assistant@roblespa.com
About Curtiss Courtyard
Curtiss Courtyard, LLC filed its voluntary petition for relief
under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Fla. Case No.
22-11154) on Feb. 14, 2022, listing up to $1 million in assets and
up to $10 million in liabilities. Rafael D. Rodriguez, manager,
signed the petition.
Judge Robert A Mark oversees the case.
Richard R Robles, Esq., at the Law Offices of Richard R. Robles,
P.A. serves as the Debtor's legal counsel.
DALLAS ELM: Seeks to Tap Sheils Winnubst PC as Bankruptcy Counsel
-----------------------------------------------------------------
Dallas Elm Street, LLC seeks approval from the U.S. Bankruptcy
Court for the Northern District of Texas to employ Sheils Winnubst,
PC as its legal counsel.
Sheils Winnubst will render these services:
(a) advise the Debtor regarding its powers and duties;
(b) negotiate, prepare and file a plan of reorganization and
disclosure statement and otherwise promote the financial
rehabilitation of the Debtor;
(c) take all necessary action to protect and preserve the
estate of the Debtor;
(d) prepare legal papers;
(e) perform general legal services in connection with the
foregoing; and
(f) 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:
T. Craig Sheils $395
Mark D. Winnubst $350
Stephanie L. Utah $300
Latrice E. Andrews $300
Kimberly A. Quirk $225
In addition, the firm will seek reimbursement for expenses
incurred.
As disclosed in court filings, Sheils Winnubst is a "disinterested
person" as that term is defined in Section 101(14) of the
Bankruptcy Code.
The firm can be reached through:
T. Craig Sheils, Esq.
Sheils Winnubst, PC
1100 Atrium II
1701 N. Collins Boulevard
Richardson, TX 75080
Telephone: (972) 644-8181
Facsimile: (972) 644-8180
Email: craig@sheilswinnubst.com
About Dallas Elm Street
Dallas Elm Street, LLC sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. N.D. Tex. Case No. 22-30287) on Feb. 24,
2022. Judge Stacey G. Jernigan oversees the case.
T. Craig Sheils, Esq., at Sheils Winnubst, PC serves as the
Debtor's legal counsel.
DENDON INC: Proposes Auction Procedures for Georgia-Virginia Route
------------------------------------------------------------------
Dendon, Inc., asks the U.S. Bankruptcy Court for the Northern
District of Georgia to authorize the auction procedures in
connection with the sale of one of its designated routes, which ran
from the Atlanta, Georgia FedEx Ground Terminal #303 to Tom's
Brook, Virginia, to Sean Callahan Enterprises, Inc., to the highest
and best bidder.
Prior to the Petition Date, the Debtor had attempted to sell the
Route. The Debtor received the initial amount of $180,000 but the
balance of $150,000 remains due and owing. A disagreement
concerning certain terms and conditions arose between the parties.
The Debtor seeks authorization to sell the Route via auction to the
highest and best bidder. It requests entry of an order authorizing
the following procedures: (1) Callahan will be entitled to a credit
bid of $180,000; (2) in the event Callahan is not the successful
bidder, Callahan will receive $180,000 from the gross proceeds
immediately upon receipt in full and final satisfaction of its
claim; (3) the initial starting price for the Route will be
$335,000 and bids will increase in increments of $2,500 until the
purchase price reaches $400,000 (4) if the purchase price reached
$400,000 the bids will increase incrementally at the minimum rate
of $5,000; (3) if the purchase price reaches $500,000, the bids
will increase at the minimum incremental rate of $10,000 until a
final purchase price is reached.
The transactions will be subject to the approval of Federal Express
and the parties will comply with all requirements to transfer the
route required by Federal Express. The transaction will be payable
in cash at closing.
The Debtor has significant tax obligations. It will continue to
operate and will have two undesignated routes with Federal Express
after the closing of transactions and anticipates amending the
proposed plan and utilization of the sale proceeds to pay a
significant
portion of the outstanding tax obligation due and owing to the
Internal Revenue Service.
The Internal Revenue Service has filed a proof of claim asserting a
secured claim in excess of $800,000 as evidence by the tax liens
filed prior to the Petition Date.
The sale will be free and clear of Liens and Claims. Any liens on
the Assets will attach to the proceeds of the Sale, subject to any
claims or defenses the Debtor may have in response to such lien.
Any sale of the Assets by Debtor will be on an "as is, where is"
basis and without representations or warranties of any kind,
nature, or description by Debtor, its agents or anyone acting on
its behalf.
The Debtor also requests that the Court allows the sale to be
consummated immediately as authorized by Bankruptcy Rule 6004(g).
By the Motion, the Debtor seeks entry of an order approving the
procedures set forth and scheduling a date for the auction of the
Route. It further requests that upon completion of the auction,
the Court enters an order authorizing the sale of the Route.
About Dendon Inc.
Dendon, Inc. filed a petition for Chapter 11 protection (Bankr.
N.D. Ga. Case No. 21-55796) on Aug 4, 2021, listing up to $50,000
in assets and up to $1 million in liabilities. M. Denise Dotson,
LLC represents the Debtor as legal counsel.
DRALA MOUNTAIN: Seeks to Hire Ropes & Gray as Bankruptcy Counsel
----------------------------------------------------------------
Drala Mountain Center, formerly known as Shambhala Mountain Center,
seeks approval from the U.S. Bankruptcy Court for the District of
Colorado to employ Ropes & Gray LLP as its bankruptcy counsel.
Ropes & Gray will render these legal services:
(a) advise the Debtor regarding its powers and duties in the
continued management and operation of its business and properties;
(b) advise and consult on the conduct of this Subchapter V
case;
(c) take any necessary action on behalf of the Debtor to
negotiate, draft, and obtain approval of a Subchapter V plan and
all documents related thereto;
(d) represent the Debtor in connection with obtaining
authority to use cash collateral;
(e) attend meetings and negotiate with representatives of
creditors and other parties-in-interest;
(f) take all necessary actions to protect and preserve the
Debtor's estate;
(g) prepare pleadings in connection with this Subchapter V
case;
(h) appear before the court and any appellate courts to
represent the interests of the Debtor's estates; and
(i) perform all other necessary legal services for the Debtor
in connection with the prosecution of this Subchapter V case.
The firm may charge the Debtor for charges and disbursements
incurred in the rendition of services.
James Wilton, Esq., a partner at Ropes & Gray, 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:
James M. Wilton, Esq.
Ropes & Gray LLP
Prudential Tower
800 Boylston Street
Boston, MA 02199-3600
Telephone: (617) 951-7474
Email: james.wilton@ropesgray.com
About Drala Mountain Center
Drala Mountain, formerly Shambala Mountain Center, is a Tibetan
Buddhist retreat and meditation hub in Colorado.
Drala Mountain sought Chapter 11 bankruptcy protection (Bankr. D.
Colo. Case No. 22-10656) on Feb. 28, 2022, listing up to $10
million in both assets and liabilities. Michael Gayner, executive
director, signed the petition.
Judge Joseph G. Rosania, Jr. oversees the case.
The Debtor tapped Ropes & Gray LLP as bankruptcy counsel, Markus
Williams Young & Hunsicker LLC as local counsel, and Cordes &
Company as financial advisor.
DRALA MOUNTAIN: Seeks to Tap Cordes & Company as Financial Advisor
------------------------------------------------------------------
Drala Mountain Center, formerly known as Shambhala Mountain Center,
seeks approval from the U.S. Bankruptcy Court for the District of
Colorado to employ Cordes & Company as its financial advisor.
Cordes & Company will render these services:
(a) assemble financial information necessary to determine the
value of the Debtor's assets;
(b) project the Debtor's income and expenses to facilitate a
discounted cash flow valuation;
(c) estimate a pro forma operating year when economic
conditions normalize;
(d) assist in the preparation of the Debtor's budget, initial
and monthly financial reports, schedules and statement of financial
affairs;
(e) assist the Debtor and its legal counsel with its
Subchapter V filing;
(f) explore strategic alternatives available to the Debtor;
(g) assist the Debtor in restructuring its outstanding
indebtedness; and
(h) provide testimony, if necessary, to assist the Debtor's
efforts to reorganize and confirm a plan under Subchapter V.
The hourly rates of the firm's professionals are as follows:
Michael Staheli $275
Supporting Staff $75 - $265
In addition, the firm will seek reimbursement for expenses
incurred.
The firm received a security retainer of $10,000 from the Debtor.
Michael Staheli, a managing director at Cordes & Company, 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 Staheli
Cordes & Company
5299 DTC Boulevard, Suite 600
Greenwood Village, CO 80111
Telephone: (303) 796-1130
Email: mstaheli@cordesco.com
About Drala Mountain Center
Drala Mountain, formerly Shambala Mountain Center, is a Tibetan
Buddhist retreat and meditation hub in Colorado.
Drala Mountain sought Chapter 11 bankruptcy protection (Bankr. D.
Colo. Case No. 22-10656) on Feb. 28, 2022, listing up to $10
million in both assets and liabilities. Michael Gayner, executive
director, signed the petition.
Judge Joseph G. Rosania, Jr. oversees the case.
The Debtor tapped Ropes & Gray LLP as bankruptcy counsel, Markus
Williams Young & Hunsicker LLC as local counsel, and Cordes &
Company as financial advisor.
DRALA MOUNTAIN: Taps Markus Williams Young as Local Counsel
-----------------------------------------------------------
Drala Mountain Center, formerly known as Shambhala Mountain Center,
received approval from the U.S. Bankruptcy Court for the District
of Colorado to employ Markus Williams Young & Hunsicker LLC as its
local counsel.
The firm will render these legal services:
(a) assist in the production of the Debtor's schedules and
statement of financial affairs and other pleadings necessary to
file its Chapter 11 case;
(b) assist in the preparation of the Debtor's plan of
reorganization and disclosure statement;
(c) prepare legal papers;
(d) represent the Debtor in adversary proceedings and
contested matters related to the Debtor's bankruptcy case;
(e) advise the Debtor regarding its rights, powers,
obligations and duties in the continued operation of its business
and the administration of the estate; and
(f) provide other legal services for the Debtor as necessary
and appropriate for the administration of its estate.
The hourly rates of the firm's counsel and staff are as follows:
James T. Markus $275 - $450
Zachary G. Sanderson $275 - $450
Paralegal and Assistant $125
Prior to the petition date, the firm received a security retainer
of $10,000 from the Debtor.
James Markus, Esq., an attorney at Markus Williams Young &
Hunsicker, 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:
James T. Markus, Esq.
Zachary G. Sanderson, Esq.
Markus Williams Young & Hunsicker LLC
1775 Sherman Street, Suite 1950
Denver, CO 80203-4505
Telephone: (303) 830-0800
Facsimile: (303) 830-0809
Email: jmarkus@markuswilliams.com
zsanderson@markuswilliams.com
About Drala Mountain Center
Drala Mountain, formerly Shambala Mountain Center, is a Tibetan
Buddhist retreat and meditation hub in Colorado.
Drala Mountain sought Chapter 11 bankruptcy protection (Bankr. D.
Colo. Case No. 22-10656) on Feb. 28, 2022, listing up to $10
million in both assets and liabilities. Michael Gayner, executive
director, signed the petition.
Judge Joseph G. Rosania, Jr. oversees the case.
The Debtor tapped Ropes & Gray LLP as bankruptcy counsel, Markus
Williams Young & Hunsicker LLC as local counsel, and Cordes &
Company as financial advisor.
ELECTRO SALES: Unsecureds Will be Paid in Full
----------------------------------------------
Electro Sales & Service, Inc., submitted a Second Amended
Disclosure Statement.
The Debtor proposes to pay all Secured Creditors' and General
Unsecured Creditors' claims in full. The Debtor proposes to fund
its Plan through the liquidation of its assets. Specifically, the
Debtor shall market and sell its commercial real estate within 180
days from the Confirmation Date.
The means necessary for the execution of the Debtor's Plan shall be
the liquidation of its assets, including the marketing and sale of
the Debtor's commercial real estate. All of the Debtor's real
property shall be sold within 180 days from the Confirmation Date.
Class V All Allowed General Unsecured Claims of creditors, which
are not otherwise classified. This class insists solely of the
claim of American Express in the amount of $1,179. This claim will
be paid in full from either the sale of the property at 3941
Eisenhauer Rd, San Antonio, Texas 78218 or the property at 2750 S.
Loop 1604 E, San Antonio, Texas 78229, whichever one occurs first.
These properties will be sold within 180 days of the Confirmation
Date. Class V is impaired.
Attorney for the Debtor:
David T. Cain, Esq.
LAW OFFICE OF DAVID T. CAIN
8626 Tesoro Dr., Suite 811
San Antonio, Texas 78217
Tel: (210) 308-0388
Fax: (210) 503-5033
A copy of the Disclosure Statement dated Feb. 25, 2022, is
available at https://bit.ly/33XaISW from PacerMonitor.com.
About Electro Sales & Service
Electro Sales & Service filed its voluntary petition for relief
under Chapter 11 of the Bankruptcy Code (Bankr. W.D. Tex. Case No.
21-50546) on May 3, 2021. At the time of the filing, the Debtor
disclosed $500,001 to $1 million in assets and $100,001 to $500,000
in liabilities. Judge Ronald B. King oversees the case. David T.
Cain, Esq., is the Debtor's legal counsel.
ENLINK MIDSTREAM: Fitch Alters Outlook on 'BB+' IDR to Positive
---------------------------------------------------------------
Fitch Ratings has affirmed EnLink Midstream, LLC's (ENLC) and
EnLink Midstream Partners, LP's (ENLK) Long-Term (LT) Issuer
Default Rating (IDR) at 'BB+' and senior unsecured rating at
'BB+'/'RR4'. Fitch has also affirmed ENLK's preferred equity rating
at 'BB-'/'RR6'. The Rating Outlook for both entities is revised to
Positive from Stable.
The Positive Outlook revision reflects ENLC's leverage (total debt
with equity credit to operating EBITDA), which has improved faster
than previously forecasted, and is expected to decline below
Fitch's positive 4.5x leverage sensitivity by YE 2022. Sustained
leverage below positive sensitivity threshold over a couple of
quarters would be a main trigger for an upgrade.
KEY RATING DRIVERS
Deleveraging Underpinned by Financial Policy: Fitch calculated
ENLC's YE 2021 leverage to be 4.8x. During 2020 and 2021, ENLC was
able to execute on credit enhancement items, such as distribution
cuts, capex reduction, and cost savings, and posted strong 2021
result. ENLC raised its distributions in the 4Q21 by 20%. Given
ENLC's current distribution policy and capex program, Fitch
forecasts that ENLC's leverage will trend below positive
sensitivity threshold of 4.5x in 2022.
ENLC's 2021 earnings were stronger than expected due to a
significant improvement in the commodity environment in the second
half of 2021, which accelerated growth in Permian and also helped
to stabilize volumes in Oklahoma and North Texas. Fitch expects
ENLC's growth in Permian and Louisiana should keep leverage below
positive sensitivity threshold beyond 2022 under the current
Fitch's price deck. Fitch believes, following the successful
deleveraging in the past two years, ENLC is well positioned to
manage its leverage below 4.5x, while at the same time support
moderate dividend growth, a modest share buyback program and
current capital expenditure levels.
Permian and Louisiana Assets Growth: The Permian and Louisiana
segments remain the two growing segments for ENLC, in Fitch's
forecast, as ENLC's diversification in these regions allows the
company to offset flat operating results in Oklahoma and Barnett
and drive EBITDA growth in 2022. Fitch projects ENLC's Permian
segment to continue its recent steep growth in 2022, underpinned by
strong natural gas volume production.
ENLC recently completed relocation of the underutilized 80mcfpd
natural gas processing plant from Oklahoma to the Permian under
project Warhorse. New plan relocation -- project Phantom, which
will add 200MMcf/d of processing capacity in the Midland Basin is
currently under way and is expected to be completed during the
4Q22. Additionally, ENLC also has long-term contracts with high
quality producer customers that have a focus in allocating capital
in the Permian in the near term. Within Louisiana, ENLC has built
an integrated gas and natural gas liquid (NGL) pipeline network
that has interconnectivity to key export markets near the Gulf
Coast.
Oklahoma and North Texas Stabilizing: The Oklahoma segment decline
stabilized in 2021 and is expected to modestly grow in 2022 driven
by the strong commodity back drop. Growth in Oklahoma production is
driven by rig activity from several producers including the DVN/Dow
Chemicals (BBB+/Stable) JV drilling program. ENLC also has exposure
in the Barnett, where production volume and segment profit have
been in a decline in the past years, but the decline has moderated
in 2021. Fitch expects cashflow and volume to stabilize in the near
term, driven by expected rig activity by BKV Barnett, the main
counterparty in the region.
Customer Exposures and Volumetric Risk: Customer risk is a general
concern across most G&P operators in the midstream sector with
exposure to non-IG producer customers. Fitch continues to view the
counterparty risk for ENLC as limited across its three main G&P
segments as the customer base is diverse and large counterparties
in Permian and Oklahoma are predominately investment grade rated.
Counterparty exposure in the Barnett could pose a concern given the
basin economics and unclear hedging policy by its main producer
customer in that region. Another key risk that ENLC faces given its
contract structure is volumetric risk, as ENLC does not have any
material MVCs remaining. Diverse customer base, where no customer
represents more than 20% of the gross margin, offsets some of the
volumetric risk.
Fee-Based Cash Flow: ENLC has exhibited a strong focus on fee-based
contracts to mitigate commodity price volatility. Fitch expects
ENLC will continue to generate at least 90% of its gross margin
from fee-based services in 2022 and 2023. G&P operations in the
Permian and Oklahoma are further underpinned by long-term,
fee-based contracts. In addition, ENLC hedges its commodity
exposure for the current year, further limiting any commodity price
volatility impact on earnings.
Parent Subsidiary Linkage: The credit profile of ENLC and ENLK
under Fitch's Parent Subsidiary Ratings Linkage Criteria is
consolidated for the ratings of these two entities. Fitch considers
ENLK to have a stronger credit profile than ENLC. ENLC is the
parent of ENLK and ENLK, as the operating subsidiary, is the only
source of cash flow for ENLC.
The debt of ENLC is guaranteed by ENLK and is ranked pari passu to
the existing debt at ENLK. The legal ring-fencing is open as there
are minimal limitations between the entities. Access and control is
also open, given the pooled cash between the two entities. Due to
the aforementioned linkage considerations, Fitch rates both
entities based on the consolidated credit profile and assigns the
same IDRs.
ESG Consideration: ENLC's and ENLK's ESG Relevance Score for Group
Structure and Financial Transparency has changed from a '4' to a
'3'. ENLC operates under a complex group structure, with private
equity levered holding company owning its general partner.
Timeliness and transparency in financial and other disclosures have
resulted in the revision of the relevance score. This factor no
longer has an impact on ratings.
Unless otherwise disclosed in this section, the highest level of
ESG credit relevance is a score of '3'. 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.
DERIVATION SUMMARY
Western Midstream Partners, LP (WES; BB+/Stable) is a G&P
comparable for ENLC. Both companies have similar degree of
geographic diversification (moderate diversification), but WES has
much higher customer concentration. Fitch views that WES is better
positioned financially relative to ENLC given WES's larger size (by
EBITDA size) and lower leverage of 3.8x at YE 2021 (versus ENLC's
at 4.8x).
However, WES's overall counterparty risk is greater than ENLC's, as
WES is largely exposed to non-investment grade E&P producer
customers. WES's largest counterparty, Occidental Petroleum Corp.
(OXY; BB+/Stable), contributed approximately 60% of WES's revenue
in 2021. ENLC has a customer concentration (greater than 10% of
revenue) from higher quality customers, including Devon Energy
(BBB+/Stable) and about 80% of its customers are investment grade
rated.
Another comparable for ENLC is DCP Midstream Operating, LP (DCP;
BB+/Positive). DCP's ratings are reflective of its favorable size,
scale, geographic and business line diversity within the natural
gas gathering and processing space. Relative to ENLC, DCP has
greater exposure to commodity prices than many of its midstream
peers, with approximately 70% of gross margin supported by
fixed-fee contracts.
This commodity price exposure has been partially mitigated in the
near term through DCP's use of hedges for its NGL, natural gas and
crude oil price exposure, pushing the percentage of gross margin,
either fixed-fee or hedged, up to 88% as of 2Q21. This helps DCP's
cash flow stability, but exposes it to longer-term hedge roll-over
and commodity price risks. DCP is larger and more geographically
diversified than ENLC. Fitch expects DCP YE 2021 and YE 2022
leverage to be modestly below 4.5x compared to ENLC at 4.8x in 2021
and around 4.4x in 2022 and 4.1x in 2023.
KEY ASSUMPTIONS
Fitch's key assumptions within its rating case for the issuer
include:
-- The Fitch price deck for oil and natural gas informs the
assumptions for natural gas, crude, the unhedged volumes, and
NGL prices;
-- Flat operating results in Oklahoma and Barnett with growth in
the Permian and Louisiana in 2022 and beyond; 3% annual growth
in the Louisiana segment profit beyond 2022; Moderation of
growth in Permian over the forecast period;
-- Moderate growth in EBITDA in 2023 and assuming flat EBITDA
beyond 2023;
-- 2022 total capex aligns with management guidance of $285
million-$325 million; Project Phantom to be completed on time
and on budget; flat capex beyond 2022;
-- $100 million common unit repurchase annually over the forecast
period;
-- Distribution increase in 2022 as announced in the 4Q21 and
further modest increases in forecast years.
RATING SENSITIVITIES
Factor that could, individually or collectively, lead to positive
rating action/upgrade:
-- Leverage and distribution coverage sustained below 4.5x and
above 1.1x underpinned by stable segment performances.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
-- A significant change in cash flow stability, including a move
away from the current profile of fee-based profits that could
lead to a negative rating action;
-- Leverage above 5.5x on a sustained basis and/or distribution
coverage consistently below 1.1x.
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
Ample Liquidity: As of Dec 31, 2021, there was $15.0 million in
outstanding borrowings under the revolving credit facility and
$41.3 million outstanding letters of credit. Its $1.75 billion
revolving credit facility matures in January 2024. This facility
contains a leverage covenant maximum of 5.0x for consolidated
indebtedness to consolidated EBITDA (each term as defined, and
where EBITDA includes EBITDA from certain capital expansion
projects) and consolidated indebtedness excludes the existing
preferred securities. The maximum leverage level may rise from 5.0x
to 5.5x for four quarters following an acquisition (with the rise
subject to limitations). Following the term loan repayment in
December 2021, ENLC has no debt maturities until 2024.
ENLC was in compliance with its covenant as of Dec. 31, 2021 and is
expected to remain in compliance under Fitch's forecast period.
Fitch expects ENLC will continue to fund its capex program with its
internally generated cash flow in the near term.
ISSUER PROFILE
EnLink Midstream, LLC is predominately a midstream gathering and
processing (G&P) company that operates in three G&P regions:
Oklahoma (STACK play), Permian, and the Barnett. ENLC also operates
gas and NGL gathering and transmission pipelines, gas processing
facilities, gas and NGL storage, and NGL fractionation business in
Louisiana.
SUMMARY OF FINANCIAL ADJUSTMENTS
Fitch applied 50% equity credit to ENLK's preferred equity.
ENTEGRIS INC: S&P Lowers Secured Debt Rating to 'BB+'
-----------------------------------------------------
S&P Global Ratings lowered the issue-level ratings on Entegris
Inc.'s proposed new $2.5 billion term loan and $575 million
revolving credit facility to 'BB+' from 'BBB-' and revised the
recovery ratings to '3' from '2', reflecting a lower share of
unsecured debt in the capital structure and decreasing cushion
supporting the secured debt in an event of a default. S&P's '3'
recovery rating reflects its expectation of meaningful (50%-70%;
rounded estimate: 65%) recovery in a payment default. The total
quantity of debt involved in the financing of the acquisition will
remain unchanged and the shift of $600 million to secured debt from
unsecured debt does not materially impact the company's credit
metrics, thus its 'BB+' corporate credit rating and stable outlook
on Entegris are unchanged.
Entegris Inc. announced that it plans to upsize the secured debt
issuance to fund the acquisition of CMC Materials by $600 million,
while downsizing the planned unsecured debt issuance by the same
amount.
S&P's rating and outlook on Entegris reflect its expectation that
the company will continue to benefit from strong demand in the
semiconductor industry over at least the next 12 months, maintain
revenue growth while modestly improving profitability, enabling
stable deleveraging in the 12-24 months post transaction close.
ISSUE RATINGS – RECOVERY ANALYSIS
Key analytical factors
-- S&P's 'BB+' rating and '3' recovery rating on the company's
senior secured credit facilities reflect its expectation for
meaningful (50%-70%; rounded estimate: 65%) recovery in the event
of a payment default.
-- S&P's 'BB' rating on the existing senior unsecured notes
indicates our expectation for modest (10%-30%; rounded estimate:
20%) recovery in the event of a payment default.
-- S&P's simulated default scenario assumes a default in 2027 due
to a significant decline in wafer production and semiconductor
capital equipment spending, affecting Entegris' operating
performance.
-- A multiple of 6x is consistent with what S&P uses for other
modest size semiconductor companies.
Simulated default assumptions
-- Simulated year of default: 2027
-- Emergence EBITDA: $601 million
-- EBITDA multiple: 6x
Simplified waterfall
-- Gross recovery value: $3,604 million
-- Net enterprise value (after 5% administrative costs): $3,423
million
-- Obligor/nonobligor valuation split: 30%/70%
-- Estimated first-lien claim: $4,591 million
-- Value available for first-lien claim: $3,047 million
—Recovery expectations: 50%-70%; rounded estimate: 65%
Note: All debt amounts include six months of prepetition interest.
Ratings List
ISSUE-LEVEL RATINGS LOWERED; RECOVERY RATINGS REVISED
TO FROM
ENTEGRIS INC.
Senior Secured
US$2.495 bil term B bank ln due 2029 BB+ BBB-
Recovery Rating 3(65%) 2(70%)
US$400 mil fltg rate 1st lien
term B bank ln due 11/06/2025 BB+ BBB-
Recovery Rating 3(65%) 2(70%)
US$575 mil fltg rate revolver
bank ln due 2027 BB+ BBB-
Recovery Rating 3(65%) 2(70%)
ISSUE-LEVEL RATINGS AFFIRMED; RECOVERY RATINGS UNCHANGED
ENTEGRIS INC.
Senior Unsecured
US$400 mil 3.625% callable nts
due 05/01/2029 BB
Recovery Rating 5(20%)
US$400 mil 4.375% nts due 04/15/2028 BB
Recovery Rating 5(20%)
ENTRUST ENERGY: Judge Isgur Wants More Power Cutoff Blame Evidences
-------------------------------------------------------------------
Rick Archer of Law360 reports that a Texas bankruptcy judge on
Wednesday, March 2, 2022, put off deciding whether to dismiss
claims that electricity supplier Shell sent power retailer Entrust
Energy Inc. into Chapter 11 by breaching a supply contract ahead of
a catastrophic winter storm, saying he wants to see more evidence.
At a telephone hearing, U.S. Bankruptcy Judge Marvin Isgur told
both sides of the dispute to conduct discovery in preparation for
an evidentiary hearing in July to settle what he said was the key
issue of whether Entrust had been the party that breached the
contract by failing to comply with its own internal risk policies.
About Entrust Energy
Houston, Texas-based Entrust Energy, Inc. generates, transmits and
distributes electrical energy to homes and businesses.
Entrust Energy and 14 of its affiliates sought Chapter 11
bankruptcy protection (Bankr. S.D. Tex. Lead Case No. 21-31070) on
March 30, 2021. At the time of the filing, Entrust Energy disclosed
total assets of between $100 million and $500 million and total
liabilities of between $50 million and $100 million.
Judge Marvin Isgur oversees the cases.
The Debtors tapped Baker & Hostetler, LLP and Alvarez & Marsal
North America, LLC as their legal counsel and financial advisor,
respectively. BMC Group, Inc., is the claims noticing and
solicitation agent.
The U.S. Trustee for Region 7 appointed an official committee of
unsecured creditors in the Debtors' Chapter 11 cases on April 28,
2021. McDermott Will & Emery, LLP and FTI Consulting, Inc., serve
as the committee's legal counsel and financial advisor,
respectively.
ENTRUST ENERGY: Shell to Test Its Risk Policy in Contract Fight
---------------------------------------------------------------
Alex Wolf of Bloomberg Law reports that Entrust Energy Inc. will
have to undergo court scrutiny to determine if it complied with its
own risk policy before the electricity retailer's bankruptcy estate
can proceed with a $175 million suit against a Shell unit over
canceled contracts.
U.S. Bankruptcy Judge Marvin Isgur said Wednesday, March 2, 2022,
that he plans to hold a "minitrial" later this 2022 on the risk
policy. Issues surrounding the policy need to be ironed out before
a trust in Entrust's bankruptcy can advance claims that Shell
Energy North America US LP breached an electricity-supply deal
before last 2021's winter storm in Texas, the judge said.
A full-text copy of the Bloomberg article is available at
https://news.bloomberglaw.com/bankruptcy-law/shell-to-test-bankrupt-entrusts-risk-policy-in-contract-fight?context=search&index=0
About Entrust Energy
Houston, Texas-based Entrust Energy, Inc. generates, transmits and
distributes electrical energy to homes and businesses.
Entrust Energy and 14 of its affiliates sought Chapter 11
bankruptcy protection (Bankr. S.D. Tex. Lead Case No. 21-31070) on
March 30, 2021. At the time of the filing, Entrust Energy
disclosed total assets of between $100 million and $500 million and
total liabilities of between $50 million and $100 million.
Judge Marvin Isgur oversees the cases.
The Debtors tapped Baker & Hostetler, LLP and Alvarez & Marsal
North America, LLC as their legal counsel and financial advisor,
respectively. BMC Group, Inc., is the claims noticing and
solicitation agent.
The U.S. Trustee for Region 7 appointed an official committee of
unsecured creditors in the Debtors' Chapter 11 cases on April 28,
2021. McDermott Will & Emery, LLP and FTI Consulting, Inc., serve
as the committee's legal counsel and financial advisor,
respectively.
FAMILY FRIENDLY: Unsecureds be Paid From Litigation Proceeds
------------------------------------------------------------
Family Friendly Contracting LLC submitted an Amended Chapter 11
Subchapter V Plan of Reorganization.
After payment of Classes 1 through 5, and of any Administrative
Expense Claims and Priority Tax Claims, and in full satisfaction of
the Class 6 Allowed General Unsecured Claims, the Debtor shall pay
the Holders of Allowed Class 6 Claims without interest their
pro-rata share of all remaining proceeds from the Lyons Litigation.
Distributions to Holders of Allowed Class 6 Claims, less reserves
for anticipated administrative expenses, are projected to occur
upon completion of the Lyons Litigation, and recovery of any
judgments awarded therefrom. Payment to Class 6 Claims will occur
within 30 days of the receipt of any recovery of the Lyons
Litigation. It is unknown at this juncture whether Debtor will be
in a position to make lump sum payments or periodic regular
payments as funds come into the Estate. To the extent that
Administrative Expense Claims are Allowed, ultimately, in amounts
greater than projected, the total amount available to Class 6 will
be reduced in proportional amount. Class 6 is impaired.
"Lyons Litigation" shall mean any adversary proceeding, or other
litigation Debtor or a related party, files against Stephen Lyons,
and potentially other parties involved in the purchase and sale of
Family Friendly Contracting, LLC. To date the Debtor has conducted
extensive discovery in further investigation of this litigation and
will be conducting a Rule 2004 examination of Mr. Lyons in March
2022. It is anticipated that the Lyons Litigation will commence
upon completion of Debtor's investigation.
During the term of this Plan, the Debtor shall use its Cash on Hand
and the recovery from any litigation, to include the Lyons
Litigation (subject to any applicable liens).
As Debtor is not operating as a going concern, it is not
anticipated that it will have any Disposable Income to dedicate to
the Plan until the completion of the Lyon's Litigation.
Counsel for the Debtor:
Paul Sweeney, Esq.
YUMKAS, VIDMAR, SWEENEY & MULRENIN, LLC
10211 Wincopin Circle, Suite 500
Columbia, Maryland 21044
Tel: (443) 569-5972
E-mail: psweeney@yvslaw.com
A copy of the Plan dated Feb. 25, 2022, is available at
https://bit.ly/3hnfDzB from PacerMonitor.com.
About Family Friendly Contracting
Family Friendly Contracting LLC is a local home improvement,
restoration and contract management company that provides reliable
services to homeowners and commercial properties in Maryland, D.C.
and West Virginia. Its commercial and residential services include
fire and smoke restoration, water and flood damage restoration,
storm and wind damage restoration, remodeling, additions, basement
finishing, and service support for property management companies.
It has operated from its headquarters at 9001 Baltimore Road,
Frederick, Maryland, since around 2017.
Family Friendly sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. Md. Case No. 21-14213) on June 27, 2021.
In the petition signed by Adam Borcz, chief financial officer, the
Debtor disclosed up to $10 million in both assets and liabilities.
Paul Sweeney, Esq. at Yumkas, Vidmar, Sweeney & Mulrenin, LLC is
the Debtor's counsel.
Live Oak Banking Company, as lender, is represented by Whiteford
Taylor Preston LLP.
GIP III STETSON: Fitch Raises LongTerm IDR to 'B', Outlook Stable
-----------------------------------------------------------------
Fitch Ratings has upgraded the Long-Term Issuer Default Rating
(IDR) for GIP III Stetson I, L.P. and GIP III Stetson II, L.P.
(collectively GIP Stetson) to 'B' from 'B-'. In addition, Fitch has
upgraded GIP Stetson's senior secured rating to 'B'/'RR4' from
'B-'/'RR4'. The Rating Outlook is Stable.
