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240410.mbx T R O U B L E D C O M P A N Y R E P O R T E R Wednesday, April 10, 2024, Vol. 28, No. 100 Headlines 1191 DOLSONTOWN: Rental Income to Fund Plan Payments 13111 WESTHEIMER: Unsecureds Get Share of Refinancing Transaction 304 KENMORE AVE: Voluntary Chapter 11 Case Summary ACORDA THERAPEUTICS: $20MM DIP Loan from GLAS Has Interim OK ACORDA THERAPEUTICS: Reports $252.9 Million Net Loss in 2023 ACTION FACE: Hilco Seeks Offers for Intangible Assets AGEAGLE AERIAL: WithumSmith+Brown Raises Going Concern Doubt AIRSPAN NETWORK: $53MM DIP Loan from DBFIP ANI Has Interim OK ALAMO DRAFTHOUSE CINEMA: Explores Sale of Assets ANADA INC: Case Summary & Seven Unsecured Creditors ANTIBE THERAPEUTICS: To File Application Under CCAA ARIS WATER: S&P Affirms 'B+' Issuer Credit Rating, Outlook Stable ATLANTIC CITY, NJ: Moody's Ups Issuer Rating to Ba1, Outlook Pos. BAFFINLAND IRON: S&P Raises ICR to 'CCC' on Maturity Extension BARRIO DOGG: David Wood of Marshack Named Subchapter V Trustee BARRIO RESTAURANT: David Wood Named Subchapter V Trustee BENDED PAGE: Tattered Cover Offered for Sale, Says Parent BH&G HOLDINGS: Files Amendment to Disclosure Statement BIOLARGO INC: Hacker, Johnson & Smith Raises Going Concern Doubt BMA LLC: Involuntary Chapter 11 Case Summary BOROHUB GARDENS: Says Unsecureds Unimpaired in Sale Plan C-BOND SYSTEMS: Salberg & Company Raises Going Concern Doubt CANO HEALTH: Proposes Dual-Track Chapter 11 Plan CANO HEALTH: Seeks Approval of Disclosure Statement CAROLINA SLEEP: Case Summary & Five Unsecured Creditors CATHETER PRECISION: WithumSmith+Brown Raises Going Concern Doubt CLEARSIGN TECHNOLOGIES: Auditor Raises Going Concern Doubt CLEARY PACKAGING: Court Confirms Plan, Approves Cantwell Deal CLST ENTERPRISES: Case Summary & Four Unsecured Creditors COCO SUSHI: Case Summary & 20 Largest Unsecured Creditors CODERSLINK LLC: Hits Chapter 11 Bankruptcy Protection CONVERGEONE HOLDINGS: Cleared to Seek Expedited Chapter 11 Exit CONVERGEONE HOLDINGS: Davis Polk & Haynes Advise 2nd Lien Lenders CONVERGEONE HOLDINGS: Gibson & Porter Advise 1st Lien Ad Hoc Group COSTA SHIPPING: David Wood of Marshack Named Subchapter V Trustee D & D DRYWALL: Mark Sharf Named Subchapter V Trustee DESERT HAWK: Assure CPA Raises Going Concern Doubt DIAMOND SPORTS: Renews Multi-Year Distribution Deal w/ Charter DIOCESE OF SYRACUSE: Interstate Says Amended Disclosures Inadequate DISH DBS: KPMG Raises Going Concern Doubt EASTSIDE DISTILLING: M&K CPAs Raises Going Concern Doubt ECL ENTERTAINMENT: S&P Rates New Senior Secured Term Loan 'B+' ELECTRIC LAST: $2.7Mil. Executives Settlement Nears Initial Okay ENCHANTED LITTLE: Unsecureds to Get Remaining Funds Available ENDO FINANCE: Moody's Rates New $1.25BB Senior Secured Notes 'B2' ENDO FINANCE: S&P Rates New Senior Secured Notes 'B+' ENVIVA INC: Receives NYSE Non-Compliance Notice Over Delayed 10-K ESCAPE VELOCITY: Moody's Alters Outlook on 'B3' CFR to Stable ETTA COLLECTIVE: Set to Auction Its Assets FARMER'S PEANUT: Case Summary & 11 Unsecured Creditors FEC RESOURCES: DMCL LLP Raises Going Concern Doubt FISKER INC: Fails to Make March 29 Payment, Gets Short Forbearance FISKER INC: William McDermott Resigns; John Dubel Named Director FLUENT INC: Reports $63.2 Million Net Loss in 2023 FOCUS UNIVERSAL: Weinberg & Company Raises Going Concern Doubt FREEDOM PLUMBERS: Court Approves Disclosure Statement FREMONT TERRACE: Creditor Says Plan Disclosures Inadequate FTX GROUP: Hedge Funds to Profit From Bankruptcy Claims GARTNER INC: Moody's Ups Rating on Senior Unsecured Notes From Ba1 GHOST RECYCLING: Case Summary & 11 Unsecured Creditors GUARDIAN FUND: Available Cash & Sale Proceeds to Fund Plan HEALTHY EXTRACTS: BF Borgers CPA Raises Going Concern Doubt HERITAGE CANNABIS: Obtains Initial Order Under CCAA IMPEL PHARMA: Amended Joint Plan of Liquidation Takes Effect INSOURCE SUPPLIES: Samuel Dawidowicz Named Subchapter V Trustee INTRUSION INC: Whitley Penn Raises Going Concern Doubt ITTELLA INTERNATIONAL: Court Approves Disclosure Statement JD MOTORSPORTS: Case Summary & 20 Largest Unsecured Creditors JLK CONSTRUCTION: FCCI Opposes Plan Shield for Kagarices KRAIG BOCRAFT: M&K CPAs Raises Going Concern Doubt L.O.F. INC: Case Summary & 20 Largest Unsecured Creditors LATAM AIRLINES: Okayed to Start NYSE ADRs Listing Process Again LENDINGTREE INC: S&P Upgrades ICR to 'B-', Outlook Stable LITIGATION PRACTICE: May 15 Hearing on Disclosure Statement LITIGATION PRACTICE: Trustee and Committee Propose Liquidation Plan LORDSTOWN MOTORS: Settles Ex-CEO Steve Burns Fraud Charges MAJESTIC GARDENS: Unsecureds Will Get 100% of Claims in Plan MIDCAP FINANCIAL: Moody's Affirms 'Ba3' CFR, Outlook Stable MKS REAL ESTATE: Unsecureds Owed $582K to Get 100% Over 71 Months MV REALTY: Unsecureds to Get Share of GUC Distributions NEVER SLIP: $30MM DIP Loan from Antares Has Interim OK NORTHERN DYNASTY: Deloitte LLP Raises Going Concern Doubt ONDAS HOLDINGS: RRBB PA Raises Going Concern Doubt ONEMETA INC: M&K CPAs Raises Going Concern Doubt ORENGO AIR: Case Summary & 18 Unsecured Creditors PEAR THERAPEUTICS: To Seek Plan Confirmation on May 6 PLANET GREEN: YCM CPA Raises Going Concern Doubt POLYMER EXTRUSION: Unsecureds Owed $706K to Get 6% of Claims PRIDE GROUP: Chapter 15 Case Summary RAPID P&P: United Bank Says Disclosure Inadequate RICEBRAN TECH: WithumSmith+Brown Raises Going Concern Doubt SAVAGE ENTERPRISES: Fitch Assigns 'B+' LongTerm IDR, Outlook Stable SAVAGE ENTERPRISES: S&P Affirms 'BB-' ICR on Acquisition of Texon SCHULTE INC: Case Summary & 20 Largest Unsecured Creditors SKYX PLATFORMS: M&K CPAs Raises Going Concern Doubt SOILOGIC INC: Unsecureds Get Paid Over 5 Years or Until Fully Paid SONIC AUTOMOTIVE: Fitch Affirms 'BB' LongTerm IDR, Outlook Stable STARCO BRANDS: Macias, Gini, & O'Connell Raises Going Concern Doubt STEWARD HEALTH: Plans to Sell Its Managed Services Organization SUNSTOCK INC: Fruci & Associates II Raises Going Concern Doubt SURGE TRANSPORTATION: Unsecureds get Share of Exit Loan Facility TASEKO MINES: Fitch Rates Proposed $500MM 2nd Lien Notes 'B-' TASEKO MINES: Moody's Rates New $500MM Senior Secured Notes 'B3' TASEKO MINES: S&P Rates New US$500MM Senior Secured Notes 'B-' TEHUM CARE: Court Grill Creditors Over Terms of Proposed Settlement TENNANT CO: S&P Withdraws 'BB' Issuer Credit Rating, Outlook Stable THREE SISTERS: Glen Watson Named Subchapter V Trustee TRANSMONTAIGNE PARTNERS: Fitch Affirms 'B' IDR, Outlook Stable TRANSMONTAIGNE PARTNERS: S&P Affirms 'B' ICR, Outlook Negative TREVENA INC: Ernst & Young Raises Going Concern Doubt TRILOGY METALS: Raises Going Concern Doubt TROIKA MEDIA: Posts $3.2 Million Profit in February TWO RIVERS: Unsecured Creditors to Recover 100% Under Plan VENTURE INC: Debtor Will Liquidate in Order to Pay Claims VIEW INC: Unsecured Creditors Unimpaired in Prepackaged Plan WHITTAKER CLARK: Fox Rothschild, Others Lose Official Committee Bid WISA TECHNOLOGIES: BPM LLP Raises Going Concern Doubt WOM SA: Downgraded by Moody's to 'Ca' After Chapter 11 Filing WORMHOLE LABS: Unsecured Owed $27.5M Get 95% of New Equity Interest ZEVRA THERAPEUTICS: Ernst & Young Raises Going Concern Doubt [] Seward & Kissel Formalizes Private Credit Group ********* 1191 DOLSONTOWN: Rental Income to Fund Plan Payments ---------------------------------------------------- 1191 Dolsontown Road, LLC, filed with the U.S. Bankruptcy Court for the Southern District of New York a Disclosure Statement describing Plan of Reorganization dated April 2, 2024. The Debtor was formed in May, 2014 and is a real estate holding company. 1191 Dolsontown Road, LLC owns mixed-use real property located at 1191 Dolsontown Road, Middletown, New York (the "Property"). The Property consists of approximately 1 acre with 3 buildings. Prior to the filing of the Chapter 11 petition, 1191 Dolsontown Road, LLC fell behind on its property tax obligations. The debtor has exerted substantial time, energy, and funds to manage and maintain the property. The Chapter 11 reorganization has allowed 1191 DOLSONTOWN ROAD, LLC the ability to reorganize. The Plan is based on the debtor's belief that a forced liquidation would be an economic waste to itself, its creditors and the community, as the Plan herein seeks to provide for payment in full of all creditors of the debtor. Class 3 consists of allowed claims for all other creditors of the debtor, subject to an allowance of their claims by the Court, will be paid in cash, in full on the Effective Date of the Plan. The claim in this class total the approximate sum of ($1,300.00). This class is not impaired and its vote will not be solicited. Class 4 consists of the interest of the stockholders of the debtor, William Hadden (50%) and Marie Hadden (50%), and will not be impaired. Said individuals will retain 100% of their ownership interest in the reorganized debtor, but shall not receive any dividends or payments under the Plan. Said individuals own 100% of the outstanding shares of the debtor corporation, and are insiders as defined by the Bankruptcy Code. The total amount reflected as unsecured debt does not include the claims of any insiders. William Hadden and Marie Hadden shall retain their interests as holders of the shares of stock in the corporation. The funds necessary for the satisfaction of creditors' claims shall be generated from the rents received in the ordinary course of the debtor's business and a contribution from the principals of the debtor. The maximum amount of cash that will be necessary to confirm the Plan is expected to be approximately $38,300.00 as and for the payments to Classes 1, 2, and 3 claims. Upon confirmation, the reorganized debtor shall be entitled to manage its affairs without further Order of this Court. A full-text copy of the Disclosure Statement dated April 2, 2024 is available at https://urlcurt.com/u?l=Mh0y58 from PacerMonitor.com at no charge. Attorneys for the Debtor: Michelle L. Trier, Esq. Andrea B. Malin, Esq. GENOVA AND MALIN 1136 Route 9 Wappingers Falls, NY 12590 Tel: (845) 298-1600 About 1191 Dolsontown Road 1191 Dolsontown Road, LLC, was formed in May, 2014 and is a real estate holding company. The Debtor filed a Chapter 11 bankruptcy petition (Bankr. S.D.N.Y. Case No. 19-36870) on Nov. 20, 2019, disclosing under $1 million in both assets and liabilities. The Debtor is represented by Michelle L. Trier, partner of Genova & Malin. 13111 WESTHEIMER: Unsecureds Get Share of Refinancing Transaction ----------------------------------------------------------------- 13111 Westheimer, LLC, submitted a Combined Amended Disclosure Statement and Chapter 11 Plan. The Debtor's primary asset is a 59,294 square foot Class B commercial building located in the Westchase District/Energy Corridor of Houston, Texas (the "Westheimer Property") having a total value of $3,491,200. Upon assuming control and management of the Westheimer Property in 2023, Gelt Financial retained the services of LandPark Advisors LLC to manage the day-to-day operations of the Westheimer Property and to assist with the leasing of available office space. As a result of mismanagement by the Former Members, the Debtor's financial affairs were in disarray with several tenants abandoning their leases at the time Gelt Financial assumed control. Through the efforts of Gelt Financial and LandPark Advisors, LLC, the Debtor rehabilitated its operations by obtaining additional tenants and repairing the Westheimer Property. Under the Plan, Class 4 is comprised of general unsecured claims of the Debtor. Holders of General Unsecured Claims and Litigation Claims in Class 4 shall receive Pro Rata monthly payments in Cash from the Refinancing Transaction on or before the Refinancing Deadline to the extent funds are available after the payment of Allowed Claims in Classes 1, 2, 3, and 4 (to the extent Class 4 is entitled to the Bottomline Payment). Litigation Claimants shall file proofs of claim by the Bar Date to receive payments under Section 5.1.4 of the Plan or will be treated in accordance with Section 11.5 of the Plan. In the event of any failure of the Reorganized Debtor to timely make its payments to holders of Claims in this Class, to the extent this Class is entitled to receive payment, an event of default under the Plan has occurred. If an event of default occurs, holders of Claims in Class 5 shall send a Notice of Default to the Reorganized Debtor and if such default is not cured within 30 days of such notice, Claimants in this Class may proceed to collect all amounts owed pursuant to state law without further recourse to the Bankruptcy Court. Claimants in Class 5 are only required to send 2 notices of default and upon the occurrence of a third event of default, Claimants may proceed to collect all amounts owed under state law without recourse to the Bankruptcy Court and further notice. Class 4 is impaired. Refinancing Deadline: April 1, 2027. Refinancing Transaction: The transaction that will occur on or before the Refinancing Deadline where the Reorganized Debtor will obtain funding from the refinancing of the secured obligations of the Debtor and/or sale of the Westheimer Property. The payments contemplated in this Plan shall be funded from Cash on hand and continued operations of the Debtor. The Debtor believes it will generate sufficient rental income to fund payments under the Plan. The For additional security, the Debtor further relies on the guarantee of payments from the Plan Sponsor under the Plan Sponsor Agreement. The Debtor's vacancy rate is= 27.12%, however, the Debtor awaiting the signature of two additional leases which will yield additional annual income of $46,000 and the Debtor anticipates lower its vacancy rate each month. Upon entry of the Confirmation Order, the Debtor shall be authorized to consummate the Plan Sponsor Agreement with the Plan Sponsor pursuant to the terms of the Plan Sponsor Agreement, the Plan, and the Confirmation Order. The transactions contemplated by the Plan Sponsor Agreement and the Plan are undertaken by the Debtor and the Plan sponsor without collusion and in good faith, and accordingly, the reversal or modification on appeal of the authorization provided herein to consummate the transactions contemplated thereunder and hereunder shall not affect the validity of such transaction. Counsel to the Debtor: Susan Tran Adams, Esq. Brendon D. Singh, Esq. TRAN SINGH LLP 2502 La Branch Street Houston, Texas 77004 Tel: (832) 975-7300 Fax: (832) 975-7301 E-mail: stran@ts-llp.com bsingh@ts-llp.com A copy of the Combined Amended Disclosure Statement and Chapter 11 Plan dated March 22, 2024, is available at https://tinyurl.ph/yWmEx from PacerMonitor.com. About 13111 Westheimer 13111 Westheimer, LLC, is a manager managed Texas limited liability company incorporated on December 18, 2018 and is currently managed by Investors 18, LLC. The Debtor sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D. Tex. Case No. 23-34448) on November 9, 2023. In the petition signed by Nik Lavrinoff, managing member of End Litigation Advisors, LLC, disclosed up to $10 million in both assets and liabilities. Judge Eduardo V. Rodriguez oversees the case. Susan Tran Adams, Esq., at Tran Singh, LLP, is the Debtor's legal counsel. 304 KENMORE AVE: Voluntary Chapter 11 Case Summary -------------------------------------------------- Debtor: 304 Kenmore Ave LLC 800 W 6th Street 16th Floor Los Angeles, CA 90017 Chapter 11 Petition Date: April 4, 2024 Court: United States Bankruptcy Court Central District of California Case No.: 24-12618 Judge: Hon. Barry Russell Debtor's Counsel: Donna C. Bullock, Esq. LAW OFFICES OF DONNA BULLOCK 800 W 6th St Ste 1250 Los Angeles, CA 90017 Tel: 562-726-0778 Fax: 562-683-0319 Estimated Assets: $1 million to $10 million Estimated Liabilities: $1 million to $10 million The petition was signed by Jonathan Pae, manager. A copy of the Debtor's list of 20 largest unsecured creditors is now available at https://www.pacermonitor.com/view/3K2W7PA/304_Kenmore_Ave_LLC__cacbke-24-12618__0001.1.pdf A full-text copy of the petition is now available at https://www.pacermonitor.com/view/3MIJCZQ/304_Kenmore_Ave_LLC__cacbke-24-12618__0001.0.pdf?mcid=tGE4TAMA ACORDA THERAPEUTICS: $20MM DIP Loan from GLAS Has Interim OK ------------------------------------------------------------ The U.S. Bankruptcy Court for the Southern District of New York authorized Acorda Therapeutics, Inc. to use cash collateral and obtain postpetition financing, on an interim basis, in accordance with the budget. The Debtor is permitted to obtain a senior secured priming and superpriority postpetition financing, consisting of a term loan facility for up to $20 million from a consortium of lenders, GLAS Americans LLC as collateral agent and GLAS USA LLC, as the administrative agent. The Debtor requires financing: (A) fund, among other things, to consummate the sale transactions contemplated by a Restructuring Support Agreement, ongoing working capital, general corporate expenditures and other financing needs of the Debtors, (B) subject to entry of a Final Order, convert $40 million of the outstanding principal amount of the Prepetition Secured Obligations to DIP Obligations under the DIP Loan Documents, (C) pay adequate protection amounts to the Prepetition Secured Parties, (D) pay transaction fees and other costs and expenses of administration of the Cases, and (E) pay fees and expenses (including reasonable attorneys' fees and expenses) and interest owed to the DIP Secured Parties under the DIP Loan Documents and the Interim Order. Pursuant to the Indenture dated December 23, 2019 among (a) Acorda, as issuer, (b) the guarantors party thereto from time to time, and (c) Wilmington Trust, National Association, as trustee and collateral agent, Acorda issued 6.00% Convertible Senior Secured Notes due 2024. As of the Petition Date, the Debtors owed Prepetition Secured Parties an aggregate principal amount of not less than $207 million. The Debtors have an immediate need to obtain the DIP Facility and use cash collateral to, among other things, permit the orderly continuation of the operation of their businesses, to maintain business relationships with vendors, suppliers, and customers, to make payroll, to make capital expenditures, to satisfy other working capital and operational needs, to complete the Debtors' marketing and sale process and to otherwise preserve the value of the Debtors' estates. As adequate protection, the Prepetition Agent, for the benefit of all the Prepetition Secured Parties, is granted replacement Liens upon all of the DIP Collateral. To the extent of Diminution in Prepetition Notes Collateral Value, the Prepetition Agent, for the benefit of the Prepetition Secured Parties, is further granted allowed superpriority administrative claims, pursuant to 11 U.S.C. section 507(b), with priority over all administrative expense claims and priority and other unsecured claims against the Debtors or their estates. A final hearing on the matter is set for April 26, 2024 at 10 a.m. A copy of the order is available at https://urlcurt.com/u?l=oZVPsp from PacerMonitor.com. About Acorda Therapeutics Acorda is a biopharmaceutical company that has developed breakthrough products, therapies, and biotechnology to restore function and improve the lives of people with neurological disorders. INBRIJA is approved for intermittent treatment of OFF episodes in adults with Parkinson's disease treated with carbidopa/levodopa. Acorda Therapeutics Inc. and its affiliates sought relief under Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D.N.Y. Lead Case No. 24-22284) on April 1, 2024. In the petition signed by Michael A. Gesser, as chief financial officer, the Debtor disclosed total assets as of Dec. 31, 2023, of $108,525,000 and total debt as of Dec. 31, 2023, of $266,204,000. The Honorable Bankruptcy Judge David S. Jones handles the case. Acorda is being advised by Baker McKenzie as legal counsel, Ernst & Young as financial advisor, and Ducera Partners and Leerink Partners as the investment bankers. Kroll Restructuring Administration is the claims agent. Merz is being advised by Freshfields Bruckhaus Deringer US LLP as legal counsel, Morgan Stanley as investment banker, and Deloitte as financial and tax advisors. Senior Convertible Noteholders are being advised by King & Spalding as legal counsel and Perella Weinberg Partners as investment banker. ACORDA THERAPEUTICS: Reports $252.9 Million Net Loss in 2023 ------------------------------------------------------------ Acorda Therapeutics, Inc. filed with the U.S. Securities and Exchange Commission its Annual Report on Form 10-K disclosing a net loss of $252.9 million on $117.6 of net revenue for the year ended December 31, 2023, compared to a net loss of $65.9 million on $118.6 million of net revenue for the year ended December 31, 2022. As of December 31, 2023, the Company had $108.5 million in total assets, $266.5 million in total liabilities, and $158 million in total stockholders' deficit. Stamford, Connecticut-based Ernst & Young, LLP, the Company's auditor since 2010, issued a "going concern" qualification in its report dated April 1, 2024, citing that the Company has a significant debt payment due in December 2024 for which significant uncertainties exist as it relates to the Company's ability to repay the debt principle as it currently is structured. The Company has stated that filing for relief under Chapter 11 of the United States Bankruptcy Code in the United States Bankruptcy Court for the Southern District of New York is imminent and has stated that substantial doubt exists about the Company's ability to continue as a going concern. A full-text copy of the Company's Form 10-K is available at https://tinyurl.com/bdhhyrr9 About Acorda Therapeutics Acorda is a biopharmaceutical company that has developed breakthrough products, therapies, and biotechnology to restore function and improve the lives of people with neurological disorders. INBRIJA is approved for intermittent treatment of OFF episodes in adults with Parkinson's disease treated with carbidopa/levodopa. Acorda Therapeutics Inc. and its affiliates sought relief under Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D.N.Y. Lead Case No. 24-22284) on April 1, 2024. In the petition signed by Michael A. Gesser, as chief financial officer, the Debtor disclosed total assets as of Dec. 31, 2023 amounting to $108,525,000 and total debt as of Dec. 31, 2023 of $266,204,000. The Honorable Bankruptcy Judge David S. Jones handles the case. Acorda is being advised by Baker McKenzie as legal counsel, Ernst & Young as financial advisor, and Ducera Partners and Leerink Partners as the investment bankers. Kroll Restructuring Administration is the claims agent. Merz is being advised by Freshfields Bruckhaus Deringer US LLP as legal counsel, Morgan Stanley as investment banker, and Deloitte as financial and tax advisors. Senior Convertible Noteholders are being advised by King & Spalding as legal counsel and Perella Weinberg Partners as investment banker. ACTION FACE: Hilco Seeks Offers for Intangible Assets ----------------------------------------------------- Hilco Streambank, a leading intellectual property advisory firm specializing in intangible asset valuation, advisory, and monetization services, on April 5 announced that it is seeking offers to acquire the intangible assets of Action Face, Inc. Action Face is a pioneering technology company that has developed an AI-powered platform to create instant 3D selfie avatars and action figures of users for use in virtual and augmented realities. This is a turnkey opportunity with existing and assumable agreements with HP for 3D printing action figures and with the NBA for franchise sublicensing. The deadline to submit a bid to acquire the assets is April 16, 2024. An auction will be conducted April 18, 2024. Founded in 2018, Action Face has developed first-of-its-kind technology that allows users to create photorealistic, personalized 3D selfie avatars and action figures of themselves quickly and easily by using the camera on their smartphone. Through a partnership with the NBA, users can create their lifelike avatars donning their favorite team's jerseys. Through a partnership with HP's HyperX division, users can also purchase custom, 3D-printed action figures of themselves, delivered directly to their door. Created for cross-platform compatibility, the 3D avatars can be used digitally in augmented and virtual reality environments, including on social media platforms such as Instagram, as well as within virtual reality and gaming environments that support user-created content such as avatars. The available intangible assets include the company's codebase supporting its full tech stack, registered trademarks, domain names, customer database, social media accounts, and a potentially assumable NBA sublicense and HP 3D-printing agreement. Hilco Streambank Chief Executive Officer Gabe Fried commented, "With the potential to tap into the $217 billion videogaming market and the projected $71 billion AR/VR market, acquiring Action Face's technology assets should be a compelling option for strategic operators across multiple sectors, including videogaming, digital entertainment, metaverse, and action figures and collectibles." Fried continued, "The potential to assume a valuable NBA sublicense as well as the 3D-printing agreement with HP also offers additional strategic advantage to a buyer looking to engage and expand its distribution and branded partnership capabilities." Interested parties can click here to learn more or directly contact the professionals at Hilco Streambank listed below at project+action@hilcoglobal.com. Gabe Fried Jordon Parker Stella Silverstein CEO VP Analyst Action Face, Inc. is a debtor in possession in a voluntary chapter 11 case pending before the United Stated Bankruptcy Court for the Central District of California, San Fernando Division, Case No. 24-10180-MB. Any potential designation of a stalking horse bidder or transaction related to this opportunity are subject to Bankruptcy Court approval. About Hilco Streambank Hilco Streambank -- http://www.HilcoStreambank.com-- is a preeminent intangible asset advisory firm specializing in all forms of intangible assets, including brands, data, software, patent portfolios and supporting technology. In connection with these assets, Hilco Streambank provides unmatched expertise in sell-side, buy-side, advisory and valuation services. Its sister companies, IPv4.Global and Hilco Digital Assets, offer both advisory services and online markets for digital assets. Hilco Streambank is part of Northbrook, Illinois based Hilco Global, the world's leading authority on maximizing the value of business assets by delivering valuation, monetization, and advisory solutions to an international marketplace. Hilco Global operates more than twenty specialized business units offering services that include asset valuation and appraisal, retail and industrial inventory acquisition and disposition, real estate, and strategic capital equity investments. About Action Face Action Face is a developer of customized selfie action figures and avatar videos starring the user, intended to capture memorable events in life. Action Face, Inc., filed its voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. C.D. Cal. Case No. 24-10180) on Feb. 5, 2024, listing $100,000 to $500,000 in assets and $1 