The upgrade reflects the improved credit outlook at EnLink
Midstream LLC (ENLC; BB+/Positive), which is constructive to GIP
Stetson's cashflow stability and the driver for the improved credit
metrics. GIP Stetson has no hard assets and is entirely dependent
on cashflow distribution received from ENLC. Fitch believes that
ENLC should have ample liquidity and financial flexibility to meet
its needs while maintaining its current distribution policy in the
near term. Fitch projects GIP Stetson's leverage to reduce to below
7.0x by 2024, assuming current dividend levels at ENLC.
KEY RATING DRIVERS
Leverage Improving: Fitch projects GIP Stetson's stand-alone
leverage to improve to below 9.0x starting in 2022, reflecting a
recent dividend increase at ENLC. GIP Stetson currently owns
approximately 46% of ENLC's outstanding shares. Fitch believes that
under ENLC's current distribution levels, GIP Stetson will have
sufficient funds to service its required interest expense and
deleverage under its excess cash flow sweep during the forecast
years.
Fitch projects that GIP Stetson's DSCR and FFO Fixed Charge
Coverage ratio will be above 2.0x, and improve over the forecast
period. The excess cash flow sweep provision mandated GIP Stetson
to sweep 75% of its excess cash flow when leverage is above 5.0x.
Any additional dividend increase or share buyback at ENLC would
support further deleveraging at GIP Stetson. ENLC is expected to
generate around $300 million of FCF annual over the forecast
period, which provides flexibility regarding its capital allocation
plans. Fitch projects ENLC will allocate a portion of its FCF to
shareholders through higher dividends and share buybacks, which GIP
will participate in on a pro rata basis, and expects further
leverage improvement at GIP Stetson over the forecast period.
Cash Flow Concentration: GIP Stetson's ratings reflect concerns
around cash flow concentration in receiving dividend distribution
from its subsidiary ENLC. Cash flow to service GIP Stetson's term
loan is solely dependent on dividends received from the operating
entity. Any outsized events or financial distress at ENLC resulting
in material dividend reduction would impair cash flow to GIP
Stetson. However, approximately 90% of ENLC's gross operating
margin is tied to long-term fee-based services, which should
provide some levels of cash flow stability. Further, ENLC has
historically had a strong focus on fee-based contracts to mitigate
commodity price volatility.
Structural Subordination: GIP Stetson's ratings also reflect that
the senior secured term loan (around $830 million outstanding
today) is structurally subordinated to the senior debt at the
subsidiaries level (ENLC and ENLK), and is solely reliant on the
dividend distribution from its subsidiaries for debt service
payment. Cash flow generated at its operating subsidiary ENLK is
prioritized to service debt and interest payment at ENLK and ENLC.
Additionally, GIP Stetson's term loan is only secured by pledged
equity interest in ENLC, and is junior to both senior debt and
preferred equity at the subsidiaries in recovery claims should a
credit event default occur at either ENLC or ENLK.
Parent Subsidiary Linkage: Under Fitch's parent-subsidiary linkage
analysis, GIP is rated on the standalone basis. GIP has a weaker
credit profile relative to its operating subsidiary ENLC, a strong
subsidiary/weak parent relationship. Concurrently, given the cash
flow structure and provisions around ENLC's distribution, legal
ring fencing is considered insulated. In addition, ENLC does not
guarantee the GIP Stetson's debt. The ENLC revolving credit
agreement (matures in 2024) contains a relatively tight leverage
covenant that, if not complied with, could enable ENLC lenders to
negotiate to cut off dividends to GIP Stetson.
Access and control are evaluated as insulated, as all of the ENLC's
non-equity funding is external. Cash management and funding policy
embodies a long-term intention for ENLC to separately manage its
cash and funding needs. Insulated legal ring fencing and porous
access and control result in a standalone rating for GIP Stetson.
Global Infrastructure Partners' Track Record: Fitch notes that
Global Infrastructure Partners has a wealth of expertise as to
operations best practices and financial structuring. The firm has
$77 billion in assets under management and over $20 billion
invested in the energy sector.
DERIVATION SUMMARY
GIP Stetson generates cash flow from distribution payments under
its ownership interest in ENLC. The cash flow structure is similar
to FR BR Holdings (FR BR; B-/Stable). For GIP Stetson, its IDRs and
ratings also reflect the structural subordination, in which GIP
Stetson's term loan is junior to the senior debt and preferred
security at ENLC. FR BR's ratings also reflect its term loan
structural subordination to the operating and cash flow needs at
Blue Racer (B+/Stable), as well as any borrowings on Blue Racer's
$1 billion revolving credit facility and $1.0 billion senior
unsecured notes.
Compared to FR BR, GIP Stetson has a higher leverage level. Fitch
forecasts FR BR's stand-alone leverage to trend below 6.0x by 2023.
However, refinancing risk at FR BR is larger than GIP Stetson's.
While GIP Stetson currently has a manageable refinancing risk with
its term loan has maturing in 2025, FR BR has an approaching
maturity for its term loan in 2023. Refinancing or sale of assets
at FR BR will be needed to repay the maturing debt, as the term
loan will not be fully amortized by its maturity in 2023, in
Fitch's view. Fitch projects that GIP Stetson will deleverage
faster in the next couple of years than FR BR, which should further
reduce refinancing risk.
KEY ASSUMPTIONS
Fitch's key assumptions within the rating case for the issuer
include:
-- Distribution increases throughout forecast years to reflect
dividend increase at ENLC;
-- Deleveraging supported by term loan amortization (1% per
annum) and debt repayment under excess cash flow sweep;
-- Ownership stable at the current level of around 46% throughout
the forecast period;
-- Excess cash flow after required debt service payments is
distributed to Global Infrastructure Partner.
Recovery Assumption:
The Recovery Rating 4 (RR4) for GIP Stetson's Term Loan B is based
on a scenario where GIP Stetson is in financial distress during the
year when the term loan matures, while both ENLC and ENLK remain
healthy, though not as healthy as in Fitch's rating case. In this
scenario, the combined proforma leverage of GIP Stetson and EnLink
family is too high for the term loan to be refinanced, triggering a
credit event at GIP Stetson. Fitch assumes the going-concern EBITDA
at GIP Stetson is approximately $84 million, reflecting the
distribution GIP Stetson received from ENLC in 2021 following the
dividend cut in 2020.
Fitch used an EBITDA multiple of 5.0x to calculate a
post-reorganization valuation. There have been a limited number of
bankruptcies and reorganizations within the midstream space, but
bankruptcies at Azure Midstream and Southcross Holdco had multiples
between 5.0x and 7.0x, by Fitch's best estimates.
In Fitch's recent Bankruptcy Case Study Report, "Energy, Power and
Commodities Bankruptcies Enterprise Value and Creditor Recoveries,"
published in September 2021, the median enterprise valuation exit
multiple for the 51 energy cases with sufficient data to estimate
was 5.3x, with a wide range of multiples observed. The multiple
applied in the GIP Stetson recovery scenario reflects the company's
operating profile as an entity with no real assets that solely
depends on the cashflow distribution from its operating
subsidiary.
Using this going concern EBITDA and a 10% administrative claim in
the recovery calculation as specified in Fitch's Corporates
Notching and Recovery Ratings Criteria, the agency determines the
term loan's recovery rating to be 'RR4'.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
-- Improving credit profile at ENLC could lead to positive rating
action;
-- GIP Stetson's Stand-alone debt to distributions expected below
7.0x over a sustained basis.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
-- Negative rating action could happen if stand-alone debt to
distributions received exceeds 9.0x on a sustained basis;
-- FFO fixed-charge coverage sustained below 2.0x;
-- Significant deterioration of credit profile at ENLC and/or
ENLK reflecting the deteriorating cash flow from the
subsidiaries.
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
Manageable Liquidity: Fitch believes that the under ENLC's current
distribution policy GIP Stetson will have sufficient liquidity to
service its required interest expense and deleverage under its cash
flow sweep in the near term. However, the deleveraging pace is
slower than the previous years', given the current distribution
received from ENLC, which although recently raised, remains well
below the 2019 level. The excess cash flow sweep provision mandated
GIP Stetson to distribute 75% of its excess cash flow when leverage
is above 5.0x. The remaining amount is the cash flow available as
distribution to Global Infrastructure Partners.
GIP Stetson also has a six-month debt service reserve account in
place supported by letters of credits. The instrument that provides
back-up liquidity directed toward term loan holders is in the form
of a LOC issued by a bank. The LOC is written in favor of the
collateral agent. The obligation to repay the LOC resides at an
entity above GIP Stetson, in GIP Stetson's ownership chain.
ESG Considerations: GIP Stetson's ESG Relevance Score for Group
Structure and Financial Transparency has changed from a '4' to a
'3'. GIP Stetson operates under a complex group structure due to
significant structural subordination. Timelines and transparency in
financial and other disclosures have resulted in the revision of
the relevance score. This factor no longer has an impact on
ratings.
Unless otherwise disclosed in this section, the highest level of
ESG credit relevance is a score of '3'. 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
GIP Stetson is an entity with no hard assets that owns about 46%
equity interest in EnLink Midstream LLC (ENLC; BB+/Positive) and
that is entirely dependent on the cashflow distribution received
from ENLC and its subsidiary.
GLENN PATERNOSTER: Mas Buying Henderson Property for $2.25 Million
------------------------------------------------------------------
Glenn A. Paternoster and Carmel P. Paternoster ask the U.S.
Bankruptcy Court for the District of Nevada to authorize the sale
of the real property commonly known as 5 Corral De Tiera Place, in
Henderson, Nevada 89052, to Roberto Mas for $2.25 million, on the
terms and conditions set forth in the Purchase Agreement.
A major asset of the Debtors is the Property. The Property has a
value and purchase price of $ 2.25 million. The first mortgage
holder on the Property is PHH Mortgage which holds the rights to a
note and first deed of trust which encumbers the Property. The
amount of the total claim of PHH is currently $1,981,778.99,
subject to a possible downward adjustment as a result of the
balance decreasing as part of a loan modification agreement. The
secured lender that is second in priority on the Property is U.S.
Bank. ("USB") in the amount of $101,492.01.
The Internal Revenue Service has two liens on the Property in the
amounts of $314.217.97 and $1189.49. Clark County - 3589.47,
Nevada Association Services - 42.636.12. Two other statutory liens,
other than those in favor of the IRS are: (1) property taxes to the
Clark County Treasurer in the amount of $3589.47; and (2) Nevada
Association Services in the amount of $42,636.12.
All of the amounts to be disbursed as part of the sale are set
forth in the Estimated Settlement Statement as based on the
Preliminary Title Report.
A summary of the terms of the proposed sale to the Buyer is as
follows:
i. Assets To Be Purchased: Buyer has agreed to purchase the
Property and all of the Debtors' rights and interests related
thereto, free and clear of all interest related thereto;
ii. Purchase Price: The Purchase Price for the Property is
$2.25 million;
iii. Closing: The Purchase Agreement provides for a closing
date that has been, or can be, extended a reasonably short time
period; and
iv. Treatment of Proceeds: It is anticipated that the Debtors
will receive no proceeds of the sale. Instead all monies will be
allocated to administrative fees and costs and to satisfy the first
mortgage, any other liens and encumbrances (of which there seem to
be none) and, it is hoped, a partial satisfaction of the lien of
the IRS.
Because time is of the essence, and as noted more thoroughly in the
next section of the Motion, the Debtors do seek relief from the
14-day stay of FRBP 6004(h).
The Motion seeks entry of the Sale Order authorizing the sale of
the Property free and clear of liabilities, liens, claims,
interests, and encumbrances and in connection therewith.
A copy of the Agreement is available at
https://tinyurl.com/ycsnw97y from PacerMonitor.com free of charge.
About the Paternosters
Glenn A. Paternoster and Carmel P. Paternoster live Las Vegas,
Nevada. Mr. Paternoster is a practicing attorney, focusing on
personal injury cases, and owns the Paternoster Law Group. The
Paternosters also own and manage an investment property in Newport
Beach, California.
The Paternosters sought Chapter 11 protection (Bankr. D. Nev. Case
No. 17-13415) on June 23, 2017.
The Debtors' attorneys:
David A. Riggi, Esq
5550 Painted Mirage Rd., Suite 120
Las Vegas, NV 89149
Tel: 1-702-463-7777
Fax: 1-888-306-7157
E-mail: RiggiLaw@gmail.com
GLOBAL CARIBBEAN: Plan Solicitation Period Extended to May 31
-------------------------------------------------------------
Judge Scott Grossman of the U.S. Bankruptcy Court for the Southern
District of Florida extended the exclusivity period for Global
Caribbean, Inc. to solicit acceptances for its proposed Chapter 11
plan of reorganization to May 31.
About Global Caribbean
Global Caribbean, Inc. sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. S.D. Fla. Case No. 21-14402) on May 4,
2021, disclosing total assets of up to $500,000 and total
liabilities of up to $1 million. Judge Scott M. Grossman oversees
the case.
Brian S. Behar, Esq., at Behar, Gutt & Glazer, P.A., and Berkowitz
Pollack Brant Advisors CPAS, LLP serve as the Debtor's legal
counsel and accountant, respectively.
The Debtor filed its disclosure statement and plan of
reorganization on Nov. 29, 2021. On Jan. 21, 2022, the Debtor
filed an amended version of the disclosure statement after it was
denied by the court.
GOTSPACE DATA: Seeks to Hire Shapiro Dorry Masterson as Counsel
---------------------------------------------------------------
Gotspace Data Equity Fund, LLC seeks approval from the U.S.
Bankruptcy Court for the District of Massachusetts to employ
Shapiro Dorry Masterson, LLC to serve as legal counsel in its
Chapter 11 case.
The firm's services include:
(a) assisting the Debtor in preparing bankruptcy schedules,
statement of financial affairs and related documents with the
court;
(b) employing professionals to assist in the reorganization of
the Debtor;
(c) effecting a reorganization of the Debtor's estate by
filing the appropriate plans of reorganizations and disclosure
statements and defending against any motions to dismiss or for
relief from the stay;
(d) assisting the Debtor in complying with Chapter 11
reporting and operations requirements; and
(e) negotiating with creditors for adequate protection and the
use of cash collateral, assumption or rejection of leases and
executory contracts, objection to claims and related issues.
The firm received a $5,000 retainer.
As disclosed in court filings, Shapiro Dorry Masterson has no
connection with the Debtor, creditors or any other party in
interest.
The firm can be reached through:
Shawn M. Masterson, Esq.
Shapiro Dorry Masterson, LLC,
145 Waterman Street
Providence, RI 02906
Phone: 401-455-0002
Email: smasterson@sdmlawgroup.com
About Gotspace Data Equity Fund
Gotspace Data Equity Fund, LLC sought protection under Chapter 11
of the Bankruptcy Code (Bankr. D. Mass. Case No. 22-10044) on Jan.
14, 2022. Nicholas J. Fiorillo, sole manager, signed the
petition.
At the time of the filing, the Debtor disclosed total assets of
between $10 billion and $50 billion and total liabilities of
between $1 million and $10 million.
Perez-Kudzma Law Office, P.C. is the Debtor's legal counsel.
GTT COMMUNICATIONS: Seeks to Extend Exclusivity Period to June 28
-----------------------------------------------------------------
GTT Communications, Inc. is seeking more time to control its
bankruptcy as it waits for regulatory approvals required to emerge
from Chapter 11 protection.
In its motion, GTT Communications asked the U.S. Bankruptcy Court
for the Southern District of New York to extend the exclusivity
period to file a Chapter 11 plan to June 28, and the period to
solicit acceptances for the plan to Aug. 27.
Under U.S. bankruptcy rules, companies in Chapter 11 protection
have the sole right to craft and formally propose turnaround plans
unless a judge strips them of that right.
"Although the plan has been confirmed, given the pending regulatory
approvals, [GTT Communications] seeks to extend the exclusivity
periods solely out of an abundance of caution in the event
unforeseen issues arise prior to emergence," the company's
attorney, Philip Dublin, Esq., at Akin Gump Strauss Hauer & Feld,
LLP, said, referring to the company's prepackaged Chapter 11 plan
of reorganization confirmed by the court on Dec. 16 last year.
The exclusivity motion is on the court's calendar for March 8.
About GTT Communications
Headquartered in McLean, Va., GTT Communications, Inc. --
http://www.gtt.net/-- owns and operates a global Tier 1 Internet
network and provides a comprehensive suite of cloud networking
services.
GTT and its affiliates sought Chapter 11 protection (Bankr.
S.D.N.Y. Lead Case No. 21-11880) on Oct. 31, 2021, to implement a
prepackaged Chapter 11 plan.
GTT had total assets of $2.8 billion and total debt of $4.1 billion
as of June 30, 2021. As of the petition date, the Debtors had
pre-bankruptcy funded indebtedness totaling $2.015 billion.
Judge Michael E. Wiles oversees the cases.
The Debtors tapped Akin Gump Strauss Hauer & Feld, LLP as legal
counsel; TRS Advisors as financial advisor and investment banker;
The Siegfried Group, LLP as accounting and financial resource
services provider; Ernst & Young LLP as tax, valuation and
accounting and advisory services provider; and Alvarez & Marsal,
LLC as restructuring advisor. Brian Fox, Alvarez & Marsal's
managing director, serves as the Debtors' chief restructuring
officer. Prime Clerk, LLC is the claims agent and administrative
advisor.
GULF COAST HEALTH: Seeks to Extend Exclusivity Period to May 12
---------------------------------------------------------------
Gulf Coast Health Care, LLC asked the U.S. Bankruptcy Court for the
District of Delaware to extend the exclusivity period to file a
Chapter 11 plan to May 12, and the period to solicit acceptances
for the plan to July 11.
The exclusivity period refers to the 120-day period during which
only the company can file a plan after a bankruptcy petition.
The extension, if granted by the court, will give Gulf Coast Health
Care more time to revise its proposed Chapter 11 plan to reflect
the resolution it reached with the unsecured creditors' committee
and other concerned parties regarding plan-related issues following
several mediation sessions that took place earlier this year,
according to a motion filed by the company in court.
The exclusivity motion is on the court's calendar for March 24.
About Gulf Coast Health Care
Gulf Coast Health Care, LLC is a licensed operator of 28 skilled
nursing facilities comprising nearly 3,350 licensed beds across
Florida, Georgia, and Mississippi. It provides short-term
rehabilitation, comprehensive post-acute skilled care, long-term
care, assisted living, and therapy services in each of its
facilities.
Gulf Coast Health Care and 61 affiliates sought Chapter 11
protection (Bankr. D. Del. Lead Case No. 21-11336) on Oct. 14,
2021. In the petition signed by Benjamin M. Jones as chief
restructuring officer, Gulf Coast Health Care listed up to $50
million in assets and up to $500 million in liabilities.
The cases are handled by Judge Karen B. Owens.
The Debtors tapped McDermott Will & Emery LLP and Ankura Consulting
Group LLC as legal counsel and restructuring advisor, respectively.
M. Benjamin Jones of Ankura serves as the Debtors' chief
restructuring officer. Epiq Corporate Restructuring, LLC, is the
claims, noticing, and administrative agent.
On Oct. 25, 2021, the U.S. Trustee for Region 3 appointed an
official committee of unsecured creditors in the Debtors' Chapter
11 cases. Greenberg Traurig, LLP, and FTI Consulting, Inc., serve
as the committee's legal counsel and financial advisor,
respectively.
The Debtor filed its proposed Chapter 11 plan and disclosure
statement on Oct. 28, 2021.
H-CYTE INC: Incurs $4.8 Million Net Loss in 2021
------------------------------------------------
H-Cyte, Inc. filed with the Securities and Exchange Commission its
Annual Report on Form 10-K disclosing a net loss of $4.80 million
on $1.61 million of revenues for the year ended Dec. 31, 2021,
compared to a net loss of $6.46 million on $2.15 million of
revenues for the year ended Dec. 31, 2020.
As of Dec. 31, 2021, the Company had $321,405 in total assets,
$4.98 million in total liabilities, and a total stockholders'
deficit of $4.66 million.
Tampa, Florida-based Frazier & Deeter, LLC, the Company's auditor
since 2018, issued a "going concern" qualification in its report
dated Feb. 25, 2022, citing that he Company has negative working
capital, has an accumulated deficit, has a history of significant
operating losses and has a history of negative operating cash flow.
These factors raise substantial doubt about the Company's ability
to continue as a going concern.
A full-text copy of the Form 10-K is available for free at:
https://www.sec.gov/ix?doc=/Archives/edgar/data/1591165/000149315222005486/form10-k.htm
About H-CYTE Inc.
Headquartered in Tampa, Florida, H-CYTE -- http://www.HCYTE.com--
is a hybrid-biopharmaceutical company dedicated to developing and
delivering new treatments for patients with chronic respiratory and
pulmonary disorders.
HERBERT H. STONE: JSP Buying Mineral Point Property for $4.16-Mil.
------------------------------------------------------------------
Herbert H. Stone asks the U.S. Bankruptcy Court for the Western
District of Wisconsin to authorize the sale of the real property
located at 416 Acres M/L on Fort Defiance Road, in Mineral Point,
Wisconsin, to JSP Property Holdings, LLC, for $4,162,200.
The Debtor is the owner of, among other assets, the Property.
An Offer to Purchase the Property was received by the Debtor from
the Buyer, which accepted a Counteroffer for the sum of $4,162,200.
The actual legal description will be determined after a survey is
performed of the Property. An application to employ a surveyor is
currently pending.
The Debtor is indebted to Investors Community Bank, now known as
National Bank, pursuant to three mortgage loans with a total
aggregate outstanding balance of $3,143,392.96 as of May 31, 2021
according to the Debtor's confirmed Third Amended Plan of
Reorganization. The obligations to the Bank are secured by a
properly-perfected first-position real estate mortgage dated May
22, 2017, and recorded in the office of the Lafayette County
Register of Deeds on May 30, 2017 as Document No. 351203; a
properly-perfected second-position real estate mortgage dated May
22, 2017, and recorded in the office of the Lafayette County
Register of Deeds on May 30, 2017 as Document No. 351207; and a
properly-perfected third-position real estate mortgage dated June
24, 2019, and recorded in the office of the Lafayette County
Register of Deeds on July 24,2019 as Document No. 358131.
The Debtor is also indebted to Titan Pro SCI, Inc. pursuant to a
valid judgment docketed in Lafayette County with a total
outstanding balance of $265,042.03. The Debtor owes Lafayette
County Treasurer for real estate taxes owed on the Property for the
second half of the 2021 in the amount of approximately $6,000.
The Debtor believes the Offer represents a fair price for the
Property. The Pursuant to Bankruptcy Court approval, the Debtor is
hiring real estate agent Adam Crist to evaluate the value of the
property in relation to values of similar local properties. Mr.
Crist did evaluate this Property and proposed a listing price of
$4,162,900. The actual sale price of $4,162,200 is a fair price
after negotiations for the Property. The Offer has been approved by
the Debtor and contains terms and conditions that are customary for
transactions of this type.
Accordingly, the Debtor requests that the Court approve the terms
and conditions of the Offer. He also requests that the Court grant
a waiver of the 14-day automatic stay under Bankruptcy Rule 6004(h)
so that a closing of the sale of the Property can take place
promptly after an order approving the sale has been entered. This
is necessary because a portion of the Buyer's financing is
dependent upon a Section 1031 exchange under the Internal Revenue
Code.
The Debtor seeks authority to sell the Property free and clear of
all liens, claims, encumbrances, and interests, with net proceeds,
applied as follows: Nicolet Bank - Approximately $2,560,355 subject
to a stipulation between Debtor and Nicolet Bank to be filed to
resolve the Bank's pending motion for relief from stay to be
approved by the Court.
Titan Pro pursuant to Debtor’s Plan: $100,000
Balance 2021 Est. Real Property Taxes: $6,000
Debtor's Est. 2022 Crop Inputs: $600,000
Debtor's 1-Year Rent to Buyer: $140,000
The remaining net proceeds must be used by the Debtor to upgrade
equipment to improve his farm operations and for estimated capital
gains taxes arising from this sale.
The Debtor further requests authority to pay all usual and
customary closing costs, including but not limited to, title
insurance, transfer fees, pro-rated real estate taxes, and
recording fees.
As noted, the Debtor will be renting the Property from the Buyer
for an initial one-year lease term at the rate of$400 per acre for
350 tillable acres based upon FSA cropland acres.
A copy of the Offer to Purchase is available at
https://tinyurl.com/2p93a9ze from PacerMonitor.com free of charge.
Herbert H. Stone sought Chapter 11 protection (Bankr. W.D. Wis.
Case No. 20-11611) on June 22, 2020. The Debtor tapped Michelle
Angell, Esq., at Krekeler Strother, S.C. as counsel.
HUSCH & HUSCH: Liquidating Agent Selling Harrah Property for $185K
------------------------------------------------------------------
McCallen & Sons, Inc. ("MSI"), in its capacity as the
Court-appointed liquidating agent of Husch & Husch, Inc., asks the
Bankruptcy Court for the Eastern District of Washington to
authorize the sale of the real property located at Main
Street/Branch Road, in Harrah, Washington, free and clear of liens,
SimonCRE Budster, LLC for $185,000.
At the time of MSI's appointment, the Debtor had been under
contract with the Buyer to sell the Real Property, which contract
eventually expired. MSI re-engaged the Buyer, negotiated a 6%
increase to the purchase price and a reduction in the brokers'
commission from 7% to 5%. As part of this process, MSI evaluated
comparable properties to determine that the purchase price
represented fair market value.
MSI subsequently entered into a Commercial & Investment Real Estate
Purchase & Sale Agreement with the Buyer for the sale of the Real
Property conditioned upon Court approval. The PSA remains subject
to Court approval and the completion of a lot line adjustment with
a neighboring parcel of real property.
MSI seeks to distribute 80% of the net proceeds after payment of
all closing costs, including, without limitation, recording fees,
escrow fees, title insurance and brokers' commissions, from the
sale to Heritage Bank with the remaining 20% to be held in its bank
account to be distributed to secured creditors as outlined in the
Plan as cash flow allows.
About Husch & Husch
Husch & Husch, Inc. -- http://www.huschandhusch.com/-- is a
family-owned and operated agricultural chemical and fertilizer
company located in Harrah, Washington. It provides conventional
and organic fertilizers, micro-nutrient technology, and chemicals
to help make lawn, garden, agronomic crops, and fruit trees grow
to
their full potential. Husch & Husch was founded in 1937 by Pete
Husch.
Husch & Husch, Inc., based in Harrah, WA, filed a Chapter 11
petition (Bankr. E.D. Wash. Case No. 20-00465) on March 4, 2020.
In the petition signed by CFO Allen Husch, the Debtor disclosed
$12,284,732 in assets and $5,966,019 in liabilities. Dan
O'Rourke,
Esq., at Southwell & O'Rourke, P.S., is the Debtor's bankruptcy
counsel.
On Aug. 25, 2021, the court confirmed the Debtor's Fourth Amended
Plan. Pursuant to the Plan, on Oct. 12, 2021, the court appointed
McCallen & Sons, Inc. as the liquidating agent under the Plan.
HUSCH & HUSCH: Liquidating Agent Selling Inventory to GS for $90K
-----------------------------------------------------------------
McCallen & Sons, Inc. ("MSI"), in its capacity as the
Court-appointed liquidating agent of Husch & Husch, Inc., asks the
Bankruptcy Court Bankruptcy Court for the Eastern District of
Washington to authorize the sale of liquid and dry fertilizers
("Inventory") to GS Long Co. for $90,000.
The Debtor, prior to the appointment of the liquidating agent,
primarily engaged in the business of selling the Inventory to the
agricultural industry in and around central Washington. Upon MSI's
appointment, as contemplated by the Plan and the Appointment Order,
the Debtor's ordinary sales ceased and MSI began the process of
locating a buyer for all of its Inventory.
The Debtor's Inventory, at the time of MSI's appointment, included
both saleable and non-saleable products. MSI endeavored to have any
buyer remove all Inventory, regardless of its quality, in order to
reduce administrative expenses in the future of having to store,
transport and dispose of non-saleable inventory.
Over a multi-week process, MSI contacted all known potential
purchasers in the greater Pacific Northwest region. As a result of
such efforts, MSI obtained five offers ranging initially from
$51,000 to $150,000 for the Inventory, with each except for one
including an obligation to pick-up the Inventory and to dispose or
otherwise handle to non-saleable Inventory.
The buyer who made the highest original offer at $150,000, The
McGregor Co., ended up backing out after MSI filed its motion to
approve that sale. MSI subsequently had all potential buyers do
more detailed diligence and gave them an opportunity to revise
their offers. After this process was complete, the highest offer
was from the Buyer at $90,000. MSI therefore entered into an asset
purchase agreement with the Buyer for the sale of the Inventory
conditioned upon Court approval. The APA remains subject to any
higher and better offers being received before the Court approves
the APA.
At the time of the Motion, Heritage Bank has a first position lien
on the Inventory and is thus entitled to the proceeds from the sale
after a holdback of such amounts that MSI needs to fund the ongoing
administration of the post-confirmation estate.
MSI seeks to distribute 80% of the proceeds from the sale to
Heritage with the remaining 20% to be held in its bank account to
be further distributed as outlined in the Plan as cash flow allows.
Hence, MSI, as liquidating agent of Debtor, hereby requests the
entry of an order authorizing the sale of the Inventory pursuant to
the APA to the Buyer and for authority to distribute such proceeds
as outlined.
About Husch & Husch
Husch & Husch, Inc. -- http://www.huschandhusch.com/-- is a
family-owned and operated agricultural chemical and fertilizer
company located in Harrah, Washington. It provides conventional
and organic fertilizers, micro-nutrient technology, and chemicals
to help make lawn, garden, agronomic crops, and fruit trees grow
to
their full potential. Husch & Husch was founded in 1937 by Pete
Husch.
Husch & Husch, Inc., based in Harrah, WA, filed a Chapter 11
petition (Bankr. E.D. Wash. Case No. 20-00465) on March 4, 2020.
In the petition signed by CFO Allen Husch, the Debtor disclosed
$12,284,732 in assets and $5,966,019 in liabilities. Dan
O'Rourke,
Esq., at Southwell & O'Rourke, P.S., is the Debtor's bankruptcy
counsel.
On Aug. 25, 2021, the court confirmed the Debtor's Fourth Amended
Plan. Pursuant to the Plan, on Oct. 12, 2021, the court appointed
McCallen & Sons, Inc. as the liquidating agent under the Plan.
IM SERVICES: Seeks to Hire Johnson May as Bankruptcy Counsel
------------------------------------------------------------
IM Services Group, LLC filed an amended application seeking
approval from the U.S. Bankruptcy Court for the District of Idaho
to hire Johnson May to serve as legal counsel in its Chapter 11
case.
The firm's services include:
a. preparation and filing of bankruptcy schedules, statement
of financial affairs, and other related forms;
b. attendance at all meetings of creditors, hearings, pretrial
conferences, and trials in the bankruptcy case or any litigation
arising in connection with the case, whether in state or federal
court;
c. preparation, filing and presentation to the bankruptcy
court of pleadings requesting relief;
d. preparation, filing and presentation to the court of a
disclosure statement and plan of arrangement under Chapter 11 of
the Bankruptcy Code;
e. review of claims made by creditors or interested parties,
preparation, and prosecution of any objections to claims as
appropriate;
f. preparation and presentation of a final accounting and
motion for final decree closing the bankruptcy case;
g. performance of all other legal services; and
h. collection of receivables owed to Debtor.
The firm's hourly rates are as follows:
Attorneys $195 to $375 per hour
Paralegal $95 to $175 per hour
The Debtor agreed to pay the firm $60,000 as retainer.
Additionally, for the services related to collection of
receivables, the Debtor wishes to employ the attorney on a
contingency-fee basis based on Accounts Receivable actually
recovered by counsel.
As disclosed in court filings, Johnson May does not represent
interests adverse to the Debtor and its estate.
The firm can be reached through:
Matthew T. Christensen, Esq.
Johnson May
199 N. Capitol Blvd, Ste 200
Boise, ID 83702
Tel: 208-384-8588
Fax: 208-629-2157
Email: info@johnsonmaylaw.com
About IM Services Group
IM Services Group, LLC is an engineering company that provides
turn-key engineering, design and construction management services
to clients in a range of industries, including the pipeline
construction industry. The company is based in Boise, Idaho.
IM Services Group filed its voluntary petition for relief under
Chapter 11 of the Bankruptcy Code (Bankr. D. Idaho Case No.
21-00737) on Dec. 28, 2021, listing $20,479,785 in assets and
$21,829,475 in liabilities. Judge Noah G. Hillen presides over the
case.
Matthew T. Christensen, Esq., at Johnson May represents the Debtor
as legal counsel.
ISTAR INC: Fitch Affirms 'BB' LongTerm IDR, Outlook Stable
----------------------------------------------------------
Fitch Ratings has affirmed the Long-Term Issuer Default Rating
(IDR) of iStar Inc. at 'BB'. The Rating Outlook is Stable. Fitch
has also affirmed iStar's senior secured debt rating at 'BBB-',
unsecured debt rating at 'BB+', and preferred stock rating at 'B'.
On Feb. 2, 2022, iStar announced that it had entered into a
definitive agreement to sell its portfolio of net lease assets for
$3.07 billion to The Carlyle Group Inc. (BBB+/Positive).
Post-closing, iStar expects to retain net cash proceeds of
approximately $1.1 billion. The transaction is expected to close in
March 2022.
KEY RATING DRIVERS
IDR AND SENIOR DEBT
The affirmation reflects Fitch's belief that the transaction will
be neutral to iStar's ratings. The expected improvement in
leverage, funding flexibility and liquidity are offset by uncertain
expected growth in leasehold loans and ground lease assets; and
uncertainty around iStar's medium-term strategy and its long-term
relationship with Safehold. The remaining assets will be more
heavily concentrated in business done alongside affiliate Safehold
Inc. (Safehold; BBB+/Stable) and in ownership of Safehold stock.
Rating constraints include iStar's focus on the CRE market, which
exhibits volatility through the credit cycle; multiple shifts in
the firm's strategy over time; continued, albeit declining,
exposure to land and other legacy noncore assets; inconsistent
operating performance and declining revenue diversity; and key
person risk associated with CEO Jay Sugarman. Additionally, iStar's
performance will be highly dependent upon continued growth at SAFE,
which has a relatively limited track record, given slower growth in
the traditional net lease and real estate finance businesses in
recent years.
The portfolio being sold consists of office, entertainment and
industrial properties totaling $2.2 billion, or 39% of iStar's
portfolio at Dec. 31, 2021, which is partially financed with
mortgage debt. With sale proceeds, iStar is expected to repay
associated mortgage obligations and its secured term loan. Excess
proceeds of $1.1 billion are expected to be used to invest in
leasehold loans, ground leases and, potentially, share repurchases.
Net lease assets associated with iStar's ground lease business,
specifically ground lease plus, were not included in the sale.
Fitch primarily assesses iStar's leverage on the basis of
debt-to-tangible equity, affording 50% equity credit to the
preferred securities. On this basis, leverage was 3.0x at YE 2021,
which is down from 4.6x at YE 2020. The decline was driven by the
reclassification of assets and liabilities in connection with the
transaction. Fitch expects leverage to be 1.8x at close, due to the
repayment of debt and increase in equity. The reduction in leverage
is viewed favorably by Fitch but it is not clear where leverage
will be managed long-term.
At YE 2021, approximately 82.2% of iStar's outstanding debt was
unsecured, which is above many similarly rated balance
sheet-intensive finance and leasing companies. Fitch expects
unsecured debt will increase to at least 95% following the close of
the transaction, but may not be maintained there should iStar draw
on its secured revolving facility to fund portfolio growth.
Fitch views iStar's liquidity as adequate for its rating. At YE
2021, iStar had $339.6 million of unrestricted cash and $350
million of undrawn capacity on its secured revolving credit
facility. iStar expects to have $1.5 billion of unrestricted cash
following the portfolio sale. While Fitch views the anticipated
increase in liquidity favorably, excess liquidity is expected to be
deployed into portfolio growth and, possibly, share repurchases.
Fitch views iStar's management team as having sufficient industry
experience, but believes key-person risk continues to reside with
CEO Jay Sugarman. In February 2022, iStar announced that Brett
Asnas was promoted to the CFO role after 12 years with the company.
Fitch views the appointment of a long-tenured iStar employee
favorably given the turnover in the role in recent years.
The Stable Outlook reflects Fitch's view that iStar's stable NPL,
financial flexibility and experienced management team are
appropriate at the rating level. Additionally, Fitch believes the
company will maintain sufficient liquidity and manage the debt
maturity profile accordingly.
The secured debt rating is two notches above iStar's Long-Term IDR
and reflects the collateral backing these obligations, indicating
superior recovery prospects for secured debtholders under a
stressed scenario.
The unsecured debt rating is one notch above iStar's Long-Term IDR
and reflects the availability of sufficient unencumbered assets,
which provide support to unsecured creditors, and relatively low
levels of secured debt in the firm's funding profile. This profile
indicates good recovery prospects for unsecured debtholders under a
stressed scenario. In addition, iStar adheres to a 1.3x
unencumbered assets-to-unsecured debt covenant, which provides
protection to bondholders during periods of market stress.
HYRBID CAPITAL
The preferred stock rating is three notches below iStar's Long-Term
IDR, reflecting that these securities are deeply subordinated and
have loss absorption elements that would likely result in low
recovery prospects.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
-- Clarity around the long-term ownership in and relationship
with Safehold;
-- Strategic execution on growth in leasehold loans and ground
leases which results in a more consistent earnings profile;
-- A sustained Fitch-calculated leverage below 3.0x; and
-- Continued execution on efforts to further reduce exposure to
legacy assets and the redeployment of proceeds in assets
viewed as core.
-- An upgrade would also be conditioned upon continued growth and
solid performance in the Safehold business; the maintenance of
sufficient liquidity; and continued management of the
company's debt maturity profile.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
-- An inability to generate consistent operating performance from
failure to execute on growth in the leasehold loan and ground
lease businesses;
-- A material weakening in asset quality, as demonstrated by a
significant increase in NPLs, and/or weaker performance at
Safehold;
-- A sustained increase in Fitch-calculated leverage above 5.0x;
and
-- A significant reduction in long-term unsecured funding below
50%.
The secured debt rating, unsecured debt rating and preferred stock
ratings are sensitive to changes in iStar's IDR as well as changes
in the firm's secured and unsecured funding mix and collateral
coverage for each class of debt. If secured debt were to
meaningfully increase as a proportion of the firm's debt funding
and/or unencumbered asset coverage of unsecured debt were to
decline, it is possible that the upward notching for the secured
debt and unsecured debt, relative to the IDR, could begin to
compress. Additionally, as the IDR approaches investment grade,
there would be more compression expected in the secured and
unsecured notching.
BEST/WORST CASE RATING SCENARIO
International scale credit ratings of Financial Institutions and
Covered Bond 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.
ESG CONSIDERATIONS
The highest level of ESG credit relevance, if present, is a score
of '3'. This means ESG issues are credit-neutral or have only a
minimal credit impact on the entity(ies), either due to their
nature or to the way in which they are being managed by the
entity(ies).
JAFFAN INTERNATIONAL: Taps Buddy D. Ford as Bankruptcy Counsel
--------------------------------------------------------------
Jaffan International, LLC seeks approval from the U.S. Bankruptcy
Court for the Middle District of Florida to hire Buddy D. Ford,
P.A. to serve as legal counsel in its Chapter 11 case.
The firm's services include:
a. advising the Debtor with regard to its powers and duties in
the continued management of its financial affairs, operation of its
business and management of the property of the estate;
b. preparing schedules of assets and liabilities, statement of
financial affairs, and other documents required by the court;
c. representing the Debtor at the Section 341 creditors'
meeting;
d. advising the Debtor with respect to its responsibilities in
complying with the U.S. Trustee's Operating Guidelines and
Reporting Requirements and with the rules of the court;
e. preparing legal papers and appearing at court hearings;
f. protecting the interest of the Debtor in all matters
pending before the court;
g. representing the Debtor in negotiation with its creditors
in the preparation of a Chapter 11 plan; and
h. performing all other legal services for the Debtor.
The hourly rates charged by the firm's attorneys and paralegals are
as follows:
Buddy D. Ford $450 per hour
Senior Associate Attorneys $400 per hour
Junior Associate Attorneys $350 per hour
Senior Paralegals $150 per hour
Junior Paralegals $100 per hour
The firm will also seek reimbursement for out-of-pocket expenses
incurred. The retainer fee is $7,500.
Buddy Ford, Esq., disclosed in a court filing that his firm is a
"disinterested person" as the term is defined in Section 101(14) of
the Bankruptcy Code.
The firm can be reached at:
Buddy D. Ford, Esq.
Jonathan A. Semach, Esq.
Heather M. Reel, Esq.
Buddy D. Ford, P.A.
9301 West Hillsborough Avenue
Tampa, FL 33615-3008
Tel: (813) 877-4669
Email: Buddy@tampaesq.com
Jonathan@tampaesq.com
Heather@tampaesq.com
About Jaffan International
Jaffan International, LLC sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. M.D. Fla. Case No. 22-00459) on Feb. 4,
2022. In the petition signed by Ahmad Maher AlJaffan, managing
member, the Debtor disclosed up to $500,000 in both assets and
liabilities.
Buddy D. Ford, Esq., at Buddy D. Ford, P.A. is the Debtor's legal
counsel.
JEM HOMES: Amends Several Secured Claims Pay Details
----------------------------------------------------
JEM Homes International, LLC, submitted a Second Amended Small
Business Plan of Reorganization dated Feb. 28, 2022.
This Plan of Reorganization of JEM Homes proposes to pay creditors
from sources of payment, such as a Capital Investment, as well as
cash flow and future income from operations over three to five
years.
Subject to the acceptance of the final terms of the operating
agreement between the Capital Investor and the Debtor's principal,
the Debtor will fund the Plan with funds from a Capital Investor,
who, in consideration of the Debtor's principal ceding, to the
Capital Investor, 65% of his interest in the Debtor, will make a
Capital Contribution equal to the amount of Debtor's debts who, at
least 5 days prior to confirmation hearing of this Plan, elect to
be paid with a lump sum payment on the Effective Date, as well as a
small Working Capital.
Creditors who elect not to be paid with a lump sum payment on the
Effective Date will be paid from the Debtor's continued operations
and other receivables from operations.
Unsecured creditors will be given the opportunity to receive a
reduced lump sum payment on the Effective Date or a full payment of
their claim through equal monthly payments.
Class 4 consists of the Secured Claims of Wright Brothers. This is
a Disputed Claim Contract will be assumed as modified and extended.
Secured Portion of the Claim will be paid through an equal interest
only payment, during the first 36 months, at 4% interest per annum.
The total Value of the Claim will be paid in the earlier of month
60 or the sale of each lot based on the Release Price.
Class 5 consists of the Secured Claims of Roberto and Monica
Suarez. This is a Disputed Claim Contract will be assumed as
modified and extended. Secured Portion of the Claim will be paid
through an equal interest only payment, during the first 36 months,
at 4% interest per annum. The total Value of the Claim will be paid
in the earlier of month 60 or the sale of each lot based on the
Release Price.
Class 7 consists of the General Unsecured Claims of Architechenburo
Sibilo NV in the amount of $50,000.00. This is a Disputed Claim
which will be objected to and, if allowed, will be paid in a manner
to be determined by the parties.
Class 8 consists of Pre-petition Rent. Lease to be Assumed and
modified as agreed to by the parties. Value of the Claim to be paid
in equal monthly installments through the first 12 months.
Subject to the acceptance of the final terms of the operating
agreement between the Capital Investor and the Debtor's principal,
the Capital Investor will deposit, at least 3 days before
confirmation, into Escrow Agent's account all funds needed to pay
the Creditors who have been designated to be paid on Effective Date
without the need of an election of a different treatment and all
Creditors who can choose and have elected to be paid on the
Effective Date and who have made such election at least 5 days
before the Confirmation Date. All Creditors who make an Election of
a lump sum within the 5 days before the Confirmation Date or after,
will be paid directly by the Capital Investor, within 30 days from
when the election is made or on the Effective Date, whichever is
latest.
A full-text copy of the Second Amended Plan dated Feb. 28, 2022, is
available at https://bit.ly/3CdehkD from PacerMonitor.com at no
charge.
Counsel for Debtor:
Humberto Rivera, Esq.
Rivera Law Firm, PA
P.O. Box 211746
Royal Palm Beach, FL 33421
Telephone: (786) 529-6060
Facsimile: (786) 441-4373
Email: humberto@hriveralaw.com
About JEM Homes International
JEM Homes International, LLC, a Fort Pierce, Fla.-based
manufacturer of single-family homes, filed a petition for Chapter
11 protection (Bankr. S.D. Fla. Case No. 21-19086) on Sept. 20,
2021, listing up to $50,000 in assets and $1 million to $10 million
in liabilities. Roy Ronel Dan, managing member, signed the
petition. Judge Mindy A. Mora oversees the case. Rivera Law Firm,
PA, serves as the Debtor's legal counsel.
JINZHENG GROUP: Unsecured Creditors Seek Chapter 11 Trustee
-----------------------------------------------------------
The Committee of Creditors Holding Unsecured Claims appointed in
the Chapter 11 case for Jinzheng Group (USA) LLC asks the U.S.
Bankruptcy Court for the Central District of California to enter an
order appointing a Chapter 11 Trustee for the Debtor or, in the
alternative, terminating the plan and solicitation exclusivities
and authorizing standing for the Committee to prosecute actions
against the Debtor's insiders.
The Committee asks the Court to consider its Motion at a hearing
scheduled for March 22, 2022.
According to the Committee, the Debtor's gross mismanagement wasted
and squandered the Debtor's assets, particularly by allowing them
to be the subject of a secured lender's relief from stay motion
that, if granted, would deprive the estate and its creditors of the
vast majority of the Debtor's assets (by size and value).
As an alternative, the Committee is prepared to offer an
alternative plan, that is, to terminate exclusivity for cause. The
Committee argued that terminating exclusivity is warranted to level
the playing field and allow creditors to consider competing plans,
especially in this context where the Debtor is steeped in
mismanagement, and the Debtor has no hope of reorganizing or
ongoing stake, and are instead liquidating all of their assets.
About Jinzheng Group (USA)
Jinzheng Group (USA) LLC, owner of multiple properties in Los
Angeles County, Calif., sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. C.D. Calif. Case No. 21-16674) on Aug. 24,
2021, listing up to $50 million in both assets and liabilities.
Judge Ernest M. Robles oversees the case.
JOSEPH MARTIN THOMAS: Proposes Auction Sale of Personal Property
----------------------------------------------------------------
Joseph Martin Thomas, M.D., and the Official Committee of Unsecured
Creditors of Tri-State Pain Institute, LLC, as a party in interest,
ask the U.S. Bankruptcy Court for the Western District of
Pennsylvania to authorize the auction sale of the following
personal property:
a. Approximately 150 items of household furnishings;
b. Approximately 500 pieces of artwork, prints, sketches,
etc.;
c. Dozens of items of decorative art and/or antiques; and
d. Substantially all other personal property currently in
storage from the sale of the Debtor's residence and former office
location.
A hearing on the Motion is set for March 24, 2022, at 11:30 a.m.
The Objection Deadline is March 4, 2022.
The United States of America, Internal Revenue Service is being
named as a Respondent as the following Federal Tax Liens have/had
been entered in the Court of Common Pleas of Erie County,
Pennsylvania:
a. Federal Tax Lien entered on June 15, 2018 at Case No.
30954-2018 in the amount of $255,140.32; and
b. Federal Tax Lien entered on July 9, 2018 at Case No.
31126-2018 in the amount of $187,570.67.
The Debtor has made payments and/or distributions from other sales
on the tax obligations that are included in the referenced tax
liens, and it is believed that the liens have been paid in full.
To the extent that these tax liens may not have yet been marked
satisfied, the Debtor lists United States of America, Internal
Revenue Service as a Respondent to the within Sale Motion out of an
abundance of caution. The Internal Revenue Service is represented
by Jill Locnikar, Esquire, Assistant U.S. Attorney, 700 Grant
Street, Suite 4000, Pittsburgh, Pennsylvania 15219.
The Commonwealth of Pennsylvania, Dept. of Revenue is being named
as a Respondent because the following liens have/had been entered
in the Court of Common Pleas of Erie County, Pennsylvania:
a. Tax Lien entered on Dec. 10, 2018 at Case No. 32118-2018 in
the amount of $38,193.59; and
b. Tax Lien entered on Feb. 4, 2019 at Case No. 30321-2019 in
the amount of $20,512.12.
The Debtor has made payments and/or distributions from other sales
on the tax obligations that are included in the referenced tax
liens, and it is believed that the liens have been paid in full.
To the extent that these tax liens may not have yet been marked
satisfied, the Debtor lists Commonwealth of Pennsylvania,
Department of Revenue as a Respondent to the within Sale Motion out
of an abundance of caution. Commonwealth of Pennsylvania, Dept. of
Revenue, is represented by Lauren A. Michaels, Deputy Attorney
General, Pennsylvania Office of Attorney General, 1251 Waterfront
Place, Mezzanine Level, Pittsburgh, Pennsylvania 15222.
The Debtor holds title to the Property. Exhibit A is a copy of the
Household Goods Descriptive Inventory, which generally evidences
the Property subject to the within Sale Motion dependent upon
further cataloging and identification by the Court-appointed
co-auctioneers. It is believed and therefore averred that the fair
market value of the Property may be worth between $150,000 to
$350,000, net of any buyers’ premium, depending on the current
status of the market and the number of similar items already
available. It is believed and averred that the Debtor holds title
to the Property free and clear of liens and encumbrances. The tax
liens of the Respondents, the Internal Revenue Service and the
Pennsylvania Department of Revenue, were paid in full prior to the
filing of the within Motion.
The Parties have determined that the best interests of the
bankruptcy estate and creditors will be served by a professionally
run auction sale or sales of the Debtor's personal property subject
to Order of the Court.
The Debtor has retained co-auctioneers United Auctions & Antique
Purchasing and Schultz Auctioneers to list the Property for sale
via live and online auction(s), for which a retention motion
pursuant to Sections 327(a) and 328(a) of the Bankruptcy Code has
been conditionally approved by Order of Court dated Feb. 7, 2022,
prior to the filing of the within Sale Motion.
The Parties are proposing to sell the Property free and divested of
liens. United/Schultz will ensure that the Property is promoted
nationally and internationally by targeting retail customers,
museums, private collectors, and galleries in the marketplace.
Several important trade publications and online sites will
advertise the auction sale with ads and press releases, including
but not limited to Antique Weekly.
Potential bidders will be able to participate live, in person,
and/or online, by registering via the following web sites:
Schultzauctioneers.net; and/or liveauctioneers.com. United/Schultz
have also agreed to market the Property for live and online
auction(s) by doing the following: Publishing in the Buffalo news,
Erie news, penny savers, and regional papers; Sending flyers via
direct mail/email to targeted customers; Publishing in national and
regional trade publications; Listing online at
www.liveauctioneers.com, www.schultzauctioneers.com, and more; and
providing additional promotion that United/Schultz deem reasonably
necessary and/or valuable.
The live and online auction(s) will be conducted on a date
subsequent to an order being entered approving the within Sale
Motion. Currently that date is projected to be in or around April
of 2022. Any updates regarding the date(s) and time(s) of the
auction can be found at Schultzauctioneers.net and/or
Auctionzip.com.
The live and online auction(s) may also be conducted into May and
June and combined with other auctions to draw additional interest
from a larger audience. United/Schultz will endeavor to determine
with which auctions and during which times the return for the
Property may be maximized.
In exchange for the above-referenced services, United/Schultz is
proposing a 20% commission up to $250,000 in gross sale proceeds,
and 10% over $250,000, plus online listing fees and moving and
storage costs. United/Schultz's commission rate includes
clerk's/cashier's fees, insurance, inventory, photography, labor,
setup, facilities, and rental fees. All items will be fully
insured by United/Schultz while in their possession and/or control.
The terms and conditions of United/Schultz’s retention and
compensation also includes a buyers' premium of 13%.
When the Property is sold, and subject to the further order of the
Court, the following amounts will be first paid from the gross
proceeds of the sale, net of the buyers' premium: commission owed
to United/Schultz; any online listing fees; moving and storage
fees; any other incidental costs associated with the auction
sale(s) incurred by United/Schultz or the Debtor; and all remaining
proceeds will be paid to the counsel for the Debtor to be held in
escrow for the payment of administrative expenses or other such
claims as may be entitled to payment in order of priority under the
Confirmed Plan.
By this Motion, the Parties request, pursuant to sections 105(a)
and 363(b) and (f) of the Bankruptcy Code and Fed. R. Bankr. P.
6004 and 9014, that the Court authorizes the Debtor (through the
Court approved co-auctioneers) to conduct an auction sale of the
Property and that the Court enter an order confirming the auction
sale to the highest bidder(s) free and clear of all liens, claims,
encumbrances and other interests, with any valid and enforceable
liens, claims, interests and encumbrances to attach to the proceeds
of the sale.
A copy of the Exhibit A is available at
https://tinyurl.com/42yw3jbr from PacerMonitor.com free of charge.
Joseph Martin Thomas sought Chapter 11 protection (Bankr. W.D. Pa.
Case No. 20-10334) on May 6, 2020. The Debtor tapped Michael P.
Kruszewski, Esq., at The Quinn Law Firm as counsel.
JTS TRUCKING: Quality Investment Buying Albertville Asset for $445K
-------------------------------------------------------------------
JTS Trucking LLC asks the U.S. Bankruptcy Court for the Northern
District of Alabama to authorize the private sale of the estate's
rights, title, and interest to property located at 940 Portwood
Drive, in Albertville, Alabama 35950, also described as Tracts 10,
11, and 12 in the W. C. Portwood 3rd Addition Subdivision,
according to the map or plat thereof, recorded in Plat Book 8, page
107, Probate Office, Marshall County, Alabama, to Quality
Investment Property, LLC, for $445,000.
The Debtor proposes to sell the Property free and clear of any and
all mortgages, liens, interests, and/or other encumbrances to the
Buyer. Otherwise, the property is sold "As Is" and "Where Is" with
no warranty of any type whatsoever.
The real property to be sold is free and clear of the following
liens, mortgages, claims or other interests:
a. Vantage Bank, by mortgage filed for record in Marshall
County, Alabama on Dec. 30, 2014 in Book 5496 at Page 206 in the
amount of $239,000 which will be paid at closing. Said mortgage
was modified and said Modification Agreement was filed in Marshall
County, Alabama on July 2, 2015 in Book 5569 at Page 296. This
indebtedness will be paid and satisfied in full.
b. The liens, interests and claims of KHR Properties, LLC as
set out in that certain lawsuit styled as KHR Properties, LLC v.
JTS Trucking LLC and John H. Lowden, filed in the Circuit Court of
Marshall County, Alabama and having case number 50-CV-2018-000021.
All liens, claims and interests of Atlantic Southern Construction,
Inc. raised in said lawsuits will be released from said property
and will only be recoverable from the net proceeds from the sale.
These liens, claims and interests are in bona fide dispute.
Other than the payment of Vantage Bank, all liens, claims,
mortgages, or other interests will attach to the proceeds of the
sale. The Debtor reserves the right to contest the validity,
priority, extent of any such claim, lien or other interest.
The Debtor moves the Court to (i) authorize it to pay for title
insurance, pro-rated ad valorem taxes, real estate commission as
hereinabove set out and requested, and any other cost at the
closing of the sale as set forth in the Sales Contract; (ii) waive
the stay provisions set forth in Rule 6004(h)to allow the sale to
take place as soon as practicable; and (iii) authorize it to pay
Vantage Bank the amount necessary to satisfy its mortgage and
direct the Debtor to hold the balance of the net proceeds from the
sale pending resolution of the amount of claims, if any, owed to
KHR Properties, LLC as hereinabove set.
About JTS Trucking
JTS Trucking LLC, a trucking company based in Albertville,
Alabama,
sought protection under Chapter 11 of the Bankruptcy Court (Bankr.
N.D. Ala. Case No. 20-40423) on March 6, 2020, listing under $1
million in both assets and liabilities. The petition was signed
by
Susan M. Lowden, its member. The Debtor tapped Harry P. Long,
Esq., at the Law Offices of Harry P. Long, LLC as its counsel;
Bill
Massey and MDA Professional Group, PC as its accountants; and
Kevin
Lowery and RE/MAX The Real Estate Group as broker and property
manager for the Debtor's estate.
LEAR CAPITAL: Files for Chapter 11 Bankruptcy Protection
--------------------------------------------------------
Jodi Xu Klein of The Wall Street Journal reports that Lear Capital
Inc., a gold- and silver-coin dealer, filed for chapter 11 on
Wednesday, March 2, 2022, to address potential future legal claims
tied to the company's sales practices and customer disclosures.
Lear filed for chapter 11 protection after reaching settlements for
a total of $8.75 million with the Los Angeles City Attorney’s
Office and New York Attorney General last year in separate lawsuits
alleging the company breached state consumer-protection laws.
About Lear Capital Inc.
Lear Capital Inc. is a silver- and gold-coin dealer based in Los
Angeles, California.
Lear Capital Inc. sought voluntary Chapter 11 bankruptcy protection
(Bankr. D. Del. Case No. 22-10165) on March 2, 2022, to weather
possible future legal claims associated with its sales practices as
well as customer disclosures. The case is handled by Honorable
Judge Brendan Linehan Shannon.
As of Feb. 28, 2022, Lear Capital had assets of $34,449,619 against
liabilities of $22,355,066.
SHULMAN BASTIAN FRIEDMAN & BUI LLP is the Debtor's general counsel.
MORRIS JAMES LLP is the Debtor's local counsel. PALADIN
MANAGEMENT GROUP is the financial advisor. BMC GROUP INC. is the
claims agent.
LTL MANAGEMENT: Opposes Bid to Delay Talc Committee Reinstatement
-----------------------------------------------------------------
LTL Management, LLC has opposed a recent request by the official
committee representing mesothelioma claimants to delay the
reinstatement of the original talc claimants' committee formed in
the company's Chapter 11 case.
The mesothelioma claimants' committee had earlier asked Judge
Michael Kaplan to extend the March 9 deadline, saying the U.S.
trustee overseeing the company's bankruptcy may soon file a motion
to appoint a separate mesothelioma claimants' committee.
"[LTL] opposes any modification of the court's order to extend the
March 9 deadline to permit a possible late-filed motion, and will
oppose any motion seeking to appoint a separate mesothelioma
claimants' committee," LTL's attorney, Gregory Gordon, Esq., at
Jones Day said in a letter to Judge Kaplan.
"There is no need to modify the court's prior order, and it would
only impede progress in this case to do so," the attorney said,
adding that the U.S. trustee has been given enough time to file a
motion but no such motion has been filed to date.
In a letter to Judge Kaplan, Andrew Vara, the U.S. trustee for
Regions 3 and 9, said he won't be filing a motion for relief with
respect to the Nov. 8 order, which approved the formation of the
original talc claimants' committee.
The Nov. 8 order was issued by Judge Craig Whitley of the U.S.
Bankruptcy Court for the Western District of North Carolina who was
initially assigned to handle LTL's case.
About LTL Management
LTL Management, LLC, is a subsidiary of Johnson & Johnson (J&J),
which was formed to manage and defend thousands of talc-related
claims and oversee the operations of Royalty A&M. Royalty A&M owns
a portfolio of royalty revenue streams, including royalty revenue
streams based on third-party sales of LACTAID, MYLANTA/MYLICON and
ROGAINE products.
LTL Management originally filed a petition for Chapter 11
bankruptcy protection (Bankr. W.D.N.C. Case No. 21-30589) on Oct.
14, 2021. The case was transferred to New Jersey (Bankr. D. N.J.
Case No. 21-30589) on Nov. 16, 2021. The Hon. Michael B. Kaplan is
the case judge. At the time of the filing, the Debtor was estimated
to have $1 billion to $10 billion in both assets and liabilities.
The Debtor tapped Jones Day and Rayburn Cooper & Durham, P.A., as
bankruptcy counsel; King & Spalding, LLP and Shook, Hardy & Bacon
LLP as special counsel; McCarter & English, LLP as litigation
consultant; Bates White, LLC as financial consultant; and
AlixPartners, LLP as restructuring advisor. Epiq Corporate
Restructuring, LLC, is the claims agent.
An official committee of talc claimants was formed in the Debtor's
Chapter 11 case on Nov. 9, 2021. On Dec. 24, 2021, the U.S. Trustee
for Regions 3 and 9 reconstituted the talc claimants' committee and
appointed two separate committees: (i) the official committee of
talc claimants I, which represents ovarian cancer claimants, and
(ii) the official committee of talc claimants II, which represents
mesothelioma claimants.
The official committee of talc claimants I tapped Genova Burns LLC,
Brown Rudnick LLP, Otterbourg PC and Parkins Lee & Rubio LLP as its
legal counsel. Meanwhile, the official committee of talc claimants
II is represented by the law firms of Cooley LLP, Bailey Glasser
LLP, Waldrep Wall Babcock & Bailey PLLC, Massey & Gail LLP, and
Sherman Silverstein Kohl Rose & Podolsky P.A.
About Johnson & Johnson
Johnson & Johnson is an American multinational corporation founded
in 1886 that develops medical devices, pharmaceuticals, and
consumer packaged goods. It is the world's largest and most broadly
based healthcare company.
Johnson & Johnson is headquartered in New Brunswick, New Jersey,
the consumer division being located in Skillman, New Jersey. The
corporation includes some 250 subsidiary companies with operations
in 60 countries and products sold in over 175 countries.
The corporation had worldwide sales of $82.6 billion in 2020.
MACY'S: S&P Assigns 'BB' Rating on New Senior Unsecured Notes
-------------------------------------------------------------
S&P Global Ratings assigned its 'BB' issue-level and '4' recovery
ratings to Macy's Retail Holdings LLC's proposed unsecured notes
due in 2030 and 2032. The notes will be senior unsecured
obligations of the issuer and will be unconditionally guaranteed on
a senior unsecured basis by Macy's Inc. The company intends to use
the net proceeds, together with cash on hand, to redeem existing
outstanding senior notes.
S&P's 'BB' issuer credit rating and positive outlook on Macy's Inc.
and Macy's Retail Holdings are unaffected by the transaction.
ISSUE RATINGS – RECOVERY ANALYSIS
Key analytical factors
-- S&P's simulated default scenario assumes a limited recovery in
sales and operating profits following the COVID-19 pandemic with a
weak environment and shifting consumer preferences, exacerbated by
merchandise missteps, increased competition that leads to the
continued loss of market share, and a weak economy.
-- S&P assumes Macy's will emerge as a going concern given its
name recognition. S&P applies a 5x EBITDA multiple (in line with
the multiples we use for other department stores) to our projected
emergence-level EBITDA figure.
-- S&P believes that as Macy's approaches default, it would
further rationalize its store footprint and sell assets.
-- Macy's capital structure after the proposed transaction
consists of the $3 billion asset-based lending (ABL) facility (not
rated), about $280 million in second-lien secured notes, and about
$2.7 billion of unsecured notes. This also reflects about $300
million in debt reduction in conjunction with the proposed
refinancing.
-- S&P believes the company could take on additional secured debt
as it approaches default, which would pressure recovery prospects
for debtholders.
-- S&P assumes the ABL facility is 60% drawn at default and
believe this claim would rank ahead of secured debt and the
unsecured notes' claim in bankruptcy.
Simulated default assumptions
-- Simulated year of default: 2027
-- S&P uses a combined discrete asset valuation (DAV) and
enterprise value (EV) approach to value Macy's because certain real
estate was carved out to secure the $1.3 billion secured notes
(redeemed in August 2021) and subsequently the remaining $280
million second-lien secured notes.
-- S&P estimates a gross EV of $4 billion based on $2.9 billion of
going-concern value (emergence EBITDA of about $588 million and a
5x multiple) and $1.1 billion of adjusted real estate value.
Simplified waterfall
-- Net EV after 5% administrative costs and estimated unfunded
pension claims: $3.6 billion
-- About 52% of the value distributed to the ABL, and senior
secured notes under Macy's Retail Holdings, with the ABL ranking
ahead of the secured notes in terms of priority.
-- Remaining 48% of the value distributed to the senior unsecured
notes.
-- Secured note claims: $290 million*
--Recovery expectations: 90%-100% (rounded estimate: 95%)
-- ABL secured claims: $1.83 billion*
--Recovery expectations: not rated
-- Unsecured debt and nondebt claims: $2.8 billion*
--Recovery expectations: 30%-50% (rounded estimate: 45%)
*All debt claims include six months of prepetition interest.
In addition, if the company exercises its collateral offer per its
debt indenture on the second-lien notes and the security interest
is subsequently released from these notes, S&P will likely review
the capital structure again and lower the recovery rating on the
second-lien notes as they would become unsecured and rank pari
passu with existing unsecured notes.
MAUI MEADOWS: Seeks Approval to Hire Alan Sears as Accountant
-------------------------------------------------------------
Maui Meadows Management, LLC seeks approval from the U.S.
Bankruptcy Court for the District of Hawaii to employ Alan Sears,
an accountant practicing in Tucson, Ariz.
The Debtor requires an accountant to prepare tax filings and
provide other accounting services during the pendency of its
Chapter 11 case.
The firm will charge $45 per hour for its services.
As disclosed in court filings, Mr. Sears is a "disinterested
person" within the meaning of Section 101(14) of the Bankruptcy
Code.
Mr. Sears holds office at:
Alan Sears
2230 E. Speedway Blvd. Suite 120
Tucson, AZ 85719
Tel: (520) 885-1040
Fax: (520) 795-2686
About Maui Meadows Management
Maui Meadows Management, LLC, a company based in Kihei, Hawaii,
filed a petition for Chapter 11 protection (Bankr. D. Hawaii Case
No. 21-01129) on Dec. 14, 2021, listing as much as $10 million in
both assets and liabilities. Steven Michael Warsh, manager, signed
the petition.
Judge Robert J. Faris oversees the case.
Michael J. Collins, Esq., at Cain & Herren, ALC and Alan Sears, a
certified public accountant based in Tucson, Ariz., serve as the
Debtor's legal counsel and accountant, respectively.
MAYA KARAPETROVA: Li & Meng Buying Mountainside Property for $710K
------------------------------------------------------------------
Maya Karapetrova asks the U.S. Bankruptcy Court for the District of
New Jersey to authorize the sale of the real property located at
345 Forest Hill Way, in Mountainside, New Jersey, to Zelin Li and
Xiaoke Meng for $710,000.
The Objection Deadline is seven days before the return date of the
Motion.
The Debtor and co-owner Kirtcho Karapetro jointly own the Property.
The Property is an approximately 3,024 square foot, single-family
residential home, consisting of four-bedrooms, two full bathrooms,
and one half-bathroom. The Sellers are married but separated, and
thus the Debtor alone resides on the Property. Their mortgage on
the Property was satisfied in full in 2007.
Unfortunately, due to the COVID-19 pandemic, the Debtor faced a
complete loss of all of her business earnings, resulting in the
default of her business loans. The holder of the business loans
filed suit against the Debtor's businesses and the Debtor.
Inevitably, the New Jersey Superior Court entered a default
judgment against the Debtor as the guarantor of the business loans,
Judgment No.J-090542-2020, in the matter of Popular Bank v. Arka
Memory Cab Corp., Pak Trans. Corp., Kirk Taxi Corp., and Maya
Karapetrova, bearing case no. L-001653-20, Union County, in the
amount of $5,187,996.26 ("Judgment Lien"). Thus, while the
Property is not encumbered by a mortgage, the entry of such
judgment against the Debtor in New Jersey resulted in the automatic
creation of a judgment lien on the Debtor’s Property.