million to $10 million in liabilities. The petition was signed by Kenneth Davis as chief executive officer. Ron Bender, at LEVENE, NEALE, BENDER, YOO & GOLUBCHIK L.L.P., is the Debtor's counsel. AGEAGLE AERIAL: WithumSmith+Brown Raises Going Concern Doubt ------------------------------------------------------------ AgEagle Aerial Systems Inc. disclosed in a Form 10-K Report filed with the U.S. Securities and Exchange Commission for the fiscal year ended December 31, 2023, that its auditor expressed that there is substantial doubt about the Company's ability to continue as a going concern. Orlando, Florida-based WithumSmith+Brown, PC, the Company's auditor since 2020, issued a "going concern" qualification in its report dated April 1, 2024, citing that the Company has suffered recurring losses from operations, has experienced cash used from operations in excess of its current cash position, and has an accumulated deficit, which raise substantial doubt about its ability to continue as a going concern. As of December 31, 2023, the Company had $0.8 million of cash on hand and working capital of negative $0.5 million. During the year ended December 31, 2023, the Company incurred a net loss of approximately $42.4 million and used cash in operating activities of approximately $11.0 million. While the Company has historically been successful in raising capital to meet its working capital needs, the ability to continue raising such capital to enable the Company to continue its growth is not guaranteed. As the Company will require additional liquidity to continue its operations and meet its financial obligations over the next 12 months, there is substantial doubt about the Company's ability to continue as a going concern. The Company is evaluating strategies to obtain the required additional funding for future operations and the restructuring of operations to grow revenues and reduce expenses. If the Company is unable to generate significant sales growth in the near term and raise additional capital, there is a risk that the Company could default on obligations; and could be required to discontinue or significantly reduce the scope of its operations if no other means of financing options are available. As of December 31, 2023, the Company had $25.2 million in total assets, $14.5 million in total liabilities, and $10.7 million in total stockholders' equity. A full-text copy of the Company's Form 10-K is available at https://tinyurl.com/u65aztav About AgEagle Aerial Systems Inc. Wichita, Kansas-based AgEagle Aerial Systems Inc. through its wholly owned subsidiaries, is actively engaged in designing and delivering best-in-class drones, sensors, and software that solve important problems for our customers. Founded in 2010, AgEagle was originally formed to pioneer proprietary, professional-grade, fixed-winged drones and aerial imagery-based data collection and analytics solutions for the agriculture industry. AIRSPAN NETWORK: $53MM DIP Loan from DBFIP ANI Has Interim OK ------------------------------------------------------------- The U.S. Bankruptcy Court for the District of Delaware authorized Airspan Networks Holdings Inc. and affiliates to use cash collateral and obtain postpetition financing, on an interim basis. Airspan Networks Inc. is permitted to receive postpetition financing pursuant to a superpriority, senior secured and priming debtor-in-possession term loan credit facility subject to the terms and conditions set forth in the Senior Secured Superpriority Debtor-in-Possession Term Loan Credit Agreement, from a consortium of lenders, agented by DBFIP ANI LLC, in an aggregate principal amount not to exceed $53.9 million, consisting of: i. a new money superpriority senior secured delayed draw term loan in the aggregate principal amount of $16.5 million, of which $7.5 million will be immediately available upon entry of the Interim Order in accordance with the terms and conditions set forth in the DIP Credit Agreement; and ii. a superpriority term loan facility in an aggregate principal amount of $37.4 million, which, concurrently with the initial funding of the DIP New Money Commitments, will be deemed funded in an equal amount of, and deemed substituted and exchanged with, Senior Secured Term Loans, which will be deemed converted into and exchanged for, such Roll-Up Loans in accordance with the terms and conditions set forth in the DIP Credit Agreement and the other DIP Documents. The DIP facility is due and payable on the earlier of (i) the Stated Maturity Date of October 2024, (ii) the consummation (as defined in 11 U.S.C. section 1101(2)) of any plan of reorganization under the Chapter 11 Cases, including pursuant to a Chapter 11 Plan that has been confirmed by the Confirmation Order, (iii) the consummation of a sale or other disposition of all or substantially all assets of the Debtors, taken as a whole, under 11 U.S.C. section 363 and (iv) the date of acceleration of the Term Loans and the termination of unused Commitments with respect to the DIP Term Facility in accordance with the terms of the Agreement. The Debtors are required to comply with these milestones. 1. On March 31, 2024, the Petition Date must have occurred and solicitation of the Chapter 11 Plan and a disclosure statement in respect thereof, each in form and substance satisfactory to the Requisite Lenders, must have been commenced prior to filing of the Chapter 11 Cases. 2. On the Petition Date plus 1 day, the Company must have filed a (i) motion seeking the scheduling of a combined hearing for approval of the Chapter 11 Plan and a disclosure statement in respect thereof (each in form and substance satisfactory to the Requisite Lenders) and (ii) motion seeking entry of the Interim Order (in form and substance satisfactory to the Requisite Lenders) with the U.S. Bankruptcy Court.1 3. On the Petition Date plus 3 days, the U.S. Bankruptcy Court must have entered the Interim Order in form and substance satisfactory to the Requisite Lenders. 4. On the Petition Date plus 25 days, the U.S. Bankruptcy Court must have entered the Final Order in form and substance satisfactory to the Requisite Lenders. 5. On the Petition Date plus 45 days, the U.S. Bankruptcy Court must have entered the Confirmation Order in form and substance satisfactory to the Requisite Lenders. 6. On the Petition Date plus 60 days, the Plan Effective Date must have occurred. 7. On the Closing Date and thereafter, no later than 5 p.m. (New York City time) on Friday of every calendar week, the Borrower must deliver to the Administrative Agent (i) a 13-week rolling cash flow forecast for Holdings and its Subsidiaries including a forecast of expenditures for the upcoming 13-week period, which must be acceptable to the Administrative Agent and reflect the Borrower's good faith projection of all weekly cash receipts and disbursements in connection with the operation of its business for the 13-week period beginning on such date of delivery; and (ii) a report certified by a Responsible Officer of the Borrower detailing the variances for the immediately preceding weekly period (as compared to the prior cash flow forecast) of the actual operating cash of the Borrower and providing supporting detail as to any material variances. 8. No later than 5 p.m. (New York City time) on Friday of every calendar week, commencing with the Friday in the first full calendar week following the Closing Date, the Borrower must deliver a report certified by a Responsible Officer of the Borrower in a form satisfactory to the Administrative Agent detailing the variances for the immediately preceding two weeks (as compared to the prior cash flow forecast) of the net cash flow of the Borrower and providing supporting detail as to any material variances. Except as otherwise permitted in writing by the Administrative Agent in its sole discretion, the Borrower must not permit the net cash flow for any two-week period ended on the close of business on the Friday immediately prior to the date on which the delivery of the Variance Report is required to be less than 80% of the net cash flow projected for such period in the previously delivered Budget. The Debtors have an immediate and critical need to obtain the DIP Financing and to use the Prepetition Collateral to, among other things (a) permit the orderly continuation of the operation of their business, (b) maintain business relationships with vendors, suppliers and customers, including governmental entities, (c) make payroll, (d) make capital expenditures, (e) satisfy other working capital and operational needs and (f) fund expenses of the Chapter 11 Cases. Pursuant to the Senior Secured Credit Agreement, dated December 30, 2020 and agented by Pacific Western Bank, the successor in interest by merger to Square 1 Bank, the Prepetition Term Loan Secured Parties have extended the Prepetition Senior Secured Term Loans, for the benefit of the Prepetition Senior Secured Term Loan Parties. The Prepetition Senior Secured Term Loan Parties are indebted and liable to the Prepetition Term Loan Secured Parties in the aggregate principal amount as of the Petition Date of not less than $102.2 million of outstanding Prepetition Senior Secured Term Loans, including delayed draw bridge term loans in the aggregate principal amount of $37.4 million. Pursuant to the senior secured convertible note purchase agreement and guarantee agreement for the 10.000% senior secured convertible notes due December 30, 2024, dated as of July 30, 2021, the Prepetition Senior Secured Convertible Notes Parties are indebted to the Prepetition Convertible Notes Secured Parties in the aggregate principal amount as of the Petition Date of not less than $44.66 million. As adequate protection, the Prepetition Agent, for itself and for the benefit of the other Prepetition Secured Parties are granted a valid, perfected replacement security interest in and lien upon all of the DIP Collateral. The Prepetition Secured Parties are also granted, subject to the Carve Out, an allowed superpriority administrative expense claim in each of the Chapter 11 Cases as provided for in 11 U.S.C. section 507(b). A final hearing on the matter is set for April 22, 2024 at 1 p.m. A copy of the order is available at https://urlcurt.com/u?l=KXTUEB from PacerMonitor.com. About Airspan Networks Airspan Networks Holdings Inc. is a U.S.-based provider of groundbreaking, disruptive software and hardware for 5G networks, and a pioneer in end-to-end Open RAN solutions that provide interoperability with other vendors. As a result of innovative technology and significant R&D investments to build and expand 5G solutions, Airspan believes it is well-positioned with 5G indoor and outdoor, Open RAN, private networks for enterprise customers and industrial use applications, fixed wireless access (FWA), Air-To-Ground, Neutral Host Networks and Utilities solutions to help mobile network operators of all sizes deploy their networks of the future, today. With over one million cells shipped to 1,000 customers in more than 100 countries, Airspan has global scale. On the Web: http://www.airspan.com/ Airspan Networks sought relief under Chapter 11 of the U.S. Bankruptcy Code (Bankr. D. Del. Lead Case No. 24-10621) on March 31, 2024. In the petition filed by Glenn Laxdal, as president and chief executive officer, the Debtor reports total assets as of Sept. 30, 2023 amounting to $58,965,000 and total debts as of Sept. 30, 2023 of $176,745,000. The Honorable Bankruptcy Judge Thomas M. Horan oversees the case. Dorsey & Whitney LLP is serving as legal counsel to Airspan. VRS Restructuring Services, LLC is serving as Airspan's financial advisor and Intrepid Investment Bankers LLC is serving as Airspan's investment banker. Epiq is the claims agent. ALAMO DRAFTHOUSE CINEMA: Explores Sale of Assets ------------------------------------------------ Nate Kotisso of KSAT.com reports that the Alamo Drafthouse Cinema, founded and owned by Austin film producer Tim League, is exploring a sale, according to a report from Deadline. Alamo Drafthouse Cinema opened its first location in Austin in 1997 before expanding its reach across the state and the United States. Best known for its large seating and expansive menu of entrees and drinks, the chain now boasts 41 locations in 13 states, including two in San Antonio. The company has fallen on some hard times in recent years. In March 2021, the chain filed for Chapter 11 bankruptcy protection, which the company touted as a move that would allow it to survive in the long term. One month later, the company shut down its Alamo Drafthouse Westlakes location at 1255 Southwest Loop 410. San Antonio-based chain Santikos Theatres has since stepped in and reopened the location as a Santikos Entertainment theatre. After the company emerged from bankruptcy, it opened new locations in St. Louis, Missouri, New York and Washington D.C. According to Deadline, there are not any known bidders for the chain nor what any potential asking price might be. About Alamo Drafthouse The Alamo Drafthouse Cinema -- https://www.drafthouse.com/ -- is an American cinema chain founded in 1997 in Austin, Texas, that is famous for its strict policy of requiring its audiences to maintain proper cinema-going etiquette. Known for offering full meal and alcohol service at its theaters, the company also operates a movie merchandise store and an annual genre film festival, Fantastic Fest. Alamo Drafthouse had 41 locations as of March 31, 2021, with 23 of those locations ran by franchisees. Alamo Drafthouse Cinemas Holdings, LLC and 33 affiliated companies filed Chapter 11 petitions (Bankr. D. Del. Lead Case No. 21-10474) on March 3, 2021. Alamo Drafthouse was estimated to have $100 million to $500 million in assets and liabilities as of the bankruptcy filing. The Hon. Mary F. Walrath is the case judge. The Company tapped Young Conaway Stargatt & Taylor LLP as bankruptcy counsel and Portage Point Partners as its financial adviser. The Debtor tapped Houlihan Lokey Capital as its investment banker, led by Russell Mason, director in the firm's Financial Restructuring Group. Epiq Corporate Restructuring, LLC, is the claims agent. * * * In May 2021, Bankruptcy Judge Mary F. Walrath authorized Alamo Drafthouse Cinemas Holdings, LLC, and its affiliated debtors to sell substantially all assets to ALMO Holdings, LLC. The aggregate consideration for the purchased assets consists of a credit bid of the DIP Loans (including the deemed term "roll up" of up to $26 million of Loans under the Credit Agreement) as well as the assumption of liabilities. ALMO was formed by creditors led by private equity firm Altamont Capital Management and investment manager Fortress Investment Group. ANADA INC: Case Summary & Seven Unsecured Creditors --------------------------------------------------- Debtor: Anada, Inc. 345 W. Washington Avenue, Suite 400A Madison, WI 53703 Chapter 11 Petition Date: April 8, 2024 Court: United States Bankruptcy Court Western District of Wisconsin Case No.: 24-10662 Judge: Hon. Catherine J Furay Debtor's Counsel: Kristin J. Sederholm, Esq. KREKELER LAW, S.C. 26 Schroeder Court, Suite 300 Madision, WI 53711 Tel: 608-258-8555 Email: ksederho@ks-lawfirm.com Estimated Assets: $100,000 to $500,000 Estimated Liabilities: $1 million to $10 million The petition was signed by David Rettig as president. A full-text copy of the petition containing, among other items, a list of the Debtor's seven unsecured creditors is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/JRMCEFA/Anada_Inc__wiwbke-24-10662__0001.0.pdf?mcid=tGE4TAMA ANTIBE THERAPEUTICS: To File Application Under CCAA --------------------------------------------------- Antibe Therapeutics Inc. (TSX: ATE, OTCQX: ATBPF) on April 9, 2024, disclosed that it intends to file an application with the Ontario Superior Court of Justice (Commercial List) (the "Court") for an Initial Order under the Companies' Creditors Arrangement Act (the "CCAA"). The application seeks an order that would, amongst other things, stay any action by Nuance Pharma to enforce the previously announced confidential ruling from the Singapore International Arbitration Centre requiring Antibe to pay approximately US$24 million to Nuance and would also enable the Company to continue engaging with the U.S. Food and Drug Administration with respect to the previously announced hold on the Company's planned Phase II trial. In addition, the Company announced that Amal Khouri and Jennifer McNealey have resigned from its Board of Directors effective April 8, 2024. Further updates will be provided as appropriate. About Antibe Therapeutics Antibe Therapeutics Inc. -- http://www.antibethera.com/-- is a clinical-stage biotechnology company leveraging its proprietary hydrogen sulfide platform to develop next-generation therapies to target pain and inflammation arising from a wide range of medical conditions. The Company's current pipeline includes assets that seek to overcome the gastrointestinal ulcers and bleeding associated with nonsteroidal anti-inflammatory drugs ("NSAIDs"). Antibe's lead drug, otenaproxesul, is intended as a safer alternative to opioids and today's NSAIDs for acute pain. Antibe's second pipeline drug, ATB-352, is being developed for a specialized pain indication. The Company's next target is inflammatory bowel disease ("IBD"), a condition long in need of safer, more effective therapies. ARIS WATER: S&P Affirms 'B+' Issuer Credit Rating, Outlook Stable ----------------------------------------------------------------- S&P Global Ratings affirmed its 'B+' issuer credit rating on Aris Water Solutions Inc., with a stable outlook. S&P said, "At the same time, we affirmed our 'B+' issue-level rating on Aris' $400 million senior unsecured notes. Our recovery rating remains '4', indicating our expectation of average (30%-50%; rounded estimate: 40%) recovery in the event of default. "The stable outlook reflects our expectation that the company will maintain adequate liquidity over the next 12 months. "Although Aris now has a shorter weighted-average debt profile, we believe the company's low leverage and liquidity position mitigate risks about its ability to refinance the upcoming maturity within the next few quarters." The company's capital structure consists of its $400 million senior unsecured notes due April 1, 2026, and a $350 million credit facility maturing Oct. 17, 2027. Aris' financial flexibility, supported by low leverage levels with S&P Global Ratings-adjusted leverage in the 2.7x-3.0x range over the next two years, $323.9 million of availability under the revolving credit facility, and positive free cash flow generation over the next 24 months, should allow the company sufficient flexibility in addressing its capital structure. Aris's leverage continued to improve to below the company's stated leverage target of 2.5x-3.5x in 2023. S&P Global Ratings-adjusted leverage, which includes a $98 debt adjustment for tax receivable agreement (TRA) liabilities, improved from 3.8x in fiscal 2022 to 3.2x in fiscal 2023. S&P said, "Despite the improvement in leverage, our view of the company's financial risk is unchanged because we believe the company will continue to manage leverage within its stated range, which aligns to an S&P Global Ratings-adjusted range of 3.3x-4.3x, given the company's willingness to pursue mergers and acquisitions (M&A) and increase shareholder returns through dividend growth or share repurchases over the next several quarters, which may affect leverage metrics. Opportunities for additional debt repayment are limited to its revolving credit facility, which had $26 million outstanding as of Dec. 31, 2023. Our view of a robust oil price environment over the next two years, along with Aris's active acreage position, and inflation-based escalator contracts, should continue to support S&P Global Ratings-adjusted EBITDA growth to the $185 million-$200 million range in 2024 and 2025." S&P said, "The stable outlook reflects our view that Aris will address its upcoming maturity such that liquidity is not pressured while continuing to pursue organic growth. We expect S&P Global Ratings-adjusted leverage in the 2.7-3.0x range in 2024 and 2025." Environmental factors are a negative consideration in S&P's credit rating analysis of Aris Water Solutions. The company owns and operates water infrastructure systems related to the gathering and disposal of produced water and the supply of recycled produced water in the Permian Basin. As the energy transition gathers pace, Aris' volumes may decrease due to a decline in oil and natural gas drilling and production activities. That said, the company recognizes sustainability-related risks and opportunities and has identified reducing water stress through water recycling as one of its primary goals. Aris is the leading independent provider of recycled water for multiple users in the Permian basin. ATLANTIC CITY, NJ: Moody's Ups Issuer Rating to Ba1, Outlook Pos. ----------------------------------------------------------------- Moody's Ratings has upgraded the city of Atlantic City, NJ's issuer rating to Ba1 from Ba2, while maintaining a positive outlook. Moody's maintain enhanced A2 ratings on the city's 2018A, 2017A and 2017B bonds, which are enhanced under the New Jersey Municipal Qualified Bond Program and are unaffected by this action. The city has $264 million of debt outstanding. The upgrade to Ba1 reflects the substantial strengthening of the city's fiscal position, including sharp increases in fund balance and declines in debt. RATINGS RATIONALE The Ba1 rating recognizes that Atlantic City has proven its ability to achieve good fiscal outcomes under the current fiscal framework created by the state. Its cash position and budget management are strong (70% of revenue), it is in structural surplus, and its debt is rapidly declining (92% of revenue at the end of 2023, down from 169% in 2018). The city has also made strides in addressing deferred capital investment. The primary risk facing the city is the expiration in 2026 of the fiscal framework under which this has been achieved. Governance is therefore a key driver of this rating action. If the current system expires, the city could once again face the volatile casino property tax revenue structure that presented so much trouble a decade ago. This high-poverty city is still not in a position to withstand that type of volatility. Moody's anticipate that the state will equip the city with the tools it needs to maintain fiscal balance, most likely by retaining some but not all elements of the current system after 2026. RATING OUTLOOK The positive outlook reflects the strength that the city will retain under the current fiscal framework, which does not expire until 2026, as well as the possibility that the state will extend at least some elements of the framework beyond that. FACTORS THAT COULD LEAD TO AN UPGRADE OF THE RATING -- Extension of current fiscal framework by the state, or creation of a system equipping the city with sufficient tools to maintain fiscal balance -- Redevelopment of city's tax base, driving higher income and full value per capita -- Decline in long-term liabilities ratio below 200% of revenue FACTORS THAT COULD LEAD TO A DOWNGRADE OF THE RATING -- Indication that state will allow current fiscal system to expire without equipping the city with the tools it needs to achieve fiscal balance -- Decline in available fund balance below 10% of revenue -- Decline in fortunes of the city's casino industry LEGAL SECURITY The city's bonds are general obligations. In the case of the bonds carrying an enhanced rating of A2, the bonds additionally benefit from the Municipal Qualified Bond Act. PROFILE The City of Atlantic City is located in Atlantic County, approximately 65 miles southeast of Philadelphia. METHODOLOGY The principal methodology used in this rating was US Cities and Counties Methodology published in November 2022. BAFFINLAND IRON: S&P Raises ICR to 'CCC' on Maturity Extension -------------------------------------------------------------- S&P Global Ratings raised its issuer credit rating (ICR) on Baffinland Iron Mines Corp. to 'CCC' from 'SD' (selective default). S&P's 'CCC' issue-level rating, with a '4' recovery rating, on the company's senior secured notes due July 2026, is unchanged. Following a recent extension of Baffinland's revolver and Export Development Canada (EDC) term facility to May 2025, S&P believes the risk of default within the coming months has decreased. S&P said, "Our 'CCC' rating reflects our expectations that Baffinland will generate FOCF deficits beyond 2025 and has significant upcoming debt maturities. Our 'CCC' rating reflects our expectations that Baffinland will generate FOCF deficits beyond 2025 and has significant upcoming debt maturities. Baffinland's recent extension of its revolver and EDC term credit facility to May 26, 2025, along with the completion of its royalty agreement with shareholders of its parent company, Nunavut Iron mines Inc., for an amount of up to $100 million, has provided some near-term liquidity relief for the company. However, we expect the FOCF generated by the company over the next 12 months is likely to be insufficient to meet its debt maturities in May 2025, likely requiring a portion to be refinanced. Furthermore, we expect annual FOCF generation will decline to near breakeven in 2025, and be negative thereafter as iron ore prices decline to about US$100 per metric ton in 2025 and US$90 metric ton thereafter. In our view, Baffinland's limited FOCF prospects beyond this year, high debt levels, and sizable debt maturities in May 2025 and July 2026 increases the likelihood of a transaction we could consider a distressed exchange within the next 12 months. "The negative outlook, primarily reflects our view that Baffinland's limited FOCF prospects and sizable debt maturities in May 2025 and July 2026, increase the likelihood of a refinancing transaction within the next 12 months that we would view as tantamount to default. "We could lower our ratings on Baffinland if the company pursued a below-par debt repurchase or refinancing that we deemed as tantamount to default. We could also lower the rating if a default, distressed exchange, or redemption appeared to be inevitable within six months, absent unanticipated significantly favorable changes in the company's circumstances. "We could raise our ratings on Baffinland within the next 12 months if we no longer viewed default as likely. This could occur if the company successfully refinances or repays its upcoming debt maturities supported by FOCF prospects that are stronger than we currently view them." BARRIO DOGG: David Wood of Marshack Named Subchapter V Trustee -------------------------------------------------------------- The Acting U.S. Trustee for Region 15 appointed David Wood of Marshack Hays Wood as Subchapter V trustee for Barrio Dogg, LLC. Mr. Wood will be paid an hourly fee of $610 for his services as Subchapter V trustee and will be reimbursed for work-related expenses incurred. Mr. Wood declared that he is a disinterested person according to Section 101(14) of the Bankruptcy Code. The Subchapter V trustee can be reached at: David Wood Marshack Hays Wood 870 Roosevelt Irvine, CA 92620 Phone: (949) 333-7777 Email: DWood@marshackhays.com About Barrio Dogg Barrio Dogg, LLC, a company in San Diego, Calif., sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D. Calif. Case No. 24-01183) on April 2, 2024, with $103,252 in assets and $1,506,957 in liabilities. Margarita Georgieva, managing member, signed the petition. Judge Christopher B. Latham presides over the case. Ahren A. Tiller, Esq., at Bankruptcy Law Center represents the Debtor as bankruptcy counsel. BARRIO RESTAURANT: David Wood Named Subchapter V Trustee -------------------------------------------------------- The Acting U.S. Trustee for Region 15 appointed David Wood of Marshack Hays Wood as Subchapter V trustee for Barrio Restaurant Group, LLC. Mr. Wood will be paid an hourly fee of $610 for his services as Subchapter V trustee and will be reimbursed for work-related expenses incurred. Mr. Wood declared that he is a disinterested person according to Section 101(14) of the Bankruptcy Code. The Subchapter V trustee can be reached at: David Wood Marshack Hays Wood 870 Roosevelt Irvine, CA 92620 Phone: (949) 333-7777 Email: DWood@marshackhays.com About Barrio Restaurant Group Barrio Restaurant Group, LLC, a company in San Antonio, Texas, sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D. Calif. Case No. 24-01184) on April 2, 2024, with $76,752 in assets and $1,506,957 in liabilities. Margarita Georgieva, managing member, signed the petition. Judge Christopher B. Latham presides over the case. Ahren A. Tiller, Esq., at Bankruptcy Law Center represents the Debtor as bankruptcy counsel. BENDED PAGE: Tattered Cover Offered for Sale, Says Parent --------------------------------------------------------- Jennifer Campbell-Hicks of 9News reports that the parent company for the Tattered Cover said in a court motion that potential buyers have expressed an interest in purchasing the independent bookstore chain. Bended Page, LLC, which owns and operates Tattered Cover, asked in a filing Friday, March 29, 2024, with U.S. Bankruptcy Court for the District of Colorado to reschedule a hearing on its Chapter 11 reorganization plan, saying it "anticipates moving forward with a sale process." The company started the reorganization process in October 2023, three years after being sold to an investment group. Its initial bankruptcy filing said Tattered Cover owed its creditors, numbering in the hundreds, between $1 million and $10 million. The company, which opened in 1971, had seven locations at that time and has since closed three of them. The newest court filings said sales have improved, with February sales up 14% over 2023, and sales to date in March were up 20%. "As the Debtor's condition has improved, certain parties have expressed an interest in acquiring some or all of Debtor's assets," the court filing says. The company's board of directors decided last week that "positioning Tattered Cover for sale to a qualified, committed new owner is in the best long-term interests of the company, current investors, employees, suppliers and Colorado's literary community," Bended Page said in a news release. A court hearing on the reorganization plan was originally set for May 28. The company requested in its newest filing that the date be postponed to June 17 at the earliest. The bookstore chain expanded despite economic headwinds after its 2020 acquisition by Bended Page, an investment group led by David Back, Alan Frosh and Kwame Spearman of Denver. Spearman stepped down as CEO in April. In July, Tattered Cover hired bankruptcy attorney and former Republican congressional candidate Brad Dempsey as CEO. Dempsey said at the time that his goal was to “remedy” the company’s “immediate financial obstacles.” Tattered Cover was led for decades by Joyce Meskis, who gained national recognition as a fierce defender of the First Amendment and independent booksellers. In 2015, Meskis sold Tattered Cover to Len Vlahos and Kristen Gilligan, who received nationwide derision for their 2020 decision to declare neutrality, not support, regarding the Black Lives Matter movement. Vlahos and Gilligan sold the company to the investment group months later. About Bended Page, LLC Bended Page, LLC is a book store owner in Denver, Colorado. The Debtor sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. D. Colo. Case No. 23-14679) on October 16, 2023. In the petition signed by Bradford Dempsey, chief executive officer, the Debtor disclosed up to $10 million in both assets and liabilities. Judge Michael E. Romero oversees the case. Andrew D. Johnson, Esq., at Onsager Fletcher Johnson Palmer LLC, is the Debtor's legal counsel. BH&G HOLDINGS: Files Amendment to Disclosure Statement ------------------------------------------------------ BH&G Holdings, LLC, submitted a First Amended Disclosure Statement for the First Amended Plan of Reorganization dated April 2, 2024. Since the outset of this Chapter 11 Case, the Debtor sought the support of some of its key creditor constituencies, including the C-Pace Lender and Burke Construction and its subcontractors. On March 26, 2024, the Debtor entered into that certain Plan Support Agreement with the C-PACE Lender (the "C-PACE PSA"). Through the C-PACE PSA, the Debtor and the C-PACE Lender agreed to mutually work together to facilitate confirmation and consummation of the Plan and any restructuring transactions set forth therein. In exchange for such support, the Debtor has agreed to treat the C-PACE Lender's claim in the Plan in accordance with the C-PACE Loan Documents, provided however that the term of the C-PACE Credit Agreement shall be extended for 6 months. On March 26, 2024, the Debtor also entered into that certain Plan Support Agreement with Burke and its subcontractors (the "Contractor Group PSA"), which subcontractors include Helix Electrical of Nevada, LLC, Residential Fire Protection d/b/a On Guard Fire Protection, Gold Star Insulation LP d/b/a Red Rock Insulation, PDE Holdings Limited Liability Co. d/b/a Enix Mechanical (collectively with Burke, the "Contractor Group"). Through the Contractor Group PSA, the Debtor and the Contractor Group have agreed to mutually work together to facilitate confirmation and consummation of the Plan and any restructuring transactions set forth therein. In exchange for such support, the Debtor has agreed to treat each Contractor Group entity's claim in the Plan to be paid, at the election of winning bidder at the Auction, either: (i) its pro rata portion of the proceeds from the sale of the Debtor's Property; or (ii) in full in equal monthly installments over 30 months following the Effective Date of the Plan. The Debtor focused on developing and executing a reorganization strategy to: (a) maximize the value of its Estate; (b) address the factors that led to the bankruptcy filing; and (c) allow the Debtor to sell its Property for the highest and best value in order to maximize distributions to creditors and parties-in interest. Class 4 consists of the Secured Claim of Burke Construction. Impaired and shall receive payment at the election of the winning bidder at the Auction, either: (i) its pro rata portion of proceeds from the Sale of the Property with Class 5 and Class 6 Claims, and after payment of Claims in Classes 1 through 3, or (ii) in full of its Allowed Class 4 Claim in equal monthly installments over 30 months from the Effective Date of the Plan, all in accordance with the Contractor Group PSA. Class 5 consists of the Secured Claims of the Contractor Group (other than Burke Construction). Impaired and shall receive payment at the election of the winning bidder at the Auction, either: (i) its pro rata portion of proceeds from the Sale of the Property with Class 4 and Class 6 Claims, after payment of Claims in Classes 1 through 3, or (ii) in full of its Allowed Class 5 Claim in equal monthly installments over 30 months from the Effective Date of the Plan, all in accordance with the Contractor Group PSA. Class 6 consists of Other Secured Claims – Other Mechanics Liens and Secured Claims not included in Classes 1, 2, 3, 4 or 5. Impaired and shall receive payment at the election of the winning bidder at the Auction, either: (i) its pro rata portion of proceeds from the Sale of the Property with Class 4 and Class 5 Claims, or (ii) in full of its Allowed Class 6 Claim in equal monthly installments over 48 months from the Effective Date of the Plan. Like in the prior iteration of the Plan, each holder of an Allowed General Unsecured Claim shall receive its pro rata share of the proceeds from the sale of the Debtor's Property, after payment all Administrative Claims, Priority Claims, and Secured Claims. Prior to, on or after the Effective Date, and pursuant to the Plan, the Debtor and the Reorganized Debtor may enter into the restructuring transactions that are not inconsistent with the Plan Support Agreement (each, a "Restructuring Transaction"), and may take any actions as may be necessary or appropriate to affect a restructuring of its business or the overall organizational structure of the Reorganized Debtor. Provided they are consistent with the Plan Support Agreement, the Restructuring Transactions may include one or more sales, mergers, consolidations, restructurings, conversions, dissolutions, transfers or liquidations as may be determined by the Debtor or the Reorganized Debtor to be necessary or appropriate. Pursuant to the Plan, and as the Debtor's principal Restructuring Transaction, the Debtor seeks to sell its Property and related assets in conjunction with the Plan Confirmation process. A full-text copy of the First Amended Disclosure Statement dated April 2, 2024 is available at https://urlcurt.com/u?l=zlyz8c from PacerMonitor.com at no charge. Proposed Attorneys for the Debtor: Samuel A. Schwartz, Esq. Gabrielle A. Hamm, Esq. SCHWARTZ LAW, PLLC 601 East Bridger Avenue Las Vegas, NV 89101 Telephone: (702) 385-5544/(702) 802-2207 Facsimile: (702) 385-2741 Email: legalinfo@nvfirm.com About BH&G Holdings, LLC BH&G Holdings, LLC is a single asset real estate entity organized for the purpose of developing and constructing that certain residential apartment complex consisting of multiple buildings in the City of Henderson, Nevada known initially as Apex 582, and most recently, as the Apex at Galleria (the "Project"), located on a 19.04-acre site at the southeast corner of Boulder Highway and Galleria Drive, in Henderson, Nevada, Assessor's Parcel No. 178 02-513-001 (the "Property"). The Debtor filed its voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. D. Nev. Case No. 24-10687) on February 27, 2024, listing $50,000,001 to $100 million in assets and $10,000,001 to $50 million in liabilities. Judge Hilary L Barnes presides over the case. Matthew L. Johnson of Johnson & Gubler, P.C., represents the Debtor as counsel. BIOLARGO INC: Hacker, Johnson & Smith Raises Going Concern Doubt ---------------------------------------------------------------- BioLargo, Inc. disclosed in a Form 10-K Report filed with the U.S. Securities and Exchange Commission for the fiscal year ended December 31, 2023, that its auditor expressed that there is substantial doubt about the Company's ability to continue as a going concern. Orlando, Florida-based Hacker, Johnson & Smith PA, the Company's auditor since 2023, issued a "going concern" qualification in its report dated April 1, 2024, citing that the Company has suffered recurring losses from operations, has negative cash flow from operations and has a significant accumulated deficit, which raise substantial doubt about the Company's ability to continue as a going concern. During the year ended December 31, 2023, the Company generated revenues of $12,230,000 through its business segments, had a net loss of $4,648,000, used $2,365,000 cash in operations, and at December 31, 2023, the Company had working capital of $3,652,000, and current assets of $6,362,000. The Company did not generate enough revenues or gross profits to fund its operations during the year, and thus to meet its cash obligations, the Company (i) sold $995,000 of its common stock to Lincoln Park Capital Fund, LLC, (ii) sold $1,158,000 of our common stock and warrants to accredited investors, (iii) sold $1,575,000 of Clyra Medical Series A Preferred Stock and $35,000 of Clyra common stock, and (iv) sold $raised $1,005,000 from the sale of its common stock (of that amount, $100,000 was invested by BioLargo, and $50,000 was from the conversion of BioLargo debt). The Company has been, and anticipates that it will continue to be, limited in terms of its capital resources, and expect to continue to need further investment capital to fund operations. If it is unable to rely on its current arrangement with Lincoln Park to fund its working capital requirements, the Company will have to rely on other forms of financing, and there is no assurance that it will be able to do so, or if it does so, it will be on favorable terms. The foregoing factors raise substantial doubt about the Company's ability to continue as a going concern, unless the Company is able to continue to raise funds through stock sales to Lincoln Park or other private financings, and in the long term, its ability to attain a reasonable threshold of operating efficiencies and achieve profitable operations by licensing or otherwise commercializing products incorporating its technologies." As of December 31, 2023, the Company had $8,205,000 in total assets, $4,003,000 in total liabilities, and $4,202,000 in total stockholders' equity. A full-text copy of the Company's Form 10-K is available at https://tinyurl.com/2x2xrxd8 About BioLargo Inc. BioLargo, Inc. (OTCQB:BLGO) is a cleantech and life sciences innovator and engineering services solution provider. Its core products address PFAS contamination, achieve advanced water and wastewater treatment, control odor and VOCs, improve air quality, enable energy-efficiency and safe on-site energy storage, and control infections and infectious disease. Its approach is to invent or acquire novel technologies, develop them into product offerings, and extend their commercial reach through licensing and channel partnerships to maximize their impact. BMA LLC: Involuntary Chapter 11 Case Summary -------------------------------------------- Alleged Debtor: BMA LLC 30 N Gould St Sheridan, WY 82801 Involuntary Chapter 11 Petition Date: April 5, 2024 Court: United States Bankruptcy Court District of Arizona Case No.: 24-02602 Judge: Hon. Brenda K. Martin Petitioners' Counsel: ____ A full-text copy of the Involuntary Petition is now available for download at PacerMonitor.com. Alleged creditors who signed the petition: Petitioner Nature of Claim Claim Amount 1. Cory Lucas 3049 E McKellips Rd Suite 13 Mesa, AZ 85213 2. Chaney Gifford 1829 N Oracle Mesa, AZ 85203 3. Dan Earl 881 N Sunnyvale Ave Gilbert, AZ 85234 BOROHUB GARDENS: Says Unsecureds Unimpaired in Sale Plan -------------------------------------------------------- Borohub Gardens LLC filed a Plan and a Disclosure Statement. The Debtor is a New York limited liability company with its corporate office located at 555 Willow Avenue, Cedarhurst, NY, 11516. The Debtor is a real estate investment company formed in or around February 25, 2015 and its business involves the purchase, ownership and management of the Property. The reason for the filing was a discovery by the former Managing Member of the Debtor that a purported UCC sale of the equity interests in the Debtor was scheduled to take place on December 5, 2023. DM asserted that it had properly called a default under a certain Security and Pledge Agreement dated December 21, 2018, under which it was asserted a security interest in the membership interests in the Debtor held by Epstein and Richter, which secured the obligations pursuant to a Promissory Note dated December 1, 2018 in the amount of $600,000. DM had noticed a sale of those interests and the case was filed on the morning of the scheduled sale. The Debtor's Plan is a liquidating plan with the centerpiece being a sale of the Debtor's real estate property located at 4820 Bay Parkway, Brooklyn, New York (the "Property"). To that end, the Debtor has entered into a contract for a private sale of the Property. The sales price is $1,500,000. This sum will be sufficient to pay off the secured liens on the Property, all unsecured claims and will provide the funding to pay the loan of DM Investors, which asserted a secured loan against the equity interests in the Debtor. Under the Plan, Class 4 consists General Unsecured Claims. Class 4 Claimants will receive a one 100% distribution from the net proceeds of the sale of the Property to be paid within 30 days after the Effective Date together with interest at the federal judgment rate in effect on the Confirmation Date. Class 4 Claimants are unimpaired and are deemed to have accepted the Plan. The Plan shall be funded by the sale of the Property and the net proceeds from the sale of the Property and any cash on hand with the Debtor. Attorneys for the Debtor: Avrum J. Rosen, Esq. Alex E. Tsionis, Esq. Law Offices of Avrum J. Rosen, PLLC 38 New Street Huntington, NY 11743 Tel: (631) 423-8527 A copy of the Disclosure Statement dated March 22, 2024, is available at https://tinyurl.ph/kvfKL from PacerMonitor.com. About Borohub Gardens Borohub Gardens, LLC, filed a Chapter 11 bankruptcy petition (Bankr. E.D.N.Y. Case No. 23-44469) on Dec. 4, 2023, with as much as $1 million in both assets and liabilities. Judge Jil Mazer-Marino oversees the case. The Law Offices of Avrum J. Rosen, PLLC, serves as the Debtor's bankruptcy counsel. C-BOND SYSTEMS: Salberg & Company Raises Going Concern Doubt ------------------------------------------------------------ C-Bond Systems, Inc. disclosed in a Form 10-K Report filed with the U.S. Securities and Exchange Commission for the fiscal year ended December 31, 2023, that its auditor expressed that there is substantial doubt about the Company's ability to continue as a going concern. Boca Raton, Florida-based Salberg & Company, P.A., the Company's auditor since 2017, issued a "going concern" qualification in its report dated April 1, 2024, citing that the Company has cash used in operations of $1,602,218 in 2023 and a working capital deficit, shareholders' deficit and accumulated deficit of $1,351,954, $4,324,535 and $60,851,714 respectively, at December 31, 2023. These matters raise substantial doubt about the Company's ability to continue as a going concern. As reflected in the Company's accompanying consolidated financial statements filed on Form 10-K, the Company had net income of $1,886,807 for the year ended December 31, 2023, which included a gain from the sale of the Company's nanoShield product line of $4,051,709. Net cash used in operations was $1,602,218 for the year ended December 31, 2023. Additionally, as of December 31, 2023, the Company had an accumulated deficit, shareholders' deficit, and working capital deficit of $60,851,714, $4,324,535 and $1,351,954, respectively. On May 8, 2023, the Company sold its nanoShield product line and received proceeds of $4,042,631. The proceeds were used to repay convertible notes payable, notes payable and related accrued interest. On December 31, 2023, the Company had cash of $736,461. These factors raise substantial doubt about the Company's ability to continue as a going concern for a period of 12 months from the issuance date of its report. Management cannot provide assurance that the Company will ultimately achieve profitable operations or become cash flow positive or raise additional debt and/or equity capital. The Company is seeking to raise capital through additional debt and/or equity financings to fund its operations in the future. Although the Company has historically raised capital from sales of common shares and preferred shares, and from the issuance of promissory notes and convertible promissory notes, there is no assurance that it will be able to continue to do so. If the Company is unable to raise additional capital or secure additional lending in the near future, management expects that the Company will need to curtail its operations. As of December 31, 2023, the Company had $2,283,113 in total assets, $3,782,521 in total liabilities, $2,825,127 in commitments and contingencies, and $4,324,535 in total shareholders' deficit. A full-text copy of the Company's Form 10-K is available at https://tinyurl.com/yc8djfh5 About C-Bond Systems Inc. San Antonio, TX-based C-Bond Systems, Inc. is a nanotechnology company and sole owner and developer of the patented C-Bond technology. The Company is engaged in the implementation of proprietary nanotechnology applications and processes to enhance properties of strength, functionality, and sustainability of brittle material systems. CANO HEALTH: Proposes Dual-Track Chapter 11 Plan ------------------------------------------------ Cano Health, Inc., et al., submitted a Disclosure Statement for Joint Chapter 11 Plan of Reorganization. The Debtors are seeking to confirm a prearranged plan under chapter 11 of the Bankruptcy Code with the support, pursuant to the terms of a restructuring support agreement entered into on February 4, 2024 (the "Restructuring Support Agreement"), of creditors holding approximately 86% of the Debtors' secured revolving and term loan debt and approximately 92% of the Debtors' senior unsecured notes (collectively, the "Consenting Creditors"). With the committed support of the Consenting Creditors, the Debtors are seeking to move forward with a committed Plan to recapitalize and deleverage their balance sheet (the "Reorganization Transaction"), while at the same time explore opportunities for a sale of all, or substantially all, of their assets (a "Whole-Co Sale Transaction"). The Plan provides that either the Reorganization Transaction or the Whole-Co Sale Transaction may be coupled with the sale of one or more certain discrete businesses and assets (each, a "Discrete Asset Sale"). This dual track path provides for, among other things, (i) a comprehensive restructuring of the Debtors' prepetition obligations or sale of substantially all of their assets, (ii) the provision of the going-concern value of the Debtors' businesses, (iii) maximization of creditor recoveries, (iv) an equitable distribution to the Debtors' stakeholders, (v) continuation of high-quality medical care to the Debtors' patients, and (vi) optimal protection of the jobs of the Debtors' providers and other employees. The key terms of the restructuring transactions as contemplated by the Plan and the Restructuring Support Agreement are as follows: * the reorganization and substantial deleveraging of the Debtors' business pursuant to either a Reorganization Transaction or a Whole-Co Sale Transaction (in each case subject to the consent of the Requisite Consenting Creditors); * either (i) conversion of approximately $933 million in principal amount of secured debt into a combination of takeback debt and 100% of the Reorganized Equity or (ii) payment of the secured debt claims with the proceeds of a Whole-Co Sale Transaction after all DIP Claims have been paid in full; * $150 million in new senior, super priority debtor-in-possession term loans (the "DIP Facility"), which will convert into, or be replaced by, an exit facility (the "Exit Facility") at emergence (or be paid in full in cash in the event of a Whole-Co Transaction); * raising of a new money superpriority revolving credit facility for up to $75 million on terms acceptable to the Requisite Consenting Creditors to further supplement the Debtors' liquidity post-emergence in the event of a Reorganization Transaction; * assumption of executory contracts of continuing trade contract counterparties and payment in full of Allowed Cure Amounts subject to the reasonable consent of the Requisite Consenting Lenders; * either (i) in the event of a Reorganization Transaction, pro rata distributions to holders of allowed General Unsecured Claims of (a) warrants to purchase up to 5% of Reorganized Equity, (b) net proceeds from the liquidation of certain shares in MSP Recovery, Inc. ("MSP") held by the Debtors as of the Petition Date and the balance of any unsold MSP shares as of the date of distribution, and (c) proceeds of certain causes of action against certain of the Debtors' former officers and directors to be assigned to a trust for the benefit of General Unsecured Creditors or (ii) in the event of a Whole-Co Sale Transaction, pro-rata distribution of the proceeds of a Whole-Co Sale Transaction after all DIP Claims and First Lien Claims have been paid in full; and * prompt emergence from chapter 11 pursuant to the milestones set forth in the Restructuring Term Sheet included in the RSA (as modified by the DIP Orders). Prior to and following the Petition Date, the Debtors have conducted a marketing process (the "Sale Process") to solicit interest and bids from potential strategic and financial investors for a Whole-Co Sale Transaction, and have also continued to pursue Discrete Asset Sales. In accordance with the milestones set forth in the Restructuring Support Agreement, the Debtors set 5:00 p.m. ET on March 3, 2024 (the "Initial IOI Deadline"), as the deadline for parties to submit initial indications of interest (each, an "IOI") for a potential Whole-Co Sale Transaction. Although no bids for a Whole-Co Sale Transaction were received by the Debtors by the Initial IOI Deadline, the Debtors continue to engage with third parties to determine if an actionable Whole-Co Sale Transaction is achievable. The Debtors are also engaged with several parties regarding potential Discrete Asset Sales, which, with the consent of the Consenting Creditors, may be implemented on or before the Confirmation Hearing or following the Effective Date. The Debtors will inform parties no later than the Voting Deadline if they intend to pursue (i) the Reorganization Transaction or a Whole-Co Sale Transaction, or (ii) any Discrete Asset Sales. Under the Plan, Class 4 consists of General Unsecured Claims. Each holder of an Allowed General Unsecured Claim will receive: i. In the event of a Reorganization Transaction, such holder's Pro Rata share of (i) the GUC Warrants, (ii) the MSP Recovery Proceeds and any remaining unsold shares of MSP Recovery Class A Stock, and (iii) the Litigation Trust Proceeds. ii. In the event of a Whole-Co Sale Transaction, such holder's Pro Rata share of (i) the Whole-Co Transaction Proceeds, if any, after deducting for the amount required to satisfy in full, or otherwise render Unimpaired, all Allowed Administrative Expense Claims (including, for the avoidance of doubt, all Allowed DIP Claims), Allowed Priority Tax Claims, Allowed Other Priority Claims, Allowed Other Secured Claims and Allowed First Lien Claims, (ii) the MSP Recovery Proceeds and any remaining unsold shares of MSP Recovery Class A Stock, and (iii) the Litigation Trust Proceeds. Class 4 is impaired. Attorneys for the Debtors: Gary T. Holtzer, Esq. Jessica Liou, Esq. Kevin Bostel, Esq. Matthew P. Goren, Esq. WEIL, GOTSHAL & MANGES LLP 767 Fifth Avenue New York, NY 10153 Tel: (212) 310-8000 E-mail: gary.holtzer@weil.com jessica.liou@weil.com kevin.bostel@weil.com matthew.goren@weil.com -and- Mark D. Collins, Esq. Michael J. Merchant, Esq. Amanda R. Steele, Esq. RICHARDS, LAYTON & FINGER, P.A. 920 N. King Street Wilmington, DE 19801 Tel: (302) 651-7700 E-mail: collins@rlf.com merchant@rlf.com steele@rlf.com A copy of the Disclosure Statement dated March 22, 2024, is available at https://tinyurl.ph/qsdbW from kccllc.net, the claims agent. About Cano Health Inc. Cano Health, Inc., and