Furthermore, due to the complete loss of the Debtor's business
income, the Debtor can no longer afford to maintain the Property.
At present, the Co-Owner, along with her family are assisting her
in maintaining the household and property expenses until a sale of
the Property can be realized. As such, since the loss of the the
Debtor's business income, the Sellers have been trying to secure a
buyer for the Property.
In the Sellers' efforts to consummate a sale of the Property, the
Co-Owner initially utilized a listing agent, for a one-time fee of
approximately $200.00, to list the Property on MLS and other
affiliated websites with a listing price of $649,999. A
Comparative Market Analysis ("CMA"), demonstrating the market value
of the Property, is annexed to the Debtor Certification as Exhibit
B. The Co-Owner scheduled showings and accepted offers, the Debtor
conducted the viewings of the property, and the Sellers conducted
negotiations. The initial proposed sale, a cash offer for
$649,999, was eventually terminated by the potential buyer.
The Sellers went on to retain a real estate agent to market and
procure a sale of the Property. Subject to Court authorization,
the Sellers have entered into a new contract of sale for real
estate to sell the Property for a purchase price of $710,000. The
proposed Purchasers executed the Purchase Agreement on Jan. 14,
2022, and have concluded attorney review, with an anticipated
closing date of Feb. 28, 2022. The Purchase Agreement and the
subsequent sale to the Purchasers is contingent upon and subject to
the Court's approval.
Liens that may encumber the Property include: any and all unpaid
property taxes; any and all unpaid municipal charges for water
and/or sewer; judgment lien in favor of Popular Bank in the amount
of $5,187,996.261 pursuant to Judgment No. J-090542-2020, less the
value realized from foreclosure sale of collateral; and joint
ownership rights of Kirtcho Karapetrov.
The pertinent terms of the Purchase Agreement are:
a. Purchase Price. $710,000
i. Initial Deposit: $10,000 (Seller's Attorney)
ii. Additional Deposit: $10,000
iii. Mortgage: $568,000
iv. Balance at Closing: $122,000 (less any Seller
Concessions)
b. Purchasers: Zelin Li and Xiaoke Meng
c. Seller: Kirtcho Karapetrov and Maya Karapetrova
d. Closing: Feb. 28, 2022. In the event the property cannot
close 45 days from conclusion of attorney review due to the
Seller's bankruptcy petition or inability to provide clear title,
then either party may cancel the contract. The Buyer will be
reimbursed for fees up to $1,000.
e. Inspection: The Buyer acknowledges that Property is being
sold in "as is" condition. Inspection will be completed within 14
days after the attorney review. The Seller may serve a
3-business-day notice requesting Buyer to perform. If buyer fails
to comply with the Seller's notice, the Buyer may be deemed to have
waived his rights. In the event that the parties cannot agree on
any repair issues, Buyer has the right to cancel the contract.
f. Physical Condition of Property: The Property is being sold
"as is" and will be delivered in broom swept condition, including
the cutting of grass and removal of snow.
g. Realtor's Commission: 3% of total amount of sale for the
Property and will only be paid upon closing of the Property
h. Appraisal Contingency: The contract is subject to the
property appraised at no less than the purchase price. In the
event that the appraised value is less than the contract price and
the Buyer and Seller cannot agree to a new purchase price, then
either party may cancel the contract and all deposit money will be
returned to the Buyer.
i. The Purchase Agreement will be construed, interpreted, and
enforced pursuant to the laws of the State of New Jersey.
j. Seller’s Representations: The Seller makes the following
representations to the Seller's best knowledge: the property is not
in a flood zone; the Seller is not aware of any pending or
forth-coming new tax assessments; the property does not include any
asbestos material; the property does not contain any EIFS or
synthetic stucco; there is no underground oil tank or abandoned
septic tank; the Seller represents there are no restrictions,
easements, encroachments affecting the property other than utility
easements that serve the property; the property is serviced by
public water and sewer; the property does not contain Federal
Pacific Electric Panels; the sale is not a short sale and the
property is not in foreclosure and there is sufficient equity in
the home to pay off any liens, mortgages and/or claims at closing;
and no claim has been made under the homeowner's insurance policy
for any damage to persons or the property.
k. Oil Tank: The Buyer will have the right to inspect oil
tank, if any, servicing the premises within 14 days of the date of
the signing of this contract by all parties. If it is determined
that the tank is located on the property and is leaking or is in
violation of any governmental regulations, then the Buyer will
furnish a copy of the report to the Seller within 14-day period.
The Seller will have the right to correct all deficiencies
regarding such tank at his own cost or expense or void the
agreement.
The sale of the Property benefits CO-Owner as well as the Debtor,
as the Co-Owner is currently financially responsible for the
maintenance of the Property and the costs that continue to incur.
Furthermore, the Co-Owner does not reside at the Property, and upon
a sale of the Property, the Debtor will move to a less costly
residence she owns in Florida.
Special Counsel Ralph Grieco, Esq., was retained for the purposes
of representing the Sellers in the sale of the Property. The Court
should allow the Special Counsel's fees to be paid from the sale
proceeds at closing and in accordance with D.N.J. LBR 6004-5.
The Debtor asserts that given the goal by the parties in this case
to sell the Property and bring the case to conclusion in the short
term, there is cause to waive the stay and the Debtor requests that
upon approval of the sale, the 14-day period pursuant to Rule
6004(h) be waived by the Court.
A copy of the Contract is available at https://tinyurl.com/2p8zzv64
from PacerMonitor.com free of charge.
Maya Karapetrova sought Chapter 11 protection (Bankr. D.N.J. Case
No. 21-14071) on May 17, 2021. The Debtor tapped David Stevens,
Esq., as counsel.
MERIDIAN HIVE: Voluntary Chapter 11 Case Summary
------------------------------------------------
Debtor: Meridian Hive, LLC
d/b/a Meridian Hive Meadery
8120 Exchange Drive
Austin, TX 78754
Business Description: Meridian Hive is an Austin, Texas company,
founded in 2013, that operates in the
beverage Manufacturing industry.
Chapter 11 Petition Date: March 2, 2022
Court: United States Bankruptcy Court
Western District of Texas
Case No.: 22-10140
Judge: Hon. Tony M. Davis
Debtor's Counsel: Todd Headden, Esq.
HAYWARD PLLC
901 Mopac Expressway
Building 1, Suite 300
Austin, TX 78746
Tel: 737-881-7100
Email: theadden@haywrdfirm.com
Estimated Assets: $100,000 to $500,000
Estimated Liabilities: $1 million to $10 million
The petition was signed by William Cayce Rivers as managing
member.
The Debtor failed to include in the petition a list of its 20
largest unsecured creditors.
A full-text copy of the petition is available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/6SF5KNY/Meridian_Hive_LLC__txwbke-22-10140__0001.0.pdf?mcid=tGE4TAMA
MERIDIAN REDEVELOPMENT: Involuntary Chapter 11 Case Summary
-----------------------------------------------------------
Alleged Debtor: Meridian Redevelopment Inc.
93541 Territorial Hwy
Junction City, OR 97448
Type of Debtor's Business: Single Asset Real Estate (as defined
in 11 U.S.C. Section 101(51B)).
Involuntary Chapter
11 Petition Date: March 3, 2022
Court: United States Bankruptcy Court
District of Oregon
Case No.: 22-60232
Petitioners' Counsel: N/A
A full-text copy of the Involuntary Petition is available for free
at PacerMonitor.com at:
https://www.pacermonitor.com/view/4I67YEA/Meridian_Redevelopment_Inc__orbke-22-60232__0001.0.pdf?mcid=tGE4TAMA
Alleged creditors who signed the petition:
Petitioner Nature of Claim Claim Amount
---------- --------------- ------------
Jodi Jennings Wages/Loan $21,000
93545 Territorial Hwy
Junction City, OR 97448
Jason White Wages/Loan $15,000
93545 Territorial Hwy
Junction City, OR 97448
MESOBLAST LTD: Reports $25.9 Million Loss for Second Quarter
------------------------------------------------------------
Mesoblast Limited reported a loss attributable to owners of the
company of $25.95 million on $2.38 million of revenue for the three
months ended Dec. 31, 2021, compared to a loss attributable to
owners of the company of $25.69 million on $2.24 million of revenue
for the three months ended Dec. 31, 2020.
For the six months ended Dec. 31, 2021, the Company reported a loss
attributable to owners of the company of $48.59 million on $5.98
million of revenue compared to a loss attributable to owners of the
company of $50.24 million on $3.55 million of revenue for the six
months ended Dec. 31, 2020.
As of Dec. 31, 2021, the Company had $704.44 million in total
assets, $168.93 million in total liabilities, and $535.51 million
in total equity.
The Company held total cash reserves of $94.8 million as of Dec.
31, 2021.
"Management and the directors believe that we will meet our
forecast expenditure over the next twelve months by accessing
additional cash inflows, including up to $40.0 million which is
available to be drawn from our existing loan arrangements, subject
to certain milestones, and/or by completing one or more strategic
partnerships and have prepared the financial report on a going
concern basis. The dependency on these planned objectives
indicates material uncertainty which may cast significant doubt (or
substantial doubt as contemplated by Public Company Accounting
Oversight Board ("PCAOB") standards) on our ability to continue as
a going concern and that we may be unable to realize our assets and
discharge our liabilities in the normal course of business,"
Mesoblast said.
"Our primary sources of liquidity have historically been equity
raisings, upfront and milestone payments from strategic license
agreements, and borrowings under our loan agreements. We also
expect net sales to become a source of liquidity. While in the
long-term we expect to be able to complete transactions, draw upon
these facilities and achieve approval of our product candidates to
provide liquidity as needed, there can be no assurance as to
whether we will be successful or, if successful, what the terms or
proceeds may be," the Company said.
A full-text copy of the press release is available for free at:
https://www.sec.gov/ix?doc=/Archives/edgar/data/0001345099/000156459022006896/meso-6k_20211231.htm
About Mesoblast
Headquartered in Melbourne, Australia, Mesoblast --
www.mesoblast.com -- is a developer of allogeneic (off-the-shelf)
cellular medicines for the treatment of severe and life-threatening
inflammatory conditions. The Company has leveraged its proprietary
mesenchymal lineage cell therapy technology platform to establish a
broad portfolio of late-stage product candidates which respond to
severe inflammation by releasing anti-inflammatory factors that
counter and modulate multiple effector arms of the immune system,
resulting in significant reduction of the damaging inflammatory
process. Mesoblast has locations in Australia, the United States
and Singapore and is listed on the Australian Securities Exchange
(MSB) and on the Nasdaq (MESO).
Mesoblast reported a net loss of US$98.81 million for the year
ended June 30, 2021, a net loss of US$77.94 million for the year
ended June 30, 2020, and a net loss of US$89.80 million for the
year ended June 30, 2019. As of Sept. 30, 2021, the Company had
US$721.82 million in total assets, US$162.07 million in total
liabilities, and US$559.75 million in total equity.
MICHAEL L. ZOLLICOFFER: Taps Frost & Associates as Legal Counsel
----------------------------------------------------------------
Michael L. Zollicoffer, MD, P.A. seeks approval from the U.S.
Bankruptcy Court for the District of Maryland to hire Frost &
Associates, LLC to serve as legal counsel in its Chapter 11 case.
The firm's services include:
a. preparing bankruptcy schedules and financial statements for
filing;
b. providing the Debtor with legal advice with respect to its
powers and duties pursuant to the Bankruptcy Code;
c. preparing legal papers;
d. assisting in the analysis and representation with respect
to lawsuits to which the Debtor is or may be a party;
e. negotiating, preparing and seeking approval of a plan of
reorganization;
f. representing the Debtor at all hearings, meetings of
creditors and other proceedings; and
g. performing all other legal services for the Debtor.
The hourly rates charged by the firm for its services are as
follows:
Daniel A. Staeven, Esq. $495 per hour
Rebecca Sheppard $495 per hour
Glen Frost $545 per hour
Attorneys $395 - $565 per hour
Legal Assistants/Law Clerks $100 - $255 per hour
The firm received an advance retainer of $11,738.
As disclosed in court filings, Frost & Associates is disinterested
within the meaning of Section 101(14) of the Bankruptcy Code.
The firm can be reached through:
Daniel A. Staeven, Esq.
Frost & Associates, LLC
1050 Connecticut Ave NW #500
Washington, DC 20036
Phone: +1 202-618-1873
Email: daniel.staeven@frosttaxlaw.com
About Michael Zollicoffer
Michael L. Zollicoffer MD, P.A. operates a professional pediatrics
office in Baltimore, Md.
Michael L. Zollicoffer filed a Chapter 11 petition (Bankr. D. Md.
Case No. 21 15494) on Aug. 27, 2021. The Debtor is represented by
Daniel A. Staeven, Esq., at Frost & Associates, LLC.
MICROVISION INC: Incurs $12.6 Million Net Loss in Fourth Quarter
----------------------------------------------------------------
MicroVision, Inc. reported a net loss of $12.62 million on $557,000
of total revenue for the three months ended Dec. 31, 2021, compared
to a net loss of $3.57 million on $395,000 of total revenue for the
three months ended Dec. 31, 2020.
For the 12 months ended Dec. 31, 2021, the Company reported a net
loss of $43.20 million on $2.50 million of total revenue compared
to a net loss of $13.63 million on $3.09 million of total revenue
for the same period during the prior year.
As of Dec. 31, 2021, the Company had $130.22 million in total
assets, $17.47 million in total liabilities, and $112.75 million in
total shareholders' equity.
"MicroVision made significant progress in 2021, delivering our 1st
generation Long Range Lidar sensor early in the year, demonstrating
its best-in-class cost advantages and key features, and receiving
positive feedback and continued interest from automotive OEMs and
Tier 1 suppliers," said Sumit Sharma, MicroVision's chief executive
officer. "We look forward to track testing our high-speed Highway
Pilot system in the U.S. and Germany in Q2 2022."
"During the past twelve months, we've strengthened our balance
sheet, increasing our cash position by approximately $100 million
and ending the year with $115 million in cash and investments. We
are investing in our growth. We grew our employee base from 52
employees last March to 97 employees today and are expanding our
R&D labs and testing infrastructure in Redmond. We are pleased
with our progress scaling the team and ramping our efforts to be
the leading provider of Lidar and ADAS solutions," continued
Sharma.
About MicroVision
MicroVision -- http://www.microvision.com-- is a pioneering
company in MEMS based laser beam scanning technology that
integrates MEMS, lasers, optics, hardware, algorithms and machine
learning software into its proprietary technology to address
existing and emerging markets. The Company's integrated approach
uses its proprietary technology to provide solutions for automotive
lidar sensors, augmented reality micro-display engines, interactive
display modules and consumer lidar modules.
MicroVision reported a net loss of $13.63 million for the year
ended Dec. 31, 2020, a net loss of $26.48 million for the year
ended Dec. 31, 2019, and a net loss of $27.25 million for the year
ended Dec. 31, 2018. As of Sept. 30, 2021, the Company had $134.07
million in total assets, $11.72 million in total liabilities, and
$122.35 million in total shareholders' equity.
NATIONAL RIFLE: NYAG Fends Off Repeated Moves to Dismiss Fraud Suit
-------------------------------------------------------------------
New York Attorney General Letitia James today, March 3, 2022,
released the following statement after Justice Joel Cohen of the
New York County State Supreme Court rejected a second round of
motions brought forward by the National Rifle Association (NRA),
Executive Vice-President Wayne LaPierre, and Corporate Secretary
and General Counsel John Frazer as they sought to dismiss a lawsuit
filed by Attorney General James against the organization in August
2020:
"Today, the court affirmed my office's right to pursue its
long-standing claims that fraud, abuse, and greed permeate through
the NRA and its senior leadership. While we're heartened that the
judge rejected the NRA’s attempts to thwart most of the claims in
our case against the NRA, we are disappointed that the judge ruled
against the dissolution portion of the case. We are considering our
legal options with respect to this ruling. We remain committed to
enforcing New York law regardless of how powerful any individual or
organization may be."
In March 3, 2022 decision, the court let stand all of the Office of
the Attorney General's (OAG) claims of self-dealing, abuse, and
unlawful conduct by LaPierre, who has been at the helm of the NRA
for three decades. Similarly, the court rebuked the efforts by
Frazer to dismiss him from the case, finding that OAG's allegations
that Frazer violated his obligations as the NRA’s General Counsel
for failing to address conflicts of interest and respond to
whistleblowers who alerted the NRA to systemic financial wrongdoing
were valid. The court also held that OAG's claims against the NRA
for false regulatory filings and failing to address conflicts of
interest will proceed.
In August 2020, Attorney General James filed a lawsuit against the
NRA and four of the organization's current or former top executives
for failing to manage the NRA's funds; failing to follow numerous
state and federal laws, as well as the NRA's own bylaws and
policies; and contributing to the loss of more than $64 million in
just three years. The suit was filed against the NRA as a whole, as
well as LaPierre, Frazer, former Treasurer and Chief Financial
Officer Wilson "Woody" Phillips, and former Chief of Staff and
Executive Director of General Operations Joshua Powell.
The NRA then moved to dismiss Attorney General James' complaint in
its entirety, stay the action, and change the venue to an Albany
court. This past January 2022, the New York County State Supreme
Court ruled that the case be permitted to continue in a Manhattan
court, and not be moved to an Albany court or dismissed outright.
Days before that ruling, in an effort to avoid accountability
altogether, the NRA filed for chapter 11 bankruptcy even though the
organization still claimed to have healthy financial reserves. In
May, a federal bankruptcy court in Texas rejected the
organization’s claims of bankruptcy after the NRA sought to
reorganize in Texas, finding that the NRA had filed for bankruptcy
to avoid regulators and stating, "that the NRA did not file the
bankruptcy petition in good faith."
About National Rifle Association
Founded in 1871 in New York, the National Rifle Association of
America is a gun rights advocacy group. The NRA claims to be the
longest-standing civil rights organization and has more than five
million members.
Seeking to move its domicile and principal place of business to
Texas amid lawsuits in New York, the National Rifle Association of
America sought Chapter 11 protection (Bankr. N.D. Tex. Case No.
21-30085) on Jan. 15, 2021. Affiliate Sea Girt LLC simultaneously
sought Chapter 11 protection (Case No. 21-30080).
The NRA was estimated to have assets and liabilities of $100
million to $500 million as of the bankruptcy filing.
Judge Harlin Dewayne Hale oversees the cases.
The Debtors tapped Neligan LLP and Garman Turner Gordon LLP as
their bankruptcy counsel, and Brewer, Attorneys & Counselors as
their special counsel.
The U.S. Trustee for Region 6 appointed an official committee of
unsecured creditors on Feb. 4, 2021. Norton Rose Fulbright US, LLP
and AlixPartners, LLP serve as the committee's legal counsel and
financial advisor, respectively.
* * *
Following a 12-day trial, U.S. Bankruptcy Judge Harlin D. Hale
dismissed the National Rifle Association's Chapter 11 case Tuesday,
May 11, 2021, after finding the group filed its petition in bad
faith in order to gain advantage in litigation brought by New
York's attorney general. New York Attorney General Letitia James
sought the dismissal of the case. The judge condemned the NRA's
attempts to avoid accountability, making clear that the
organization's actions were "not an appropriate use of bankruptcy."
NATIONAL RIFLE: NYAG James Can't Dissolve NRA, Judge Rules
----------------------------------------------------------
Theresa Schliep of Law360 reports that a New York state judge
declined Wednesday, March 2, 2022, to dissolve the National Rifle
Association as requested by the state attorney general in her
financial probe of the organization, saying that disbanding the
group could infringe on its members' First Amendment rights.
New York Attorney General Letitia James' complaint against the NRA
doesn't prove it has harmed the public in a way that would justify
dissolution of the organization, a state judge found. Attorney
General Letitia James' complaint against the tax-exempt gun rights
organization doesn't prove the NRA has harmed the public in a way
that would justify dissolution.
About National Rifle Association
Founded in 1871 in New York, the National Rifle Association of
America is a gun rights advocacy group. The NRA claims to be the
longest-standing civil rights organization and has more than five
million members.
Seeking to move its domicile and principal place of business to
Texas amid lawsuits in New York, the National Rifle Association of
America sought Chapter 11 protection (Bankr. N.D. Tex. Case No.
21-30085) on Jan. 15, 2021. Affiliate Sea Girt LLC simultaneously
sought Chapter 11 protection (Case No. 21-30080).
The NRA was estimated to have assets and liabilities of $100
million to $500 million as of the bankruptcy filing.
Judge Harlin Dewayne Hale oversees the cases.
The Debtors tapped Neligan LLP and Garman Turner Gordon LLP as
their bankruptcy counsel, and Brewer, Attorneys & Counselors as
their special counsel.
The U.S. Trustee for Region 6 appointed an official committee of
unsecured creditors on Feb. 4, 2021. Norton Rose Fulbright US, LLP
and AlixPartners, LLP serve as the committee's legal counsel and
financial advisor, respectively.
* * *
Following a 12-day trial, U.S. Bankruptcy Judge Harlin D. Hale
dismissed the National Rifle Association's Chapter 11 case Tuesday,
May 11, 2021, after finding the group filed its petition in bad
faith in order to gain advantage in litigation brought by New
York's attorney general. New York Attorney General Letitia James
sought the dismissal of the case. The judge condemned the NRA's
attempts to avoid accountability, making clear that the
organization's actions were "not an appropriate use of bankruptcy."
NAVIENT CORP: Fitch Affirms 'BB-' LongTerm IDR, Outlook Stable
--------------------------------------------------------------
Fitch Ratings has affirmed Navient Corporation's (Navient)
Long-Term Issuer Default Rating (IDR) and senior unsecured debt
rating at 'BB-' and its Short-Term IDR at 'B'. The Rating Outlook
is Stable.
KEY RATING DRIVERS
IDRs AND SENIOR DEBT
The rating affirmation reflects Navient's scale and position as one
of the largest non-government owners and servicers of student loan
assets, its demonstrated track record (including as part of its
predecessor organization) in the student loan servicing/collection
space, the low credit risk and predictable cash flow nature of its
FFELP loan assets, adequate liquidity and a seasoned management
team.
Rating constraints include Navient's monoline business model with a
concentration on student lending, higher leverage relative to
peers, a reliance on wholesale funding and high levels of asset
encumbrance, long-term strategic uncertainty related to the success
of its growth initiatives, and ongoing regulatory, legislative and
litigation risk related to student lending.
Navient's $72.8 billion loan portfolio at YE21 declined 8.3% from
YE20 driven by FFELP run off as well as the sale of $1.6 billion of
private student loans in 2021. The portfolio consisted of $52.6
billion of FFELP loans and $20.2 billion of private education loans
approximately split evenly between legacy and new refinance loans
as of YE21.
Asset quality was solid during 2020-2021 as the unprecedented
amount of government stimulus coupled with widespread loan
forbearance programs and a contraction in consumer discretionary
spending helped to counter the rise in unemployment. The
forbearance rate declined to 2.6% at YE21 from 3.9% at YE20 on the
private education loan portfolio, while the 30+ delinquency rate
had an uptick to 3.2% from 2.6%, but remains well below 4.6% at
YE19. Net charge-offs on the private student loan portfolio were
0.8% in 2021 and remain low relative to the reserve coverage which
stood at 7.9% at YE21.
Navient's core earnings, which primarily adjusts GAAP results for
mark-to-market gains/losses on derivatives and goodwill/intangible
asset amortization, grew 14% in 2021, driven by FFELP net interest
margin (NIM) expansion from floor income, the reversal of loan loss
provisions as credit performance improved and 61% revenue growth in
its Business Processing (BPS) segment.
The BPS EBITDA margin also increased to 28% in 2021, as management
was able to effectively pivot its service offerings toward
processing services that grew as a result of the pandemic. However,
Fitch expects many of the trends that helped profitability in
2020-2021 to normalize in 2022, and, along with the transfer of the
U.S. Department of Education (DOE) servicing business, to pressure
revenue and profitability.
In January 2022, Navient announced a settlement of outstanding
regulatory matters with the state attorneys general. As part of the
agreement, Navient will cancel loan balances of approximately
66,000 borrowers and will also make a one-time payment of
approximately $145 million to the states. Fitch believes the
payment will be manageable given expected 2022 cash flows while the
settlement will also reduce the costs of managing state-by-state
litigation and investigations. In October 2021, Navient also
transferred its servicing contract for DOE-owned student loan
accounts to a third party, via a contract novation. Fitch believes
the cost reduction benefits from both of these actions as well as
the reduction in regulatory uncertainty are credit positives.
The ongoing enforcement action by the Consumer Financial Protection
Bureau (CFPB) continues to be an overhang, as the potential
monetary restitution to borrowers, fines and the reputational risk,
should there be an adverse judgement, could impact current and
future client relationships, particularly government contracts.
Although Fitch believes a resolution of the CFPB litigation could
occur over the Outlook horizon, the exact timing and financial
impact are not predictable.
Navient's leverage (adjusted debt to adjusted tangible equity,
excluding debt and capital associated with the guaranteed FFELP
assets) was 10.8x at YE21 compared with 16.1x at YE20. Management's
leverage metric, adjusted tangible equity (ATE) ratio, ended the
year at 5.9% at YE21, slightly below its 6% target, but would have
been 7% excluding the mark to market impact of its floor income
hedge. Fitch views Navient's leverage as high relative to the risk
profile of private education loans and while it is mitigated to
some extent by a highly seasoned legacy portfolio, Navient's less
seasoned refinance loan originations now represent 49% of the
portfolio and are expected to grow further.
Navient's unsecured debt declined to 9.1% of total funding at YE21,
versus 10.1% a year ago, as operating cashflows are utilized to pay
down unsecured debt. This level is consistent with Fitch's 'b'
category benchmark range. Fitch expects unsecured funding to
decline further as the refi loan portfolio, funded with ABS,
continues to grow. Fitch believes this reduced funding flexibility
is partially mitigated by Navient's strengthened liquidity position
as it addressed its earlier elevated unsecured debt maturities. The
next maturity is in 2023 and remains fully covered by expected
cashflows from the FFELP portfolio.
Navient had $0.9 billion in unrestricted cash at YE21 and projected
cash flows (before operating expenses, taxes, unsecured debt
paydowns and shareholder distributions) from its loan portfolio of
$2.2 billion and $2.0 billion in 2022 and 2023, respectively.
Navient can also generate incremental liquidity by financing
overcollateralization from its student loan ABS trusts and
securitizing unencumbered loans.
The Stable Outlook reflects Fitch's expectation for consistently
solid credit performance and for leverage and funding mix to
stabilize over the Outlook horizon.
The senior unsecured debt rating is equalized with Navient's IDR.
The equalization reflects average recovery prospects under a stress
scenario given the availability of unencumbered assets.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
-- An increase in Navient's debt to tangible equity ratio
(excluding FFELP and the mark to market on floor income
hedges) to over 12x on a sustained basis, a decrease in the
unsecured debt mix representing less than 10% of the company's
funding (excluding debt allocated to the FFELP portfolio).
-- Negative rating momentum could also occur from a significant
deterioration in credit performance, material core operating
losses, an increase in shareholder distributions above
Navient's core earnings, an inability to access the capital
markets on economic terms, and/or an adverse outcome in the
pending CFPB actions that significantly impair its market
position, liquidity and/or future profitability.
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
-- Sustainable improvements in core revenue growth and operating
performance and a demonstrated ability to successfully grow
new businesses that enhance Navient's earnings capacity.
Strong credit performance on the private education loan refi
portfolio and/or a meaningful reduction in leverage could also
drive positive momentum.
-- The senior unsecured debt ratings are primarily sensitive to
changes in the Long-Term IDR of Navient and the availability
of unencumbered assets.
BEST/WORST CASE RATING SCENARIO
International scale credit ratings of Financial Institutions and
Covered Bond 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.
ESG CONSIDERATIONS
Navient has an ESG Relevance Score of '4' for Exposure to Social
Impacts due to its exposure to shift in social or consumer
preferences as a result of an institution's social positions, or
social and/or political disapproval of core activities which, in
combination with other factors, impacts the rating.
Navient has an ESG Relevance Score of '4' for Customer Welfare -
Fair Messaging, Privacy, and Data Security due to its exposure to
compliance risks including fair lending practices, debt collection
practices and consumer data protection, which has a negative impact
on the credit profile, and is relevant to the rating in conjunction
with other factors.
Unless otherwise disclosed in this section, the highest level of
ESG credit relevance is a score of '3'. This means ESG issues are
credit-neutral or have only a minimal credit impact on the entity,
either due to their nature or the way in which they are being
managed by the entity.
NEPHROS INC: Incurs $3.9 Million Net Loss in 2021
-------------------------------------------------
Nephros, Inc. reported a net loss of $3.87 million on $10.40
million of total net revenues for the year ended Dec. 31, 2021,
compared to a net loss of $4.53 million on $8.56 million of total
net revenues for the year ended Dec. 31, 2020.
As of Dec. 31, 2021, the Company had $17.65 million in total
assets, $2.90 million in total liabilities, and $14.75 million in
total stockholders' equity.
"We are pleased to report that Nephros delivered four consecutive
quarters of year-over-year growth averaging 19%, ending the year at
a new revenue record for the company," said Andy Astor, president
and chief executive officer of Nephros. "Looking forward to 2022,
we believe our recent investments into a scalable sales and
marketing infrastructure, along with the expected retreat of
COVID-19 to endemic state, will bring our growth rates even higher,
as evidenced by our recent revenue guidance of $13.0-13.5 million,
or 25-30% growth."
Cost of goods sold for the year ended Dec. 31, 2021 was $4.7
million, compared with $3.6 million in 2020, an increase of 28%.
Cost of goods sold for the fourth quarter of 2021 was $1.3 million,
compared with $1 million in the fourth quarter of 2020, an increase
of 26%.
Gross margins for the year ended Dec. 31, 2021 were 55%, compared
with 57% in 2020. Gross margins for the fourth quarter of 2021
were 53%, compared with 56% in the fourth quarter of 2020.
Selling, general and administrative expenses for the year ended
Dec. 31, 2021 were $7.7 million, compared with $6.5 million in
2020, an increase of 19%. Selling, general and administrative
expenses for the fourth quarter of 2021 were approximately $2
million compared with approximately $1.4 million in the fourth
quarter of 2020, an increase of 44%.
Research and development expenses for the year ended Dec. 31, 2021
were $2.2 million, compared with $2.8 million in 2020, a decrease
of 21%. Research and development expenses for the fourth quarter
of 2021 were $0.5 million, compared with $0.6 million in the fourth
quarter of 2020, a decrease of 19%.
Depreciation and amortization expenses for the year ended Dec. 31,
2021 were approximately $202,000, compared with approximately
$192,000 in 2020, an increase of 5%. Depreciation and amortization
expenses for the fourth quarter of 2021 were approximately $51,000,
compared with approximately $50,000 in the fourth quarter of 2020,
an increase of 2%.
Net loss for the fourth quarter of 2021 was approximately ($1
million), compared with a net loss of approximately ($0.8 million)
in the fourth quarter of 2020, a 37% increase.
Adjusted EBITDA for the year ended Dec. 31, 2021 was ($2.6
million), compared with ($3.6 million) in 2020, a 29% decrease.
Adjusted EBITDA for the fourth quarter 2021 was approximately ($0.4
million), compared with approximately ($0.5 million) in the fourth
quarter of 2020, a 11% decrease.
As of Dec. 31, 2021, the Company had $17.65 million in total
assets, $2.90 million in total liabilities, and $14.75 million.
As of Dec. 31, 2021, Nephros had cash and cash equivalents of
approximately $7.0 million.
A full-text copy of the press release is available for free at:
https://www.sec.gov/Archives/edgar/data/1196298/000149315222005242/ex99-1.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.
NETWORK COMMUNICATIONS: Taps Ausley McMullen as Special Tax Counsel
-------------------------------------------------------------------
Network Communications of Northwest Florida, Inc. seeks approval
from the U.S. Bankruptcy Court for the Northern District of Florida
to employ the law firm of Ausley McMullen as special tax counsel.
The Debtor requires the services of a special tax counsel to assist
in connection with an analysis of tax and corporate implications
relating to its Chapter 11 bankruptcy restructuring.
The hourly rates of the firm's professionals are as follows:
Steven Hogan $350
Paralegals $80 - $125
In addition, the firm will seek reimbursement for expenses
incurred.
Steven Hogan, Esq., a shareholder at Ausley McMullen, 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 M. Hogan, Esq.
Ausley McMullen
123 South Calhoun Street
Tallahassee, FL 32301
Telephone: (850) 224-9115
Facsimile: (850) 222-7560
About Network Communications
Network Communications of Northwest Florida, Inc., a cable company
in Pensacola, Fla., filed its voluntary petition for relief under
Chapter 11 of the Bankruptcy Code (Bankr. N.D. Fla. Case No.
22-30087) on Feb. 11, 2022, listing up to $500,000 in assets and up
to $10 million in liabilities. Timothy G. McDonald, chief executive
officer, signed the petition.
The Debtor tapped Brian G. Rich, Esq., at Berger Singerman, LLP as
legal counsel and Steven M. Hogan, Esq., at Ausley McMullen as
special tax counsel.
NICOLAS THOMAS SCOTT: 4T Land Buying Elevator Tract for $188.5K
---------------------------------------------------------------
Nicolas Thomas Scott and Mandy Lea Scott ask the U.S. Bankruptcy
Court for the District of Colorado to authorize the sale of the
real property located in Kit Carson County, Colorado, legally
described as Township 8 South, Range 43 West of the 6th Principal
Meridian,
Section 25: 3 Acre Tract in SE4 (AKA Peconic Elevator), Kit Carson
County, Colorado, also known as SE4 25-8-43 ("Elevator Tract"), to
4T Land, LLC, for $188,500.
Property of the bankruptcy estate includes the Elevator Tract.
Creditor MNB Bank ("MNB") obtained an appraisal of the Land dated
Jan. 30, 2020.
In the Appraisal, the Elevator Tract is described as follows: The
3-acre tract in the SE/4 25-8-43 (Peconic Elevator) includes 6 bins
with approximately 184,000-bushel storage between Highway 24 and
the railroad right-of-way. An old elevator and 60-ton scale
present, with scale an older non-digital that appears to no longer
be in use. The bins appear to have been maintained/repaired, with
fans in good condition. Metal building is located near the
southwest corner of the tract. Includes well (Permits #272051 &
#272051-A), along with empty manufactured home hook-ups on the east
side. Owner indicates that there is a railroad lease on a 50'x300'
tract along the north side, which costs some $500.00+/- per year.
Client should verify presence of same on title insurance. It
appears that old elevator and 5 of the grain bins may be located on
this right-of-way."
The Appraisal includes a valuation of the Elevator Tract in the
amount of $215,350.
As referenced in the property description set forth in the
Appraisal, a portion of the railway crossing the Elevator Tract is
subject to a May 1, 2006 Lease Agreement originally between
Mid-States Port Authority as lessor and Mulch Farms as lessee,
which, by purchase and assignment, is now between Kyle Railways,
LLC as lessor and Nicolas Scott as lessee ("Railroad Lease").
The Debtors have entered a contract for the sale of the Elevator
Tract to 4T Land, LLC, subject to Bankruptcy Court approval.
MNB has asserted a lien against the Elevator Tract pursuant to
following recorded instruments ("DOT Liens"):
(a) Deed of Trust securing an indebtedness not to exceed $11
million recorded with the Kit Carson County Clerk and Recorder on
May 31, 2017, at Reception No. 00573986;
(b) Deed of Trust securing an indebtedness not to exceed
$3,053,400 recorded with the Kit Carson County Clerk and Recorder
on January 5, 2015, at Reception No. 201500567374; and,
(c) Deed of Trust securing an indebtedness not to exceed $5
million recorded with the Kit Carson County Clerk and Recorder on
May 1, 2013, at Reception No. 201300562962.
MNB also asserts judgment liens against the Elevator Tract pursuant
to following recorded transcripts of judgments ("Judgment Liens"):
(a) Transcript of Judgment in the amount of $155,306.16
recorded with the Kit Carson County Clerk and Recorder on Feb. 28,
2020, at Reception No. 00580451;
(b) Transcript of Judgment in the amount of $77,536.36
recorded with the Kit Carson County Clerk and Recorder on Feb. 28,
2020, at Reception No. 00580452;
(c) Transcript of Judgment in the amount of $2,333,239.25
recorded with the Kit Carson County Clerk and Recorder on Feb. 28,
2020, at Reception No. 00580453;
(d) Transcript of Judgment in the amount of $547,278.46
recorded with the Kit Carson County Clerk and Recorder on Feb. 28,
2020, at Reception No. 00580454; and,
(e) Transcript of Judgment in the amount of $3,840,337.83
recorded with the Kit Carson County Clerk and Recorder on Feb. 28,
2020, at Reception No. 00580455.
The Debtors have entered a contract for the sale of the Elevator
Tract to the Buyer subject to Bankruptcy Court approval. They seek
to sell the Elevator Tract free and clear of liens, encumbrances,
and interests.
The Contract includes the following terms:
a. Closing of the sale will occur on April 26, 2022;
b. The sale price is $188,500;
c. The sale includes water rights and well rights of record or
appurtenant to the Elevator Tract, if any;
d. The Debtors must assign to the Buyer all leases at closing
that will continue after closing and Buyer must assume the Debtors
obligations under all such leases;
e. The Elevator Tract is being sold "as is, where is," and
"with all faults";
f. Title will be conveyed by general warranty deed; and
g. Closing costs will be paid by the Buyer.
Pursuant to the terms of the Contract, the Debtors will assign and
the Buyers will assume the Railroad Lease. The Buyers are owned by
the Debtors' children. There are no conflicts of interest between
the parties.
As part of a global settlement agreement incorporated into the
Debtors' plan of reorganization, as amended, MNB has agreed to the
sale of the Elevator Tract to the Buyers, provided (a) MNB's lien
attaches to the sale proceeds; (b) such proceeds are deposited in
the Debtors' bank account at Bank of the West, Acct. No. 04064;
and, (c) the proceeds are distributed to MNB pursuant to the terms
of the settlement agreement.
For all of the foregoing reasons, the Debtors assert the proposed
sale meets the requirements for approval under 11 U.S.C. Section
363 and the sale should be approved.
A copy of the Agreement is available at
https://tinyurl.com/yvmzrcmf from PacerMonitor.com free of charge.
Nicolas Thomas Scott and Mandy Lea Scott sought Chapter 11
protection (Bankr. D. Colo. Case No. 20-14159 KHT) on June 17,
2020.
NIDA ALSHAIKH: PCO Files Second Report
--------------------------------------
Erika D. Hart, the duly appointed Patient Care Ombudsman for Nida
Alshikh DDS, PC d/b/a Oval Dental, filed with the U.S. Bankruptcy
Court for the Eastern District of Michigan a Second Report
regarding the Debtor's quality of patient care.
According to the Report, the Debtor appears to continue the same
quality of care during the post-petition period.
At the time of the second visit to the facility, the PCO was
contesting objections to her proposed plan of reorganization. The
PCO was convinced that she would be able to meet her obligations
under the plan and still maintain a high standard of patient care.
Since that time, it appears the parties have reached a resolution
of objections to the Plan and are in the process of documenting the
same.
A copy of the Ombudsman Second Report is available for free at
shorturl.at/qKMVY from PacerMonitor.com.
The Ombudsman may be reached at:
Erika D. Hart
Patient Care Ombudsman
700 E. Maple Rd., Second Floor
Birmingham, MI 48009
Tel: (248) 644-7800
Email: ehart@tauntlaw.com
About Nida Alshaikh DDS
Nida Alshaikh DDS, PC, owner of a dental clinic in Westland, Mich.,
filed a petition for Chapter 11 protection (Bankr. E.D. Mich. Case
No. 21-47459) on Sept. 17, 2021, listing up to $50,000 in assets
and up to $10 million in liabilities. Nida Alshaikh, owner, signed
the petition.
Judge Lisa S. Gretchko oversees the case.
The Debtor tapped Schafer and Weiner PLLC as legal counsel,
Calderone Advisory Group LLC as financial advisor, and Accunet Pro
Inc. as accountant. Erika D. Hart is appointed as the Patient Care
Ombudsman for the Debtor.
NMDC HOME: Seeks to Hire Meridian Law as Bankruptcy Counsel
-----------------------------------------------------------
NMDC Home Improvement LLC seeks approval from the U.S. Bankruptcy
Court for the District of Maryland to employ Meridian Law, LLC to
handle its Chapter 11 case.
Meridian Law will be paid at the hourly rate of $300 plus
reasonable and customary disbursements.
Aryeh Stein, Esq., the principal of Meridian Law, 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:
Aryeh E. Stein, Esq.
Meridian Law, LLC
5141 Virginia Way, Ste. 320
Brentwood, TN 37027
Telephone: (615) 229-7499
Facsimile: (615) 229-7498
Email: astein@meridianlawfirm.com
About NMDC Home Improvement
NMDC Home Improvement LLC filed its voluntary petition for relief
under Chapter 11 of the Bankruptcy Code (Bankr. D. Md. Case No.
22-10785) on Feb. 16, 2022, listing as much as $1 million in both
assets and liabilities. Michael Coleman, member, signed the
petition.
Aryeh E. Stein, Esq., at Meridian Law, LLC serves as the Debtor's
legal counsel.
NORTHERN OIL: Swings to $6.4 Million Net Income in 2021
-------------------------------------------------------
Northern Oil and Gas, Inc. filed with the Securities and Exchange
Commission its Annual Report on Form 10-K disclosing net income of
$6.36 million on $496.90 million of total revenues for the year
ended Dec. 31, 2021, compared to a net loss of $906.04 million on
$552.21 million of total revenues for the year ended Dec. 31,
2020.
As of Dec. 31, 2021, the Company had $1.52 billion in total assets,
$1.31 billion in total liabilities, and $215.14 million in total
stockholders' equity.
Oil and natural gas sales for the fourth quarter were $332.4
million, an increase of 28% over the third quarter. Fourth quarter
GAAP net income was $171.1 million or $2.13 per diluted share.
Fourth quarter Adjusted Net Income was $87.0 million or $1.06 per
diluted share, an increase of $35.7 million or $0.64 per diluted
share over the prior year. Adjusted EBITDA in the fourth quarter
was $175.3 million, an increase of 29% over the third quarter.
Oil and natural gas sales for full year 2021 were $975.1 million,
an increase of 201% over full year 2020. Full year 2021 Adjusted
Net Income was $256.3 million or $3.49 per diluted share. Full year
2021 GAAP net loss was $8.4 million or $0.13 per diluted share.
Full year 2021 Adjusted EBITDA was $543.0 million, an increase of
54% over the prior year.
"2021 was a truly transformational year for NOG," commented Nick
O'Grady, NOG's chief executive officer. "We enter 2022 with a
stronger asset base and balance sheet, and with a formalized plan
of increasing shareholder returns. We are an increasingly
diversified, balanced business, with opportunities to self-fund
accretive growth while steadily increasing returns to our
shareholders."
LIQUIDITY, CAPITAL RESOURCES, AND RECENT ACQUISITIONS
As of Dec. 31, 2021, NOG had $9.5 million in cash and $55.0 million
of borrowings outstanding on its revolving credit facility. NOG
had total liquidity of $704.5 million as of Dec. 31, 2021,
consisting of cash and committed borrowing availability under the
revolving credit facility. Additionally, NOG had $40.7 million in
an escrow account as of Dec. 31, 2021, as a deposit on the Veritas
acquisition that was signed in November 2021 and closed in January
2022.
In November 2021, NOG executed both common equity and senior debt
offerings. NOG issued 11.0 million shares of common equity for
gross proceeds of $220.0 million. NOG also raised $213.5 million
of gross proceeds, plus accrued interest, by issuing $200 million
of principal amount of 8.125% Senior Unsecured Notes due 2028 at
106.75% of par value. With the net proceeds from these
transactions, NOG retired debt under its existing revolving credit
facility and, ultimately, closed on the Comstock and Veritas
acquisitions.
On Nov. 16, 2021, NOG paid the adjusted cash purchase price of
$154.0 million to close its Comstock acquisition, funded by the
$7.7 million deposit previously paid, cash on hand and borrowings
on its revolving credit facility. The cash consideration included
typical closing adjustments, and remains subject to final
post-closing settlement between NOG and the seller.
On Jan. 27, 2022, NOG paid the adjusted cash purchase price of
$419.4 million to close its Veritas acquisition, funded by the
$40.7 million deposit previously paid, cash on hand and borrowings
on its revolving credit facility. The cash consideration included
typical closing adjustments, and remains subject to final
post-closing settlement between NOG and the seller. NOG also
issued approximately 1.9 million common stock warrants to Veritas
as additional purchase consideration.
A full-text copy of the Form 10-K is available for free at:
https://www.sec.gov/ix?doc=/Archives/edgar/data/1104485/000110448522000047/nog-20211231.htm
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.
* * *
This concludes the Troubled Company Reporter's coverage of Northern
Oil until facts and circumstances, if any, emerge that
demonstrate financial or operational strain or difficulty at a
level sufficient to warrant renewed coverage.
NYNY & D3: Unsecured Creditors to Split $3K over 3 Years
--------------------------------------------------------
NyNy & D3 Logistics, LLC, filed with the U.S. Bankruptcy Court for
the Middle District of Georgia a Disclosure Statement with respect
to Chapter 11 Plan of Reorganization dated Feb. 28, 2022.
The Debtor is a limited liability company registered in the State
of Georgia, and the Debtor operates as a load specific truck cargo
service operating throughout the continental United States.
The Debtor filed this case to reorganize its business affairs. The
impact of the COVID-19 pandemic had a significant negative impact
on the Debtor's business, especially with respect to the demand for
freight service throughout the United States. The pandemic's
effects led to the Debtor being unable to fund its continuing
obligations to creditors who made high interest loans to the Debtor
funds so the Debtor could attempt to maintain operations.
Class 1 consists of the claim of Ponte Investments, LLC. Ponte
Investments is a secured creditor that is secured by all assets of
the Debtor pursuant to a recorded UCC-1. Upon information and
belief, Ponte is in first lien position as of the Petition Date as
to any assets of the Debtor. As of the filing date, the Debtor's
only tangible asset was its bank account with a balance of $1,581.
The Debtor has valued its goodwill at $5,000. Ponte's Allowed
Secured Claim in the amount of $6,581 will be paid at 6% interest
per annum in 36 equal monthly installment payments of $201. The
remainder of Ponte's claim will be treated as a general unsecured
claim.
Class 2 consists of General Unsecured Claims of Ponte Investments,
LLC ($37,320) and Silverline Services, Inc. ($45,786). Because
Ponte's secured claim encumbered the Debtor's assets and is senior
to Silverline's secured claim, Silverline's claim is being treated
as being fully unsecured. Class 2 will be paid a total of $3,000
distributed pro rata over three years as set forth in the Plan.
Class 3 consists of Equity interest holder Antonio Walters. The
equity security holder will waive distributions under the Plan as
additional new value consideration to retain his equity interest.
Payments and distributions under the Plan will be funded by the
income generated from the operation of Debtor's business.
A full-text copy of the Disclosure Statement dated Feb. 28, 2022,
is available at https://bit.ly/3MfQYLB from PacerMonitor.com at no
charge.
Counsel for the Debtor:
Robert C. Bruner, Esq.
Byron Wright III, Esq.
Bruner Wright, P.A.
2810 Remington Green Circle
Tallahassee, FL 32308
Office: (850) 385-0342
E-mail: rbruner@brunerwright.com
twright@brunerwright.com
About NyNy & D3 Logistics
NyNy & D3 Logistics, LLC filed a petition for Chapter 11 protection
(Bankr. M.D. Ga. Case No. 21-10507) on Sept. 1, 2021, listing up to
$50,000 in assets and up to $500,000 in liabilities. Bruner
Wright, P.A., serves as the Debtor's legal counsel.
OCEAN DEVELOPMENT: Seeks to Hire Shapiro Dorry as New Counsel
-------------------------------------------------------------
Ocean Development Partners, LLC seeks approval from the U.S.
Bankruptcy Court for the District of Massachusetts to employ
Shapiro Dorry Masterson, LLC to substitute for Perez-Kudzma Law
Office, P.C.
The firm's services include:
(a) assisting the Debtor in preparing bankruptcy schedules,
statement of financial affairs and related documents with the
court;
(b) employing professionals to assist in the reorganization of
the Debtor;
(c) effecting a reorganization of the Debtor's estate by
filing the appropriate plans of reorganizations and disclosure
statements, and defending against any motions to dismiss or for
relief from the stay;
(d) assisting the Debtor in complying with Chapter 11
reporting and operations requirements; and
(e) negotiating with creditors for adequate protection and the
use of cash collateral, assumption or rejection of leases and
executory contracts, objection to claims and related issues.
The firm received a $5,000 retainer.
As disclosed in court filings, Shapiro Dorry Masterson has no
connection with the Debtor, creditors or any other party in
interest.
The firm can be reached through:
Shawn M. Masterson, Esq.
Shapiro Dorry Masterson, LLC
145 Waterman Street
Providence, RI 02906
Phone: 401-455-0002
Email: smasterson@sdmlawgroup.com
About Ocean Development Partners
Boston-based Ocean Development Partners, LLC sought protection
under Chapter 11 of the Bankruptcy Code (Bankr. D. Mass. Case No.
22-10043) on Jan. 14, 2022. Nicholas J. Fiorillo, sole manager,
signed the petition. In its petition, the Debtor disclosed total
assets of between $10 billion and $50 billion and total liabilities
of between $1 million and $10 million.
Judge Frank J. Bailey oversees the case.
Shapiro Dorry Masterson, LLC serves as the Debtor's legal counsel.
PRESIDIO DEVELOPMENT: Court Confirms Reorganization Plan
--------------------------------------------------------
Judge Julia W. Brand has entered an order confirming and approving
the First Amended Chapter 11 Plan of Reorganization of Presidio
Development, LLC dba MBZ Toys.
A post confirmation Status Conference will take place on June 16,
2022 at 10:00 a.m.
Not later than June 2, 2022, the Debtor must file a post
confirmation status report explaining what progress has been made
toward consummation of the confirmed Plan.
The effective date of the Plan will be the first business day that
is 14-calendar days following the entry of this Order.
On or before the 5th calendar day following the Effective Date, the
Debtor must file and serve a notice of the Effective Date on all
creditors and the United States Trustee.
Attorneys for Presidio Development:
Roksana D. Moradi-Brovia
W. Sloan Youkstetter
RESNIK HAYES MORADI LLP
17609 Ventura Blvd., Suite 314
Encino, CA 91316
Telephone: (818) 285-0100
Facsimile: (818) 855-7013
E-mail: roksana@RHMFirm.com
sloan@RHMFirm.com
About Presidio Development
Presidio Development, LLC, owns a retail toy business that leases
space at 5060 E. Montclair Plaza Lane, Units 5124, 5228 and 2188,
Montclair, CA 91763. It also owns a commercial vacant land located
at 1229 Hollister Street, San Diego, CA 92154.
Presidio Development, doing business as MBZ Toys, sought Chapter 11
protection (Bankr. C.D. Cal. Case No. 21-10086) on Jan. 6, 2021,
listing as much as $1 million in assets and as much as $500,000 in
liabilities. The Law Offices of Michael Jay Berger serves as the
Debtor's legal counsel.
PRODUCE DEPOT: Case Summary & 20 Largest Unsecured Creditors
------------------------------------------------------------
Debtor: Produce Depot USA LLC
52 Center Market Street
Brooklyn, NY 11236
Business Description: The Debtor is a merchant wholesaler of
grocery and related products.
Chapter 11 Petition Date: March 2, 2022
Court: United States Bankruptcy Court
Eastern District of New York
Case No.: 22-40412
Judge: Hon. Elizabeth S. Stong
Debtor's Counsel: Alla Kachan, Esq.
LAW OFFICES OF ALLA KACHAN, P.C.
2799 Coney Island Avenue
Suite 202
Brooklyn, NY 11235
Tel: (718) 513-3145
Fax: (347) 342-3156
E-mail: alla@kachanlaw.com
Total Assets: $0
Total Liabilities: $1,660,488
The petition was signed by Gaetano Balzano, principal.
A full-text copy of the petition containing, among other items, a
list of the Debtor's 20 largest unsecured creditors is available
for free at PacerMonitor.com at:
https://www.pacermonitor.com/view/JEBXSCI/Produce_Depot_USA_LLC__nyebke-22-40412__0001.0.pdf?mcid=tGE4TAMA
PSG MORTGAGE: Selling Sea Cliff Avenue Property for $13 Million
---------------------------------------------------------------
PSG Mortgage Lending Corp. asks the U.S. Bankruptcy Court for the
Northern District of California to authorize the sale of the real
property located at 224 Sea Cliff Avenue, in San Francisco,
California, for $13 million.
A hearing on the Motion is set for March 11, 2022, at 10:30 a.m.
Out of valid concerns based upon the past and current ongoing
actions and efforts of the former owner of the Sea Cliff Avenue
Property to interfere with and disrupt any sale of the property to
anyone but him or his cohorts, the identity of the Buyer and the
Title Company involved in the transaction have been concealed. The
Debtor will gladly provide the information to the Court as deemed
necessary, including full copies of any and all documents under
seal if deemed appropriate. Likewise, as is set forth in Section
IX herein, the Buyer will be present at the sale hearing to testify
and provide evidence to the Court in support of the request for a
good faith finding by the Buyer.
The following are affected lienholders/interest holders and
purported/disputed interest holders:
A. Non-Governmental Individuals/Entities:
1. World Savings Bank, FSB, its successors and/or assigns,
including but not limited to Wells Fargo Bank;
2. Natural Software Systems Inc., Money Purchase Pension Plan
as to an undivided 65% interest and Tanya Waltimyer, a married
woman as her sole and separate property as to an undivided 35%
interest, as assignees of Saxe Mortgage, et al;
3. Paul Greenfield, as an individual, to the extent any
interests are claimed in the referenced deed of trust;
4. Dakota Note, LLC; and
5. PSG Capital Partners, Inc. and Debtor PSG Mortgage Lending
Corp.
B. Governmental Lienholder/Entity: San Francisco Department of
Public Health/Public Utilities Commission;
C. Purported/Disputed Interest Holders: Kay Brugnara and
Family/Luke Brugnara/individually or as
Officer(s)/Directors)/Shareholder(s) of Brugnara Properties VI.
Under the San Francisco Purchase Agreement, the Debtor has accepted
a sales price for the Sea Cliff Avenue Property of $13 million from
the Buyer, with some of the secured lienholders agreeing to reduce
their payoff to pay the transfer tax which will be owed to the City
and County of San Francisco upon the closing of the transaction in
the approximate sum of $780,000. The Sale Agreement requires an
initial deposit of 3% to made by the Buyer into Escrow upon receipt
and approval ofa disclosure of the status of the oceanside stairs,
with Escrow to close within 30 days or sooner of Court approval of
the transaction. By Amendment of the parties, the expiration of
the Agreement was extended to Feb. 11, 2022. On Feb. 11, 2022, the
Debtor accepted the offer and signed the Agreement.
The Sale Agreement is subject to Bankruptcy Court approval and
higher and better bids. The sale of the Sea Cliff Avenue Property
free and clear of any liens or interests is on an "as-is, where is"
basis, with no warranties or representations. This includes an
acceptance by the Buyer of all responsibility for permits and work
on the cliffside and the staircase to the beach.
The minimum starting overbid is $13,5 million (together with
payment of the transfer tax, as noted), with minimum increments
thereafter of $50,000. The deadline for submitting qualified
overbids is 12:00 noon on March 4, 2022. The Debtor will only
consider overbids from qualified buyers. Prior to overbidding, an
overbidder must demonstrate the ability to close the transaction to
sole and complete satisfaction of the Debtor and provide a
non-refundable deposit (if the successful bidder) of $390,000. In
the event a qualified overbidder or overbidders is obtained, an
auction will be held on March 11, 2022. Qualified overbidders may
participate by Zoom video or telephone.
Overbids must be submitted in writing on terms equal to or better
than the proposal from the Buyer, e.g., all cash and close of
escrow within 30 days of Court approval, on an "as-is, where is"
basis, with no warranties or representations. This includes an
acceptance by the Buyer of all responsibility for permits and work
on the cliff side and the staircase to the beach along with any
remaining issues with the City/County of San Francisco. Any
overbidder should contact the Estate's real estate broker, Mark
Allan Levinson, COMPASS (mark@markallanlevinson.com; (415)
441-5500.
Pursuant to an agreement between the Debtor and its Broker, the
Estate agreed to pay a 4% real estate commission upon the closing
of sale ofthe Sea Cliff Avenue Property. While the agreement
provided for no dual agency, the Buyer is represented by Compass,
the same
brokerage firm that represents the Estate. Compass has agreed to a
reduced sales commission of 2.5% if Mark Levinson represents the
buyer and seller. The Debtor has concluded that the under the
unique and exigent circumstances of the case, and considering that
if there are successful overbidders, it is possible that another
real estate firm will represent the overbidder, the reduced
commission as proposed should be paid.
After extensive marketing under adverse conditions and the exchange
of offers and counter-offers, the Debtor has brought the best offer
to the table, subject to higher and better bids. It believes this
is a unique property being sold under very adverse conditions and
with a long history of problems and issues. Accordingly, the sale
should go forward as contemplated and subject to overbid.
The Debtor requests that the order approving the proposed sale of
the Sea Cliff Avenue Property provides that the stay otherwise
imposed by Rule 62(a) of the Federal Rules of Civil Procedure
and/or Bankruptcy Rule 6004(h) will not apply.
About PSG Mortgage Lending Corp.
Irvine, Calif.-based PSG Mortgage Lending Corp. filed a petition
for Chapter 11 protection (Bankr. N.D. Calif. Case No. 21-30592)
on
Aug. 25, 2021, listing as much as $50 million in both assets and
liabilities. Philip Fusco, chief executive officer of PSG, signed
the petition. Judge Dennis Montali oversees the case. The Law
Office of Julian Bach is the Debtor's legal counsel.
PURDUE PHARMA: Agrees to New Opioid Settlement With U.S. States
---------------------------------------------------------------
Geoff Mulvihill and John Seewer of The Associated Press reports
that Purdue Pharma reached a nationwide settlement Thursday over
its role in the opioid crisis, with the Sackler family members who
own the company boosting their cash contribution to as much as $6
billion in a deal intended to staunch a flood of lawsuits facing
the maker of OxyContin.
The deal follows an earlier settlement that had been appealed by
eight states and the District of Columbia. They agreed to sign on
after the Sacklers kicked in more cash and accepted other terms. In
exchange, the family would be protected from civil lawsuits.
In all, the plan could be worth more than $10 billion over time. It
calls for members of the Sackler family to give up control of the
Stamford, Connecticut-based company so it can be turned into a new
entity with profits used to fight the crisis. The deal would not
shield members of the family from criminal charges, although
there’s no indication any are forthcoming.
Sackler family members have not unequivocally offered an apology
but issued a statement of regret about the toll of OxyContin, its
signature painkiller, which users learned could be manipulated to
produce quick highs. Purdue Pharma had promoted its use for a broad
range of pain issues for which doctors previously had shied away
from prescribing opioids.
"While the families have acted lawfully in all respects, they
sincerely regret that OxyContin, a prescription medicine that
continues to help people suffering from chronic pain, unexpectedly
became part of an opioid crisis that has brought grief and loss to
far too many families and communities,” said the statement from
the Sackler family.
Under the settlement, victims also are to have a forum in court, by
videoconference scheduled for March 9, to address some of the
Sacklers. That’s something they have not been able to do
previously in a public setting.
The settlement is outlined in a report filed in U.S. Bankruptcy
Court in White Plains, New York, and must be approved by the judge.
It was hammered out with attorneys general from the eight states
— California, Connecticut, Delaware, Maryland, Oregon, Rhode
Island, Vermont and Washington — and D.C. who had opposed the
earlier one, arguing that it did not properly hold Sackler family
members accountable.
Several parents whose children became addicted to opioids said they
were ambivalent -- glad that more money will be available for
addiction treatment, but upset that the Sacklers will remain
wealthy and escape more accountability.
Connecticut's Paige Niver, whose daughter became addicted following
a bicycle accident when she was 14 and remains in recovery about 13
years later, said she didn't want other families to endure what
hers did.
"As a mother, I did what the doctor told me to do and I just kept
giving them to her. And when they were starting to have kind of a
lesser effect, they say, 'Oh, then you need to give her more.' And
that's exactly what I did," she said at a news conference Thursday
with her state's attorney general.
"I never thought I'd see any justice for it, so the money will do
so much good -- fund as much treatment and prevention as possible,"
Niver said.
Ed Bisch, whose 18-year-old son died of an overdose 20 years ago,
is glad states pushed Sackler family members to pay more. Still,
he called the settlement "a horrible deal" because so many parents
who buried loved ones won't see money, while the Sacklers retain
their wealth."
"Guess what? They still made billions and billions of dollars,"
said Bisch, of Westampton, New Jersey. "Without any jail time,
where is the deterrent? We've lost two generations to their
greed."
Individual victims and their survivors are to share a $750 million
fund, a key provision not found in other opioid settlements. About
149,000 people made claims in advance and could qualify for shares
from the fund.
That amount is unchanged in the new plan, but states will be able
to create funds they can use to compensate victims beyond that, if
they choose.
Other new provisions include an agreement from Sackler family
members that they won't fight when institutions attempt to take
their names off buildings funded by the family's support. And
additional company documents are to be made public.
Most of the the money is to flow to state and local governments,
Native American tribes, and some hospitals, with the requirement
that it be used to battle an opioid crisis that has been linked to
more than 500,000 deaths in the U.S. over the past two decades.
"We're pleased with the settlement achieved in mediation, under
which all of the additional settlement funds will be used for
opioid abatement programs, overdose rescue medicines, and victims,"
Purdue Pharma said in a statement issued separately from the
family's. "With this mediation result, we continue on track to
proceed through the appeals process on an expedited schedule, and
we hope to swiftly deliver these resources."
Kentucky and Oklahoma are not part of the deal because they both
reached previous settlements with Purdue.
Purdue, the originator of time-release versions of powerful
prescription painkillers, is the highest-profile company out of
many that have faced lawsuits over the crisis. It has twice pleaded
guilty to criminal charges related to its business practices around
OxyContin.
The latest announcement follows another landmark settlement late
last week, when drugmaker Johnson & Johnson and three distributors
finalized a settlement that will send $26 billion over time to
virtually every state and local governments throughout the U.S.
There are two key differences between the the latest Purdue
settlement and the previous one struck last year. The Sacklers’
cash contribution has gone up by at least $1.2 billion, and state
attorneys general and the District of Columbia have now agreed.
The money is to begin flowing after Purdue, which is to be renamed
Knoa Pharma, emerges from bankruptcy. It's not clear when that
will be. The last payment under the settlement is not scheduled to
be made until 2039.
Last 2021, the eight states and D.C. refused to sign on, and then
most of them appealed after the deal was approved by the bankruptcy
judge.
In December 2021, a U.S. district judge sided with the nine
holdouts. The judge, Colleen McMahon, rejected the settlement with
a finding that bankruptcy judges lack the authority to grant legal
protection to people who don't themselves file for bankruptcy when
some parties disagree.
Purdue appealed that decision, which, if left standing, could have
scuttled a common method of reaching settlements in sweeping,
complicated lawsuits.
The attorneys general who have signed on are dropping from the main
legal battle but are still free to write briefs to tell courts not
to allow the protections for people who do not file for bankruptcy
themselves.
Connecticut Attorney General William Tong has repeatedly said he
has felt a "special obligation to be aggressive" in the case
because Purdue is headquartered in the state. He expressed some
disappointment Thursday with the final settlement, even though he
said it was 40% more than the previous one.
"I wanted more. I still want more. But I took it as far as I could
take it," he said during a news conference. "If we were to
continue, we would do it alone and that is untenable."
The new settlement requires approval from U.S Bankruptcy Judge
Robert Drain. Appeals related to the previous version of the plan
could continue moving through the court system.
About Purdue Pharma LP
Purdue Pharma L.P. and its subsidiaries --
http://www.purduepharma.com/-- develop and provide prescription
medicines and consumer products that meet the evolving needs of
healthcare professionals, patients, consumers and caregivers.
Purdue's subsidiaries include Adlon Therapeutics L.P., focused on
treatment for Attention-Deficit/Hyperactivity Disorder (ADHD) and
related disorders; Avrio Health L.P., a consumer health products
company that champions an improved quality of life for people in
the United States through the reimagining of innovative product
solutions; Imbrium Therapeutics L.P., established to further
advance the emerging portfolio and develop the pipeline in the
areas of CNS, non-opioid pain medicines, and select oncology
through internal research, strategic collaborations and
partnerships; and Greenfield Bioventures L.P., an investment
vehicle focused on value-inflection in early stages of clinical
development.
Opioid makers in the U.S. are facing pressure from a crackdown on
the addictive drug in the wake of the opioid crisis and as state
attorneys general file lawsuits against manufacturers. More than
2,000 states, counties, municipalities and Native American
governments have sued Purdue Pharma and other pharmaceutical
companies for their role in the opioid crisis in the U.S., which
has contributed to the more than 700,000 drug overdose deaths in
the U.S. since 1999.
OxyContin, Purdue Pharma's most prominent pain medication, has been
the target of over 2,600 civil actions pending in various state and
federal courts and other fora across the United States and its
territories.
On Sept. 15 and 16, 2019, Purdue Pharma L.P. and 23 affiliated
debtors each filed a voluntary petition for relief under Chapter 11
of the U.S. Bankruptcy Code (Bankr. S.D.N.Y. Lead Case No.
19-23649), after reaching terms of a preliminary agreement for
settling the massive opioid litigation. The Debtors' consolidated
balance sheet as of Aug. 31, 2019, showed $1.972 billion in assets
and $562 million in liabilities.
U.S. Bankruptcy Judge Robert Drain oversees the cases.
The Debtors tapped Davis Polk & Wardwell, LLP and Dechert, LLP as
legal counsel; PJT Partners as investment banker; AlixPartners as
financial advisor; and Grant Thornton, LLP as tax structuring
consultant. Prime Clerk LLC is the claims agent.
Akin Gump Strauss Hauer & Feld LLP and Bayard, P.A., represent the
official committee of unsecured creditors appointed in the Debtors'
bankruptcy cases.
David M. Klauder, Esq., is the fee examiner appointed in the
Debtors' cases. The fee examiner is represented by Bielli &
Klauder, LLC.
* * *
U.S. Bankruptcy Judge Robert Drain in early September 2021 approved
a plan to turn Purdue into a new company (Knoa Pharma LLC) no
longer owned by members of the Sackler family, with its profits
going to fight the opioid epidemic. The Sackler family agreed to
pay $4.3 billion over nine years to the states and private
plaintiffs and in exchange for a lifetime legal immunity. The deal
resolves some 3,000 lawsuits filed by state and local governments,
Native American tribes, unions, hospitals and others who claimed
the company's marketing of prescription opioids helped spark and
continue an overdose epidemic.
Separate appeals to approval of the Plan have already been filed by
the U.S. Bankruptcy Trustee, California, Connecticut, the District
of Columbia, Maryland, Rhode Island and Washington state, plus some
Canadian local governments and other Canadian entities.