its affiliates are independent primary care physician group. The Debtors sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. D. Del. Lead Case No. 24-10164) on February 4, 2024. In the petitions signed by Mark Kent, authorized signatory, the Debtors disclosed $1,211,931,000 in assets and $1,471,032,000 in liabilities. Judge Karen B. Owens oversees the cases. The Debtors tapped Richards, Layton & Finger, P.A. and Weil, Gotshal & Manges, LLP as bankruptcy counsels; Quinn Emanuel Urquhart & Sullivan, LLP as special counsel; Houlihan Lokey, Inc. as investment banker; and AlixPartners, LLP as financial advisor. Kurtzman Carson Consultants, LLC is the claims, notice and solicitation agent. Gibson, Dunn & Crutcher, LLP and Pachulski, Stang, Ziehl & Jones, LLP represent the ad hoc first lien group while ArentFox Schiff, LLP represents Wilmington Savings Fund Society, FSB, the DIP agent. Credit Suisse AG, Cayman Islands Branch, serves as administrative agent and collateral agent, under the Credit Agreement. Freshfields Bruckhaus Deringer US, LLP is counsel to the agent. JPMorgan Chase Bank, N.A., serves as administrative agent and collateral agent under the Side-Car Credit Agreement. It is represented by Proskauer Rose, LLP. CANO HEALTH: Seeks Approval of Disclosure Statement --------------------------------------------------- Cano Health, Inc., et al., filed a motion for entry of an order approving proposed Disclosure Statement and form and manner of notice of Disclosure Statement hearing and granting related relief. The Debtors on March 22, 2024, filed their Joint Chapter 11 Plan of Reorganization and a Disclosure Statement. A hearing will be held before the Honorable Karen B. Owens, United States Bankruptcy Judge, in the United States Bankruptcy Court for the District of Delaware, 824 North Market Street, 6th Floor, Courtroom 3, Wilmington, Delaware 19801, on May 9, 2024 at 9:30 a.m. (prevailing Eastern Time), to consider entry of an order determining, among other things, that the Proposed Disclosure Statement contains "adequate information" within the meaning ascribed to such term in Section 1125 of the Bankruptcy Code. The Debtors, together with their non-debtor affiliates, are one of the largest independent primary care physician groups in the United States. The Debtors commenced their chapter 11 cases on a prearranged basis with the support, pursuant to the terms of a restructuring support agreement (the "Restructuring Support Agreement"), of creditors holding approximately 86% of the Debtors' secured revolving and term loan debt and approximately 92% of the Debtors' senior unsecured notes (collectively, the "Consenting Creditors"). With the support of the Consenting Creditors, the Debtors are seeking to implement a comprehensive restructuring, which, as described below, may be implemented through a chapter 11 plan or a sale of substantially all of the Debtors' assets. Contemporaneously herewith, the Debtors filed the Proposed Plan and Proposed Disclosure Statement. For the Court's convenience, the Debtors propose these key dates, subject to the Court's availability: * Disclosure Statement Objection Deadline will be on April 29, 2024 at 5:00 p.m. (prevailing Eastern Time). * Deadline to Reply to Disclosure Statement Objection(s) will be on May 6, 2024 at 4:00 p.m. (prevailing Eastern Time). * Disclosure Statement Hearing will be on May 9, 2024 at 9:30 a.m. (prevailing Eastern Time). * Voting Record Date will be on the Date of entry of the Proposed Order at 5:00 p.m. (prevailing Eastern Time). * Solicitation Date will be on the date that is 5 business days following entry of the Proposed Order (expected to be May 16, 2024). * Plan Supplement Filing will be on May 21, 2024. * Rule 3018(a) Motion Deadline will be on May 24, 2024 at 5:00 p.m. (prevailing Eastern Time). * Deadline to file Claim Objections or Requests to Estimate Claims for Voting Purposes will be on June 7, 2024 (10 days before Voting Deadline). * Voting Deadline will be on June 17, 2024 at 5:00 p.m. (prevailing Eastern Time). * Plan Confirmation Objection Deadline will be on June 17, 2024 at 5:00 p.m. (prevailing Eastern Time). * Deadline to File (i) Reply to Plan Objection(s), (ii) Brief in Support of Plan Confirmation, (iii) Declarations in Support of Confirmation, and (iv) Voting Certification will be on June 25, 2024 at 5:00 p.m. (prevailing Eastern Time). * Plan Confirmation Hearing will be on June 28, 2024 at 9:30 a.m. (prevailing Eastern Time). The Proposed Disclosure Statement provides many of the types of information identified in the applicable categories above, including: i. an overview of the Proposed Plan, including a description of the Debtors' proposed dual-track process allowing them to move forward with their committed chapter 11 plan to recapitalize and deleverage their balance sheet (the "Reorganization Transaction"), while at the same time explore opportunities for a sale of all or substantially all of their assets (a "Whole-Co Sale Transaction"), which, in either case, may be coupled with a potential third-party plan sponsor investment or with the sale of one or more certain discrete businesses and assets (each, a "Discrete Asset Sale") (Art. I); ii. key events leading to the commencement of the Debtors' chapter 11 cases (Art. III); iii. the operation of the Debtors' health and wellness businesses (Art. II); iv. the indebtedness of the Debtors and information regarding pending claims (ss II.B, III.D); v. a discussion of the status of any Discrete Asset Sales (Art. IV); vi. the status of certain prepetition litigation involving the Debtors and investigations regarding potential Estate causes of actions (ss III.D, IV.K, Art. V); vii. a disclaimer, which indicates that no representations or warranties concerning or related to the Debtors, the Chapter 11 Cases, or the Proposed Plan are authorized by the Bankruptcy Court or the Bankruptcy Code, other than those set forth in the Proposed Disclosure Statement (s X.F); viii. an overview of a liquidation analysis under chapter 7 (s XIII.C); ix. risk factors affecting the Debtors (Art. X); x. the relationship of the Debtors with their affiliates (s II.A); xi. requirements for confirmation of the Proposed Plan (Art. XII.C); and xii. tax consequences of the Proposed Plan (Art. VIII). In addition to the type of information that courts typically look for in a disclosure statement, the Proposed Disclosure Statement provides an analysis of the alternatives to confirmation and consummation of the Proposed Plan (Art. XIII). Based on the foregoing, the Debtors submit the Proposed Disclosure Statement contains sufficient information for a voting creditor to make an informed judgment whether to vote to accept or reject the Proposed Plan. Attorneys for the Debtors: Mark D. Collins, Esq. Michael J. Merchant, Esq. Amanda R. Steele, Esq. RICHARDS, LAYTON & FINGER, P.A. 920 North King Street Wilmington, DR 19801 Tel: (302) 651-7700 E-mail: collins@rlf.com merchant@rlf.com steele@rlf.com - and - Gary T. Holtzer, Esq. Jessica Liou, Esq. Matthew P. Goren, Esq. Kevin Bostel, Esq. WEIL, GOTSHAL & MANGES LLP 767 Fifth Avenue New York, NY 10153 Tel: (212) 310-8000 E-mail: gary.holtzer@weil.com jessica.liou@weil.com matthew.goren@weil.com kevin.bostel@weil.com About Cano Health Inc. Cano Health, Inc., and its affiliates are independent primary care physician group. The Debtors sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. D. Del. Lead Case No. 24-10164) on February 4, 2024. In the petitions signed by Mark Kent, authorized signatory, the Debtors disclosed $1,211,931,000 in assets and $1,471,032,000 in liabilities. Judge Karen B. Owens oversees the cases. The Debtors tapped Richards, Layton & Finger, P.A. and Weil, Gotshal & Manges, LLP as bankruptcy counsels; Quinn Emanuel Urquhart & Sullivan, LLP as special counsel; Houlihan Lokey, Inc. as investment banker; and AlixPartners, LLP as financial advisor. Kurtzman Carson Consultants, LLC is the claims, notice and solicitation agent. Gibson, Dunn & Crutcher, LLP and Pachulski, Stang, Ziehl & Jones, LLP represent the ad hoc first lien group while ArentFox Schiff, LLP represents Wilmington Savings Fund Society, FSB, the DIP agent. Credit Suisse AG, Cayman Islands Branch, serves as administrative agent and collateral agent, under the Credit Agreement. Freshfields Bruckhaus Deringer US, LLP is counsel to the agent. JPMorgan Chase Bank, N.A., serves as administrative agent and collateral agent under the Side-Car Credit Agreement. It is represented by Proskauer Rose, LLP. CAROLINA SLEEP: Case Summary & Five Unsecured Creditors ------------------------------------------------------- Debtor: Carolina Sleep Shoppe, LLC d/b/a America's Mattress 141 Denver Ridge Road Old Fort, NC 28762 Business Description: The Debtor is an online seller of mattresses, adjustable beds, bed frames, pillows, sheets and protectors. Chapter 11 Petition Date: April 8, 2024 Court: United States Bankruptcy Court Western District of North Carolina Case No.: 24-40057 Judge: Hon. J. Craig Whitley Debtor's Counsel: Richard S. Wright, Esq. MOON WRIGHT & HOUSTON, PLLC 212 N. McDowell Street Suite 200 Charlotte, NC 28204 Tel: 704-944-6560 Fax: 704-944-0380 E-mail: rwright@mwhattorneys.com Total Assets: $560,006 Total Liabilities: $1,538,661 The petition was signed by Jeffrey Trivette as member-manager. A full-text copy of the petition containing, among other items, a list of the Debtor's five unsecured creditors is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/HMSRS4I/Carolina_Sleep_Shoppe_LLC__ncwbke-24-40057__0001.0.pdf?mcid=tGE4TAMA CATHETER PRECISION: WithumSmith+Brown Raises Going Concern Doubt ---------------------------------------------------------------- Catheter Precision, Inc. disclosed in a Form 10-K Report filed with the U.S. Securities and Exchange Commission for the fiscal year ended December 31, 2023, that its auditor expressed that there is substantial doubt about the Company's ability to continue as a going concern. East Brunswick, New Jersey-based WithumSmith+Brown, PC., the Company's auditor since 2023, issued a "going concern" qualification in its report dated March 29, 2024, citing that the Company has incurred recurring losses from operations and expects to continue to incur operating losses that raise substantial doubt about its ability to continue as a going concern. As of December 31, 2023, the Company had cash and cash equivalents of approximately $3.6 million. For the year ended December 31, 2023, the Company used $20.6 million in cash for operating activities. The Company has incurred recurring net losses from operations and negative cash flows from operating activities since inception. During the year ended December 31, 2023, the company reported a net loss of $70.6 million, compared to a net loss of $$26.9 million in 2022. As of December 31, 2023, the Company had an accumulated deficit of approximately $275.7 million. As of December 31, 2023, the Company had $30.7 million in total assets, $9.5 million in total liabilities, and $21.2 million in total stockholders' equity. Management expects operating losses and negative cash flows to continue for the foreseeable future as the Company invests in its commercial capabilities. Additional costs associated with the Merger with Old Catheter paid during the years ended December 31, 2023 and 2022, respectively, have substantially depleted the Company's cash. Following the Merger, management further reduced staff and other costs while assuming the operating costs of Old Catheter. Of the Company's cash flows used in operating activities of $20.6 million, a portion of them are cash outflows related to the Merger and are non-recurring in nature. Specifically, the Company paid approximately $5.0 million in settlement costs that had been accrued as of December 31, 2022. Management will continue to monitor its operating costs and seek to reduce its current liabilities. Such actions may impair its ability to proceed with certain strategic activities. In January 2023, the Company raised gross proceeds of $1.3 million from a 2023 Warrant Repricing and, in March 2023, the Company completed a Private Placement and raised gross proceeds of $8.0 million. If expected revenues are not adequate to fund planned expenditures, or if the Company is unsuccessful at raising cash through future capital transactions, it may be required to reduce its spending rate to align with expected revenue levels and cash reserves, although there can be no guarantee that it will be successful in doing so. Accordingly, the Company may be required to raise additional cash through debt or equity transactions. It may not be able to secure financing in a timely manner or on favorable terms, if at all. As a result of these factors, management has concluded that there is substantial doubt about the Company's ability to continue as a going concern within the next 12 months. A full-text copy of the Company's Form 10-K is available at https://tinyurl.com/yubwczck About Catheter Precision Inc. Catheter Precision is an innovative U.S.-based medical device company bringing new solutions to market to improve the treatment of cardiac arrhythmias. It is focused on developing groundbreaking technology for electrophysiology procedures by collaborating with physicians and continuously advancing its products. Reincorporated as Ra Medical Systems, Inc. in Delaware in 2018, the Company changed its name to Catheter Precision, Inc. on August 17, 2023. CLEARSIGN TECHNOLOGIES: Auditor Raises Going Concern Doubt ---------------------------------------------------------- ClearSign Technologies Corporation disclosed in a Form 10-K Report filed with the U.S. Securities and Exchange Commission for the fiscal year ended December 31, 2023, that its auditor expressed that there is substantial doubt about the Company's ability to continue as a going concern. East Brunswick, New Jersey-based WithumSmith+Brown, PC., the Company's auditor since 2023, issued a "going concern" qualification in its report dated March 29, 2024, citing that the Company has suffered recurring losses from operations and has a net capital deficiency that raise substantial doubt about its ability to continue as a going concern. Net loss for the year ended December 31, 2023, was $5.19 million, as compared to $5.75 million for the same period in 2022. As of December 31, 2023, the Company's cash and cash equivalents totaled $5.68 million, which is not sufficient to fund current operating expenses beyond 12 months from the date hereof. The Company's technologies are currently in field development, but with nominal fully operational commercial installations, and have generated nominal revenues from operations to date to meet operating expenses. In order to generate meaningful revenues, the technologies must be fully developed, gain market recognition and acceptance, and develop a critical level of successful sales and product installations. These factors raise substantial doubt about the Company's ability to continue as a going concern for the 12 months from the date of its report. Historically, the Company has financed operations primarily through issuances of equity securities. Since inception, the Company has raised approximately $91 million in gross proceeds through the sale of its equity securities. During the year ended December 31, 2023, the Company did not raise proceeds through the issuance of common stock. The Company has incurred losses since its inception totaling $93.7 million and expects to experience operating losses and negative cash flows for the foreseeable future. Management believes that the successful growth and operation of the Company's business is dependent upon its ability to obtain adequate sources of funding through co-development agreements, strategic partnering agreements, or equity or debt financing to adequately support product commercialization efforts, protect intellectual property, form relationships with strategic partners, and provide for working capital and general corporate purposes. There can be no assurance that the Company will be successful in achieving its long-term plans as set forth above, or that such plans, if consummated, will result in profitable operations or enable the Company to continue in the long-term as a going concern. As a result, the substantial doubt in the Company's ability to continue as a going concern had not been alleviated. As of December 31, 2023, the Company had $7.62 million in total assets, $2.43 million in total liabilities, and $5.19 million in total equity. A full-text copy of the Company's Form 10-K is available at https://tinyurl.com/2nbjt2x9 About ClearSign Technologies Tulsa, Oklahoma-based ClearSign Technologies Corporation designs and develops products and technologies that have been shown to significantly improve key performance characteristics of industrial and commercial systems, including operational performance, energy efficiency, emission reduction, safety, and overall cost-effectiveness. CLEARY PACKAGING: Court Confirms Plan, Approves Cantwell Deal ------------------------------------------------------------- Judge Michelle M. Harner has entered an order that the Cleary Packaging, LLC's Plan and each of its provisions is approved and confirmed under Section 1129 of the Bankruptcy Code. The Debtor's settlement with Cantwell-Cleary is approved on the terms set forth in the Binding Term Sheet and memorialized in the Debtor's Plan and the Joint Motion for Approval of Settlement Agreement with Cantwell-Cleary Co., Inc. The Debtor's assumption of its non-residential lease for its operating location is approved on the terms set forth in the Motion for Authority to Assume Commercial Lease at 8700 Larkin Road, Suite A, Savage, MD. To the extent that any Plan objections have not been withdrawn or resolved by stipulation, all such objections are overruled. As of the Effective Date, and whether or not surrendered by the Holder thereof, all instruments evidencing or relating to any Claim, other than for an Allowed Class 1 or Allowed Class 2 Claim, shall be deemed automatically cancelled and deemed void and of no further force or effect, without any further action on the part of any Person, and any Claims evidenced by or relating to such instruments shall be deemed discharged. Pursuant to Section 1129(a)(8) of the Bankruptcy Code, Classes 2 and 4 and Holders of Interests in Class 7 have voted to accept the Fourth Amended Plan, as outlined in the Tally of Ballots, and Class 5 (Allowed Unsecured Judgment Claims) has consented to the treatment proposed under the Debtor's Plan. Class 4 is an Impaired Class of Claims that voted to accept the Fourth Amended Plan. To the Debtor's knowledge, these votes were not cast by insiders. The modifications to the Fourth Amended Plan reflect the settlement reached between the Debtor and Cantwell-Cleary Co., Inc., which is memorialized in a Binding Term Sheet executed by the Debtor, the Debtor's president and sole member Vincent D. Cleary, Jr., and Shirley A. Cleary on behalf of Cantwell-Cleary Co., Inc. as well as Timothy Ingram and Kevin DeGregory, employees of the Debtor. The Settlement resolves any and all disputes and claims that may exist among those parties. The Debtor's Plan incorporates the Settlement and modifies the Debtor's treatment of Cantwell-Cleary Co., Inc. in Class 5 to effectuate the Settlement. No other Creditors' treatment is changed, and no other changes to the treatment of Creditors are made other than to Class 5. Accordingly, pursuant to Bankruptcy Rule 3019, these modifications do not require additional disclosure under Section 1125 of the Bankruptcy Code or re-solicitation of votes under Section 1126 of the Bankruptcy Code, nor do they require that Holders of Claims be afforded an opportunity to change previously cast acceptances or rejections of the Debtor's Plan. About Cleary Packaging Cleary Packaging, LLC, is a wholesale distributor of packaging and janitorial supplies. The company sought protection under Subchapter V of Chapter 11 of the Bankruptcy Code (Bankr. D. Md. Case No. 21-10765) on Feb. 7, 2021. At the time of the filing, the Debtor disclosed assets of between $1 million and $10 million and liabilities of the same range. The Debtor tapped Yumkas, Vidmar, Sweeney & Mulrenin as its legal counsel and George S. Magas CPA, PC as its accountant. Scott W. Miller was appointed as Subchapter V Trustee for the Debtor. CLST ENTERPRISES: Case Summary & Four Unsecured Creditors --------------------------------------------------------- Debtor: CLST Enterprises, LLC 19 E 75th Street New York, NY 10021 Business Description: The Debtor owns 4,742 square feet mixed use building consisting of residence with commercial retail and/ or office space rentals valued at $9.36 million. Chapter 11 Petition Date: April 8, 2024 Court: United States Bankruptcy Court Southern District of New York Case No.: 24-10596 Debtor's Counsel: Adrienne Woods, Esq. WZMP WEINBERG ZAREH MALKIN PRICE LLP 45 Rockefeller Plaza, 20th Floor New York, NY 10111 Tel: 212-899-5470 Email: awoods@wzmplaw.com Total Assets: $9,393,173 Total Liabilities: $7,356,006 The petition was signed by Carl Thomson as member. A full-text copy of the petition containing, among other items, a list of the Debtor's four unsecured creditors is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/QS6DJVQ/CLST_Enterprises_LLC__nysbke-24-10596__0001.0.pdf?mcid=tGE4TAMA COCO SUSHI: Case Summary & 20 Largest Unsecured Creditors --------------------------------------------------------- Debtor: Coco Sushi, LLC d/b/a Sushi Garage 3015 Grand Avenue Miami FL 33133 Business Description: Sushi Garage is a Japanese restaurant with traditional roots, quality ingredients, and proper execution. Chapter 11 Petition Date: April 9, 2024 Court: United States Bankruptcy Court Southern District of Florida Case No.: 24-13421 Judge: Hon. Laurel M. Isicoff Debtor's Counsel: Jacqueline Calderin, Esq. AGENTIS PLLC 45 Almeria Avenue Coral Gables, FL 33134 Tel: (305) 722-2002 Email: jc@agentislaw.com Estimated Assets: $0 to $50,000 Estimated Liabilities: $1 million to $10 million The petition was signed by Jonas Millan as manager. 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/BMNMPMQ/Coco_Sushi_LLC__flsbke-24-13421__0001.0.pdf?mcid=tGE4TAMA CODERSLINK LLC: Hits Chapter 11 Bankruptcy Protection ----------------------------------------------------- Zoe Gottlieb of San Antonio Business Journal reports that CodersLink LLC, a San Antonio-based recruiting company that links Mexican software engineers to U.S. jobs, has filed for Chapter 11 bankruptcy. The company's attorney, Heidi McLeod of the Heidi McLeod Law Office PLLC, submitted on March 12, 2024 a voluntary petition for Chapter 11 bankruptcy with the Western District Court of Texas, court records show. The petition was filed on CodersLink's behalf and signed by CodersLink CEO and co-founder Jesus 'Tito' Salas. In a statement obtained by the Business Journal, Salas said changing exchange rates prompted the bankruptcy filing. "The whole world is being transformed digitally, with AI accelerating even more. The demand for tech and tech professionals is going to double in the next 10 years. LatAm is an excellent region to be in. We are seeing consistent growth and promising projections," Salas said. "However, we decided to file for Chapter 11 to restructure the debt that we got last year to help us reduce the impact that we had from the fluctuation between the USD and Mexican Peso, which increased our costs (talent salaries) and reduced our profit by a 15% margin." "We saw Chapter 11 as a strategic way for us to extend the term loan repayments and continue growing without any risks," he added. At the time of the filing, CodersLink owed $712,061 to 32 creditors, including Snackpass, a social mobile ordering app for restaurants, and Tec de Monterrey, a private university based in Monterrey, Mexico. CodersLink owes a majority of its debt, $569,900, to New York-based Capchase Finance LLC. CodersLink has $515,629 worth of real and personal property assets, according to the filing. Salas founded CodersLink in 2015. As reported by the Austin Business Journal, the company helps candidates tailor their resumes to meet the specifications of U.S. employers, tests their coding skills and matches them with jobs. Keep up with the latest San Antonio headlines by signing up here for SABJ newsletters. Bankruptcy Judge Michael M. Parker will preside over the case. CodersLink's reorganization plan is due June 10, 2024. About CodersLink LLC CodersLink LLC is a San Antonio-based recruiting company that links Mexican software engineers to U.S. CodersLink LLC sought relief under Chapter 11 of the U.S. Bankruptcy Code (Bankr. W.D. Tex. Case No. 24-50383) on March 12, 2024. In its petition, the Debtor estimated assets and liabilities between $500,000 and $1 million. The Honorable Bankruptcy Judge Michael M Parker handles the case. CONVERGEONE HOLDINGS: Cleared to Seek Expedited Chapter 11 Exit --------------------------------------------------------------- Jonathan Randles of Bloomberg News reports that cloud computing and networking provider ConvergeOne won court approval for an expedited Chapter 11 case after striking a restructuring deal backed by most of its lenders and private equity owner CVC Capital Partners. Judge Christopher Lopez agreed Thursday to hold a hearing next month to consider approving C1's restructuring plan designed to trim $1.6 billion in debt and provide funding through new equity and debt commitments. About ConvergeOne Holdings ConvergeOne Holdings, Inc., operates as a holding company. The Company, through its subsidiaries, provides managed cloud, cyber security, enterprises networking, data center, application and software development, security infrastructure, and hosted collaboration solutions. ConvergeOne Holdings and its subsidiaries sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D. Tex. Lead Case No. 24-90194) on April 4, 2024, with $1 billion to $10 billion in assets and liabilities. Judge Christopher M. Lopez presides over the cases. White & Case LLP is the Debtors' legal counsel. Evercore Group LLC is the Debtors' investment banker, and AlixPartners, LLP, is the restructuring advisor. EPIQ Bankruptcy Solutions is the claims agent. Porter Hedges LLP and Gibson, Dunn & Crutcher LLP advise the first lien lenders. CONVERGEONE HOLDINGS: Davis Polk & Haynes Advise 2nd Lien Lenders ----------------------------------------------------------------- The law firms Davis Polk & Wardwell LLP and Haynes and Boone, LLP filed a joint verified statement pursuant to Rule 2019 of the Federal Rules of Bankruptcy Procedure to disclose that in the Chapter 11 cases of ConvergeOne Holdings, Inc. and certain of its subsidiaries, the law firms represent the Ad Hoc Group of Second Lien Lenders. The Ad Hoc Group of Second Lien Lenders was formed by certain holders (the "Members") under that certain Second Lien Term Loan Agreement, dated as of January 4, 2019 (as amended by Amendment No. 1 dated as of July 10, 2022, and as further amended, modified, supplemented, and/or restated, the "Prepetition Second Lien Credit Agreement"), by and among ConvergeOne, as borrower, PVKG Intermediate Holdings Inc., as holdings, UBS AG, Stamford Branch, as administrative agent and collateral agent, and certain lenders. In or around June 2023, the Ad Hoc Group of Second Lien Lenders engaged Davis Polk