Purdue filed its Chapter 11 Plan on March 15, 2021. A 12th amended
Chapter 11 plan was filed on Sept. 2, 2021, which was confirmed on
Sept. 17. Purdue divides the claims against it into several
categories, one of which it calls "PI Claims," consisting of claims
"for alleged opioid-related personal injury." The plan provides for
the creation of the "PI Trust," which will administer all PI
Claims. The trust will be funded with an initial distribution of
300 illion on the effective date of the Chapter 11 plan, followed
by a distribution of $200 million in 2024, and distributions of
$100 million in 2025 and 2026. In sum, "[t]he PI Trust will
receive at least $700 million in value, and may receive an
additional $50 million depending on the amount of proceeds received
on account of certain of Purdue's insurance policies."
The Plan further provides that Purdue's ability to recover from its
insurers will be vested in a "Master Disbursement Trust." To the
extent any proceeds are recovered from Purdue's insurers with
respect to the PI Claims, up to $450 million of those proceeds will
be channeled from the MDT to the PI Trust. However, the PI Trust
will be funded regardless of whether anything is recovered from
Purdue's insurers. Instead, "[d]istributions to the PI Trust are
subject to prepayment on a rolling basis as insurance proceeds from
certain of Purdue's insurance policies are received by the MDT and
paid forward to the PI Trust."
PURDUE PHARMA: Kleinberg Kaplan Partner Assists Wash. in Deal
-------------------------------------------------------------
Kleinberg Kaplan Creditors' Rights and Bankruptcy Litigation
partner Matthew J. Gold has been representing the State of
Washington in its highly publicized legal battle against Purdue
Pharma, maker of OxyContin, a painkiller that allegedly contributed
to the national opioid crisis. Kleinberg Kaplan senior counsel
Robert Tuchman also advises on this matter.
The Attorney General for the State of Washington, Bob Ferguson,
announced that the state will receive an additional $113 million
from Purdue Pharma and the Sackler family following a challenge
brought forward by a group of nine attorneys general to the drug
maker's bankruptcy plan.
Attorney General Ferguson and eight other attorneys general won an
additional $1.175 billion from the Sacklers to help states, cities,
and tribes address the harms of the opioid epidemic. Washington
will now receive a total of $183 million from Purdue and Sacklers
to address the crisis, more than double the $70 million under the
original plan.
The proposed resolution must still be approved by the bankruptcy
court. In addition, Purdue and the Sacklers have appealed the
District Court's ruling vacating the original bankruptcy plan. As
part of the new proposal, Washington and the eight other attorneys
general will drop their opposition to the appeal pending approval
of this settlement.
OxyContin was, at times, the most prescribed brand-name narcotic
medication for treating severe pain that required around-the-clock
management. As lawsuits brought on by state and local governments,
tribes, hospitals and individuals grew, Purdue filed for chapter 11
protection in September 2019.
Kleinberg Kaplan's Creditors' Rights and Bankruptcy Litigation
practice offers clients an aggressive approach to bankruptcy and
insolvency issues. The firm has provided representation to
individual and institutional debtors, creditors and investors of
every type in bankruptcy litigation, adversary proceedings and
contested matters in chapter 11, chapter 7 and chapter 15 cases,
such as avoidance actions, adequate protection disputes,
confirmation battles and claim disputes.
For additional information on this latest development, please see
the recently published press release from the State of Washington.
About Purdue Pharma LP
Purdue Pharma L.P. and its subsidiaries --
http://www.purduepharma.com/-- develop and provide prescription
medicines and consumer products that meet the evolving needs of
healthcare professionals, patients, consumers and caregivers.
Purdue's subsidiaries include Adlon Therapeutics L.P., focused on
treatment for Attention-Deficit/Hyperactivity Disorder (ADHD) and
related disorders; Avrio Health L.P., a consumer health products
company that champions an improved quality of life for people in
the United States through the reimagining of innovative product
solutions; Imbrium Therapeutics L.P., established to further
advance the emerging portfolio and develop the pipeline in the
areas of CNS, non-opioid pain medicines, and select oncology
through internal research, strategic collaborations and
partnerships; and Greenfield Bioventures L.P., an investment
vehicle focused on value-inflection in early stages of clinical
development.
Opioid makers in the U.S. are facing pressure from a crackdown on
the addictive drug in the wake of the opioid crisis and as state
attorneys general file lawsuits against manufacturers. More than
2,000 states, counties, municipalities and Native American
governments have sued Purdue Pharma and other pharmaceutical
companies for their role in the opioid crisis in the U.S., which
has contributed to the more than 700,000 drug overdose deaths in
the U.S. since 1999.
OxyContin, Purdue Pharma's most prominent pain medication, has been
the target of over 2,600 civil actions pending in various state and
federal courts and other fora across the United States and its
territories.
On Sept. 15 and 16, 2019, Purdue Pharma L.P. and 23 affiliated
debtors each filed a voluntary petition for relief under Chapter 11
of the U.S. Bankruptcy Code (Bankr. S.D.N.Y. Lead Case No.
19-23649), after reaching terms of a preliminary agreement for
settling the massive opioid litigation. The Debtors' consolidated
balance sheet as of Aug. 31, 2019, showed $1.972 billion in assets
and $562 million in liabilities.
U.S. Bankruptcy Judge Robert Drain oversees the cases.
The Debtors tapped Davis Polk & Wardwell, LLP and Dechert, LLP as
legal counsel; PJT Partners as investment banker; AlixPartners as
financial advisor; and Grant Thornton, LLP as tax structuring
consultant. Prime Clerk LLC is the claims agent.
Akin Gump Strauss Hauer & Feld LLP and Bayard, P.A., represent the
official committee of unsecured creditors appointed in the Debtors'
bankruptcy cases.
David M. Klauder, Esq., is the fee examiner appointed in the
Debtors' cases. The fee examiner is represented by Bielli &
Klauder, LLC.
* * *
U.S. Bankruptcy Judge Robert Drain in early September 2021 approved
a plan to turn Purdue into a new company (Knoa Pharma LLC) no
longer owned by members of the Sackler family, with its profits
going to fight the opioid epidemic. The Sackler family agreed to
pay $4.3 billion over nine years to the states and private
plaintiffs and in exchange for a lifetime legal immunity. The deal
resolves some 3,000 lawsuits filed by state and local governments,
Native American tribes, unions, hospitals and others who claimed
the company's marketing of prescription opioids helped spark and
continue an overdose epidemic.
Separate appeals to approval of the Plan have already been filed by
the U.S. Bankruptcy Trustee, California, Connecticut, the District
of Columbia, Maryland, Rhode Island and Washington state, plus some
Canadian local governments and other Canadian entities.
Purdue filed its Chapter 11 Plan on March 15, 2021. A 12th amended
Chapter 11 plan was filed on Sept. 2, 2021, which was confirmed on
Sept. 17. Purdue divides the claims against it into several
categories, one of which it calls "PI Claims," consisting of claims
"for alleged opioid-related personal injury." The plan provides for
the creation of the "PI Trust," which will administer all PI
Claims. The trust will be funded with an initial distribution of
300 illion on the effective date of the Chapter 11 plan, followed
by a distribution of $200 million in 2024, and distributions of
$100 million in 2025 and 2026. In sum, "[t]he PI Trust will receive
at least $700 million in value, and may receive an additional $50
million depending on the amount of proceeds received on account of
certain of Purdue's insurance policies."
The Plan further provides that Purdue's ability to recover from its
insurers will be vested in a "Master Disbursement Trust." To the
extent any proceeds are recovered from Purdue's insurers with
respect to the PI Claims, up to $450 million of those proceeds will
be channeled from the MDT to the PI Trust. However, the PI Trust
will be funded regardless of whether anything is recovered from
Purdue's insurers. Instead, "[d]istributions to the PI Trust are
subject to prepayment on a rolling basis as insurance proceeds from
certain of Purdue's insurance policies are received by the MDT and
paid forward to the PI Trust."
PURDUE PHARMA: Mediators Extends Negotiations to Work on Deal Terms
-------------------------------------------------------------------
Rick Archer of Law360 reports that the mediator overseeing
negotiations for a new Purdue Pharma restructuring plan Wednesday,
March 2, 2022, told a New York bankruptcy judge she is extending
the talks, citing her authority to take more time if she's involved
in drafting terms for a deal.
In the two-page notice, U.S. Bankruptcy Judge Shelley Chapman said
the mediation, which had been due to end Feb. 28, 2022 will now
continue to an unspecified date, referring to a paragraph in the
mediation terms allowing her to extend the talks "for purposes of
the mediator's involvement in any secondary or drafting terms."
About Purdue Pharma LP
Purdue Pharma L.P. and its subsidiaries --
http://www.purduepharma.com/-- develop and provide prescription
medicines and consumer products that meet the evolving needs of
healthcare professionals, patients, consumers and caregivers.
Purdue's subsidiaries include Adlon Therapeutics L.P., focused on
treatment for Attention-Deficit/Hyperactivity Disorder (ADHD) and
related disorders; Avrio Health L.P., a consumer health products
company that champions an improved quality of life for people in
the United States through the reimagining of innovative product
solutions; Imbrium Therapeutics L.P., established to further
advance the emerging portfolio and develop the pipeline in the
areas of CNS, non-opioid pain medicines, and select oncology
through internal research, strategic collaborations and
partnerships; and Greenfield Bioventures L.P., an investment
vehicle focused on value-inflection in early stages of clinical
development.
Opioid makers in the U.S. are facing pressure from a crackdown on
the addictive drug in the wake of the opioid crisis and as state
attorneys general file lawsuits against manufacturers. More than
2,000 states, counties, municipalities and Native American
governments have sued Purdue Pharma and other pharmaceutical
companies for their role in the opioid crisis in the U.S., which
has contributed to the more than 700,000 drug overdose deaths in
the U.S. since 1999.
OxyContin, Purdue Pharma's most prominent pain medication, has been
the target of over 2,600 civil actions pending in various state and
federal courts and other fora across the United States and its
territories.
On Sept. 15 and 16, 2019, Purdue Pharma L.P. and 23 affiliated
debtors each filed a voluntary petition for relief under Chapter 11
of the U.S. Bankruptcy Code (Bankr. S.D.N.Y. Lead Case No.
19-23649), after reaching terms of a preliminary agreement for
settling the massive opioid litigation. The Debtors' consolidated
balance sheet as of Aug. 31, 2019, showed $1.972 billion in assets
and $562 million in liabilities.
U.S. Bankruptcy Judge Robert Drain oversees the cases.
The Debtors tapped Davis Polk & Wardwell, LLP and Dechert, LLP as
legal counsel; PJT Partners as investment banker; AlixPartners as
financial advisor; and Grant Thornton, LLP as tax structuring
consultant. Prime Clerk LLC is the claims agent.
Akin Gump Strauss Hauer & Feld LLP and Bayard, P.A., represent the
official committee of unsecured creditors appointed in the Debtors'
bankruptcy cases.
David M. Klauder, Esq., is the fee examiner appointed in the
Debtors' cases. The fee examiner is represented by Bielli &
Klauder, LLC.
* * *
U.S. Bankruptcy Judge Robert Drain in early September 2021 approved
a plan to turn Purdue into a new company (Knoa Pharma LLC) no
longer owned by members of the Sackler family, with its profits
going to fight the opioid epidemic. The Sackler family agreed to
pay $4.3 billion over nine years to the states and private
plaintiffs and in exchange for a lifetime legal immunity. The deal
resolves some 3,000 lawsuits filed by state and local governments,
Native American tribes, unions, hospitals and others who claimed
the company's marketing of prescription opioids helped spark and
continue an overdose epidemic.
Separate appeals to approval of the Plan have already been filed by
the U.S. Bankruptcy Trustee, California, Connecticut, the District
of Columbia, Maryland, Rhode Island and Washington state, plus some
Canadian local governments and other Canadian entities.
Purdue filed its Chapter 11 Plan on March 15, 2021. A 12th amended
Chapter 11 plan was filed on Sept. 2, 2021, which was confirmed on
Sept. 17. Purdue divides the claims against it into several
categories, one of which it calls "PI Claims," consisting of claims
"for alleged opioid-related personal injury." The plan provides
for the creation of the "PI Trust," which will administer all PI
Claims. The trust will be funded with an initial distribution of
300 illion on the effective date of the Chapter 11 plan, followed
by a distribution of $200 million in 2024, and distributions of
$100 million in 2025 and 2026. In sum, "[t]he PI Trust will
receive
at least $700 million in value, and may receive an additional $50
million depending on the amount of proceeds received on account of
certain of Purdue's insurance policies."
The Plan further provides that Purdue's ability to recover from its
insurers will be vested in a "Master Disbursement Trust." To the
extent any proceeds are recovered from Purdue's insurers with
respect to the PI Claims, up to $450 million of those proceeds will
be channeled from the MDT to the PI Trust. However, the PI Trust
will be funded regardless of whether anything is recovered from
Purdue's insurers. Instead, "[d]istributions to the PI Trust are
subject to prepayment on a rolling basis as insurance proceeds from
certain of Purdue's insurance policies are received by the MDT and
paid forward to the PI Trust."
QUALITY CARE DAYCARE: Taps Samson Properties as Realtor
-------------------------------------------------------
Quality Care Daycare at BUP, LLP seeks approval from the U.S.
Bankruptcy Court for the District of Maryland to hire Sharon Lewin,
a realtor at Samson Properties, to market for sale its real
property located at 873-875 N. Howard St., Baltimore, Md.
The realtor will get a 4 percent commission, plus broker's flat fee
of $345 on any sale procured. The realtor would pay a 2 percent
commission with any buyer's agent.
As disclosed in court filings, Samson Properties has no connection
with the Debtor, creditors or any other party in interest.
Ms. Lewin can be reached at:
Sharon Lewin
Samson Properties - Bowie
16701 Melford Blvd, Bowie, MD 20715
Phone: 301-453-6201
About Quality Care Daycare
Quality Care Daycare at BUP, LLP filed a petition for Chapter 11
protection (Bankr. D. Md. Case No. 22-10546) on Feb. 3, 2022,
listing up to $1 million in assets and up to $500,000 in
liabilities.
The Debtor tapped William C. Johnson, Jr., Esq., a practicing
attorney in Greenbelt, Md., to handle its bankruptcy case.
REWALK ROBOTICS: Incurs $12.7 Million Net Loss in 2021
------------------------------------------------------
ReWalk Robotics Ltd. filed with the Securities and Exchange
Commission its Annual Report on Form 10-K disclosing a net loss of
$12.74 million on $5.97 million of revenues for the year ended Dec.
31, 2021, compared to a net loss of $12.98 million on $4.39 million
of revenues for the year ended Dec. 31, 2020.
The increase in FY 2021 revenues was driven primarily by higher
number of rehabilitation units sold in the Unites States including
a multiple unit order to a medical academic center as well as an
increase in personal unit revenues in Germany as the Company has
seen reduced COVID-19 restrictions during most of the year.
The Company's full year 2021 gross margin was 49% compared to 50%
in 2020. The Company's gross margin for FY 2021 declined because
of a higher inventory write-off of ReStore parts due to lower than
expected sales during the pandemic and increased service expenses,
partially offset by a higher number of Personal 6.0 units sold and
an increase in its average selling price due to a change in sales
mix.
Total operating expenses for the full year 2021 were $15.6 million,
compared to $14.2 million in 2020. The increase is due to higher
SG&A employee and employee related expenses as well as increased
professional services offset with reduced R&D employee and employee
related expenses.
As of Dec. 31, 2021, the Company had $94.75 million in total
assets, $5.37 million in total liabilities, and $89.38 million in
total shareholders' equity.
"2021 was a foundational year for the company as we made meaningful
progress with our efforts to expand access through broad coverage
in the United States and Germany. These payment activities
combined with new technical developments and the easing of the
pandemic restrictions are pivotal elements for our company and this
industry in achieving sustainable growth after many years of
investment," stated Larry Jasinski, chief executive officer of
ReWalk.
Fourth Quarter Financial Results
Total revenue was $1.2 million for the fourth quarter of 2021,
compared to $1.2 million during the prior year quarter.
Gross margin was 26% during the fourth quarter of 2021, compared to
33% in the fourth quarter of 2020.
Total operating expenses in the fourth quarter of 2021 were $4.2
million, compared to $3.2 million in the prior year period. The
increase in the fourth quarter was due to the Company's Paycheck
Protection Program forgiveness booked last quarter, increased SG&A
professional as well as employee and employee related expenses.
Net loss was $3.9 million for the fourth quarter of 2021, compared
to a net loss of $2.9 million in the fourth quarter of 2020.
As of Dec. 31, 2021, ReWalk had $88.3 million in cash on its
balance sheet.
A full-text copy of the Form 10-K is available for free at:
https://www.sec.gov/ix?doc=/Archives/edgar/data/1607962/000117891322000800/zk2227327.htm
About ReWalk Robotics
ReWalk Robotics Ltd. -- http://www.rewalk.com-- develops,
manufactures, and markets wearable robotic exoskeletons for
individuals with lower limb disabilities as a result of spinal cord
injury or stroke. ReWalk's mission is to fundamentally change the
quality of life for individuals with lower limb disability through
the creation and development of market leading robotic
technologies. Founded in 2001, ReWalk has headquarters in the
U.S., Israel and Germany.
ReWalk Robotics reported a net loss of $12.98 million for the year
ended Dec. 31, 2020, a net loss of $15.55 million for the year
ended Dec. 31, 2019, a net loss of $21.67 million for the year
ended Dec. 31, 2018, and a net loss of $24.72 million for the year
ended Dec. 31, 2017. As of Sept. 30, 2021, the Company had $98.72
million in total assets, $5.72 million in total liabilities, and
$92.99 million in total shareholders' equity.
ROBERT STROUMPOS: Asks Court to Waive PCO Appointment
-----------------------------------------------------
Robert Stroumpos DDS, PC asks Judge Jeffrey P. Norman of the U.S.
Bankruptcy Court for the Southern District of Texas to enter an
order determining that the appointment of a patient care ombudsman
is not necessary.
The Debtor operates a professional corporation practicing
dentistry. The Debtor contends patient health care should not be an
issue in the case and that the nature of the Debtor's health care
does not lend itself to monitoring which would improve patient's
health care. Moreover, the Debtor is maintaining its patients' care
on an ongoing basis and retaining all records.
The Debtor is represented by:
Robert C. Lane
The Lane Law Firm
6200 Savoy, Suite 1150
Houston, TX 77036
Tel: (713) 595-8200
Fax: (713) 595-8201
Email: notifications@lanelaw.com
About Robert Stroumpos
Robert Stroumpos DDS, PC filed a petition for Chapter 11 protection
(Bankr. S.D. Tex. Case No. 22-80010) on Jan. 25, 2022, listing up
to $500,000 in assets and up to $1 million in liabilities. Robert
Stroumpos, owner/president, signed the petition.
Judge Jeffrey P. Norman oversees the case.
The Debtor tapped The Lane Law Firm as legal counsel.
S-TEK 1 LLC: Seeks Cash Collateral Access Thru Sept 30
------------------------------------------------------
S-Tek 1 LLC asks the U.S. Bankruptcy Court for the District of New
Mexico for authority to use cash collateral for the period from
April 1, 2022, through September 30, 2022 in accordance with the
budget.
The Debtor will use cash collateral to maintain its various
business operations and other expenses incident to the
administration of its bankruptcy.
Surv-Tek, Inc. asserts a putative interest in the Debtor's cash
collateral.
The Debtor seeks permission to use cash collateral under adequate
protection conditions that vary from prior cash collateral orders.
These changes include:
a. The Debtor is not necessarily required to file a "Cash
Collateral Report". Instead, the Debtor will be required to file a
list of its accounts receivable with each monthly operating report,
with a designation of which receivables constitute Eligible
Receivables, and only Eligible Receivables will be reported in Part
25 of the monthly operating report. The Debtor's attainment, vel
non, of the Cash Collateral Base by the end of the month is
sufficiently clear from the monthly operating report; the
requirement to prepare and file an additional Cash Collateral
Report is disproportionately burdensome to the Debtor in comparison
to the marginal increase in adequate protection that this process
affords Surv-Tek, Inc.
b. The Debtor may file a Cash Collateral Report for the
purpose of verifying that it restored its Cash Collateral and
Eligible Receivables to the Cash Collateral Base by the 21st of the
following month, if the Debtor did not attain the Cash Collateral
Base by the end of the month for which a monthly operating report
has been prepared. This allows the Debtor to verify that it has
restored cash collateral levels if the Debtor's monthly operating
reports do not verify this.
c. Surv-Tek, Inc. may designate five, not ten, receivables for
an agreed-upon procedure to be performed by the Debtor's accountant
regarding these receivables. This reduction arises from both the
burden of responding to Surv-Tek, Inc.'s designation of receivables
and the fact that none of the receivables designated by Surv-Tek,
Inc. thus far have ever not been verified by the
Debtor's accountant.
d. The Debtor's accountant will not "review" the Designated
Receivables, but will rather perform an agreed-upon procedure that
consists of cross-checking the receivables against invoices and
making inquiries of the Debtor's management, as further detailed
below. Any receivable that is not verified under this agreed-upon
procedure will not be deemed an Eligible Procedure. The shift from
"review" to "agreed-upon procedure" responds to the position
previously maintained by Surv-Tek, Inc. that the report of the
review of Debtor's accountant is insufficient to verify that the
Designated Receivables have been properly checked.
e. If a Designated Receivable is not verified under the
agreed-upon procedure, then S-Tek will have to pay Surv-Tek the
amount of the receivable, which payment will result in an
adjustment of the Required Cash Collateral Base Amount. This
eliminates the punitive requirement in the first quarter of 2022
Cash Collateral Order and prior orders that required either
Debtor's managing member or the Debtor itself to pay a $5,000
penalty to Surv-Tek, Inc. for any receivable mis-classified as an
Eligible Receivable.
As adequate protection, Surv-Tek will continue to have a lien on an
all pre-petition cash collateral, as that term is defined in 11
U.S.C. section 363(a), upon which it had a lien pre-petition, and
it will have a replacement lien on property acquired post-petition
by the Debtor as proceeds of the Debtor's pre-petition cash
collateral. This lien will be to the same extent, and subject to
the same defenses, as Surv-Tek's pre-petition lien in Debtor's cash
collateral. Additionally, for the Cash Collateral Period, Surv-Tek
will have replacement liens in the Debtor's post-petition
collateral, of the same type in which Surv-Tek had a lien
pre-petition, to the extent of diminution in value of the Debtor's
accounts receivable, cash on deposit, cash on hand, and other cash
equivalents since the Petition Date.
To the extent the cash collateral falls below $181,765 on the last
day of any calendar month, the Debtor will be required, by the 21st
of the following month, to either (1) pay Surv-Tek the difference
as adequate protection for the diminution in the value of
Surv-Tek's interest in cash collateral; or (2) include as an
exhibit to its monthly operating report, or file as a separate
document showing that the cash collateral was restored to at least
$181,765 in the intervening 21 days since the end of month for
which the monthly operating report was prepared.
A copy of the motion and the Debtor's budget for April to September
2022 is available at https://bit.ly/3Cb3KX7 from PacerMonitor.com.
The Debtor projects $160,000 in total cash and $107,690 in total
expenses.
About S-Tek 1 LLC
S-Tek 1 LLC, also known as SurvTek -- https://www.survtek.com -- is
a land surveying and consulting firm providing services to both the
private and public sectors throughout New Mexico. It is based in
based in Albuquerque, N.M.
S-Tek 1, filed a Chapter 11 petition (Bankr. D.N.M. Case No.
20-12241) on Dec. 2, 2020. In its petition, the Debtor disclosed
$355,177 in assets and $2,251,153 in liabilities. Randy Asselin,
managing member, signed the petition.
Judge Robert H. Jacobvitz presides over the case.
The Debtor tapped Nephi D. Hardman Attorney at Law, LLC as its
bankruptcy counsel and FPM & Associates, LLC as its accountant.
SHAW 3RD HOLDINGS: Archdiocese Buying Improved Parcel for $2.5MM
----------------------------------------------------------------
Shaw 3rd Holdings, LLC, seeks approval from the U.S. Bankruptcy
Court for the District of Columbia to sell its improved parcel of
real estate located in the LeDroit Park Subdivision of Washington,
D.C., with a street address of 1901 3rd Street, NW, in Washington,
D.C. 20020, to the Archdiocese of Washington for $2.5 million.
The Debtor owns the Property. The Property was acquired by the
Debtor in September 2015. The Debtor renovated the Property and
converted it into two dwelling units for the purpose of increasing
the value and reselling the Property.
There are two liens on the Property. PS Funding, Inc. holds a lien
on the Property, securing a claim which PS Funding asserts to be
approximately $2,903,356. Three Sisters Capital Partners, LLC also
holds a lien on the Property, securing a claim which Three Sisters
asserts to be approximately $313,889.36.
There is a dispute as to the priority of the two liens of PS
Funding and Three Sisters, which is currently the subject of an
Adversary Proceeding before the Court, Adv. Proc. No. 21-10010.
The Debtor does not believe that there is any equity in the
property over and above the liens of PS Funding and Three Sisters.
As such, it is not anticipated that any funds will be available
from the proposed sales to pay any claims of unsecured creditors.
Prior to the Petition Date, Three Sisters commenced a foreclosure
proceeding, which the Debtor expected PS Funding would oppose
through an injunction action, given dispute over the parties two
competing liens. In an effort to preserve as much value as
possible in the Property and avoid costly and uncertain state court
injunction and foreclosure proceedings, the Debtor commenced the
proceeding.
The Debtor has marketed the Property for sale since prior to the
Petition Date. The Property was initially listed at $2,699,900.
The Debtor has secured an offer for the purchase of the Property
for $2.5 million. The initial offer was for $2.1 million, and was
negotiated up to the proposed sales price, pursuant to proposed
Sale Contract. The Buyer's offer is a cash offer and there is no
financing contingency. The contract identified several home
inspection/repair items, which the Debtor has or is in the process
of resolving.
The Debtor has filed (or will be filing) an Application to employ
Compass, Inc. as its realtor. The listing agreement with Compass
provides for a brokerage commission of 5%, plus a flat fee in the
amount of $395, for a total commission or $125,395. The commission
will be split between the Debtor’s (listing) broker, Compass,
Inc., and the selling broker, Particular Properties Real Estates,
LLC. After allowances for inspection items, closing costs, taxes,
sales commissions and other normal costs of sale, the net proceeds
are expected to be approximately $2,154,030.33, as reflected on the
preliminary settlement statement.
The Debtor believes that the offer represented by the Sales
Contract represents the fair market value of the Property, and that
the sale of the Property, pursuant to the terms of the Sales
Contract, is in the best interests of the bankruptcy estate and the
creditors in the case.
By the Motion, the Debtor seeks authority to sell the Property,
free and clear of all liens, claims and encumbrances, to the Buyer,
pursuant to the terms and conditions of the Sales Contract, with
all such liens, claims and encumbrances attaching to the sales
proceeds. Both the PS Funding and Three Sisters have indicated
their consent to the proposed sale of the Property, pursuant to the
terms of the Sales Contract.
The net proceeds of the sale will be held in the Debtor's counsels
trust account until the pending Adversary Proceeding and the
priority of the two secured lenders' claims is resolved or
otherwise settled and further order of the Court directing the
disbursement of the net sales proceeds.
A copy of the Motion and notice of opportunity to object was served
upon the Debtor, the Office of the US Trustee, the counsel to PS
Funding and Three Sisters and all other creditors and parties in
interest on Feb. 15, 2022.
A copy of the Contract is available at https://tinyurl.com/4bwx9jpz
from PacerMonitor.com free of charge.
About Shaw 3rd Holdings
Shaw 3rd Holdings, LLC filed a voluntary Chapter 7 petition
(Bankr.
D. D.C. Case No. 20-00467) on Dec. 2, 2020. The court converted
the case to one under Chapter 11 on Feb. 24, 2021. Judge
Elizabeth
L. Gunn oversees the case. Christopher Rogan, Esq., at
RoganMillerZimmerman, PLLC, represents the Debtor as legal
counsel.
SHE FLIPS TOO: Seeks to Extend Exclusivity Period to July 22
------------------------------------------------------------
She Flips Too, Inc. asked the U.S. Bankruptcy Court for the
Northern District of Georgia to extend the exclusivity period to
file a Chapter 11 plan to July 22, and the period to solicit
acceptances for the plan to Sept. 23.
The exclusivity period refers to the 120-day period during which
only the company can file a Chapter 11 plan after a bankruptcy
petition.
"[She Flips Too] seeks an extension to the exclusivity periods to
preclude the costly disruption and instability that would occur if
competing plans were proposed either before the plan is confirmed,
or, if the plan is not confirmed, before [She Flips Too] has a
meaningful opportunity to work with its key constituencies to put
forth an amended proposal," said the company's attorney, Elizabeth
Childers, Esq., at Rountree Leitman & Klein, LLC.
The exclusivity motion is on the court's calendar for March 15.
About She Flips Too Inc.
She Flips Too, Inc. filed a Chapter 11 bankruptcy petition (Bankr.
N.D. Ga. Case No. 21-55551) on July 27, 2021, disclosing as much as
$1 million in both assets and liabilities. Judge Paul W. Bonapfel
oversees the case.
Rountree Leitman & Klein, LLC serves as the Debtor's legal counsel.
SLM CORP: Fitch Affirms 'BB+' IDR & Alters Outlook to Positive
--------------------------------------------------------------
Fitch Ratings has affirmed the Long-Term Issuer Default Ratings
(IDRs) of SLM Corporation (SLM) and Sallie Mae Bank (SLM Bank) at
'BB+'. The Rating Outlook has been revised to Positive from
Stable.
In line with the publication of Fitch's updated Bank Rating
Criteria on Nov. 12, 2021, Fitch has assigned a Government Support
Rating (GSR) to SLM and SLM Bank, of 'ns'. Fitch is withdrawing
SLM's and SLM Bank's Support Rating and Support Rating Floor as
they are no longer relevant to the agency's coverage following the
publication of Fitch's updated Bank Rating Criteria.
KEY RATING DRIVERS
IDRs VRs AND SENIOR DEBT
The affirmation of SLM's ratings reflect its leading market
position in the U.S. private education loan industry, above average
returns and operating performance relative to peer banks, solid
asset quality and sufficient levels of capital and liquidity. SLM's
current Viability Rating (VR) of 'bb+' is one notch below the
implied VR of 'bbb-', reflecting Fitch's 'bb+'-level assessment of
the company's business profile.
The revision of the company's Outlook to Positive from Stable
reflects management's ongoing execution of its strategy to maximize
SLM's profitability by expanding upon its leading market share,
improving its cost efficiency in acquiring and servicing loans and
executing loan sales at attractive margins while reducing its
reliance on brokered deposits, which could lead to a higher
assessment of its business profile over the near-to-medium term.
SLM's monoline business model creates concentration risk that is a
constraint on its rating, particularly as it relates to
political/regulatory risk that has been a persistent source of
uncertainty in the industry. However, Fitch believes much of the
political/regulatory scrutiny is currently aimed at federal student
loans and servicers, of which SLM is not a participant, and that
the federal government's appetite and capacity to meaningfully
increase subsidies such as through debt forgiveness or free tuition
programs that would be harmful to private student lenders such as
SLM are likely to be limited over the Outlook horizon.
SLM continued to produce solid financial performance in 2021
despite lower than expected private student loan origination
growth, which came in at $5.4 billion, or a modest 2% increase
versus 2020. Federal government aid received by schools and
students through the Higher Education Emergency Relief Fund is
believed to have contributed to the reduced demand for student
loans last year.
Nonetheless, SLM's pre-tax earnings increased 33% over 2020, driven
by gains from over $4 billion in loan sales, better than expected
credit performance, and improved cost efficiencies. The company
continued to use gains and reserve releases from loan sales to
repurchase shares, buying back $1.5 billion of its shares in 2021,
or 132% of net income.
SLM's credit performance has been stable for the past several
years. Net charge-offs on its private education loan portfolio of
$201 million in 2021, or 1.33% of loans in repayment, declined
slightly from 2020 and were significantly below management's
forecast of $260 million to $280 million at the beginning of the
year. Fitch expects SLM's credit performance to weaken in 2022
driven by the fading impact of government stimulus on borrowers
including the expected lapse of the government's payment holiday on
federal student loans in May 2022, and the tightening of SLM's
forbearance policies in 2021 that are likely to result in higher
charge-offs this year.
SLM Bank's common equity Tier 1 (CET1) ratio of 14.1% and total
risk-based capital ratio of 14.5% at YE 2021 remained well in
excess of regulatory minimums and Fitch's rating sensitivity.
However, the regulatory exemption for the impact of the current
expected credit loss (CECL) accounting change, which stood at $836
million at YE 2021, will begin to phase-in at a rate of 25% per
year beginning in January 2022 and ending January 2025. Fitch
estimates SLM's fully phased-in CET1 at YE 2021 to be 10.5%.
However, because of the outsized impact of CECL on SLM relative to
peer banks, Fitch also considers its CET1 plus loan loss reserves
as a percentage of risk-weighted assets to be a relevant metric in
evaluating SLM's ability to absorb expected and unexpected losses.
Fitch estimates this ratio to be 15.5% at YE 2021, higher than the
13.8% at YE 2019 (before CECL was adopted).
SLM's liquidity remains solid relative to its rating, with cash and
liquid securities representing 24% of total assets at YE 2021, and
cash at the holding company of $570 million was well in excess of
its near-term liquidity needs, with no unsecured debt maturities
occurring until 2025. The company completed its third unsecured
debt issuance in November 2021, but the mix of unsecured debt in
SLM's capital structure remains relatively low. A significant
portion of SLM's deposits are brokered (48%), which are more price
sensitive than traditional retail deposits. As such, Fitch views
SLM's deposit franchise as weaker than its peers that have a lower
composition of brokered deposits.
GOVERNMENT SUPPORT RATING
As noted above, in line with the updated criteria, Fitch has
assigned a GSR to SLM and SLM Bank of 'ns'. In Fitch's view, the
probability of support is unlikely. IDRs and VRs do not incorporate
any support.
SUBORDINATED DEBT AND OTHER HYBRID SECURITIES
Fitch's 'B+' rating on the series B preferred shares reflect their
linkage to the VR. The notching reflects the subordinated payment
priority and weaker recovery prospects for these instruments, in
accordance with Fitch's "Global Bank Rating Criteria". The series B
preferred shares are rated three notches below the VR, reflecting
the instrument's non-performance (one notch) and relative loss
severity risk profile (two notches) in addition to their
non-cumulative nature.
Although Fitch's baseline notching for banks' preferred stock is
four notches from the VR, the three-notch differential assigned to
SLM's preferred stock is largely driven by Fitch's view that
non-performance risk is lower as SLM's holding company is
unregulated and not subject to a minimum capital requirement.
Moreover, the annual dividend payment is de minimis in relation to
holding company liquidity.
DEPOSIT RATINGS
SLM Bank's uninsured long-term deposit ratings are rated one-notch
higher than SLM's Long-Term IDR and senior unsecured debt because
U.S. uninsured deposits benefit from depositor preference. U.S.
depositor preference gives deposit liabilities superior recovery
prospects in the event of default.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
-- Execution of loan sales during a rising interest rate
environment and heightened market volatility;
-- Demonstrate credit performance that is within expectations as
federal student loan payment holiday expires later this year;
-- Effectively manage the CECL phase-in impact while remaining
above its capital ratio targets and Fitch's CET1 sensitivity
of 10%;
-- Maintain market share in the in-school channel as new
competitors emerge and effectively navigate any significant
increases in loan consolidations to third parties;
-- Effectively manage basis risk exposure through the LIBOR
transition;
-- Continued reduction in brokered deposits below 45% of total
deposits and overall funding.
With the Outlook Positive, Fitch will assess over the rating time
horizon of 12 to 24 months management's ability to execute on the
aforementioned items.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
(The following include a revision of the Outlook back to Stable
from Positive):
-- A sustained erosion in SLM Bank's CET1 ratio (fully phased in
for CECL) below 10% and/or total risk-based capital ratio
below 11.5%;
-- Meaningful deterioration in portfolio credit quality such that
SLM's net charge-off rate as a percentage of loans in
repayment exceeds 3%;
-- Capital distributions that meaningfully exceed gains and loss
reserve releases from loan sales;
-- Loan consolidations to third parties that exceed 20% of SLM's
loans in full principal and interest repayment on a sustained
basis;
-- An inability to access the student loan ABS market or senior
unsecured debt market for a sustained period.
Longer-term, negative rating momentum could be driven by
legislative actions aimed at reducing demand and/or profitability
for private education loans, or by significant erosion in the
importance of the school financial aid office channel for student
loan originations that could be detrimental to SLM's franchise.
GOVERNMENT SUPPORT
SLM and SLM Bank's GSRs are rated 'ns' and there is limited
likelihood that these ratings will change over the foreseeable
future.
SUBORDINATED DEBT AND OTHER HYBRID SECURITIES
The preferred stock ratings are sensitive to any changes in SLM's
VR and would be expected to move in tandem.
DEPOSIT RATINGS
The long- and short-term deposit ratings are sensitive to any
change in SLM's Long- and Short-Term IDRs and would be expected to
move in tandem.
VR ADJUSTMENTS
The Earnings and Profitability score of 'bbb-' has been assigned
below the 'a' category implied score due to the following
adjustment reasons: Revenue diversity (negative) and Earnings
stability (negative).
The Capitalization and Leverage score of 'bbb' has been assigned
below the 'a' category implied score due to the following
adjustment reasons: Profitability, pay-outs, and growth (negative)
and Concentrations (negative).
The Funding and Liquidity score of 'bb+' has been assigned below
the 'a' category implied score due to the following adjustment
reason: Deposit structure (negative).
BEST/WORST CASE RATING SCENARIO
International scale credit ratings of Financial Institutions and
Covered Bond 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.
ESG CONSIDERATIONS
SLM Corporation has an ESG Relevance Score of '4' for Customer
Welfare - Fair Messaging, Privacy & Data Security due to its
exposure to compliance risks including fair lending practices, debt
collection practices and consumer data protection, which has a
negative impact on the credit profile, and is relevant to the
rating[s] in conjunction with other factors.
SLM Corporation has an ESG Relevance Score of '4' for Exposure to
Social Impacts due to its exposure to shift in social or consumer
preferences as a result of an institution's social positions, or
social and/or political disapproval of core activities, which has a
negative impact on the credit profile, and is relevant to the
rating[s] 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.
SM ENERGY: Swings to $36.2 Million Net Income in 2021
-----------------------------------------------------
SM Energy Company filed with the Securities and Exchange Commission
its Annual Report on Form 10-K disclosing net income of $36.23
million on $2.62 billion of total operating revenues and other
income for the year ended Dec. 31, 2021, compared to a net loss of
$764.61 million on $1.13 billion of total operating revenues and
other income for the year ended Dec. 31, 2020.
As of Dec. 31, 2021, the Company had $5.23 billion in total assets,
$889.33 million in total current liabilities, $2.28 billion in
total noncurrent liabilities, and $2.06 billion in total
stockholders' equity.
A full-text copy of the Form 10-K is available for free at:
https://www.sec.gov/ix?doc=/Archives/edgar/data/893538/000089353822000020/sm-20211231.htm
About SM Energy
SM Energy Company is an independent energy company engaged in the
acquisition, exploration, development, and production of crude oil,
natural gas, and natural gas liquids in the state of Texas.
* * *
This concludes the Troubled Company Reporter's coverage of SM
Energy until facts and circumstances, if any, emerge that
demonstrate financial or operational strain or difficulty at a
level sufficient to warrant renewed coverage.
STANCE AUTOWORKS: Seeks to Tap LSB Financial Services as Accountant
-------------------------------------------------------------------
Stance Autoworks, LLC seeks approval from the U.S. Bankruptcy Court
for the Southern District of Texas to employ LSB Financial
Services, Inc. as its accountant.
The firm will render the following services:
(a) prepare federal tax returns and state franchise tax
returns;
(b) prepare delinquent payroll tax returns;
(c) maintain the Debtor's books and records;
(d) adjust the Debtor's books and records to the extent
necessary; and
(e) prepare monthly operating reports.
The firm has agreed to provide bookkeeping and monthly operating
report preparation services at a flat monthly rate of $1,200,
prepare federal income tax returns at the flat rate of $1,250 per
return, and prepare delinquent payroll tax returns at a flat rate
of $250 per return.
In addition, the firm will charge professional services at an
hourly rate of $150.
John Bell, CPA, a member at LSB Financial Services, 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:
John T. Bell, CPA
LSB Financial Services, Inc.
26906 Autumn Timbers Lane
Cypress, TX 77433
About Stance Autoworks
Stance Autoworks, LLC sought protection for relief under Chapter 11
of the Bankruptcy Code (Bankr. S.D. Tex. Case No. 21-33931) on Dec.
7, 2021, listing as much as $1 million in both assets and
liabilities. Judge Christopher M. Lopez oversees the case.
The Debtor tapped Alex Olmedo Acosta, Esq., at Acosta Law, PC as
legal counsel and LSB Financial Services, Inc. as accountant.
SUNOCO LP: S&P Upgrades ICR to 'BB', Outlook Stable
---------------------------------------------------
S&P Global Ratings raised its issuer credit rating on U.S.
midstream energy master limited partnership Sunoco L.P. to 'BB'
from 'BB-'. The outlook is stable.
S&P said, "In addition, we raised our rating on the senior secured
debt to 'BBB-' from 'BB+'. The recovery rating is '1', indicating
our expectation for very high (90%-100%; rounded estimate; 95%)
recovery in a payment default scenario.
"We also raised our rating on the senior unsecured debt to 'BB'
from 'BB-'. The recovery rating is '3', indicating our expectation
for meaningful (50%-70%; rounded estimate: 60%) recovery in a
payment default scenario.
"The stable outlook reflects our view that the partnership will
maintain S&P Global Ratings-adjusted financial leverage below 4.5x
and ample liquidity as it continues to look for additional
wholesale distribution and midstream opportunities."
Sunoco's wholesale distribution business has remained resilient
through the pandemic.
The partnership's wholesale distribution business has performed
well through the pandemic and market volatility. Although fuel
volumes are below the 2019 pre-pandemic peak, lower volumes require
higher industry breakeven margins. Sunoco has been able to
capitalize on its position as one of the largest fuel distributors
to improve operating efficiencies and benefit from the higher fuel
margins during the last two years. Sunoco averaged slightly more
than 11 cents per gallon (CPG) margin in 2021, which is better than
pre-COVID-19 historical margins in the 9-10 CPG range. S&P said,
"We believe margins could moderate in 2022 but likely will remain
robust in the 10.5-11.5 CPG area. Despite the risk of continued
market volatility and supply chain disruptions, we think our
forecast of Sunoco achieving EBITDA at the higher end of its $770
million to $810 million range is reasonable and will lead to strong
credit ratios."
S&P forecasts stronger credit measures in 2022 and 2023.
S&P said, "We believe Sunoco is committed to maintaining a strong
credit profile and expect it to achieve adjusted debt to EBITDA
below 4.5x in 2022. We add operating lease liabilities and
tax-adjusted asset retirement obligations to reported debt for our
adjusted ratios. We think capital spending will be in the $200
million to $225 million range and that the partnership will
generate excess discretionary cash flow in excess of $100 million
annually, which provides Sunoco will some financial flexibility to
further reduce debt or redeploy capital for various growth or
shareholder initiatives over the next several years.
"We believe Sunoco will continue to seek complementary assets as it
expands its wholesale and midstream businesses."
Sunoco's growth and acquisition strategy has generally consisted of
bolt-on acquisitions of relatively modest size to complement and
expand its wholesale fuel distribution footprint. The Brownsville,
Texas, terminal organic growth project will diversify refined
products supply and open up potential export channels to Mexico,
while the Gladieux Energy transmix processing and terminal
acquisition will provide Sunoco with some vertical integration with
the fuel distribution business and add ratable cash flow to its
margin business.
Energy transition headwinds are not a significant near-term credit
risk in S&P's view.
S&P said, "We think the transition to electric vehicles (EVs) is a
long-term risk to Sunoco's fuel distribution business but is not
currently a significant credit driver for the rating. We think EV
penetration of the U.S. vehicle fleet will likely take decades to
grow to a size that could meaningfully affect fuel volumes and will
require significant investment in infrastructure and technology to
support that growth, as well as consistent political will to
execute the change.
"The stable outlook reflects our view that Sunoco's credit measures
have improved and our belief that the partnership will maintain a
strong balance sheet and ample liquidity as it continues to look
for additional wholesale distribution and midstream opportunities.
We forecast Sunoco will maintain an adjusted debt to EBITDA ratio
below 4.5x, trending toward the low-4x area during the next two
years.
"We could lower the rating if Sunoco experiences weaker operational
performance in the wholesale distribution business, such that
adjusted debt to EBITDA remains above 4.5x. This could occur if
increased competition compresses wholesale margins, operating
expenses increase, or weaker demand pressures wholesale volumes.
"We think a positive rating action is unlikely during the next few
years, given the company's current business mix as a wholesale fuel
distributor. However, we could consider a positive ratings action
if Sunoco maintains a more conservative financial profile,
specifically, adjusted debt to EBITDA below 3.5x, while continuing
to scale its fixed fee midstream cash flows."
ESG credit indicators: E-3, S-2, G-2
S&P said, "Environmental factors are a moderately negative
consideration in our credit rating analysis of Sunoco L.P. Sunoco
is the nation's largest independent fuel distributor, primarily
focused in distributing traditional hydrocarbon fuels. Sunoco has
the operational capabilities and has demonstrated an interest to
distribute cleaner refined products, but currently faces the
general energy transition pressures confronting the midstream
industry over the next few decades. We believe the increasing
midstream infrastructure ownership within Sunoco's asset portfolio
further enhances its ability to store and transport cleaner refined
products as the fuel distribution marketplace evolves."
TEAM SYSTEMS: Chapter 11 Should Be Tossed, Says U.S. Trustee
------------------------------------------------------------
Leslie A. Pappas of Law360 reports that the Office of the United
States Trustee has voiced support for the dismissal of the Chapter
11 case of government contractor Team Systems International LLC,
saying the debtor doesn't have a lawyer and the filing smacks of
bad faith.
The contractor appears to have filed the case to avoid a $6.25
million court judgment against it for failing to pay two of its
suppliers -- GPDEV LLC and Simons Explorations Inc. -- for bottled
water sent to Puerto Rico after Hurricane Maria, the U.S. Trustee's
Office said in its motion filed Tuesday, March 1, 2022, with the U.
S. Bankruptcy Court for the District of Delaware.
About Team Systems International
Formed in 2001, Team Systems International LLC is a small business
serving the United States government as a contractor with offices
in Lewes, Del. and Ponte Vedra Beach, Fla. TSI has performed
government projects as a prime contractor and subcontractor in the
areas of program management, financial and contracts management,
tactical and specialized military training development, naval
ordinance engineering, information systems design and integration,
military firearms training, Department of State overseas foreign
officer training, vehicle or weapons platform simulation, training
center or classroom A/V system integration, force protection
services, maritime security, and administrative staffing for
government projects.
Team Systems International sought Chapter 11 bankruptcy protection
(Bankr. D. Del. Case No. 22-10066) on Jan. 18, 2022, listing up to
$50 million in assets and up to $10 million in liabilities.
Deborah Devans Mott, member, signed the petition.
Jamie L. Edmonson, Esq., at Robinson & Cole LLP, is the Debtor's
legal counsel.
TERRA MANAGEMENT: Seeks More Time to File Bankruptcy Plan
---------------------------------------------------------
Terra Management Group, LLC and Littleton Main Street, LLC asked
the U.S. Bankruptcy Court for the District of Colorado to extend
the exclusivity period to file a Chapter 11 plan to May 13 and the
period to solicit acceptances for the plan 60 days thereafter.
Under U.S. bankruptcy rules, companies in Chapter 11 protection
have the sole right to craft and formally propose turnaround plans
unless a judge strips them of that right.
The extension, if granted by the court, will give the Debtors more
time to resolve a state court litigation with Kathleen and Delaney
Keaten, former residents of Main Street.
The Keatens claimed personal injury as a result of their exposure
to toxic fumes coming from an apartment unit that was allegedly
used as a laboratory to produce illegal methamphetamines.
"The [companies'] and the Keatens' disputes have been front and
center in this bankruptcy case and Keatens' claims against the
[companies] will inform any plan of reorganization," said Michael
Pankow, Esq., at Brownstein Hyatt Farber Schreck, LLP, who serves
as attorney for both companies.
About Terra Management Group and
Littleton Main Street
Terra Management Group, LLC is an Englewood, Colo.-based company
engaged in activities related to real estate.
Terra Management Group and Littleton Main Street, LLC filed their
voluntary petitions for Chapter 11 protection (Bankr. D. Colo. Lead
Case No. 21-15245) on Oct. 15, 2021. J. Marc Hendricks, president
and manager of Terra Management Group, signed the petitions. At the
time of the filing, Terra Management Group listed up to $100,000 in
assets and up to $50 million in liabilities while Littleton listed
as much as $50 million in both assets and liabilities.
The Hon. Kimberley H. Tyson is the case judge.
The Debtors tapped Michael J. Pankow, Esq., at Brownstein Hyatt
Farber Schreck, LLP as legal counsel, and Haynie & Company as tax
accountant.
TERRAVIA HOLDINGS: Ex-Execs Ink $2.5 Mil. Deal to End Investor Suit
-------------------------------------------------------------------
Emilie Ruscoe of Law360 reports that investors in defunct biotech
company TerraVia Holdings Inc. have inked a $2.5 million deal to
end claims that the company and its executives concealed reports
linking the company's algae ingredients to gastrointestinal
distress.
In a settlement agreement filed on Tuesday, March 1, 2022, six
individual investors and three former TerraVia executives --
Jonathan S. Wolfson, Apurva S. Mody and Tyler W. Painter -- agreed
to end the consolidated proposed class action, which launched over
five years ago before TerraVia filed for Chapter 11 protection. In
the stipulated agreement, the parties agreed that "the action is
being voluntarily settled after work with mediators."
About TerraVia
Headquartered in South San Francisco, California, TerraVia
Holdings, Inc. (NASDAQ:TVIA) -- http://www.terravia.com/-- is a
plant-based food, nutrition and specialty ingredients company that
harnesses the power of algae, the mother of all plants and earth's
original superfood. TerraVia also manufactures a range of specialty
personal care ingredients for key strategic partners.
TerraVia Holdings, Inc., and its wholly-owned U.S. subsidiaries
filed voluntary petitions under chapter 11 of the United States
Bankruptcy Code (Bankr. D. Del. Lead Case No. 17-11655) on Aug. 2,
2017. The subsidiary debtors in the Chapter 11 cases are Solazyme
Brazil LLC and Solazyme Manufacturing 1, LLC.
The Debtors hired Davis Polk & Wardwell LLP as their lead counsel
and Richards, Layton & Finger, P.A., as co-counsel. Kurtzman
Carson Consultants LLC is the Debtors' claims agent.
No official committee of unsecured creditors has been appointed in
the Chapter 11 case.
TONY GRECO: VROOM Buying 2017 Audi A8 L30T Vehicle for $37K
-----------------------------------------------------------
Tony Greco and Jeanne M. Greco ask the U.S. Bankruptcy Court for
the Southern District of New York to approve the sale of Tony
Greco's right, title, and interest in and to his vehicle known as a
2017 Audi A8 L30T, VIN WAU44AFDXHN016143, to VROOM for $37,065.
A hearing on the Motion is set for April 12, 2022, at 9:00 a.m.
Objections, if any, must be filed at least seven business days
prior to the Hearing.
Unfortunately, in November 2021, Tony Greco suffered a debilitating
stroke. The Debtors have decided that it is in their best interest
to sell the Vehicle as he is no longer able to drive and cannot
maintain the payments for the Vehicle.
Prior to the filing, Mr. Greco signed a promissory note in favor of
VW Credit Inc., doing business as Audi Financial Services, which is
secured by the Vehicle owned by Mr. Greco. As of January 2022, the
outstanding balance due to VW CREDIT was approximately $33,476.63.
Mr. Greco wishes to sell his Vehicle to VROOM for the appraised
value of $37,065. The sale of the Vehicle essentially rids the
Debtors of the necessity of the continued monthly payment to VW
CREDIT and results in proceeds of $3,588.37 to the Debtors to aid
in the consummation of their Chapter 11 Plan of Reorganization.
Mr. Greco now desires to engage in a sale of his interest in the
Vehicle to VROOM. He makes this Application for an Order
authorizing him to sell his right, title, and interest in and to
the Vehicle.
In the instant case, the sale of the Vehicle maximizes the benefit
to the estate by paying the secured creditor in full, providing
proceeds to the Debtors to aid in consummation of the Chapter 11
Plan and releasing the debtor of his financial obligation to
maintain the Vehicle. Accordingly, the Court should approve the
sale of the Vehicle by the Debtors.
The bankruptcy case is In re: Tony Greco and Jeanne M. Greco, Case
No. 21-35522 (CGM) (Bankr. S.D.N.Y.).
TRANQUILITY MED SPA: Seeks to Tap Ronald D. Weiss as Legal Counsel
------------------------------------------------------------------
Tranquility Med Spa, Inc. seeks approval from the U.S. Bankruptcy
Court for the Eastern District of New York to hire the Law Office
of Ronald D. Weiss, P.C. to serve as legal counsel in its Chapter
11 case.
The firm will render these services:
(a) provide legal advice with respect to the powers and duties
of the Debtor in the continued management of its property;
(b) represent the Debtor before the bankruptcy court and at
all hearings on matters pertaining to its affairs, including
contested matters that may arise during the Chapter 11 case;
(c) advise and assist the Debtor in the preparation and
negotiation of a plan of reorganization with its creditors;
(d) prepare legal papers; and
(e) perform other necessary legal services for the Debtor.
The hourly rates charged by the firm's attorneys and paralegals are
as follows:
Attorney $450 per hour
Paralegals $250 per hour
The Law Office of Ronald D. Weiss is disinterested within the
meaning of Section 101(14) of the Bankruptcy Code, according to
court filings.
The firm can be reached through:
Ronald D. Weiss, Esq.
Law Office of Ronald D. Weiss, P.C.
734 Walt Whitman Rd #203
Melville, NY 11747
Phone: (631) 570-8742
Email: weiss@ny-bankruptcy.com
About Tranquility Med Spa
Tranquility Med Spa Inc. sought protection for relief under Chapter
11 of the Bankruptcy Code (Bankr. E.D.N.Y. Case No. 22-70184) on
Feb. 3, 2022, listing up to $50,000 in assets and $500,001 to $1
million in liabilities.
Judge Alan S Trust oversees the case.
The Law Office of Ronald D. Weiss, P.C. represents the Debtor as
legal counsel.
TROT SERVICE: Trustee Gets OK to Hire Adam L. Rosen as Counsel
--------------------------------------------------------------
Nat Wasserstein, Subchapter V trustee for Trot Service Corp. and
its affiliates, received approval from the U.S. Bankruptcy Court
for the Eastern District of New York to hire Adam L. Rosen, PLLC as
his legal counsel.
The trustee requires legal assistance to complete the Debtors'
Chapter 11 cases by seeking confirmation of their Chapter 11 plan,
and to carry out his duties pursuant to Bankruptcy Code Section
1183(b).
The firm will bill at the following rates:
Adam L. Rosen, Esq. $570 per hour
Paralegal $120 per hour
As disclosed in court filings, The Rosen Firm is a "disinterested
person" as that term is defined in Bankruptcy Code Section
101(14).
The firm can be reached through:
Adam L. Rosen, Esq.
Adam L. Rosen PLLC
2-8 Haven Ave #220
Port Washington, NY 11050
Phone: +1 516-407-3756
Email: contact@ALRcounsel.com
About Trot Service Corp.
Trot Service Corp. and affiliated debtors, including Betty Transit,
LLC, filed voluntary petitions for relief under Chapter 11 of the
Bankruptcy Code on March 27, 2020. At the time of the filing, Trot
Service listed up to $500,000 in assets and up to $10 million in
liabilities.
On June 25, 2020, the Debtors' cases were refiled under Subchapter
V of the Bankruptcy Code. Judge Elizabeth S. Stong of the U.S.
Bankruptcy Court for the Eastern District of New York ordered the
joint administration of the cases filed by Betty Transit, Lawrence
Transit LLC, Lev Transit LLC, Sima Hacking Corp., and Lyuba Hacking
Corp (Bankr. E.D.N.Y. Lead Case No. 20-41760) on July 2, 2020. Trot
Service's Chapter 11 case (Bankr. E.D.N.Y. Case No. 20-41776) is
not jointly administered.
The Debtors' cases are related to the following Chapter 11 cases
pending in the court: Walker Service Corp. (Case No. 20-41759) and
Joe and Sophie Pross (Case No. 21-42600).
Michael D. Hamersky, Esq., at Griffin Hamersky, P.C. represents the
Debtors as legal counsel.
The U.S. Trustee for Region 2 appointed Nat Wasserstein as
Subchapter V trustee on June 30, 2020. Adam L. Rosen, PLLC serves
as the Subchapter V trustee's legal counsel.
TWISTED OAK: Amends Mechanics Bank Secured Claims Pay Details
-------------------------------------------------------------
Twisted Oak Winery, LLC, submitted a Third Amended Plan of
Reorganization for Small Business.
This Plan of Reorganization proposes to pay creditors of Twisted
Oak Winery, LLC from cash flow from future operations over a
60-month period.
Class 2 consists of the Secured Claims of Mechanics Bank. Class 2
is impaired by this Plan. Mechanics Bank shall retain its security
interest according to the instruments and statutes creating same.
Class 2 principal shall be paid in full with interest at 4.50% per
annum on 25 years amortization with a January 1, 2033 maturity
date, with interest and principal payments of $10,557 per month,
commencing October 1, 2022 and continuing for 123 months, then a
balloon payment for the remaining balance due January 1, 2033.
Class 2 accrued pre-petition interest shall be paid in full with 0%
interest per annum in the amount of $1,000 per month, commencing
October 1, 2022, then a balloon payment for the remaining balance
due January 1, 2033.
With the business assets and ongoing operations, Debtor will have
sufficient cash to pay all allowed unclassified claims, future
allowed expenses of administration, and all Class 1 claims
(nominal, if any), and to purchase the additional equipment and
supplies needed to continue the manufacture of wine and to maintain
operations.
The Debtor will have sufficient cash flow commencing in January
2022, and continuing thereafter, to make the monthly payments
required for Classes 2, 3, and 4.
The Plan is relatively simple as only one creditor is impaired.
Allowed unclassified claims and priority claims will be paid upon
confirmation of the Plan. Subsequent unclassified claims (such as
expenses of administration) will be paid as the Court allows them.
Only one of the claims of the two secured creditors will be
impaired: Mechanics Bank. SBA is not impaired and will receive
their usual monthly payments $713 with no changes in interest rate,
monthly payment, or maturity. Non-priority unsecured creditors will
be paid 100 cents on the dollar over a 6 month period.
A full-text copy of the Third Amended Plan dated Feb. 28, 2022, is
available at https://bit.ly/3C5aB4e from PacerMonitor.com at no
charge.
About Twisted Oak
Twisted Oak, LLC, specializes in wines that are made from
Tempranillo, Grenache, Mourvedre, Viognier, and more. It filed a
Chapter 11 petition (Bankr. E.D. Cal. Case No. 21-90484) on Oct. 4,
2021. In the petition signed by Jeff Stai, managing member, the
Debtor disclosed $1 million to $10 million in assets and $1 million
to $10 million in liabilities. The Hon. Ronald H. Sargis oversees
the case. Brian S. Haddix, of HADDIX LAW FIRM, is the Debtor's
counsel.
TWISTED OAK: Plan Confirmation Hearing Continued to April 21
------------------------------------------------------------
On Feb. 28, 2022, Twisted Oak Winery, LLC, filed with the U.S.
Bankruptcy Court for the Eastern District of California a Third
Amended Chapter 11 Plan. Judge Ronald H. Sargis ordered that:
* The current confirmation hearing date of March 24, 2022 is
continued and the hearing on confirmation of the Subchapter V Plan
shall be conducted on April 21, 2022, at 2:00 p.m. in the United
States Bankruptcy Court, Modesto Division, 1200 I Street, Second
Floor, Modesto, CA 95354.
* April 4, 2022, is fixed as the last day for all creditors
and other parties in interest to submit ballots accepting or
rejecting the Plan.
* April 4, 2022, is fixed as the last day for any creditor or
other party in interest to file objections to confirmation of the
proposed Subchapter V Plan.
* Responses, if any, to objection to confirmation and evidence
in support of confirmation shall be filed on the objecting party,
the Subchapter V Trustee, and the U.S. Trustee at least 7 days
prior to the confirmation hearing.
A full-text copy of the order dated Feb. 28, 2022, is available at
https://bit.ly/3swRCwy from PacerMonitor.com at no charge.
About Twisted Oak
Twisted Oak, LLC, specializes in wines that are made from
Tempranillo, Grenache, Mourvedre, Viognier, and more. It filed a
Chapter 11 petition (Bankr. E.D. Cal. Case No. 21-90484) on Oct. 4,
2021. In the petition signed by Jeff Stai, managing member, the
Debtor disclosed $1 million to $10 million in assets and $1 million
to $10 million in liabilities. The Hon. Ronald H. Sargis oversees
the case. Brian S. Haddix, of HADDIX LAW FIRM, is the Debtor's
counsel.
UNITI GROUP: Swings to $124.8 Million Net Income in 2021
--------------------------------------------------------
Uniti Group Inc. filed with the Securities and Exchange Commission
its Annual Report on Form 10-K disclosing net income of $124.75
million on $1.10 billion of total revenues for the year ended Dec.
31, 2021, compared to a net loss of $718.81 million on $1.07
billion of total revenues for the year ended Dec. 31, 2020.
As of Dec. 31, 2021, the Company had $4.81 billion in total assets,
$6.92 billion in total liabilities, and a total shareholders'
deficit of $2.11 billion.
At year-end, the Company had approximately $419.4 million of
unrestricted cash and cash equivalents, and undrawn borrowing
availability under its revolving credit agreement. The Company's
leverage ratio at year-end was 5.55x based on net debt to fourth
quarter 2021 annualized Adjusted EBITDA.
On Feb. 24, 2022, the Company's Board of Directors declared a
quarterly cash dividend of $0.15 per common share, payable on
April 15, 2022, to stockholders of record on April 1, 2022.
Quarterly Results
Consolidated revenues for the fourth quarter of 2021 were $293.0
million. Net income and Adjusted EBITDA were $35.9 million and
$231.1 million, respectively, for the same period. Net income
attributable to common shares was $35.6 million for the period.
Adjusted Funds From Operations ("AFFO") attributable to common
shareholders was $114.0 million, or $0.44 per diluted common share,
an increase of 7% when compared to the fourth quarter of 2020.
Uniti Fiber contributed $82.0 million of revenues and $31.7 million
of Adjusted EBITDA for the fourth quarter of 2021, achieving
Adjusted EBITDA margins of approximately 39%. Uniti Fiber's net
success-based capital expenditures during the quarter were $33.8
million.
Uniti Leasing contributed revenues of $211.0 million and Adjusted
EBITDA of $206.1 million for the fourth quarter, representing
growth of 9% and 8%, respectively, when compared to the fourth
quarter of 2020. Revenue and Adjusted EBITDA in the fourth quarter
both include a one-time non-cash adjustment to straight-line
revenue of $8 million. During the quarter, Uniti Leasing deployed
capital expenditures of $70.9 million primarily related to the
construction of approximately 1,900 new route miles of valuable
fiber infrastructure.
"Our national network of 128,000 route miles of fiber is one of the
largest and most robust in the country. We added nearly 6,000
route miles of valuable fiber in 2021 and capped off a terrific
year of performance by adding $3.5 million of new consolidated
bookings, a 40% increase over 2020," commented Kenny Gunderman,
president and chief executive officer.
Mr. Gunderman continued, "Trends in the communications
infrastructure space have never been better, and Uniti remains
uniquely positioned to benefit from the continued proliferation of
broadband growth, fiber-to-the-home, small cells and national
transport."
A full-text copy of the Form 10-K is available for free at:
https://www.sec.gov/ix?doc=/Archives/edgar/data/1620280/000156459022007221/unit-10k_20211231.htm
About Uniti
Headquartered in Little Rock, Arkansas, Uniti Group Inc. --
http://www.uniti.com-- is an internally managed real estate
investment trust. It is engaged in the acquisition and
construction of mission critical communications infrastructure, and
is a provider of wireless infrastructure solutions for the
communications industry. As of Sept. 30, 2021, Uniti owns
approximately 126,000 fiber route miles, 7.5 million fiber strand
miles, and other communications real estate throughout the United
States.
As of Sept. 30, 2021, the Company had $4.78 billion in total
assets, $6.90 billion in total liabilities, and a total
shareholders' deficit of $2.12 billion.
* * *
In October 2021, Fitch Ratings has affirmed the Long-Term Issuer
Default Rating (IDR) of Uniti Group Inc. and the IDRs of Uniti
Group L.P. and Uniti Fiber Holdings at 'B+'.
In March 2020, S&P Global Ratings placed all ratings on U.S.
telecom REIT Uniti Group Inc., including the 'CCC-' issuer credit
rating, on CreditWatch with positive implications. The CreditWatch
placement follows the company's announcement it reached an
agreement in principle with its largest tenant Windstream Holdings
Inc. to resolve all legal claims it asserted against Uniti in the
context of Windstream's bankruptcy proceedings.
UPLAND POINT: No Patient Care Concern, PCO Report Says
------------------------------------------------------
Heather A. Bruemmer, the duly appointed Patient Care Ombudsman for
Upland Point Corporation, filed with the U.S. Bankruptcy Court for
the Western District of Wisconsin a report, dated March 1, 2022,
regarding the Debtor's health care facility.
During a virtual facility visit, the PCO reported that there was
adequate staff, care supplies, food, protective wear, and cleaning
supplies within the Debtor's Vista House facility.
Moreover, the residents informed the PCO that the food was
excellent and they are very satisfied. The PCO noted that the
residents can access "Petty Cash" which is locked in the medication
carts, for any of their purchases outside of the home to meet their
needs.
The PCO further noted that since her appointment, she has not
received any significant care and treatment complaints from, or
relating to, residents of the Debtor's six homes.
A copy of the Ombudsman Report is available for free at
https://bit.ly/3hxa7dQ from PacerMonitor.com.
The Ombudsman may be reached at:
Heather A. Bruemmer
Office of the Board on Aging and Long Term Care
402 Pankratz Street, Suite 111
Madison, WI 53704-4001
Tel: (800) 815-0015
Fax: (608) 246-7001
Email: http://longtermcare.wi.gov
About Upland Point Corporation
Upland Point Corporation, which operates six assisted living
facilities, sought protection for relief under Chapter 11 of the
Bankruptcy Code (Bankr. W.D. Wisc. Case No. 20-12186) on Aug. 21,
2020, estimating under $1 million in both assets and liabilities.
Judge Catherine J. Furay oversees the case. Michelle A. Angell,
Esq., at Krekeler Strother, S.C., is the Debtor's legal counsel.
VERANO RECOVERY: Addresses Objections to Plan Disclosures
---------------------------------------------------------
Verano Recovery, LLC, a California limited liability company, filed
its reply to the objections to the Debtor's disclosure statement
filed on January 18, 2022.
Objections were filed by Cathedral City, on behalf of Community
Facilities District No. 2000-1, RoBott Land High Yield 1 LLC, and
Rio Vista Village Community Association. The Debtor has also
conferred with the Office of the United States Trustee regarding
the issues raised by the UST and has agreed to address these
concerns through revisions to the Disclosure Statement.