to represent it in connection with the Members' holdings under the Prepetition Second Lien Credit Agreement. In April 2024, the Ad Hoc Group of Second Lien Lenders engaged Haynes Boone to act as co-counsel in the Chapter 11 Cases. Counsel represents only the Ad Hoc Group of Second Lien Lenders. Counsel does not represent or purport to represent any entities other than the Ad Hoc Group of Second Lien Lenders in connection with the Chapter 11 Cases. In addition, the Ad Hoc Group of Second Lien Lenders does not claim or purport to represent any other entity and undertakes no duties or obligations to any entity. The Members, collectively, beneficially own (or are the investment advisors or managers for funds that beneficially own) or manage approximately $150 million in aggregate principal amount under the Prepetition Second Lien Term Loan Credit Agreement. The Ad Hoc Group of Second Lien Lenders' address and the nature and amount of disclosable economic interests held in relation to the Debtors are: 1. Certain funds and/or accounts, or subsidiaries of such funds and/or accounts, managed, advised or controlled by Partners Group (USA) Inc., or a subsidiary or affiliate thereof 1114 Avenue of the Americas, 37th Floor, New York, NY 10036 * $75,000,000 in aggregate principal amount of Second Lien Term Loans * 7,500,000 in aggregate Common Series A Units of ConvergeOne Investment L.P. 2. Certain funds and/or accounts, or subsidiaries of such funds and/or accounts, managed, advised or controlled by Siris GP HoldCo III, LLC, or a subsidiary or affiliate thereof Siris Capital Group, LLC 601 Lexington Ave. 59th Floor New York, NY 10022 * $75,000,000 in aggregate principal amount of Second Lien Term Loans Counsel for the Ad Hoc Group of Second Lien Lenders: Arsalan Muhammad, Esq. Imaan Patel, Esq. HAYNES AND BOONE, LLP 1221 McKinney Street, Suite 4000 Houston, Texas 77010 Telephone.: (713) 547-2000 Facsimile: (713) 547-2600 Email: arsalan.muhammad@haynesboone.com Email: imaan.patel@haynesboone.com Adam L. Shpeen, Esq. Abraham Bane, Esq. DAVIS POLK & WARDWELL LLP 450 Lexington Avenue New York, NY 10017 Telephone: (212) 450-4000 Facsimile: (212) 701-5800 Email: adam.shpeen@davispolk.com Email: abraham.bane@davispolk.com About ConvergeOne Holdings ConvergeOne Holdings, Inc., operates as a holding company. The Company, through its subsidiaries, provides managed cloud, cyber security, enterprises networking, data center, application and software development, security infrastructure, and hosted collaboration solutions. ConvergeOne Holdings and its subsidiaries sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D. Tex. Lead Case No. 24-90194) on April 4, 2024, with $1 billion to $10 billion in assets and liabilities. Judge Christopher M. Lopez presides over the cases. White & Case LLP is the Debtors' legal counsel. Evercore Group LLC is the Debtors' investment banker, and AlixPartners, LLP, is the restructuring advisor. EPIQ Bankruptcy Solutions is the claims agent. Porter Hedges LLP and Gibson, Dunn & Crutcher LLP advise the first lien lenders. CONVERGEONE HOLDINGS: Gibson & Porter Advise 1st Lien Ad Hoc Group ------------------------------------------------------------------ In the Chapter 11 cases of ConvergeOne Holdings, Inc. and affiliates, the First Lien Ad Hoc Group filed a verified statement pursuant to Rule 2019 of the Federal Rules of Bankruptcy Procedure. In November 2022, the First Lien Ad Hoc Group was formed and retained attorneys currently affiliated with Gibson, Dunn & Crutcher LLP to represent it as counsel in connection with a potential restructuring of the outstanding debt obligations of the Debtors and certain of their subsidiaries and affiliates. Subsequently, in March 2024, Gibson Dunn contacted Porter Hedges LLP to serve as Texas co-counsel to the First Lien Ad Hoc Group. Gibson Dunn and Porter Hedges represent the First Lien Ad Hoc Group, comprised of the beneficial holders or the investment advisors or managers for certain beneficial holders. Gibson Dunn and Porter Hedges do not represent the First Lien Ad Hoc Group as a "committee" and do not undertake to represent the interests of, and are not fiduciaries for, any creditor, party in interest, or other entity that has not signed a retention agreement with Gibson Dunn or Porter Hedges. In addition, the First Lien Ad Hoc Group does not represent or purport to represent any other entities in connection with the Debtors' chapter 11 cases. Each member of the First Lien Ad Hoc Group does not represent or purport to represent the interests of, nor act as a fiduciary for, any person or entity other than itself in connection with the Debtors' chapter 11 cases. The First Lien Ad Hoc Group's address and the nature and amount of disclosable economic interests held in relation to the Debtors are: 1. Kennedy Lewis Management LP 225 Liberty Street, Suite 4210 New York, NY 10281 * $162,312,593.37 * $75,000,000.00 KL Notes 2. MJX Asset Management LLC 12 East 49th St., 38th Floor New York, NY 10017 * $69,009,258.36 3. Monarch Alternative Capital LP 535 Madison Avenue New York, NY 10022 * $178,249,658.30 4. PGIM, Inc. P.O. Box 32339 Newark, NJ 07102 * $86,323,774.80 5. Sound Point Capital Management, LP 375 Park Avenue, 34th Floor New York, NY 10152 * $53,664,091.84 6. SPCP Institutional Group, LLC 2 Greenwich Plaza Greenwich, CT 06830 * $22,567,637.07 7. SPCP Institutional Group 2, LLC 2 Greenwich Plaza Greenwich, CT 06830 * $54,846,285.43 8. SPCP Group, LLC 2 Greenwich Plaza Greenwich, CT 06830 * $174,929,162.55 Attorneys for the First Lien Ad Hoc Group: PORTER HEDGES LLP John F. Higgins, Esq. Eric M. English, Esq. James A. Keefe, Esq. 1000 Main Street, 36th Floor Houston, TX 77002 Telephone: (713) 226-6000 Facsimile: (713) 226-6248 E-mail: jhiggins@poerterhedges.com eenglish@porterhedges.com jkeefe@porterhedges.com - and - GIBSON, DUNN & CRUTCHER LLP Scott J. Greenberg, Esq. Keith R. Martorana, Esq. 200 Park Avenue New York, New York 10166 Telephone: (212) 351-4000 Facsimile: (212) 351-4035 Email: sgreenberg@gibsondunn.com kmartorana@gibsondunn.com GIBSON, DUNN & CRUTCHER LLP Michelle Choi, Esq. 333 South Grand Avenue Los Angeles, California 90071 Telephone: (213) 229-7000 Facsimile: (213) 229-7520 Email: mchoi@gibsondunn.com About ConvergeOne Holdings ConvergeOne Holdings, Inc., operates as a holding company. The Company, through its subsidiaries, provides managed cloud, cyber security, enterprises networking, data center, application and software development, security infrastructure, and hosted collaboration solutions. ConvergeOne Holdings and its subsidiaries sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D. Tex. Lead Case No. 24-90194) on April 4, 2024, with $1 billion to $10 billion in assets and liabilities. Judge Christopher M. Lopez presides over the cases. White & Case LLP is the Debtors' legal counsel. Evercore Group LLC is the Debtors' investment banker, and AlixPartners, LLP, is the restructuring advisor. EPIQ Bankruptcy Solutions is the claims agent. Porter Hedges LLP and Gibson, Dunn & Crutcher LLP advise the first lien lenders. COSTA SHIPPING: David Wood of Marshack Named Subchapter V Trustee ----------------------------------------------------------------- The Acting U.S. Trustee for Region 15 appointed David Wood of Marshack Hays Wood as Subchapter V trustee for Costa Shipping & Delivery, Inc. Mr. Wood will be paid an hourly fee of $610 for his services as Subchapter V trustee and will be reimbursed for work-related expenses incurred. Mr. Wood declared that he is a disinterested person according to Section 101(14) of the Bankruptcy Code. The Subchapter V trustee can be reached at: David Wood Marshack Hays Wood 870 Roosevelt Irvine, CA 92620 Phone: (949) 333-7777 Email: DWood@marshackhays.com About Costa Shipping & Delivery Costa Shipping & Delivery, Inc., sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D. Calif. Case No. 24-01179) on April 1, 2024, with $1 million to $10 million in both assets and liabilities. Judge Christopher B. Latham presides over the case. Steven E. Cowen, Esq., at S.E. Cowen Law represents the Debtor as bankruptcy counsel. D & D DRYWALL: Mark Sharf Named Subchapter V Trustee ---------------------------------------------------- The U.S. Trustee for Region 17 appointed Mark Sharf, Esq., a practicing attorney in Los Angeles, as Subchapter V trustee for D & D Drywall, Inc. Mr. Sharf will charge $660 per hour for his services as Subchapter V trustee and will seek reimbursement for work-related expenses incurred. Mr. Sharf declared that he is a disinterested person according to Section 101(14) of the Bankruptcy Code. The Subchapter V trustee can be reached at: Mark Sharf, Esq. 6080 Center Drive, 6th Floor Los Angeles, CA 90045 Telephone: (323) 612-0202 Email: mark@sharflaw.com About D & D Drywall D & D Drywall, Inc. sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. N.D. Calif. Case No. 24-10159) on March 27, 2024, with $100,001 to $500,000 in both assets and liabilities. Judge Charles Novack presides over the case. Brian A. Barboza, Esq., at the Law Offices of Brian A. Barboza represents the Debtor as bankruptcy counsel. DESERT HAWK: Assure CPA Raises Going Concern Doubt -------------------------------------------------- Desert Hawk Gold Corp. disclosed in a Form 10-K Report filed with the U.S. Securities and Exchange Commission for the fiscal year ended December 31, 2023, that its auditor expressed that there is substantial doubt about the Company's ability to continue as a going concern. Spokane, Washington-based Assure CPA, LLC, the Company's auditor since 2023, issued a "going concern" qualification in its report dated March 29, 2024, citing that the Company has accumulated losses since inception and has negative working capital. These factors raised substantial doubt about its ability to continue as a going concern. The Company had an accumulated deficit of $30,127,132 through December 31, 2023, and net loss of $9,389,967 for the year ended December 31, 2023, along with negative working capital of $27,883,642, which raises substantial doubt about the Company's ability to continue as a going concern. Although production restarted in 2019, it has not yet reached optimum levels. The timing and amount of capital requirements will depend on a number of factors, including demand for products, metals market pricing, and the availability of opportunities for expansion through affiliations and other business relationships. Management intends to continue to seek new capital from equity securities issuances to provide funds needed to increase liquidity, fund internal growth, and fully implement its business plan. The Company's management believes that it has sufficient funds to meet its obligations and continue production over the next 12 months. As of December 31, 2023, the Company had $10,311,532 in total assets, $30,745,556 in total liabilities, and $20,434,024 in total stockholders' deficit. A full-text copy of the Company's Form 10-K is available at https://tinyurl.com/2j2d5tmb About Desert Hawk Gold Corp. Desert Hawk Gold Corp. engages in the extraction of gold and related precious metals from its Kiewit mining property located in the Gold Hill Mining District in Tooele County, Utah. DIAMOND SPORTS: Renews Multi-Year Distribution Deal w/ Charter -------------------------------------------------------------- Diamond Sports Group announced on April 3, 2024 that it has reached a multi-year renewal of its distribution agreement with Charter Communications, Inc (NASDAQ: CHTR) ("Charter") to carry Diamond's portfolio of regional sports networks ("RSNs"). Under the new agreement, customers will continue to have access to live, local MLB, NBA and NHL games and pre- and post-game content on Diamond's RSN channels through Charter's Spectrum TV Select Plus package. Additionally, Spectrum TV Select Plus customers will be able to stream Diamond's RSN content by authenticating with their subscription credentials on the Bally Sports app. Customers who do not have access to Diamond's RSN channels as part of their service will be able to purchase Diamond's Direct-to-Consumer (DTC) product, including from Spectrum, to access all local DTC content for the teams for which Diamond retains DTC rights. David Preschlack, CEO of Diamond, stated: "Extending our distribution relationship with Charter is a key milestone and an important part of our go-forward plan, as we remain focused on restructuring the company and moving forward as a sustainable, profitable business. We expect this agreement to generate value for Diamond, Charter and our team and league partners, and enable us to continue providing high quality broadcasts for passionate local fans. We believe this agreement can serve as a model in the ongoing time-sensitive negotiations with our other distribution partners to reach carriage agreements that work for all parties." About Diamond Sports Group Diamond Sports Group, LLC, and its affiliates own and/or operate the Bally Sports Regional Sports Networks, making them the nation's leading provider of local sports programming. DSG's 19 Bally Sports RSNs serve as the home for 42 MLB, NHL, and NBA teams. DSG also holds joint venture interests in Marquee, the home of the Chicago Cubs, and the YES Network, the local destination for the New York Yankees and Brooklyn Nets. The RSNs produce about 4,500 live local professional telecasts each year in addition to a wide variety of locally produced sports events and programs. DSG is an unconsolidated and independently run subsidiary of Sinclair Broadcast Group. Diamond Sports Group and 29 of its affiliates sought relief under Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D. Texas Lead Case No. 23-90116) on March 14, 2023. In the petition signed by David F. DeVoe, Jr., as chief financial officer and chief operating officer, Diamond Sports Group listed $1 billion to $10 billion in both assets and liabilities. Judge Christopher M. Lopez oversees the cases. The Debtors tapped Paul, Weiss, Rifkind, Wharton & Garrison, LLP and Porter Hedges, LLP as bankruptcy counsel; Wilmer Cutler Pickering Hale, Dorr, LLP and Quinn Emanuel Urquhart & Sullivan, LLP as special counsel; AlixPartners, LLP as financial advisor; Moelis & Company, LLC and LionTree Advisors, LLC as investment bankers; Deloitte Tax, LLP, as tax advisor; Deloitte Financial Advisory Services, LLP, as accountant; and Deloitte Consulting, LLP as consultant. Kroll Restructuring Administration, LLC is the claims agent. The U.S. Trustee for Region 7 appointed an official committee to represent unsecured creditors in the Debtors' Chapter 11 cases. The committee tapped Akin Gump Strauss Hauer& Feld LLP as counsel; FTI Consulting, Inc., as financial advisor; and Houlihan Lokey Capital, Inc., as investment banker. DIOCESE OF SYRACUSE: Interstate Says Amended Disclosures Inadequate ------------------------------------------------------------------- Interstate Fire & Casualty Company and Fireman's Fund Insurance Company filed an objection to approval of the Disclosure Statement in Support of Amended Joint Chapter 11 Plan of Reorganization for The Roman Catholic Diocese of Syracuse, New York filed on March 5, 2024. The Court at the Feb. 6, 2026 hearing on the Original Disclosure Statement spoke plainly: the Debtor had additional ground to cover -- and more information to provide -- before a disclosure statement could be approved. Although the Amended Disclosure Statement is a step in the right direction, it still falls short of the mark. Interstate asserts that approval of the Amended Disclosure Statement should be denied for at least two reasons: * First, the Amended Disclosure Statement fails to adequately and accurately disclose a number of known, material risks. The Debtor is well aware that the Insurance Claims Assignment,2 for example, is vulnerable to jurisdictional and statutory challenges. The Debtor likewise is aware that the Insurance Claims Assignment with respect to the Interstate Policies may violate New York law and vitiate coverage. The Debtor is aware of these and other dangers because the Interstate Insurers provided proposed language detailing them. But recipients of the Amended Disclosure Statement will not be so informed; the Debtor declined proposed disclosures that referenced risks or potential adverse consequences. There is no legitimate reason to withhold this information from stakeholders, who deserve to know the whole truth about the Amended Plan. * Second, the Amended Disclosure Statement lacks a direct and digestible explanation of at least two critical components of the Amended Plan: how, exactly, the Insurance Claims Assignment will divide all rights, duties, and obligations under the Interstate Policies; and whether Distribution Claims can be tendered (to a Non-Settling Insurer) for payment. Each is unclear in the Amended Plan, and the Amended Disclosure Statement offers no straightforward answers. Counsel for Interstate Fire & Casualty Company and Fireman's Fund Insurance Company: Harris B. Winsberg, Esq. Matthew M. Weiss, Esq. Matthew G. Roberts, Esq. PARKER, HUDSON, RAINER & DOBBS LLP 303 Peachtree Street, Suite 3600 Atlanta, GA 30308 Tel: (404) 523-5300 Fax: (404) 522-8409 E-mail: hwinsberg@phrd.com mweiss@phrd.com mroberts@phrd.com -and- Todd C. Jacobs, Esq. John E. Bucheit, Esq. PARKER, HUDSON, RAINER & DOBBS LLP Two N. Riverside Plaza, Suite 1850 Chicago, IL 60606 Tel: (312) 417-3306 Fax: (404) 522-8409 E-mail: tjacobs@phrd.com jbucheit@phrd.com -and- Siobhain P. Minarovich, Esq. WHITE AND WILLIAMS LLP 7 Times Square, Suite 2900 New York, NY 10036-6524 Tel: (212) 244-9500 Fax: (212) 631-1248 E-mail: minarovichs@whiteandwilliams.com About The Roman Catholic Diocese of Syracuse The Roman Catholic Diocese of Syracuse, New York --http://www.syracusediocese.org/-- through its administrative offices (a) provides operational support to the Catholic parishes, schools and certain other Catholic entities that operate within the territory of the Diocese in support of their shared charitable, humanitarian and religious missions; (b) conducts school operations by managing tuition and scholarship payments, employee payroll, and other school-related operating expenses for separately incorporated Diocesan schools, as well as providing parish schools with financial, operational and educational support; and (c) provides comprehensive risk management services to the OCEs through the Diocese's insurance program. The Roman Catholic Diocese of Syracuse, New York filed its voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bank. N.D.N.Y. Case No. 20-30663) on June 19, 2020. Stephen A. Breen, chief financial officer, signed the petition. At the time of filing, the Debtor estimated $10 million to $50 million in assets and $50 million to $100 million in liabilities. Judge Margaret M. Cangilos-Ruiz oversees the case. Bond, Schoeneck and King, PLLC, serves as the Debtor's bankruptcy counsel. The Debtor also tapped Mullen Coughlin LLC as special counsel, Arete Advisors LLC as cybersecurity consultant, and Moxfive LLC as technical advisor. Stretto is the claims agent and administrative advisor. The U.S. Trustee for Region 2 appointed a committee to represent unsecured creditors in the Debtor's bankruptcy case. The committee tapped Stinson, LLP, Saunders Kahler, LLP and Berkeley Research Group, LLC, as its bankruptcy counsel, local counsel and financial advisor, respectively. DISH DBS: KPMG Raises Going Concern Doubt ----------------------------------------- DISH DBS Corporation disclosed in a Form 10-K Report filed with the U.S. Securities and Exchange Commission for the fiscal year ended December 31, 2023, that its auditor expressed that there is substantial doubt about the Company's ability to continue as a going concern. Denver, Colorado-based KPMG LLP, the Company's auditor since 2002, issued a "going concern" qualification in its report dated April 1, 2024, citing that the Company has debt maturing in 2024 that raises substantial doubt about its ability to continue as a going concern. The Company's cash and cash equivalents and marketable investment securities totaled $374 million as of December 31, 2023. As reflected in its consolidated financial statements as of December 31, 2023, it has $1.983 billion of debt maturing in November 2024. "Because we do not currently have committed financing to fund our operations for at least twelve months from the issuance of these consolidated financial statements, substantial doubt exists about our, our parent, DISH Network's, and our ultimate parent, EchoStar's, ability to continue as a going concern. We do not currently have the necessary Cash on Hand and/or projected future cash flows to fund the November 2024 debt maturity. To address our capital needs, we are in active discussions with funding sources to raise additional capital and restructure our outstanding debt. We cannot provide assurances that we will be successful in obtaining such new financing and/or restructuring the existing debt obligations necessary for us to have sufficient liquidity. In addition, our parent, DISH Network, and our ultimate parent, EchoStar, may not be able to provide additional liquidity in the future," the Company stated. For the years ended December 31, 2023 and 2022, the Company reported a net income of $1.74 billion and $1.81 billion, respectively. As of December 31, 2023, the Company had $11.1 billion in total assets, $15.1 billion in total liabilities, and $3.95 billion in total stockholders' deficit. A full-text copy of the Company's Form 10-K is available at https://tinyurl.com/32tk6jtj About DISH DBS Corporation Englewood, Colorado-based DISH DBS Corporation is an indirect, wholly-owned subsidiary of DISH Network, which is a wholly-owned subsidiary of EchoStar Corporation, a publicly traded company listed on the NASDAQ Global Select Market under the symbol "SATS." EASTSIDE DISTILLING: M&K CPAs Raises Going Concern Doubt -------------------------------------------------------- Eastside Distilling, Inc. disclosed in a Form 10-K Report filed with the U.S. Securities and Exchange Commission for the fiscal year ended December 31, 2023, that its auditor, expressed that there is substantial doubt about the Company's ability to continue as a going concern. The Woodlands, TX-based M&K CPAs, PLLC, the Company's auditor since 2017, issued a "going concern" qualification in its report dated April 1, 2024, citing that the Company suffered a net loss from operations and used cash in operations, which raises substantial doubt about its ability to continue as a going concern. The Company's primary capital requirements are for cash used in operating activities and the repayment of debt. Funds for the Company's cash and liquidity needs have historically not been generated from operations but rather from loans as well as from convertible debt and equity financing. The Company has been dependent on raising capital from debt and equity financing to meet the Company's operating needs. The Company had an accumulated deficit of $82.7 million as of December 31, 2023, having incurred a net loss of $7.5 million during the year ended December 31, 2023. The Company reduced debt in 2023 through a debt for preferred swap. However, the Company's ability to meet its ongoing operating cash needs over the next 12 months depends on growing revenues and gross margins, and generating positive operating cash flow primarily through increased sales, improved profit growth, and controlling expenses. In addition, the Company has been negotiating with creditors to reduce the interest burden and improve cash flow. If the Company is unable to reach an agreement with creditors or obtain additional financing, or additional financing is not available on acceptable terms, the Company may seek to sell assets, reduce operating expenses, reduce or eliminate marketing initiatives, and take other measures that could impair its ability to be successful. If the Company cannot continue as a going concern, its stockholders would likely lose most or all of their investment in it. As of December 31, 2023, the Company had $17.5 million in total assets, $16.6 million in total liabilities, and $853,000 in total stockholders' equity. A full-text copy of the Company's Form 10-K is available at https://tinyurl.com/4udeh2ht About Eastside Distilling Inc. Eastside Distilling, Inc. was incorporated under the laws of Nevada in 2004 under the name of Eurocan Holdings, Ltd. In December 2014, we changed our corporate name to Eastside Distilling, Inc. to reflect our acquisition of Eastside Distilling, LLC. The Company operates in two segments. Craft Canning + Printing segment provides digital can printing to customers in the craft beverage industry operating throughout the Pacific Northwest as well as other states. The Company also provide mobile canning services to the craft beverage industry in Oregon. ECL ENTERTAINMENT: S&P Rates New Senior Secured Term Loan 'B+' -------------------------------------------------------------- S&P Global Ratings assigned its 'B+' issue-level rating and '3' recovery rating to ECL Entertainment LLC's proposed $428 million senior secured term loan due in 2030. At the same time, S&P affirmed its 'B+' issue-level rating on ECL's $75 million revolver due in 2028, pro forma for the proposed $25 million increase. S&P sid, "The proposed larger term loan and upsized revolver (which we assume is 85% drawn at default) slightly reduces recovery prospects for senior secured lenders, but not enough to revise our '3' recovery rating. We modestly increased our assumed emergence valuation as a result of continued incremental EBITDA from new and expanded facilities in ECL's portfolios. However, our rounded estimate of recovery prospects for senior secured lenders is now 50% instead of 55%. The '3' recovery rating indicates our expectation for meaningful (50%-70%) recovery in a default." ECL will use the proceeds from the proposed larger term loan and minimal cash on the balance sheet to fund an approximately 50% equity investment in a new joint venture with Clairvest and to replace its $378 million term loan. The new venture will acquire an existing gaming business with over 1,000 gaming positions, in a single state other than Kentucky. S&P expects that ECL will not receive any cash flow from this until 2026 at the earliest. Although the transaction will increase ECL's leverage about 0.5x, ECL will maintain sufficient cushion to our 5x downgrade threshold. S&P said, "As a result, our 'B+' issuer credit rating and stable outlook are unchanged. We estimate that its S&P Global Ratings-adjusted leverage as of Dec. 31, 2023, was about 4.3x, slightly better than our previous expectation. We forecast leverage will return to 4.4x by the end of 2024, compared with our prior forecast of improvement to 4.2x." ECL is also asking lenders to lower the margin on its credit facility, which would partly offset incremental interest from the larger proposed term loan. S&P said, "ECL generated about $90 million of adjusted EBITDA in 2023, at the high end of our prior forecast of $85 million-$90 million. Good results from its Cumberland Run and Cumberland Mint facilities support the company's performance. We forecast about 8% EBITDA growth in 2024, primarily driven by upgraded games at Kentucky Downs; increased visitation from the opening of expansion of the Mint at Kentucky Downs in the third quarter of 2023, including the hotel and convention center; and a full year benefit from Cumberland Run, which opened July 26, 2023." ISSUE RATINGS - RECOVERY ANALYSIS Key analytical factors -- S&P assigned its 'B+' issue-level rating on ECL's senior secured credit facility. The new term loan is $50 million more than its existing term loan. ECL also plans to increase its revolver to $75 million from $50 million. -- The recovery rating is '3', which indicates S&P's expectation for meaningful (50%-70%; rounded estimate: 50%) recovery. -- S&P lowered the rounded estimate to 50% from 55% because of the increase in debt despite a higher emergence enterprise value at default than its previous analysis. Simulated default assumptions -- S&P's simulated default scenario considers a default in 2028 driven by a significant decline in cash flow from prolonged economic weakness or greater competitive pressure. -- S&P values the company on a going-concern basis using a 6x multiple of its projected EBITDA at emergence. S&P's multiple is modestly below the average it uses for leisure companies to reflect ECL's consolidated EBITDA concentration in a single state, which exposes it to significant event risks. -- S&P's calculation of emergence EBITDA at default is modestly higher than our previous analysis and reflects the continued ramp-up in ECL's cash flow, following the opening of its expansion at Kentucky Downs last year and the completion of ECL Corbin. -- S&P assumes ECL's proposed upsized $75 million revolver is 85% drawn at the time of default. Simplified waterfall -- Emergence EBITDA: About $46 million -- EBITDA multiple: 6x -- Gross enterprise value: About $276 million -- Net enterprise value after administrative expenses (5%): About $262 million -- Obligor/nonobligor valuation split: 100%/0% -- Value available for secured lenders: $262 million -- Estimated secured claims: About $487 million --Recovery range: 50%-70% (rounded estimate: 50%) All debt amounts include six months of prepetition interest. ELECTRIC LAST: $2.7Mil. Executives Settlement Nears Initial Okay ---------------------------------------------------------------- Martina Barash of Bloomberg Law reports that Electric Last Mile leaders' $2.5 million deal nears initial nod. Five executives of Electric Last Mile Solutions Inc. are likely to get a $2.7 million settlement with shareholders preliminarily approved if the investors make two changes to the class notice process, a federal judge ruled. The bankrupt electric vehicle maker itself is out of the proposed class action, which concerns accounting corrections after its merger with a blank-check company, Judge Michael E. Farbiarz said in an opinion docketed March 22, 2024 in the US District Court for the District of New Jersey. Accounting firm BDO USA LLP—named as a defendant for its alleged auditing role—hasn’t floated a settlement, Farbiarz said. About Electric Last Mile Solutions Electric Last Mile Solutions, Inc. (Nasdaq: ELMS) has been focused on defining a new era in which commercial vehicles run clean as connected and customized solutions that make businesses more efficient and profitable. ELMS' first vehicle, the Urban Delivery, was anticipated to be the first Class 1 commercial electric vehicle in the U.S. market. On the Web: http://www.electriclastmile.com/ Troy, Michigan-based Electric Last Mile Solutions, Inc., wholly owns Electric Last Mile, Inc., the operating subsidiary. Electric Last Mile Solutions and Electric Last Mile Inc. filed for Chapter 7 bankruptcy (Bankr. D. Del. Case No. 22-10537 and 22-10538) on June 14, 2022. Electric Last Mile Inc. estimated $50 million to $100 million in assets and liabilities as of the bankruptcy filing. Electric Last Mile Solutions estimated less than $50,000 in assets and debt. The Debtors' counsel: Kara Hammond Coyle Young Conaway Stargatt & Taylor LLP Tel: (302) 571-6600 E-mail: bankfilings@ycst.com ENCHANTED LITTLE: Unsecureds to Get Remaining Funds Available ------------------------------------------------------------- Enchanted Little Forest Childcare Center, LLC, submitted a Plan of Reorganization, dated March 29, 2024. The Debtor was organized in 2009 by Kay Doremus. In the beginning there was only one location. The Debtor grew to become a well-respected childcare center that included locations in north Everett which opened in 2009, south Everett which opened in 2012 and Snohomish which opened in 2017. The business plan focused on lower socio-economic families and underprivileged children, so their tuition was primarily paid by the Washington State Department of Children Youth and Family with small co-pays from the families. Washington State's economy was disrupted by the COVID epidemic. Washington State declared a work from home lockdown of businesses except for those considered First Responders. Enchanted Little Forest Childcare Center was designated as a service provider for First Responders. This status required the centers to remain open, yet only admit First Responder children. During this period the Debtor's expenses outpaced its income creating income losses at the company. The business has returned to profitability under chapter 11 protection. Expenses have been cut through payroll reductions, reduction of facility expenses by consolidating three centers into one, moving to a more affluent area of clientele and refocusing the mix of clients between State sponsored and private pay. Enchanted Little Forest is down to a minimum of employees. Demand for the services provided was strong and grew until COVID occurred and the MCA loans that were taken on ate up all the profit. Under the Plan, Class 4 consists General Unsecured Creditors. Each holder of an allowed general unsecured claim will be paid a pro rata share with the remaining funds available after payment of administrative, secured, and priority claims. Class 4 is impaired. The Plan will be funded with revenue from the Debtor's operation. The Debtor anticipates having sufficient funds on hand to begin making payments 60 days after the Effective Date of the Plan. Counsel for the Debtor: Steven M. Palmer, Esq. Palmer & Associates, PLLC 6912 220th St. SW, STE 113 Mountlake Terrace, WA 98043 Tel: (425) 292-8009 A copy of the Plan of Reorganization dated March 29, 2024, is available at https://tinyurl.ph/dsmgJ from PacerMonitor.com. About Enchanted Little Forest Enchanted Little Forest Childcare Center, LLC, is a childcare center which focuses on n lower social and economic families and the underprivileged children, so their tuition was essentially paid by Washington State with small copays from the families. The Debtor sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. W.D. Wash. Case No. 23-12435-TWD) on Dec. 15, 2023. In the petition signed by Kay Doramus, managing member, the Debtor disclosed up to $500,000 in assets and up to $1 million in liabilities. Judge Timothy W. Dore oversees the case. Steven Palmer, Esq, at Palmer & Associates, PLLC, is the Debtor's legal counsel. ENDO FINANCE: Moody's Rates New $1.25BB Senior Secured Notes 'B2' ----------------------------------------------------------------- Moody's Ratings has assigned a B2 rating to the new $1.25 billion backed senior secured notes issuance of Endo Finance Holdings, Inc. ("Endo") in connection with its post-bankruptcy exit financing. There are no changes to Endo's existing ratings including the B2 Corporate Family Rating, B2-PD Probability of Default Rating, Ba3 rating to the $400 million senior secured super-priority revolving credit facility, and B2 rating to $1.25 billion senior secured term loan. The outlook is stable. The Ba3 rating of the senior secured super-priority revolving credit facility are two notches above the corporate family rating, reflecting its priority in the company's capital structure. The B2 rating for the $1.25 billion senior secured term loan due 2031, along with the B2 rating for the senior secured notes maturing in 2032 (which are pari to the senior secured term loan), match the B2 Corporate Family Rating, given these facilities represent the preponderance of funded debt. The issuer of the senior secured notes and borrower of the senior secured credit facilities is Endo Finance Holdings, Inc. The senior secured debt is guaranteed by Endo, Inc., the parent company and reporting entity, and certain subsidiaries. Security includes a pledge on assets of the borrowers, the parent, and US subsidiaries (subject to certain customary exceptions). RATINGS RATIONALE Endo's B2 CFR reflects its moderate financial leverage and the risk that the recent bankruptcy could harm the company's reputation with customers. The rating is also constrained by Moody's expectation for ongoing revenue and earnings decline in company's branded and generic pharmaceuticals segments, driven by continued competitive pressure on existing products portfolio. Additionally the ratings are constrained by high earnings concentration in its largest franchise, Xiaflex, which accounted for roughly 24% of sales, and even higher portion of company's profit, in 2023. Endo's ratings are supported by its moderate scale in specialty branded pharmaceuticals and its growing pipeline of sterile injectable products, expected to be launched over the next several years. The ratings are also supported by company's resolution of key litigation issues, extension of debt maturities, and strong liquidity underpinned by meaningful free cash flow. The Speculative Grade Liquidity Rating of SGL-1 reflects Moody's expectation that Endo's liquidity will remain very good over the next 12 to 18 months. Endo's liquidity will be supported by $200 million of cash at transaction's close. Moody's estimates that the company will generate at least $200 million of annual free cash flow over the next 12-to-18 months. External liquidity is further supported by a new 5-year super priority revolving credit facility that provides for borrowings of $400 million. Alternative sources of liquidity are limited as substantially all assets are pledged. ESG CONSIDERATIONS Endo's CIS-4 indicates that the rating is lower than it would have been if ESG risk exposures did not exist. The credit impact score reflects exposure to social risks (S-4), most notably with responsible production and customer relations. Since the beginning of its bankruptcy case, the company has been subject to a voluntary opioid operating injunction ("VOI") which will apply to new Endo until 2030, preventing the company from manufacturing high-dose opioid pills, advertising or marketing opioid to patients and doctors. Additionally, because Endo's branded business represents a large share of cash flows, drug pricing risk in the US is a key social risk. The score also reflects exposure to governance risk (G-4), most notably related to financial strategy and risk management. The score also reflects the company's moderate leverage and management track record and credibility risks of successfully operating following the 2022 bankruptcy filing. Lastly, environmental risk considerations (E-2) reflects that the company does not face significant environmental exposures that are materially different than the industry norm. The stable outlook reflects Moody's expectation that Endo's financial leverage will remain moderate following the restructuring. While Moody's expect for company's earnings to decline over the next year due to higher competition, the resolution of key litigation issues, and refinancing of all of its funded debt, will allow the company to execute on its strategic priorities. Furthermore, Moody's expects Endo's combination of free cash flow, cash balance, and revolver will provide sufficient liquidity for operations. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATING Ratings upside is unlikely in the near-term as Endo emerges from bankruptcy. Longer-term, the ratings could be upgraded if the company is able to strengthen earnings through growth in its Xiaflex franchise, and commercialization of sterile injectables pipeline. The company would also need to sustain debt/EBITDA below 4.0x along with good liquidity highlighted by consistently positive free cash flows. The ratings could be downgraded if Endo's operating results are weaker than Moody's anticipates, or the company incurs. Ratings could also be downgraded if the company's debt/EBITDA is sustained above 5.0x or if liquidity deteriorates for any reason. The principal methodology used in these ratings was Pharmaceuticals published in November 2021. Endo is a specialty healthcare company offering branded and generic pharmaceuticals. Endo's reported revenue for the fiscal year ended December 31, 2023, was approximately $2.0 billion. ENDO FINANCE: S&P Rates New Senior Secured Notes 'B+' ----------------------------------------------------- S&P Global Ratings assigned its 'B+' issue-level rating to Endo Inc. subsidiary Endo Finance Holdings, Inc.'s proposed senior secured notes due 2032. The recovery rating is '3', reflecting S&P's expectation of meaningful (50% to 70%; rounded estimate: 55%) recovery in the event of payment default. Endo will use to proceeds of this issuance, together with the proceeds from the term loan B issuance, equity offerings, and cash on hand to make settlement payments, make distributions to holders of first-lien claims, and pay professional fees associated with its emergence from Chapter 11 bankruptcy. S&P's 'B+' issuer credit rating on Endo reflects its expectation for a return to revenue growth over the next year, supporting adjusted debt to EBITDA sustained between 3.5x to 4.5x. ENVIVA INC: Receives NYSE Non-Compliance Notice Over Delayed 10-K ----------------------------------------------------------------- Enviva Inc. (NYSE: EVA) on April 8, 2024, disclosed that on April 2, 2024, the Company received notice from the New York Stock Exchange (the "NYSE") that it is not in compliance with Section 802.01E of the NYSE Listed Company Manual due to a delay in filing its Annual Report on Form 10-K for the year ended December 31, 2023, with the Securities and Exchange Commission (the "SEC"). The NYSE Notice has no immediate effect on the listing of the Company's common stock on the NYSE. The NYSE informed the Company that, under the NYSE's rules, the Company will have six months from April 1, 2024 to file the Form 10-K with the SEC. The Company can regain compliance with the NYSE listing standards by filing the Form 10-K with the SEC before such date. If the Company fails to file the Form 10-K within the six-month period, the NYSE may, in its sole discretion, grant an extension of up to six additional months for the Company to regain compliance. As previously reported in the Company's Notification of Late Filing on Form 12b-25 filed with the SEC on March 15, 2024 (the "Form 12b-25"), the Company was unable to file the Form 10-K within the prescribed period because on March 12, 2024, the Company and certain of its subsidiaries filed a voluntary petition under Chapter 11 of the U.S. Bankruptcy Code (the "Chapter 11 Cases") in the U.S. Bankruptcy Court for the Eastern District of Virginia (the "Bankruptcy Court"). As previously disclosed, the Company is required to obtain approval of the Bankruptcy Court to retain the services of the Company's independent registered public accounting firm in order to complete the audit of its financial statements for the year ended December 31, 2023. Given the Bankruptcy Court approval requirement, as well as the considerable time and resources of the Company's management devoted to the Chapter 11 Cases, the Company was unable to prepare and timely file its Form 10-K on or before April 1, 2024, the end of the extension period provided by the Form 12b-25. The Company is working diligently to complete the necessary work to file the Form 10-K as soon as practicable and currently expects to file the Form 10-K within the six-month period granted by the NYSE Notice; however, there can be no assurance that the Form 10-K will be filed within such period. About Enviva Inc. Headquartered in Bethesda, Md., Enviva Inc. -- https://www.envivabiomass.com -- is a producer of industrial wood pellets, a renewable and sustainable energy source produced by aggregating a natural resource, wood fiber, and processing it into a transportable form, wood pellets. Enviva exports its wood pellets to global markets through its deep-water marine terminals at the Port of Chesapeake, Virginia, the Port of Wilmington, North Carolina, and the Port of Pascagoula, Mississippi, and from third-party deep-water marine terminals in Savannah, Georgia, Mobile, Alabama, and Panama City, Florida. Enviva Inc. and certain affiliates sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. E.D. Va. Lead Case No. 24-10453) on March 13, 2024. In the petition signed by Glenn T. Nunziata, interim chief executive officer and chief financial officer, Enviva Inc. disclosed $2,893,581,000 in assets and $2,631,263,000 in liabilities. Judge Brian F. Kenney oversees the cases. The Debtors tapped Vinson & Elkins, LLP as general bankruptcy counsel; Kutak Rock, LLP as local counsel; Lazard Freres & Co., LLC as investment banker; Alvarez & Marsal Holdings, LLC as financial advisor; and Kurtzman Carson Consultants, LLC as notice and claims agent. The U.S. Trustee for Region 4 appointed an official committee to represent unsecured creditors in the Debtors' Chapter 11 cases. ESCAPE VELOCITY: Moody's Alters Outlook on 'B3' CFR to Stable ------------------------------------------------------------- Moody's Ratings affirmed the ratings of Escape Velocity Holdings, Inc. (dba "Trace3"), including the B3 Corporate Family Rating, B3-PD Probability of Default Rating, and B3 rating on the $415 million backed senior secured first lien term loan due 2028, which will subsequently increase by $225 million as a result of the proposed fungible term loan add-on. The outlook was changed to stable from positive. The change in Trace3's outlook to stable reflects the company's aggressive financial policy characterized by a $225 million incremental term loan issuance for a shareholder distribution, which will increase leverage to around 7x debt/EBITDA from about 5x as of December 2023. Moody's expects that absent any M&A, leverage will moderate to around 6.4x over the next 12 months supported by mid-single digit revenue growth. The growth will be facilitated by a mix shift towards higher margin services and growth in emerging technology solutions. RATINGS RATIONALE Trace3's B3 CFR broadly reflects the company's small scale compared to competing IT value-added resellers and managed services firms as well as the challenges of evolving requirements of IT deployments for enterprises including the ongoing transition to cloud platforms. The company's controlled private equity ownership and expectation for an aggressive financial policy also constrain the rating. Trace3's ratings benefit from the company's diversified OEM vendor supplier list, specialization in emerging technology and software-focused IT solutions in high growth areas such as hybrid cloud, security and network, and data intelligence, and customer base of large Fortune 1,000 clients. The company is vendor agnostic and its exposure to top vendors is much lower than those of its immediate peers. Moody's expects Trace3's focus on software-IT solutions in high growth areas coupled with ample wallet share opportunities within its existing Fortune 1,000 customer base will result in solid organic gross profit growth in the next 12-18 months. Trace3's liquidity is adequate. Internal cash generation is somewhat volatile due to seasonality (approximately 65% of gross profit is generated in H2) and exposure to working capital swings. However, Moody's projects that the company will generate free cash flow of around $20-25 million in the next 12 months. Additionally, the capital structure contains a $275 million ABL revolving credit facility, $150 million (upsized from $100 million) of which can be used for general corporate purposes with the balance dedicated to channel financing capacity. Access to the ABL revolver is governed by a springing 1.0x FCCR ratio that tests only when Total Liquidity falls below the greater of i) $10 million and ii) 10% of the Line Cap for at least three consecutive days. Trace3 had around $31 million of outstanding revolver balances at the end of December 2023 (no outstanding balance as of February 29, 2024), and Moody's expects the balance to be undrawn by the end of this year. Other cash obligations maturing over the next 24 months are limited to mandatory term loan amortization payments of $6.4 million per annum. The stable outlook reflects Moody's expectation for Trace3 to continue to grow earnings such that debt/EBITDA will decline towards the mid 6x level over the next 12 months. The outlook also reflects Moody's expectation for the company to generate solid free cash flow and maintain at least adequate liquidity. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS Ratings could be upgraded if Trace3 continues to add scale, sustains organic revenue growth of at least 5% in a normalized operating environment, maintains debt/EBITDA below 6x, and generates FCF/debt above 5%. Ratings could be downgraded if a decline in profitability or cash flow leads to adjusted debt/EBITDA being sustained above 7x or EBITDA margins erode. There would be downward pressure on ratings if liquidity were to weaken resulting in breakeven FCF or reduced revolver availability. A deteriorating relationship with key suppliers could also pressure the ratings. In addition, debt-funded acquisitions and distributions can apply ratings pressure. The principal methodology used in these ratings was Business and Consumer Services published in November 2021. Trace3, headquartered in Irvine, CA, is a provider of end-to-end IT technology products, solutions and services for enterprise and mid-sized companies across the western, mid-eastern, and south-eastern regions of the US. The company specializes in providing solutions on emerging technologies in the areas of security, data intelligence, cloud, DevOps, and data center solutions. Trace3 generated net revenue and gross profit of approximately $1.4 billion and $403 million, respectively, for the fiscal-year ended December 2023. Moody's has also corrected the display on its websites to reflect that the name of the rated entity is Escape Velocity Holdings, Inc. Due to an internal administrative error the name of the rated entity was previously displayed as ASP T3 PARENT HOLDINGS, INC. ETTA COLLECTIVE: Set to Auction Its Assets ------------------------------------------ Ashok Selvam of Eater Chicago reports that Etta founder David Pisor is no longer in charge of operations at his Bucktown restaurant, according to bankruptcy-related court documents. The news comes nearly two months after Pisor's Etta Collective filed for bankruptcy in multiple states and as the once nationally recognized restaurant group's assets head to auction next week. The court's order only pertains to Etta Bucktown, meaning Pisor remains at Aya Pastry. In the interim, the court has appointed Rafael Gaspar as manager of the Bucktown restaurant. The court has ordered that a sale must be finalized by Monday, April 15, 2024. Gaspar, who represents the debtors, owns a few Chicago-area restaurants including Fireside Restaurant in Ravenswood, and has no prior relationship with Pisor, according to court documents. Etta's debtors made a motion to appoint Gaspar on March 1, 2024. His role is to "use his reasonable best efforts during the term to improve and maximize the financial performance of the restaurants and to keep them operational and maximize their value through the closing of the sale." In January and February, Pisor made five Chapter 11 bankruptcy filings covering his two Ettas in Chicago; Etta Scottsdale, Arizona; Aya Pastry in West Town; and his parent company, Etta Collective. He closed Etta River North in January after closing an Etta in Culver City, California, in December. He's been involved in restaurants in Chicago, California, and Texas, and is a co-founder Gold Coast steakhouse Maple & Ash, though he is no longer affiliated with that restaurant group. Pisor's relationship with Maple & Ash co-founder Jim Lasky deteriorated and the partners eventually reached an agreement to settle competing lawsuits against each other, and in January 2023 severed ties, with Pisor taking control of Etta properties, Aya Pastry, and Cafe Sophie under a new company, Etta Collective. Etta struggled after the split from the highly profitable Maple & Ash brand. Workers for Etta Collective in Chicago accused management of taking dental insurance premiums from their paychecks without paying for coverage in addition to other internal issues. Projects in Evanston, Downtown Chicago, and Texas have also been canceled or postponed due to the bankruptcy filings. The order to appoint Gaspar was issued on March 12, 2024, according to a filing through the United States Bankruptcy Court of Delaware. The auction, scheduled for Monday, March 25, 2024 isn't open to the public; parties had until the morning of Wednesday, March 20, to declare their interest in participating in the auction to undergo the appropriate financial background checks. About Etta Collective Etta Collective is a full-service restaurant. Etta Collective sought relief under Chapter 11 of the U.S. Bankruptcy Code (Bankr. D. Del. Case No. Case No. 24-10146) on Feb. 1, 2024. In the petition filed by David Pisor, as manager, the Debtor reports estimated assets between $100,000 and $500,000 and estimated liabilities between $1 million and $10 million. The Debtor is represented by: Maria Aprile Sawczuk, Esq. GOLDSTEIN & McCLINTOCK LLLP 501 Silverside Road, Suite 65 Wilmington, DE 19809 Tel: 302-444-6710 Fax: 302-444-6709 E-mail: marias@goldmclaw.com FARMER'S PEANUT: Case Summary & 11 Unsecured Creditors ------------------------------------------------------ Debtor: Farmers' Peanut Company of SOWEGA, Inc. 185 Hudson Street, NW Whigham, GA 39897-0094 Chapter 11 Petition Date: April 8, 2024 Court: United States Bankruptcy Court Middle District of Georgia Case No.: 24-10333 Debtor's Counsel: Wesley J. Boyer, Esq. BOERY TERRY LLC 348 Cotton Avenue, Suite 200 Macon, GA 31201 Tel: (478) 742-6481 Fax: (770) 200-9230 E-mail: Wes@BoyerTerry.com Estimated Assets: $1 million to $10 million Estimated Liabilities: $1 million to $10 million The petition was signed by Joseph D. Vaughn, III as managing member. A full-text copy of the petition containing, among other items, a list of the Debtor's 11 unsecured creditors is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/ODFNSZY/Farmers_Peanut_Company_of_SOWEGA__gambke-24-10333__0001.0.pdf?mcid=tGE4TAMA FEC RESOURCES: DMCL LLP Raises Going Concern Doubt -------------------------------------------------- FEC Resources Inc. disclosed in a Form 20-F Report filed with the U.S. Securities and Exchange Commission for the fiscal year ended December 31, 2023, that its auditor expressed that there is substantial doubt about the Company's ability to continue as a going concern. Vancouver, Canada-based DMCL LLP, the Company's auditor since 2017, issued a "going concern" qualification in its report dated April 1, 2024, citing that the Company has certain conditions that raise substantial doubt about the Company's ability to continue as a going concern. According to the Company, Management considers that the current economic