RoBott asserts that the Disclosure Statement lacks information
regarding the Purchase and Performance Agreement with the City
("PAPA") and that the Disclosure Statement does not attach the
PAPA. The PAPA serves as a development agreement between the City
of Cathedral City and the Debtor and the inducement for the Debtor
to execute on the restoration and orderly development of what
otherwise was a broken community, in return for assurances by the
City on project densities, development standards, and future
infrastructure finance. The PAPA was disclosed on the Debtor's
amended schedule G as an executory contract which the Debtor
intends to assume. Debtor also listed the PAPA in the Disclosure
Statement on its list of executory contracts to be assumed through
confirmation of the plan of reorganization ("Plan"). Debtor can
also provide a copy of the PAPA to RoBott which is a document
recorded with the County of Riverside and attach a copy of the PAPA
to the amended Disclosure Statement to be filed.
The Debtor further points out that the Debtor's real estate broker,
The Hoffman Company ("Broker"), has been marketing the land and
lots for sale. The Broker has prepared an offering memorandum and
marketing brochure for prospective buyers. As Debtor noted in its
opposition to the motion for relief from stay filed by the City,
Debtor decided that Broker is the ideal broker for the Debtor,
given its knowledge of the Coachella Valley residential
marketplace, its keen knowledge and history of the Verano
masterplan, and its recent success in brokering a sale of 329 lots
at Verano to DR Horton, a U.S. National homebuilder. Broker has
more than 43 years of experience in all types of land sale
transactions, including multi-family, commercial and industrial
sites throughout California and Nevada. Broker has been responsible
for more than 1,500 real estate transactions for a total $8 billion
since its inception. The Broker's marketing efforts have garnered
multiple offers for individual parcel sales as well as bulk sales
of the land and lots owned by Debtor. In fact, Debtor has received
3 bulk offers to date from potential buyers over $16.5 million
which is in excess of the amount of all claims Debtor believes will
be allowed in this estate. Debtor will amend the Disclosure
Statement to include Debtor's intent to move forward with a bulk
sale of the lots rather than the sale of individual planning areas
and the fact that no further entitlements are required for
consummation of such a bulk sale.
The Debtor will be filing a motion for order approving
post-petition debtor-in-possession financing ("DIP Financing
Motion") on February 23, 2022, with a hearing date of March 16,
2022. The DIP Financing Motion provides that Debtor will seek a
loan in the amount of $270,000 ("Loan"), and not the $565,000 noted
in the original Disclosure Statement, from Inland Communities Corp.
("Inland"), Debtor's managing member, in order to maintain the
business as an ongoing concern, meet its obligations under the
Court Ordered Adequate Protection Plan, pay its post-petition
business expenses including, maintain insurance liability coverage,
real property taxes, preserve current entitlements and tract map
extension fees and costs, and other post-petition real property
maintenance costs and management fees. Debtor will amend the
Disclosure Statement to include the details above with respect to
the Loan.
The Debtor will amend the Disclosure Statement to include projected
administrative fees and expenses as of the effective date of the
Plan. With respect to the administrative fees and expenses of
Debtor's professionals employed in this bankruptcy case, the
Debtor's professionals have consented to payment of their
administrative fees and expenses upon the sale of the lots and not
on the effective date of the Plan. Debtor will amend the Disclosure
Statement to disclose this consent by Debtor's professionals.
Debtor will pay all other administrative fees and expenses,
however, on the effective date of the Plan.
According to Debtor, RoBott asserts that additional information
must be provided regarding feasibility of the Plan. With respect to
the amount of the claims, Debtor has either provided sufficient
information with respect to the amount of the claims or will amend
the Disclosure Statement to include additional information
regarding the amount of the claims. With respect to the PAPA,
Debtor has hired counsel to negotiate with the City, but with
respect to the entitlements already existing, Debtor asserts that
no entitlements have expired. Moreover, because Debtor intends to
proceed with a bulk sale of the lots, Debtor does not need to
obtain any additional entitlements prior to consummation of a sale.
With respect to the value of the lots, Debtor has received multiple
purchase offers from prospective purchasers in excess of the filed
amount of the claims and believes that this reflects the fair
market value of the lots Again, the value of the lots will
ultimately be determined by the highest and best offer received by
the Debtor, and, at this point, the offers received by the Debtor
reflect that the proposed Plan is feasible because the offers are
in excess of the amount of all claims Debtor believes will be
allowed in this estate.
The Debtor asserts that there is a genuine dispute between the
Debtor and RoBott with respect to the amount of the claim filed by
RoBott. Debtor has a good faith basis to dispute the amount of the
claim of RoBott. The claim is subject to an objection filed by the
Debtor and is being litigated by the parties. The dispute is
currently set for mediation on April 5, 2022.
The Debtor points out that Rio Vista's objection seeks the
insertion of specific language to be included in the Plan that
"reaffirms the Debtor's continuing obligation to provide Phase II
improvements as set forth in the Amended, Restated and Superseding
Use and Maintenance Agreement and Grant of Non-exclusive Easements
("Easements") and Declaration of Covenants, Conditions,
Restrictions and Reservation of Easements for Rio Vista ("CC&Rs").
The Plan does not alter, void or restrict the obligations set forth
in the Easements and CC&Rs. The proposed language of Rio Vista
seeks to expand the obligations outlined in the Easements and CC&Rs
and Debtor does not agree to this language. The Easements and CC&Rs
are recorded instruments against the lots, they "run with the
land", under which the obligations and rights transfer to the
successors and assignees of Debtor, and preserve the obligations
set forth in these documents.
The Debtor received informal comments from the UST on the
Disclosure Statement and has sent to the UST proposed amendments to
the Disclosure Statement. These amendments will be reflected in
the amended Disclosure Statement to be filed after the March 2,
2022, hearing.
Attorneys for Debtor Verano Recovery, LLC:
Marc C. Forsythe – State Bar No. 153854
Reem J. Bello – State Bar No. 198840
GOE FORSYTHE & HODGES LLP
18101 Von Karman Ave., Ste. 1200
Irvine, California 92612
Telephone: (949) 798-2460
Facsimile: (949) 955-9437
E-mail: mforsythe@goeforlaw.com
rbello@goeforlaw.com
About Verano Recovery
Pasadena, Cal.-based Verano Recovery, LLC, filed its voluntary
petition for relief under Chapter 11 of the Bankruptcy Code (Bankr.
C.D. Cal. Case No. 21-14127) on May 19, 2021. At the time of the
filing, the Debtor had between $10 million and $50 million in both
assets and liabilities.
Judge Sheri Bluebond presides over the case.
The Debtor tapped Goe Forsythe & Hodges, LLP as bankruptcy counsel;
Corbett Steelman & Spector and O'Neil LLP as special counsel;
Armory Consulting Co. as financial advisor; and Cline Carroll &
Bartell, LLP as accountant.
VERSCEND HOLDING II: S&P Corrects 2nd Lien Debt Rating to 'CCC+'
----------------------------------------------------------------
S&P Global Ratings corrected its issue rating and recovery rating
on Verscend Holding Corp.'s $325 million second-lien debt due 2029
to 'CCC+' and '6', respectively, after erroneously assigning it a
'B+' and '2' on Feb. 1, 2021. The recovery rating of '6' indicates
its expectation of negligible (0%-10%: rounded estimate: 0%)
recovery in the event of a default. The corrected issue-level
rating on the second-lien debt is two notches below its issuer
credit rating on Verscend (B/Positive/--). All other ratings and
the outlook remain unchanged.
S&P had incorrectly indicated a recovery rating of '2', indicating
70%-90% recovery, and erroneously notched the debt one rating above
the (B/Positive/--) issuer credit rating to 'B+', rather than two
notches below to 'CCC+'.
Issue Ratings - Recovery Analysis
Key analytical factors:
-- S&P's simulated default scenario assumes a payment default
occurring in 2025 due to increased pricing competition in the
revenue and payment solutions segment that leads to
higher-than-expected attrition and the loss of certain large health
plan providers as well as an inability to compete effectively for
new business.
-- The company's capital structure comprises a $300 million
revolving credit facility maturing in 2023, a $3.765 billion
first-lien term loan B maturing in 2025, a $325 million second-lien
term loan due in 2029, and $1.1 billion of senior unsecured notes
maturing in 2026.
-- S&P values the company as a going concern because it believes
that it would likely be reorganized rather than liquidated
following a payment default to maximize the recovery value for its
creditors.
-- S&P applied a 6.5x multiple to its estimated distressed
emergence EBITDA of $547 million to calculate a gross recovery
value of about $3.56 billion.
-- This valuation multiple is consistent with the multiples S&P
uses for similar software companies that provide data analytics in
the health care information technology (IT) industry.
Simulated default assumptions:
-- Simulated year of default: 2025
-- EBITDA at emergence: $547 million
-- EBITDA multiple: 6.5x
Simplified waterfall:
-- Net enterprise value (after 5% administrative costs): $3.38
billion
-- Valuation split (obligors/nonobligors): 100%/0%
-- Total collateral value available to secured debt: $3.38
billion
-- Secured first-lien debt: $3.963 billion
--Recovery expectations: 70%-90% (rounded estimate: 85%)
-- Total second-lien claims: $340 million
--Recovery expectations: 0%-10% (rounded estimate: 0%)
-- Total senior unsecured claims: $1.154 billion
--Recovery expectations: 0%-10% (rounded estimate: 0%)
Note: All debt amounts include six months of prepetition interest.
Ratings List
ISSUE-LEVEL RATINGS CORRECTED
TO FROM
VERSCEND HOLDING CORP
Senior Secured CCC+ B+
Recovery Rating 6(0%) 2(85%)
VIPER PRODUCTS: United Fleet Buying Vehicles & Trailers for $200K
-----------------------------------------------------------------
Viper Products & Services, LLC, asks the U.S. Bankruptcy Court for
the Northern District of Texas to authorize the sale of the
following identified vehicles and trailers to United Fleet Sales,
LLC and/or its assigns (AUnited Fleet@), for the sum of $200,000:
Item VIN # Est. Payoff
Lienholder/Lessor
2015 Ford F-250 Crew Cab 1FT7W2BT0FEC22355
Vista Bank
2016 Ford F-350 Crew Cab 1FT8W3BT2GEA64337
Vista Bank
2018 Ford F-150 XLT 1FTEW1E56JKF34737 $21,935.46
Ally Bank
2019 Ford F-150 XLT 1FTEW1E51KKC43029 $24,2326.94
TransWorld
2019 Ford F-150 XLT 1FTEW1E51KKC43032 $24,2326.94
TransWorld
2007 International 4300 1HTMMAAM17H462336
Vista Bank
2013 International 4300 1HTMMAAL5DJ384848
Vista Bank
2016 International 4300 3HAMMMML5GL272893
Vista Bank
2012 International 4300 3HAMMAAL8CL634521
Vista Bank
2019 Ford F-450 1FD0W4HT0KEG88121 $56,036.62
Ally Bank
M 59 Backhoe/Kubota
Vista Bank
Trash Trailer TT-01
Vista Bank
The Objection Deadline is March 11, 2022.
The proposed bid for the vehicles and trailers is in line with
other bids received by the Debtor to date for vehicles and trailers
of similar makes and models. By the Motion, the Debtor seeks to
sell the vehicles and trailers to United Fleet free and clear of
all liens, claims, encumbrances, and interests, with all valid
liens, claims, encumbrances, and interests, if any, attaching to
the proceeds of the sale.
The Debtor gives notice of its intent to sell the vehicles and
trailers described for the purchase price reflected on the signed
offer submitted by United Fleet, unless a higher bid is submitted
prior to the deadline for objections set by the Court.
Accordingly, if the Debtor receives a higher bid for the vehicles
and trailers prior to the objection deadline or United Fleet
withdraws its bid, the party with the highest bid submitted to the
Debtor will be awarded the property.
The Debtor believes the sale, as proposed, is in the best interest
of all creditors of the Estate and should be approved. Ally Bank
has a first and prior lien on two of the vehicles identified
pursuant to the loan documentation attached to its proofs of claim
on file in the bankruptcy proceeding. Two other vehicles being
sold are subject to leases with Transworld Leasing Corp. and are
subject to purchase option rights of the Debtor.
Pursuant to same, the Debtor will immediately pay the proceeds of
the sale to Ally Bank and Transworld Leasing Corp., respectively,
to the extent of their note balances and/or lease purchase option
amounts for the vehicles, which estimated payoff amounts are
reflected on the table set forth. The Debtor is also advised that
there are ad valorem tax liens which will also need to be paid from
the net proceeds of the sale. As Vista Bank also has a lien on all
the assets of the Debtor=s estate, the Debtor will pay all
remaining net proceeds of the sale to Vista.
A copy of the Agreement is available at
https://tinyurl.com/nhdvm7h8 from PacerMonitor.com free of charge.
About Viper Products & Services
Viper Products & Services, LLC provides environmentally sound
solutions for the oil and gas industry. Based in Lubbock, Texas,
Viper Products & Services offers oil spill management, testing,
reporting, remediation, reclamation, excavation, and bore and core
drilling services.
Viper Products & Services filed its voluntary petition for relief
under Chapter 11 of the Bankruptcy Code (Bankr. N.D. Texas Case
No.
21-50187) on Dec. 13, 2021, listing $1 million to $10 million in
both assets and liabilities. Zack Tuttle, manager, signed the
petition.
The Debtor tapped McWhorter, Cobb & Johnson, LLP as legal counsel
and Charles W. Darter, Jr. as accountant.
WATERLOO AFFORDABLE: Proposes Procedures for Sale of All Assets
---------------------------------------------------------------
Waterloo Affordable Housing, LLC, asks approval from the U.S.
Bankruptcy Court for the District of Nebraska of proposed sale
procedures in connection with the auction sale of substantially all
assets.
After evaluating all of its alternatives, including the attempted
filing of a plan of reorganization, the Debtor believes it is in
its best interest, as well as the best interest of its estate, and
its creditors, to sell the Assets. The Debtor, through its broker,
SVN Affordable Levental Realty, will seek to market the Assets,
including contacting, and providing information to potential buyers
already identified.
In order to ensure that the highest and best offer is obtained for
the Assets, the Debtor, in conjunction with its secured lender,
Walker and Dunlap, LLC (W & D), seeks the Court's approval and the
establishment of certain Sale Procedures filed in conjunction to
govern the sale contemplated.
The Debtor submits that it will provide notice that: (a) will be
served in a manner that provides adequate notice of the proposed
Sale process including the Sale Procedures and of the date, time,
and location of the Sale Hearing; (b) informs parties in interest
of the deadlines for objecting to any proposed Sale transaction,
including any Stalking Horse Transaction; and (c) otherwise include
all information relevant to parties interested in or which may be
affected by a Sale. After entry of the Sale Procedures Order, and
if the Notice is approved by the Court, the Debtor will serve the
Notice upon the parties indicated therein.
The Debtor submits that such will constitute good and adequate
notice of the Sale and the proceedings with respect thereto in
compliance with Neb. R. Bankr. P. 6004-1 (C ) and Fed. R. Bankr. P.
2002(c), proceeds of any sale will first be paid to W&D in
satisfaction of W&D’s secured claim in the approximate amount
$2,000, the remaining proceeds will be paid to National Equity Fund
which may assert a claim in excess of $600,000 and insiders of the
Debtor with respect to unsecured claims in excess of $1.85 million,
all to the extent allowed by the Court. W&D has participated in
and negotiated the terms of this Motion and, while reserving all
rights, agrress to the terms and filing thereof.
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, listing as much as
$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.
The Debtor filed its Chapter 11 plan and disclosure statement on
Sept. 9, 2021.
WILLCO XII: Court Approves Disclosure Statement
-----------------------------------------------
Judge Thomas B. McNamara has entered an order approving the
Disclosure Statement of Willco XII Development, LLLP.
A hearing for consideration of confirmation of the Plan and such
objections is set for Tuesday, April 19, 2022, at 1:30 p.m., before
the undersigned Judge in the United States Bankruptcy Court for the
District of Colorado, Courtroom E, U.S. Custom House, 721 19th
Street, Denver, Colorado.
The hearing on adequacy of the Disclosure Statement scheduled for
Tuesday, March 1, 2022, at 1:30 p.m.
Ballots accepting or rejecting the Plan must be submitted by the
holders of all claims or interests entitled to vote on the Plan on
or before 5:00 p.m. on April 5, 2022, to Debtor's counsel, Lance J.
Goff; 3015 47th Street, Suite E-1, Boulder, CO 80301.
On or before April 5, 2022, any objection to confirmation of the
Plan must be filed and served on Debtor's counsel.
April 5, 2022, is fixed as the last day for filing written
acceptances or rejections of the Plan.
On or before April 14, 2022, the Debtor must file a Summary Report
of the Ballots received reflecting all votes by class, number of
claims and amount of claim.
About Willco XII Development
Willco XII Development, LLLP, owns the hotel property at 4851
Thompson Parkway, in Johnstown Colorado, currently identified as
the Comfort Inn & Suites in Johnstown. The company is a unit of
William G. Albrecht's Spirit Hospitality, LLC.
Willco XII Development sought Chapter 11 protection (Bankr. D.
Colo. Case No. 20-16307) on Sept. 23, 2020, to stop its lender from
foreclosing on the property.
The Debtor disclosed $14.2 million in assets and $10.274 million in
liabilities as of the bankruptcy filing. The Debtor's property is
valued at $13 million and secures a $6.4 million first mortgage to
the FirstBank of Colorado and a $3.46 million second mortgage to
Wells Fargo.
Lance J. Goff represents the Debtor.
FirstBank, as lender, is represented by Chad Caby, Esq. at LEWIS
ROCA ROTGHERBER CHRISTIE LLP.
WILMA & FRIEDA'S: Wins Interim Cash Collateral Access
-----------------------------------------------------
The U.S. Bankruptcy Court for the Central District of California,
San Fernando Valley Division, has authorized Wilma & Frieda's Inc.,
dba Wilma & Frieda's Cafe, to use cash collateral on an interim
basis.
As adequate protection, the Debtor will provide West Coast Business
Capital, LLC with a replacement lien on its post-petition assets
pursuant to the collateral described in West Coast's UCC Financing
Statement with the same priority as existed prior to the filing and
up to the value of the cash collateral actually used
post-petition. West Coast's replacement lien will exclude the
Debtor's real property leasehold interest and any furniture,
fixture, and equipment that does not belong to the Debtor. The
Debtor will pay West Coast monthly adequate protection payment in
the amount of $1,000.
A final cash collateral hearing on the matter is scheduled for
March 17, 2022 at 2 pm.
A copy of the order is available at https://bit.ly/3vwoRll from
PacerMonitor.com.
About Wilma & Frieda's Inc.
Wilma & Frieda's Inc., owns and operates the Wilma & Frieda's Cafe.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. C.D. Cal. Case No. 22-10147) on February 9,
2022. In the petition signed by Kelly McFall, chief executive
officer, the Debtor disclosed up to $50,000 in assets and up to $10
million in liabilities.
Judge Victoria S. Kaufman oversees the case.
Michael Jay Berger, Esq., at the Law Offices of Michael Jay Berger,
is the Debtor's counsel.
WITCHEY ENTERPRISES: DOJ Watchdog Directed to Appoint Trustee
-------------------------------------------------------------
Judge Henry W. Van Eck of the U.S. Bankruptcy Court for the Middle
District of Pennsylvania directed the U.S. Trustee to appoint a
Chapter 11 Trustee for Witchey Enterprises, Inc.
The Order came after the U.S. Trustee filed its Motion to Convert
Debtor's Chapter 11 case to a case under Chapter 7 and the Debtor's
Response to same.
About Witchey Enterprises
Witchey Enterprises, Inc., a Wilkes-Barre, Pa.-based provider of
courier and express delivery services, filed a Chapter 11 petition
(Bankr. M.D. Pa. Case No. 19-00645) on Feb. 14, 2019. Louis
Witchey, its president, signed the petition. At the time of filing,
the Debtor had between $1 million and $10 million in both assets
and liabilities. Judge Patricia M. Mayer oversees the case. The
Debtor tapped Andrew Joseph Katsock, III, Esq., as legal counsel,
and David L. Haldeman as accountant.
WITCHEY ENTERPRISES: Enters Asset Purchase Agreement with Superior
------------------------------------------------------------------
Witchey Enterprises, Inc., submitted a Fifth Amended Plan of
Reorganization dated Feb. 28, 2022.
The Fifth Amended Plan of Reorganization proposes to pay creditors
from continued operations.
On February 23, 2021, the Court entered an Order Granting Insurance
Company's Agreed Supplemental Application for Allowance and Payment
of an Administrative Expense, granting Protective Insurance Company
an administrative expense claim in the amount of $105,795.13.
The Protective Insurance Admin Order provided, in part, that the
administrative expense claim of $105,795.13 was to be paid in
weekly installments of $1,000.00 each starting on February 12, 2021
and continuing each Friday thereafter through February 10, 2023
with a final payment of $795.13 on February 17, 2023. At the time
of entry of the Protective Insurance Admin Order, the Debtor
experience significant cash flow issues and was not aware that it
was entitled to receive funds in connection with CARES Act.
Accordingly, due to the newly discovered evidence regarding the
Debtor's entitlement to funds in connection with the CARES Act that
could not have been reasonably discovered at the time of entry of
the Protective Insurance Admin Order, the Debtor and Protective
Insurance Company have agreed that the payment terms pursuant to
the Protective Insurance Admin Order, shall be modified as
follows:
* The Debtor shall continue paying Protective Insurance
Company a $1,000.00 per week, with the remaining balance of
Protective Insurance Company's administrative expense claim to be
paid in full within 5 days of the effective date of the Plan. Until
the effective date of the Plan, Protective Insurance Company shall
continue to be entitled to deduct from the Debtor's PNC Bank
Account, via ACH transfers, all weekly payments towards its allowed
administrative expense claim as they come due.
* The Debtor shall continue paying all weekly premiums as they
come due for its current liability insurance policies with
Protective Insurance Company ("Current Policies"). All such
payments for the Current Policies shall be made to Marsh (insurance
agent) pursuant to its standard billing practices. The weekly
premium payments for the Current Policies are subject to a master
renewal date of June 1, 2022, at which point new weekly premiums
will be calculated.
Class 4 consists of General Unsecured Creditors. The Debtor
proposes to pay the final allowed unsecured claims up to a total of
$150,000.00 following the 60 months after the effective date of the
plan. The estimated unsecured debt is $1,200,000. The debtor
proposes to make distributions from available funds. The Debtor
proposes to pay no interest on these unsecured claims.
The Debtor has entered into an Asset Purchase Agreement with
Superior Transport Solutions, Inc. for the sale of its FedEx
Package System, Inc. Route for the total purchase price of
$150,000.00. The Buyer is buying only the Assets specifically
utilized in the package delivery system for Scranton, Pennsylvania,
and no other package delivery routes.
The Debtor is not selling-off and will continue to operate all
remaining FedEx Package System, Inc. Routes. The Buyer is not
assuming any liabilities or leases of the Debtor. The Debtor has
suffered an inability to grow revenues and reduce costs in its
business and is experiencing difficulties in its cash flow. Thus,
the Debtor may not be able to continue to operate unless the sale
is approved. Therefore, the Debtor believes it is necessary to sell
this specific FedEx Route.
Louis Witchey is the current equity security holder of the Debtor.
He shall retain his interest but shall not be allowed to takey any
dividend of the reorganized corporation until the plan has been
completed and all creditors are paid.
Louis Witchey, individually, will provide $20,000 in cash infusions
to the Debtor entity as new value to fund the Plan. The Debtor has
entered into an Asset Purchase Agreement with Superior Transport
Solutions, Inc. for the sale of its FedEx Package System, Inc.
Route for the total purchase price of $150,000.00.
A full-text copy of the Fifth Amended Plan of Reorganization dated
Feb. 28, 2022, is available at https://bit.ly/3vwsU0Y from
PacerMonitor.com at no charge.
Attorney for Debtor:
Andrew Joseph Katsock, III
15 Sunrise Drive
Wilkes Barre, PA 18705
Fax: (570)829-5884
Email: ajkesq@comcast.net
About Witchey Enterprises
Witchey Enterprises, Inc., a Wilkes-Barre, Pa.-based provider of
courier and express delivery services, filed a Chapter 11 petition
(Bankr. M.D. Pa. Case No. 19-00645) on Feb. 14, 2019. Louis
Witchey, president, signed the petition. At the time of filing,
the Debtor had between $1 million and $10 million in both assets
and liabilities. Judge Patricia M. Mayer oversees the case. The
Debtor tapped Andrew Joseph Katsock, III, Esq., as legal counsel
and David L. Haldeman as accountant.
WNJ24K LLC: Court Approves Disclosure Statement
-----------------------------------------------
Judge Madeleine C. Wanslee has entered an order approving the
Disclosure Statement of WNJ24K, LLC.
The Court will consider whether to confirm the Plan at a hearing on
April 5, 2022, at 2:00 p.m.
The objection must be filed by March 25, 2022 (which date is at
least 7 calendar days prior to the initial confirmation hearing).
To be timely, a completed Ballot must be delivered to the Proponent
by March 25, 2022 at 5:00 P.M. MST (which is at least 5 business
days prior to the Confirmation Hearing).
The Proponent must file a report, consistent with Local Bankruptcy
Rule 3018-1, no later than 3 business days prior to the
Confirmation Hearing.
About WNJ24K LLC
WNJ24K, LLC, a single asset real estate investment entity that owns
a luxury residence located at 6418 E. Joshua Tree Lane, Paradise
Valley, Arizona, sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. D. Ariz. Case No. 21-05257) on July 8,
2021, listing as much as $10 million in both assets and
liabilities. Judge Madeleine C. Wanslee oversees the case. May,
Potenza, Baran & Gillespie, P.C., is the Debtor's legal counsel.
[] 2021 Pittsburgh Bankruptcies at Lowest Level in 20 Years
-----------------------------------------------------------
Patty Tascarella of Pittsburgh Business Times reports that
bankruptcy filings by Pittsburgh area businesses in 2021 dropped
beneath 200 for the first time in at least 20 years at 169,
dropping 20% under the previous low point, of 212 in 2020. During
the three months ended Dec. 31, 2021 there were 43 commercial
filings with the U.S. Bankruptcy Court for the Western District of
Pennsylvania. Of these, 26 were Chapter 7 or liquidation, 12 were
Chapter 11, or restructuring, and the remainder Chapter 13 for sole
proprietors. The data was supplied by the American Bankruptcy
Institute.
The full-year breakout saw twice as many Chapter 7 filings as
Chapter 11s, 98 versus 46.
"The biggest thing that jumped out to me was the continued absence
of restructuring activity and Chapter 11 filings in any meaningful
number," said Michael Shiner, group head of Tucker Arensberg PC’s
bankruptcy and creditors rights department. “It appears to us
that the banks are still in a mode where they're providing
extensions, especially to companies that were healthy before
Covid-19 and, even if they're experiencing difficulties because of
the pandemic, (lenders) are continuing to work with them.'
Timothy Palmer, head of the firm-wide bankruptcy practice at
Buchanan Ingersoll & Rooney PC, noted a "steady diet" of
out-of-court restructurings.
"Because of the liquidity of the market, we're able to do things
out of court, which tends to be more efficient and companies don't
have to face the difficult decision of a bankruptcy filing," Palmer
said. "It's continuing the trend we saw last year. The economy is
strong, the businesses are still able to benefit from the various
stimulus programs and PPP money. Many of them have that money
squirreled away for a rainy day."
For point of comparison, the high of 620 filings occurred in 2009,
reflecting the Great Recession during which there was no federal
stimulus, notably the Paycheck Protection Program that debuted in
April 2020 and had a second round in 2021. PPP was created to get
federal funding quickly to small businesses and, if they used the
money as intended, to pay employees and overhead, the loans could
be converted to grants and fully or partially forgiven, translating
to free money. PPP loans for both years came to almost $790
billion; so far, nearly $699 billion, or 88%, has been forgiven.
"I think we're seeing the continued effect of the use by virtually
every company that qualified for the PPP program," Shiner said.
"That equity infusion helped shore up companies that otherwise
wouldn’t have made it through the pandemic."
But now it seems very unlikely that a third round of PPP will be
coming. Plus, the interest rate hikes indicated by the Federal
Reserve are looming and inflation has accelerated.
"I do think that combination, together with the tight labor market,
is going to lead to an increase in default bankruptcy filings in
the second and third quarters of the year," Shiner said. "Part of
me thinks we might be better off without additional stimulus at
this point. Another massive infusion of government funds into the
economy is going to make inflation worse at this point."
Take the hospitality sector.
"I keep thinking one of these days, the hammer is going to fall and
some of these hotel properties that have been running at very low
occupancy levels for an extended period of time are going to end up
defaulted by their banks and end up in receivership or bankruptcy,"
Shriner said. "But, by and large, it isn't happening yet. It
reflects in part, an understanding by the lenders that the values
on these properties are materially different than what they were
before Covid and, if they force them into liquidation now,
they’re going to take significant losses."
But some industry sectors that seemed to be headed for tough times
last summer have rebounded. Palmer pointed to energy, where the
pricing environment has surged upward.
"If there's going to be an increase in business filings, it's
probably not going to happen until later in the third or fourth
quarter based on what we’ve seen," Palmer said. "There's just a
lot of liquidity and, therefore, companies are able to refinance
and avoid bankruptcy."
Nationally, commercial filings fell 31% last year to 22,339,
compared to 2020, the American Bankruptcy Institute said, citing
data provided by Epiq. Chapter 11 filings dropped 48%.
"The decrease in filings in 2021 is a reflection of the government
relief programs, moratoriums, lender deferments and low interest
rates intended to help families and businesses weather the economic
challenges resulting from the Covid-19 pandemic," ABI Executive
Director Amy Quackenboss said in a prepared statement. "Consumers
and businesses are now facing the new year with less government
relief, fewer lender deferments, rising inflation, worker shortages
and supply chain challenges as the pandemic continues."
[^] BOOK REVIEW: The Titans of Takeover
---------------------------------------
Author: Robert Slater
Publisher: Beard Books
Softcover: 252 pages
List Price: $34.95
Order your personal copy at
http://www.beardbooks.com/beardbooks/the_titans_of_takeover.html
Once upon a time -- and for a very long while -- corporate
behemoths decided for themselves when and if they would merge. No
doubt such decisions were reached the civilized way, in a proper
men's club with plenty of good brandy and better cigars. Like
giants, they strode Wall Street, fearing no one save the odd
trust-busting politico, mutton-chopped at the turn of the twentieth
century, perhaps mustachioed in the 1960s when the word was no
longer trust but monopoly.
Then came the decade of the 1980s. Enter the corporate raiders,
men with cash in hand, shrewd business sense, and not a shred of
reverence for the Way Things Have Always Been Done. These
businesspeople -- T. Boone Pickens, Carl Icahn, Saul Steinberg, Ted
Turner -- saw what others missed: that many of the corporate giants
were anomalies, possessed of assets well worth possessing yet with
stock market performances so unimpressive that they could be had
for bargain prices.
When the corporate raiders needed expert help, enter the investment
bankers (Joseph Perella and Bruce Wasserstein) and the M&A
attorneys (Joseph Flom and Martin Lipton). And when the merger
went through, enter the arbitragers who took advantage of stock
run-ups, people like Ivan "Greed is Good" Boesky.
The takeover frenzy of the 1980s looked like a game of Monopoly
come to life, where billion-dollar companies seemed to change
ownership as quickly as Boardwalk or Park Place on a sweet roll of
dice.
By mid-decade, every industry had been affected: in 1985, 3,000
transactions took place, worth a record-breaking $200 billion. The
players caught the fancy of the media and began showing up in the
news until their faces were almost as familiar to the public as the
postman's. As a result, Jane and John Q. Citizen's in Wall Street
began its climb from near zero to the peak where (for different
reasons) it is today.
What caused this avalanche of activity? Three words: President
Ronald Reagan. Perhaps his most firmly held conviction was that
Big Business was Being shackled by the antitrust laws, deprived a
fair fight against foreign competitors that has no equivalent of
the Clayton Act in their homelands.
Reagan took office on Jan. 20, 1981, and it wasn't long after that
that his Attorney General, William French Smith, trotted before the
D.C. Bar to opine that, "Bigness does not necessarily mean badness.
Efficient firms should not be hobbled under the guise of antitrust
enforcement." (This new approach may have been a necessary
corrective to the over-zealousness of earlier years, exemplified by
the Supreme Court's 1966 decision upholding an enforcement action
against the merger of two supermarket chains because the Court felt
their combined share of 8% (yes, that's "eight percent") of the Los
Angeles market was potentially anticompetitive.)
Raiders, investment bankers, lawyers, and arbitragers, plus the fun
couple Bill Agee and Mary Cunningham --remember them? -- are the
personalities Profiled in Robert Slater's book, originally
published in 1987, Slater is a wonderful writer, and he's given us
a book no less readable for being absolutely stuffed with facts,
many of them based on exclusive behind-the-scenes interviews.
About The Author
Robert Slater has authored several business books, which have been
on the best-seller lists. He has been a journalist for Newsweek and
Time.
*********
Monday's edition of the TCR delivers a list of indicative prices
for bond issues that reportedly trade well below par. Prices are
obtained by TCR editors from a variety of outside sources during
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Each Friday's edition of the TCR includes a review about a book of
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then-ending.
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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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Randy Antoni, Jhonas Dampog, Marites Claro, Joy Agravante,
Rousel Elaine Tumanda, Joel Anthony G. Lopez, Psyche A. Castillon,
Ivy B. Magdadaro, Carlo Fernandez, Christopher G. Patalinghug, and
Peter A. Chapman, Editors.
Copyright 2022. All rights reserved. ISSN: 1520-9474.
This material is copyrighted and any commercial use, resale or
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*** End of Transmission ***