environment is difficult and the outlook for holding companies investing in oil and gas exploration companies presents significant challenges in terms of raising funds through issuance of shares. To the extent necessary, the Company has relied on its ability to raise funds via dispositions of quantities of its shareholdings in Forum Energy Limited to PXP Energy Corporation under terms that are consistent with the best interests of shareholders, in order to finance its operations. The Company has been successful in disposing quantities of its shareholdings in FEL in previous fiscal years. However, there can be no assurance the Company will continue to be able to dispose of quantities of its shares in FEL under suitable terms. Currently management has no plans to sell any additional FEL shares. Since the delisting of FEL from the London Stock Exchange, there is no liquidity via a public market for the FEL shares. As the Company is wholly reliant on the information disclosed by PXP concerning the business of FEL, the Company may not be able to obtain information necessary to facilitate a wider sales process and may be reliant on significant shareholders of PXP for the disposition of any of its FEL shares. Management continues to look at all options including raising funds to operate and participate in future FEL financings by way of debt or equity financings. Given the share price of the Company, and given that any external financings may have been extremely dilutive, the Company undertook a rights offering during 2020 and accepted loans from PXP to raise funds to sustain operations and participate in pre-drilling costs on Service Contract ("SC") 72. Management has concluded that the combination of these circumstances gives rise to a material uncertainty that casts substantial doubt on the ability of the Company to continue as a going concern; therefore, the Company may be unable to realize its assets and discharge its liabilities in the normal course of business. For the years ended December 31, 2023, and 2022, the Company incurred net and comprehensive losses of $191,795 and $193,182, respectively. As of December 31, 2023, the Company had $2,478,573 in total assets, $695,204 in total liabilities, and $1,783,369 in shareholders' equity. A full-text copy of the Company's Form 20-F is available at https://tinyurl.com/374897vc About FEC Resources Inc. Vancouver, British Columbia-based FEC Resources, Inc. is an investment holding company, which engages in the exploration and development operation of oil and gas business. FISKER INC: Fails to Make March 29 Payment, Gets Short Forbearance ------------------------------------------------------------------ Fisker Inc. didn't pay the installment amount due March 29, 2024, under its Series B-1 notes, resulting in an event of default under the notes. Fisker later entered a forbearance agreement, which ends on April 21, 2024, or earlier if the company fails to meet forbearance agreement terms. Investor Agreement Fisker recounts in a regulatory filing that on July 10, 2023, it entered into a Securities Purchase Agreement with an institutional investor (the "Investor") pursuant to which the Company agreed to sell, and the Investor agreed to purchase, 0% senior convertible notes due 2025 (the "Series A-1 Notes") in a registered direct offering. On September 29, 2023, the Company agreed to sell, and the Investor agreed to purchase, additional 0% senior convertible notes due 2025 (the "Series B-1 Notes" and together with the Series A-1 Notes, the "Notes") in a registered direct offering. NYSE Suspension On March 25, 2024, the New York Stock Exchange (the "NYSE") notified the Company that it had determined to immediately suspend trading in the Company's Class A common stock and commence proceedings to delist the Company's Class A common stock. On April 2, 2024, an Event of Default occurred under the Notes as a result of the suspension from trading of the Class A Common Stock on the NYSE for a period of 5 consecutive Trading Days (the "Suspension Default"). Payment Default In addition, the Company did not pay the Installment Amount due on the March 29, 2024 Installment Date under the Series B-1 Notes, resulting in an Event of Default under the Notes (the "B-1 Payment Default"). As a result of such Events of Default, the Investor, among other things, has acquired certain rights and remedies, including the right to accelerate the Notes by requiring the Company to immediately redeem 100% of the outstanding Notes at the Event of Default Redemption Price, including any other amounts due under the Notes (the "Event of Default Redemption Right"), and accelerated the Notes pursuant to the Event of Default Redemption Right by delivering an Event of Default Redemption Notice on April 4, 2024 to demand immediate redemption of the Notes in connection therewith. Forbearance Agreement On April 4, 2024, the Company, certain subsidiaries of the Company who are guarantors of the Notes (the "Guarantors" and together with the Company, the "Obligors") and the Investor (in its capacity as collateral agent and noteholder) entered into a Forbearance Agreement (the "Forbearance Agreement") pursuant to which the Investor agreed to, among other things, forbear from enforcing its right to immediate redemption as demanded in the Event of Default Redemption Notice and forbear from exercising any of its other rights or remedies (including enforcement and collection actions) under the Transaction Documents, by operation of law or otherwise against the Obligors or any of the Collateral or other property owned by the Obligors (including, without limitation, via set-off or recoupment) with respect to defaults and events of default that have occurred, or that may occur, as a result of (i) the Suspension Default, (ii) the B-1 Payment Default, (iii) any potential default arising from the Company's failure to pay any Installment Amount due under the Series A-1 Note for the April 11, 2024 Installment Date, (iv) a potential failure by the Company to make a required interest payment due on the 2026 Notes (previously due on March 15, 2024) by April 14, 2024, and (v) the potential delisting of the Company's Class A common stock from an Eligible Market (such events described in clauses (i) through (v), collectively, the "Specified Defaults"). In connection with entry into the Forbearance Agreement, the Company paid the Investor a forbearance fee equal to $500,000 payable in cash and in kind as described in the Forbearance Agreement. The forbearance period under the Forbearance Agreement commenced on April 4, 2024 and will end on the earlier of (a) April 21, 2024 and (b) the occurrence of any Forbearance Default (as defined in the Forbearance Agreement), including, among other things, (i) the failure of any Obligor to comply in any material respect with any covenant or agreement set forth in the Forbearance Agreement, (ii) the occurrence of any Event of Default (other than the Specified Defaults described above), (iii) the Company or any Subsidiary engaging in any transaction (including the incurrence of Indebtedness), making any dividend, investment, payment or transfer, or taking any other action (or forbearing from taking any action), in each case, outside the ordinary course of business (taking into consideration the current circumstances of the Company and its Subsidiaries) and (iv) the commencement of any action, suit, litigation, investigation or other proceeding against the Company or any of its subsidiaries by (x) the holders of any of the 2.50% Convertible Senior Notes due 2026 (the "2026 Notes") issued by the Company pursuant to the indenture, dated as of August 17, 2021, between the Company and U.S. Bank National Association, as trustee (the "2026 Notes Trustee"), (y) the 2026 Notes Trustee or (z) any other person on behalf of the holders of the 2026 Notes, seeking enforcement of, redemption of, acceleration of or other similar remedies with respect to, the 2026 Notes or the obligations of the Company thereunder. About Fisker Inc. California-based Fisker Inc. is revolutionizing the automotive industry by designing and developing individual mobility in alignment with nature. Passionately driven by a vision of a clean future for all, the company is on a mission to create the world's most sustainable and emotional electric vehicles. FISKER INC: William McDermott Resigns; John Dubel Named Director ---------------------------------------------------------------- Fisker Inc. disclosed in a Form 8-K Report filed with the U.S. Securities and Exchange Commission that on March 28, 2024, William R. McDermott resigned from the board of directors of the Company and the Audit Committee of the Board. McDermott's employer requested McDermott resigns for governance reasons to reduce the number of outside boards he serves on. McDermott's resignation was not a result of any disagreement with the Company. On April 3, 2024, the Board appointed John S. Dubel to the Board, effective immediately. Dubel will serve as a Class II director with a term to expire at the annual meeting of stockholders to be held in 2025. In connection with his appointment to the Board, the Board appointed him to serve on the Audit Committee of the Board (the "Audit Committee"). There is no arrangement or understanding between Dubel and any other person pursuant to which he was selected as a director. There are no family relationships between Dubel and any director or executive officer of the Company. As part of Dubel's appointment to the Board, the Company and Dubel entered into an Independent Director Agreement dated April 3, 2024. Dubel's compensation for his services as a director and member of the Audit Committee will be in accordance with the Independent Director Agreement, which provides a monthly fee of $35,000, pro-rated for any partial service. In addition to the fees set forth above, the Company shall pay directly or reimburse Dubel upon receipt of periodic billings, for all reasonable out-of-pocket expenses incurred in connection with his appointment. Further, in connection with his appointment as a director, Dubel will enter into an indemnification agreement with the Company consistent with the form agreement executed with each of the Company's current directors. About Fisker Inc. California-based Fisker Inc. is revolutionizing the automotive industry by designing and developing individual mobility in alignment with nature. Passionately driven by a vision of a clean future for all, the company is on a mission to create the world's most sustainable and emotional electric vehicles. FLUENT INC: Reports $63.2 Million Net Loss in 2023 -------------------------------------------------- Fluent, Inc. filed with the U.S. Securities and Exchange Commission its Annual Report on Form 10-K reporting a net loss of $63.2 million on $298.4 million of total revenue for the year ended December 31, 2023, compared to a net loss of $123.3 million on $361.1 million of total revenue for the year ended December 31, 2022. As of December 31, 2023, the Company had $111.9 million in total assets, $77.5 million in total liabilities, and $34.4 million in total stockholders' equity. Donald Patrick, Fluent's Chief Executive Officer, commented, "Our results for the fourth quarter are consistent with the strategy we outlined in our last earnings release - we showed sequential quarterly growth reflecting stability in our owned and operated marketplaces coupled with the acceleration of our new strategic performance marketplaces. Our full year results also reflect our investments into growing higher quality consumer engagements designed to further establish Fluent as an industry leader in performance marketing." In 2024, the Company is continuing to invest into expanding its new syndicated performance marketplaces while strengthening its owned and operated marketplaces based on the current macro-economic realities. The Company is creating more effective customer acquisition solutions for its clients, while positioning Fluent as a market leader. This represents a more sustainable business for the Company's stakeholders. Fluent previously disclosed in its expected fourth quarter and full year 2023 financial results that there is substantial doubt about its ability to continue as a going concern due to non-compliance with the covenants of its credit agreement in light of current business conditions. If it becomes unable to satisfy a financial covenant or otherwise breach a covenant under its debt facility, the Company's auditors and/or management may determine that the potential for acceleration of its payment obligations, together with other then-existing factors, creates substantial doubt about its ability to continue as a going concern, as was the case with its prior credit facility as of the filing date of Form 10-Q for the third quarter of 2023. A full-text copy of the Company's Form 10-K is available at https://tinyurl.com/4pnzu7yd About Fluent Inc. Fluent, Inc. (NASDAQ: FLNT) is a leader in performance marketing, delivering customer acquisition solutions through our digital media portfolio, global commerce partnerships, and proprietary data and tech. The Company introduces brands to consumers through outcome-based programs across untapped channels, including our post-transaction ad solution and rewarded discovery platform. FOCUS UNIVERSAL: Weinberg & Company Raises Going Concern Doubt -------------------------------------------------------------- Focus Universal Inc. disclosed in a Form 10-K Report filed with the U.S. Securities and Exchange Commission for the fiscal year ended December 31, 2023, that its auditor expressed that there is substantial doubt about the Company's ability to continue as a going concern. Los Angeles, CA-based Weinberg & Company, P.A., the Company's auditor since 2017, issued a "going concern" qualification in its report dated April 1, 2024, citing that the Company has suffered recurring losses from operations and has experienced negative cash flows from operating activities that raise substantial doubt about its ability to continue as a going concern. The Company has a net loss of $4,718,142 and $4,926,937 for the years ended December 31, 2023 and 2022, respectively. In addition, the Company had an accumulated deficit of $22,582,170 and $17,864,028 as of December 31, 2023 and 2022, respectively, and negative cash flow from operating activities of $3,528,762 and $2,957,983 for the years ended December 31, 2023 and 2022, respectively. The Company currently suffered recurring loss from operations, generated negative cash flow from operating activities, has an accumulated deficit and has not completed its efforts to establish a stabilized source of revenues sufficient to cover operating costs over an extended period of time. These conditions raise substantial doubt as to its ability to continue as a going concern. At December 31, 2023, the Company had cash and cash equivalents, and short-term investments, in the amount of $464,989. The ability to continue as a going concern is dependent on the Company attaining and maintaining profitable operations in the future and raising additional capital to meet its obligations and repay its liabilities arising from normal business operations when they come due. Since inception, the Company has funded its operations primarily through equity and debt financings, and it expects to continue to rely on these sources of capital in the future. In addition, subsequent to year end, the Company has entered into an agreement to sell its land and buildings which upon completion, will provide additional working capital to the Company. No assurance can be given that the sale of the land and buildings will occur, or any future financing will be available or, if available, that it will be on terms that are satisfactory to the Company. Even if the Company is able to obtain additional financing, it may contain undue restrictions on the Company's operations, in the case of debt financing, or cause substantial dilution for its stockholders, in case of equity financing, or grant unfavorable terms in future licensing agreements. As of December 31, 2023, the Company had $5,334,124 in total assets, $1,788,498 in total liabilities, and $3,545,626 in total stockholders' equity. A full-text copy of the Company's Form 10-K is available at https://tinyurl.com/mt3x7cb7 About Focus Universal Inc. Focus Universal Inc. was incorporated under the laws of the State of Nevada on December 4, 2012. It is a universal smart instrument developer and manufacturer, headquartered in Ontario, California, specializing in the development and commercialization of novel and proprietary universal smart technologies and instruments. Focus Universal Inc. is also a provider of patented hardware and software design technologies for Internet of Things ("IoT") and 5G. FREEDOM PLUMBERS: Court Approves Disclosure Statement ----------------------------------------------------- Judge Klinette H Kindred has entered an order that the First Amended Disclosure Statement of Freedom Plumbers Corporation is approved as containing "adequate information." The last day for creditors to cast a ballot for or against the First Amended Plan will be May 7, 2024. The last day to timely file and to serve an objection to confirmation of the Debtor's First Amended Plan of Reorganization will be May 1, 2024. The hearing on confirmation of the Amended Plan will be on May 14, 2024, at 12:00 p.m. About Freedom Plumbers Freedom Plumbers Corporation is a Virginia corporation that was formed in 2018 and engaged in the plumbing industry. The Debtor filed a Chapter 11 petition (Bankr. E.D. Va. Case No. 23-11654) on Oct. 12, 2023, with $500,001 to $1 million in both assets and liabilities. The Debtor tapped Steven R. Fox, Esq., at The Fox Law Corporation, Inc., as lead bankruptcy counsel and RoganMillerZimmerman, PLLC, as local counsel. FREMONT TERRACE: Creditor Says Plan Disclosures Inadequate ---------------------------------------------------------- Builders Capital Finance, LLC, a secured creditor of debtor Fremont Terrace Associates Ltd., LP, filed an objection to the Debtor's Disclosure Statement. Lender holds a deed of trust on the real property located at 200 S. Fremont Street, San Mateo, California 94401 (the "Property"). Lender and the Debtor are parties to an agreement wherein Lender loaned the Debtor over eight million dollars secured by the Property ("Loan"). The Debtor defaulted on the loan agreement when it failed to repay the loan in full by the maturity date of May 16, 2023. Lender objects to the Plan because the Disclosure Statement fails to provide the required adequate information concerning the affairs of the Debtor. Without this information, the holder of a claim or interest cannot make an informed judgment about the Plan. Lender also objects to confirmation of the proposed Plan because, based on the evidence presently in the record, the Plan relies upon incorrect or unsubstantiated real property valuations and fails to provide for sufficient plan payments. The Debtor proposes to sell the Property or refinance the Loan within six months of the petition date. In the meantime, however, Lender is not being paid any amount toward its claim. Moreover, the Plan does not contain any discussion related to Debtor's efforts to refinance the Loan or sell the Property. In short, the Plan is not fair and equitable to Lender, as required by 11 U.S.C. Sec. 1129(b). Additionally, according to Lender, the Plan does not appear to be feasible, nor does the Plan appear to provide Lender with at least what it would receive in a prompt liquidation under Chapter 7, as required by 11 U.S.C. Sec. 1129(a)(11). Accordingly, the Plan is patently unconfirmable and, as such, the Court should not approve the Disclosure Statement, Lender tells the Court. Attorneys for lender Builders Capital Finance, LLC: Joshua K. Partington, Esq. Andrew B. Still, Esq. SNELL & WILMER L.L.P. 600 Anton Blvd, Suite 1400 Costa Mesa, CA 92626-7689 Tel: (714) 427-7000 Fax: (714) 427-7799 E-mail: jpartington@swlaw.com astill@swlaw.com About Fremont Terrace Associates Fremont Terrace Associates, Ltd. LP, was developing real property commonly known as 200 S. Fremont Street, San Mateo, California 94401, into residential condominium units. Fremont Terrace Associates filed a voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. N.D. Cal. Case No. 23-30840) on Dec. 13, 2023, with $10 million to $50 million in assets and $1 million to $10 million in liabilities. Victor Catanzaro, general partner, signed the petition. Judge Dennis Montali oversees the case. Brent D. Meyer, Esq., at Meyer Law Group, LLP, serves as the Debtor's bankruptcy counsel. FTX GROUP: Hedge Funds to Profit From Bankruptcy Claims ------------------------------------------------------- Niamh Rowe of FortuneCrypto reports that hedge funds that scooped up FTX bankruptcy claims are looking at nine-figure paydays. One investor shares how he could rake in $25 million. Louis d'Origny has bought almost 1,000 FTX bankruptcy claims since December 2022. When rumors began swirling online that FTX was in trouble, one of the crypto exchange's customers, Louis d'Origny, took no notice, turning his attention back to the friends he was hosting at his Miami Beach condo. "Fake news," he recalls saying. He turned away from his laptop, leaving behind the increasingly distressed crypto community for a day at the beach. But within hours, the mood had shifted. He returned home to tweets about denied withdrawals. "Things had gotten more hectic," he recalls. As the sun set through his floor-to-ceiling windows, the then 31-year-old wondered how this was going to go down. "And then," he recalls, "we couldn't withdraw our money." D'Origny is one of over a million or so victims trying to claw back lost funds from FTX, which imploded once the financial fraud of cofounder Sam Bankman-Fried came to light. "At the time, it felt like the end of crypto," he said. "It was very doom-and-gloom. Nobody thought that Bitcoin would get to an all-time high ever again." But in crypto's darkest hour, the wheels of d'Origny's mind started turning. "My view was that Sam didn't have enough time to perpetrate this fraud and to lose every single dollar. I was pretty convinced that they would be able to claw back a lot of money," he said. D'Origny spotted an opportunity: Creditors like himself wanted at least some of their funds back, but there was no clarity—nor guarantee—over how the exchange could raise the $8.7 billion combined shortfall at the time bankruptcy was declared. In other words, creditors would likely sell their claims for cheap. So what if he hedged his bets? Claim jumpers D'Origny had bought some Celsius bankruptcy claims with his own previous boutique fund, Arceau, but was relatively new to the space. And most investors he knew didn't want to go near FTX—no one wanted to front the capital to start buying up these claims. But within weeks of that day in Miami, d'Origny began using his own money to buy FTX positions for a few cents on the dollar from hedge funds under mandates to liquidate. "There was no information whatsoever available on the bankruptcy. We took a big risk. I just put my money where my mouth is," he told Fortune. Trading bankruptcy claims is a high-risk, high-reward tactic. With the bankruptcies of Lehman Brothers, Enron, and General Motors, claims traders are believed to have made hundreds of millions, if not billions, of dollars picking clean the bones of those once-mammoth firms. But other times, claims end up worthless. "It ended up being much better than I ever imagined," he says. When a company goes bust, creditors face a lengthy bankruptcy process in court, with no guarantee as to what percentage of a claim will be repaid. Instead, many opt to sell theirs immediately for cash to a buyer willing to risk the claim plummeting in value depending on how much the overseers of the bankruptcy are able to recover. Calculating the exact timeline and value of claims traded since FTX filed for Chapter 11 bankruptcy in the District Court of Delaware on Nov. 11, 2022, is complicated. Some are traded on online platforms, while others trade hands privately, and buyers aren't required to file the transfer immediately, creating a lag, while others simply report it as their own claim, traders in the space told Fortune. Over $439 million worth of claims have been exchanged across 49 trades on the industry's dominant online trading platform, Claims Market, as of March 28. Meanwhile, hedge funds have bought over $2.3 billion worth of steeply discounted claims, according to court records as of March 20. While the exact date creditors will be repaid by the bankruptcy court remains undetermined, it now looks likely they could be fully remunerated. "It looks like customers will hopefully be paid in full," Bankman-Fried told a Manhattan court at his sentencing on Thursday, March 28, 2024. When claims were first awarded, creditors were giving them up for cheap. Over 60 claims valued at over $1 million have been traded on Claims Market -- sold at roughly 10% of their value in November 2022 and now going for as much as 93%, indicative of growing confidence in repayment. Meanwhile, others are estimating the claims could exceed their initial value and be worth closer to 120% to 140%, two people close to the sales told Fortune, due to the rising value of crypto and the sale of shares in the AI startup Anthropic for more than $880 million. The process The appointment of John J. Ray III as the FTX's new CEO when bankruptcy was filed also raised interest in the claims, buyers told Fortune. "He immediately started a process by which he would sell everything that wasn't nailed down to the floor, which institutional claim buyers love because they don’t want Bitcoin," d'Origny explained. FTX has recovered about $7 billion in assets so far, including from liquidated cryptocurrencies, 38 properties in the Bahamas, and $2.6 billion in cash, according to data in a presentation filed as part of its case. The estate held about 59 million Solana tokens and 21,482 Bitcoins, and those have since gained some 1,000% and 343%, respectively, since the company filed for bankruptcy. FTX will sell 41 million Solana tokens, worth about $7.65 billion at the time of publication, to institutional investors at a 68% discount of its current market price. This has outraged some victims, including Sunil Kavuri, who criticized Bankman-Fried's "continuous lie that we will all be made full" at his sentencing. Chapter 11 filings, as of March 20, show d'Origny had bought about $29 million worth of claims. They were bought for $3.5 million with personal funds, he says: "A family office investment of me and some friends." That's a return of more than 700%. D'Origny was with his family for Christmas when he bought his first claim. He recalls the worried faces of his onlooking parents, who teased him that the family might themselves go bankrupt by next Christmas as a result of his plan. Worth almost $3 million, a claim was exchanged on Dec. 28, 2022, for 6% of its value, according to the contract viewed by Fortune. The buyers so far set to make the largest returns from FTX scraps are hedge funds specializing in distressed debt. As of March 20, Attestor, Baupost, and Farallon, which had each bought claims worth over $520 million, $518 million, and $346 million, respectively, are leading the race. The funds have used alternative entity names confirmed by people close to the matter. Another big name in the space, and a friend of d'Origny, is Thomas Braziel, a bankruptcy claim broker at 117 Partners who buys claims on behalf of some of the largest hedge funds in the market. Braziel says his first trades were on Nov. 12, 2022, before the bankruptcy had been officially filed. He paid about $240,000 for an $8 million claim (about 3% of its stated value) and about $210,000 for a separate $3.5 million claim (6%). 'Very, very scary' The current valuations are a far cry from April 27 of last year when disaster nearly struck for the claims buyers. On a Zoom call with debtors in Singapore, d'Origny was about to close a deal on a $3 million claim at 25%. While on the call, news broke that the Internal Revenue Service had filed a $44 billion claim against FTX alleging unpaid taxes. "During that call, you know, we got spooked," he says. But he decided to buy the claim regardless. "It was very, very scary." While the IRS reduced that claim to $20.4 billion, if unchallenged, it still would mean game over for creditors in such a scenario. "We're getting zero," d'Origny says. However, FTX has entered into a legal battle over the claim, asking for a court dismissal: It would "threaten to halt the debtors' progress and any distribution to customers and other creditors indefinitely." In other words, as the claim would leave fraud victims out of pocket, it's unlikely to materialize, sources told Fortune. In July, FTX opened its own—somewhat clunky—public portal for customers to file claims. But in the early days of trading, there was limited information available on what assets could be liquidated or how claims would be validated. Many appeared crowdsourced from Twitter, with KYC conducted in a time-consuming and somewhat ad hoc manner, says d'Origny. "It was really, really hard to buy claims," says Braziel, who said he bought at least two or three claims that proved to be fraudulent. Due to the pace it took d'Origny to authenticate claims, he bought 40 in his first year of trading. This gave him another idea: to speed up the due diligence process through automation. In December 2023, he cofounded his own portal, FTX Creditor, which he describes as a "custom CRM, KYC, and diligence solution," which has narrowed the authenticating process from days to 30 minutes, he says. The company now has 14 employees spanning continents, who take calls with creditors 24 hours a day. Specializing in claims under $100,000, the company's aim is to provide retail investors with an accessible way to close sales on a 30-minute call, to avoid locking them into lengthy trade confirmations. Since December, FTX Creditor has bought nearly 1,000 claims worth roughly $100 million, public records show. Assuming a purchase price north of 70%, based on market estimates, that could mean a profit for the firm of about $30 million—a cut of which d'Origny presumably adds to what he pocketed buying his earliest claims. The rising value of the claims has slowed trading a bit, d’Origny explained. Still, just this week, over $6 million worth were purchased on Claims Market, and Braziel is still buying claims at 70%, according to a contract seen by Fortune. D’Origny is resolute about staying in the business of bankruptcy post-FTX, but once these claims are repaid, he's first going on a vacation. Did throwing his money behind these claims come down to calculated ingenuity? Perhaps. But in d'Origny's eyes, the conditions that unfolded were merely serendipitous. He used a word very different from ingenious: "luck." About FTX Group FTX is the world's second-largest cryptocurrency firm. FTX is a cryptocurrency exchange built by traders, for traders. FTX offers innovative products including industry-first derivatives, options, volatility products and leveraged tokens. Then CEO and co-founder Sam Bankman-Fried said Nov. 10, 2022, that FTX paused customer withdrawals after it was hit with roughly $5 billion worth of withdrawal requests. Faced with liquidity issues, FTX on Nov. 9 struck a deal to sell itself to its giant rival Binance, but Binance walked away from the deal amid reports on FTX regarding mishandled customer funds and alleged US agency investigations. At 4:30 a.m. on Nov. 11, Bankman-Fried ultimately agreed to step aside, and restructuring vet John J. Ray III was quickly named new CEO. FTX Trading Ltd (d/b/a FTX.com), West Realm Shires Services Inc. (d/b/a FTX US), Alameda Research Ltd. and certain affiliated companies then commenced Chapter 11 proceedings (Bankr. D. Del. Lead Case No. 22-11068) on an emergency basis on Nov. 11, 2022. Additional entities sought Chapter 11 protection on Nov. 14, 2022. FTX Trading and its affiliates each listed $10 billion to $50 billion in assets and liabilities, making FTX the biggest bankruptcy filer in the US this year. According to Reuters, SBF shared a document with investors on Nov. 10, 2022, showing FTX had $13.86 billion in liabilities and $14.6 billion in assets. However, only $900 million of those assets were liquid, leading to the cash crunch that ended with the company filing for bankruptcy. The Hon. John T. Dorsey is the case judge. The Debtors tapped Sullivan & Cromwell, LLP as bankruptcy counsel; Landis Rath & Cobb, LLP as local counsel; and Alvarez & Marsal North America, LLC as financial advisor. Kroll is the claims agent, maintaining the page https://cases.ra.kroll.com/FTX/Home-Index The Official Committee of Unsecured Creditors tapped Paul Hastings as counsel, FTI Consulting, Inc., as financial advisor, and Jefferies LLC as the investment banker. Young Conaway Stargatt & Taylor LLP is the Committee's Delaware and conflicts counsel. Montgomery McCracken Walker & Rhoads LLP, led by partners Gregory T. Donilon, Edward L. Schnitzer, and David M. Banker, is representing Sam Bankman-Fried in the Chapter 11 cases. White-collar crime specialist Mark S. Cohen has reportedly been hired to represent SBF in litigation. Lawyers at Paul Weiss previously represented SBF but later renounced representing the entrepreneur due to a conflict of interest. GARTNER INC: Moody's Ups Rating on Senior Unsecured Notes From Ba1 ------------------------------------------------------------------ Moody's Ratings upgraded the senior unsecured ratings of Gartner, Inc., a Stamford, CT-based research and consulting firm, to Baa3 from Ba1. Concurrently, Moody's withdrew the company's Ba1 corporate family rating, Ba1-PD probability of default rating, and SGL-1 speculative grade liquidity rating. The outlook remains stable. The rating upgrade to investment grade reflects the recently completed refinancing of the company's senior secured bank credit facility into an all-unsecured debt structure, and Moody's expectation that Gartner will maintain strong business profile and conservative credit metrics through various business cycles. Moody's projects that over the next 12-18 months Gartner will sustain at least mid-single digit organic revenue growth supplemented by strategic tuck-in acquisitions. "The company's profitability rates could reduce by 200 to 300 basis points over the next 12-18 months as the company invests in sales and new products, but Moody's expect still-robust EBITDA margins in a low-20 percentage range, strong cash conversion with over $1.0 billion in projected annual free cash flow and excellent liquidity," said Moody's Assistant-Vice President Oleg Markin. "The rating upgrade also reflects Moody's expectation that Gartner will demonstrate a strong commitment to the investment grade rating, specifically maintaining debt-to-EBITDA (Moody's adjusted) below 3.0 times and funding shareholder returns and strategic acquisitions with internally generated free cash flow," Markin added. Governance was a key consideration for the rating action. RATINGS RATIONALE Gartner's Baa3 senior unsecured rating reflects its large size, with more than $6.0 billion of annual revenues expected in 2024, global operating scope, and wide span of influence, especially in its technology research business lines, that make it difficult to displace. Moody's anticipates recurring, subscription-based research products and services will represent around 77% of 2024 annual revenues, with very high customer retention rates – the combination of which produces favorable economics (gross margins in excess of 70%) and high revenue predictability (total global contract value of around $4.8 billion as of December 31, 2023). The consulting and conferences segments are much smaller than research and suffered revenue and profit declines during the coronavirus pandemic, as such Moody's considers these segments more cyclical and prone to disruption than research. Higher recruitment cost to support future sales growth and prevailing wage inflation, along with conference revenue expansion, lead Moody's to anticipate that EBITDA margins of around 24% for the last twelve months period ended December 31, 2023 could contract by 200 to 300 basis points in 2024. Profit rates should grow again after 2025, driven by acceleration of contract value, prudent cost management and price increases. As a business services company, Moody's considers Gartner's environmental risks as low. Social risks are moderate, reflecting Gartner's constant need to recruit and train qualified and scarce personnel for research, sales, consulting, and other roles also sought by other information services providers. Moody's also assesses Gartner's financial strategies as balanced, consistent and predictable. The company's capital structure does not have pre-payable debt, other than the outstanding revolver draw, but Moody's expects the company will remain disciplined as to the level of debt and leverage to maintain its investment grade rating. Gartner has been an active acquirer of its own stock, with over $3.0 billion purchased over the last three years. Gartner's liquidity position is strong, supported by roughly $1.3 billion in unrestricted cash and cash equivalents as of December 31, 2023. Gartner has access to $1.0 billion senior unsecured revolving credit facility (unrated) expiring in March 2029, with approximately $725.6 million of remaining undrawn capacity. As part of the March 2024 refinancing transaction, the company rolled $274.4 million of the outstanding senior secured term loan borrowings into the new revolving credit facility. Free cash flow of around $1.0 billion anticipated in 2024 is supported by favorable working capital dynamics associated with Gartner's growing, pre-paid subscription revenue base and modest capital expenditures of around 2% of revenue per year. Moody's expects Gartner to use all of its excess cash flow towards share repurchases and opportunistic acquisitions. The unsecured revolver is subject to compliance with the consolidated leverage ratio (as defined in the credit agreement; net of no more than $500 million of cash) covenant, which must be below 4.0x or 4.5x for any fiscal quarter during any acquisition step-up period. The consolidated leverage ratio for the 12-month period ended December 31, 2023 was about 1.3 times. The stable outlook reflects Moody's expectation that Gartner's operational performance will remain strong and resilient over the next 12-18 months, and that the company will manage its share repurchases and M&A strategy without jeopardizing liquidity, and maintaining leverage within the targets stated in its financial policies (2.0x-2.5x net debt-to-EBITDA). The outlook also anticipates the company will generate annual free cash flow in excess of $1.0 billion over the next 12-18 months and its EBITA margin will begin to recover in 2025. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS A rating upgrade may be warranted if Gartner sustains: 1) its strong market position; 2) profitable revenue growth; 3) EBITA margins above 20% throughout the business cycle; 4) balanced financial strategies; and 5) debt-to-EBITDA of around 2.0 times. The rating could be downgraded if Moody's anticipates: 1) debt-to-EBITDA will remain above 3.0 times; 2) EBITA margin falls below 18%; 3) revenue growth slows down materially; 4) technology or competitive shifts weaken the company's market position; 5) a deterioration in liquidity; or 6) more aggressive financial policies featuring material debt-funded acquisitions or shareholder returns. The principal methodology used in these ratings was Business and Consumer Services published in November 2021. Gartner is a global research and advisory company specializing in issues including IT, supply chain management, marketing, human resources and personnel retention, sales, finance, and legal. Moody's Ratings expects about $6.2 billion in revenue in 2024. GHOST RECYCLING: Case Summary & 11 Unsecured Creditors ------------------------------------------------------ Debtor: Ghost Recycling Group Inc. 214-216 Gates Road Little Ferry, NJ 07643 Chapter 11 Petition Date: April 9, 2024 Court: United States Bankruptcy Court District of New Jersey Case No.: 24-13649 Debtor's Counsel: Eric H. Horn, Esq. A.Y. STRAUSS LLC 290 West Mount Pleasant Avenue. Suite 3260 Livingston, NJ 07039 Tel: 973-287-5006 Email: ehorn@aystrauss.com Estimated Assets: $1 million to $10 million Estimated Liabilities: $100,000 to $500,000 The petition was signed by Steven Carr, Jr. as president. A full-text copy of the petition containing, among other items, a list of the Debtor's 11 unsecured creditors is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/FAGXUPI/Ghost_Recycling_Group_Inc__njbke-24-13649__0001.0.pdf?mcid=tGE4TAMA GUARDIAN FUND: Available Cash & Sale Proceeds to Fund Plan ---------------------------------------------------------- Guardian Fund, LLC and its Debtor Affiliates, and the Official Committee of Unsecured Creditors filed with the U.S. Bankruptcy Court for the District of Nevada a Disclosure Statement describing Joint Plan of Reorganization dated April 2, 2024. Guardian is a Nevada limited liability company established in 2017. It has been actively involved in residential real estate and debt investments since its inception. CV1 and CV2 are Delaware limited liability companies wholly owned by Guardian and formed on February 26, 2020, and May 21, 2021, respectively, as special purpose entities to facilitate two loans extended by Wilmington Trust. CV1 and CV2 collectively hold title to 121 properties in Alabama, Missouri, and Ohio which serve as collateral to secure Wilmington Trust's loans. This Plan was strategically crafted to optimize the value of the Debtors' current assets and to leverage the infrastructure, expertise, and experience of the Debtors to generate future reoccurring revenue and increased value of Debtors' fixed assets. The business operating platform developed by Guardian through its wholly owned subsidiary, 12B Residential, Inc. ("12BR"), will provide significant revenue and market value even after sale of the Debtors' current assets. The Debtors' real estate portfolio is comprised of 446 low-income residential properties ("Properties"). The Properties are approximately 50% occupied and many have substantial deferred maintenance, the result being that many Properties would not qualify for traditional financing in their "as is" condition. Many of the vacant Properties are also boarded up with utilities turned off, making it difficult for a potential buyer to perform due diligence. The Debtors and Committee have considered and analyzed several financial models to determine the model that is most likely to optimize value for and return the most value to the Debtors' creditors and equity holders. This Plan, and the related financial projections, are based on what the Debtors and Committee believe is the best and most feasible operating model which will result in payment in full to allowed unsecured creditors, with accrued interest, and also allow equity holders to retain their ownership interests in Guardian to benefit from future dividend distributions. Class 4 consists of the allowed unsecured claims of creditors who loaned money to Guardian Fund under certain promissory notes with various maturity dates. The Class 4 allowed claims are estimated in the total amount of $7.9 million as of the Petition Date. The allowed claim amounts owing on the Petition Date shall be paid in quarterly cash payments of $527,000 distributed on a pro-rata basis equally among each claimant, with the first payment due on June 30, 2025, and continuing on the last day of each calendar quarter thereafter until the Class 4 claims are paid in full. Guardian estimates the first interest-only lump sum payment on June 30, 2025, will be around $722,411. Guardian estimates that the Class 4 claims will be paid in full on or about December 31, 2028. The Class 5A allowed unsecured claims of Guardian Fund Trade Vendors in the amount of $80,254.41, calculated as of the Petition Date, shall be paid in full with simple interest at 4% per annum from the Petition Date and shall be paid in full in monthly installments of $6,700 starting on January 31, 2025, distributed on a pro-rata basis equally among each claimant, and continuing on the last day of each month thereafter for one year until December 31, 2025, when all unpaid principal and accrued interest shall be due and payable in full. The Class 5B allowed unsecured claims of CV1 Trade Vendors in the amount of $64,165.87 calculated as of the Petition Date shall be paid in full with simple interest at 4% per annum from the Petition Date and shall be paid in monthly installments of $8,000 distributed on a pro-rata basis equally among each claimant, with the first payment due on January 31, 2025, and continuing on the last day of each calendar month thereafter until the Class 5B claims are paid in full. CV1 estimates the Class 5B claims will be paid in full on or about August 31, 2025. The Class 5C allowed unsecured claims of CV2 Trade Vendors in the amount of $58,876.54 calculated as of the Petition Date shall be paid in full with simple interest at 4% per annum from the Petition Date and shall be paid in monthly installments of $8,000 distributed on a pro-rata basis equally among each claimant, with the first payment due on January 31, 2025, and continuing on the last day of each calendar month thereafter until the Class 5C claims are paid in full. CV2 estimates the Class 5C claims will be paid in full on or about August 31, 2025. The Class 5D allowed unsecured claim of the Internal Revenue Service against CV1 in the amount of $3,510.00 for penalties will be paid in full with simple interest at 4% per annum from the Petition Date and shall be paid by CV1 in monthly installments of $500 commencing on July 1, 2025, and continuing on the first day of each month thereafter until the Class 5D claim is paid in full. The Class 5E allowed unsecured claim of the Internal Revenue Service against CV1 in the amount of $8,190.00 for penalties will be paid in full with simple interest at 4% per annum from the Petition Date and shall be paid by CV2 in monthly installments of $500 commencing on July 1, 2025, and continuing on the first day of each month thereafter until the Class 5E claim is paid in full. The Class 6A allowed unsecured lease damage claims estimated in the amount of $4 million calculated as of the Petition Date, shall accrue simple interest at 4% per annum from the Petition Date until paid in full, and shall be paid as follows: the allowed claim amount owing on the Petition Date shall be paid in quarterly cash payments of $267,000 distributed on a pro-rata basis equally among each claimant, with the first payment due on June 30, 2025, and continuing on the last day of each calendar quarter thereafter until the Class 6A claims are paid in full. Guardian estimates the first interest-only lump sum payment on June 30, 2025, will be around $365,778. Guardian estimates that the Class 6A claims will be paid in full on or about December 31, 2028. The Debtors intend to continue renting, rehabbing, and selling their real properties in the ordinary course of business and reinvesting the sale proceeds into better properties in more desirable locations. Additionally, Guardian's subsidiary, 12BR, will expand its property site operations and will also continue to provide selective property sales and brokerage services. The operating platform being developed by Guardian and 12BR will provide significant revenue and market value to Guardian and 12BR even after the Debtors' current assets are sold. The Debtors' consolidated five-year financial projections show that the Debtors will have enough cash from operations and sales of assets to fund the Plan and pay allowed creditor claims, with enough expected revenue after year five for potential dividend distributions to Guardian's existing members after creditor claims are paid in full under the Plan. One five-year model assumes that Guardian will obtain a warehouse credit facility in the first quarter of year 2027, and the second five-year model assumes that Guardian will not obtain a warehouse credit facility or any new borrowings. A full-text copy of the Disclosure Statement dated April 2, 2024 is available at https://urlcurt.com/u?l=sHVfvx from PacerMonitor.com at no charge. Attorneys for Jointly Administered Debtors: Stephen R. Harris, Esq. Norma Guariglia, Esq. HARRIS LAW PRACTICE LLC 850 E. Patriot Blvd., Suite F Reno, NV 89511 Tel: (775) 786-7600 Email: steve@harrislawreno.com norma@harrislawreno.com Attorneys for Official Committee of Unsecured Creditors: Sallie B. Armstrong, Esq. McDONALD CARANO LLP 100 W. Liberty Street, 10th Floor Reno, NV 89501 Telephone: (775) 788-2000 Email: sarmstrong@mcdonaldcarano.com About Guardian Fund The WendellLa and Nancy King Family Trust and several other creditors represented by Jeffrey L. Hartman filed a Chapter 7 involuntary petition (Bankr. D. Nev. Case No. 23-50117) against Guardian Fund, LLC, a company in Reno, Nev., on March 17, 2023. On April 11, 2023, Guardian Fund filed a Chapter 11 voluntary petition (Bankr. D. Nev. Case No. 23-50233). At the time of the filing, Guardian Fund reported $10 million to $50 million in assets and $50 million to $100 million in liabilities. On April 27, 2023, the Nevada bankruptcy court approved the stipulation filed in both cases by Guardian Fund and the petitioning creditors. The order directed the consolidation of the two cases, with Case No. 23-50177 as the lead case, and set the Chapter 11 petition date to March 17, 2023. Judge Natalie M. Cox oversees the case. The Debtor tapped Harris Law Practice, LLC and Excelsis Accounting Group as legal counsel and accountant, respectively. On May 10, 2023, the U.S. Trustee for Region 17 appointed an official committee to represent unsecured creditors. Sallie B. Armstrong, Esq., at McDonald Carano, LLP serves as the committee's legal counsel. Jeffrey Golden, Esq., is the examiner appointed in the Debtor's Chapter 11 case. HEALTHY EXTRACTS: BF Borgers CPA Raises Going Concern Doubt ----------------------------------------------------------- Healthy Extracts Inc. disclosed in a Form 10-K Report filed with the U.S. Securities and Exchange Commission for the fiscal year ended December 31, 2023, that its auditor expressed that there is substantial doubt about the Company's ability to continue as a going concern. Lakewood, CO-based BF Borgers CPA PC., the Company's auditor since 2017, issued a "going concern" qualification in its report dated April 1, 2024, citing that the Company's significant operating losses raise substantial doubt about its ability to continue as a going concern. The Company's net operating loss was $2,243,843 and $911,590 for the years ended December 31, 2023 and 2022, respectively. Its net loss for the year ended December 31, 2023 was $2,472,931, compared to a loss for the year ended December 31, 2022 of $983,121. The Company has generated minimal revenues from operations. Since its inception, the Company has been engaged substantially in financing activities and developing its business plan and incurring startup costs and expenses. As a result, the Company incurred accumulated net losses from Inception (December 19, 2014) through the year ended December 31, 2023 of $18,336,268. Due to its negative cash flow, the Company has substantial doubt about the entity's ability to continue as a going concern within one year after the date that the financial statements are issued. In addition, the Company's development activities since inception have been financially sustained through equity financing. Management plans to keep seeking funding through debt and equity financing which are intended to mitigate the conditions that have raise substantial doubt about the entity's ability to continue as a going concern. As of December 31, 2023, the Company had $2,635,014 in total assets, $1,680,424 in total liabilities, and $954,590 in total stockholders' equity. A full-text copy of the Company's Form 10-K is available at https://tinyurl.com/4hbh6py4 About Healthy Extracts Inc. Henderson, NV-based Healthy Extract Inc. operates as a pharmaceutical company. The Company engages in the proprietary research and development of natural plant-based formulations, sales, and distribution of cardiovascular and neuro products to improve brain health, memory, cognition, focus, migraines, dementia, and neuro-energy. Healthy Extract focuses on patients and healthcare professionals. HERITAGE CANNABIS: Obtains Initial Order Under CCAA --------------------------------------------------- Heritage Cannabis Holdings Corp. (CSE: CANN) (OTCQX: HERTF), on April 2, 2024, disclosed that the Company and its subsidiaries sought and obtained an order for creditor protection (the "Initial Order") from the Ontario Superior Court of Justice (Commercial List) (the "Court") pursuant to the Companies' Creditors Arrangement Act (the "CCAA"). The difficult but necessary decision to commence CCAA proceedings was made after careful consideration of the Company's financial position, while evaluating all available alternatives and engaging in significant consultation with legal and financial advisors. Additionally, on April 1, 2024, the Company's senior secured lender, BJK Holdings Ltd. (the "Lender"), made demand to the Company for payment in full of certain indebtedness owing by the Heritage Group to the Lender in the amount of $8,421,088.87, excluding legal fees of the Lender's counsel. The Initial Order includes, among other things: (i) a stay of proceedings in favour of the Company and its Canadian subsidiaries; and (ii) the appointment of KPMG Inc. as monitor of the Company (in such capacity, the "Monitor"). The Initial Order also extends the stay of proceedings to certain U.S. affiliates of the Company who are not applicants in the CCAA proceedings. The board of directors of the Company will remain in place and management will remain responsible for the day-to-day operations of the Company, under the general oversight of the Monitor. Heritage intends to seek approval of a sale and investment solicitation process (the "SISP"), which, if approved, would allow interested parties to participate in the process in accordance with the SISP procedures. Additional details in respect of the SISP will be disclosed in due course. It is anticipated that the Canadian Securities Exchange (the "CSE") will place the Company under delisting review and that there can be no assurance as to the outcome of such review or the continued qualification for listing on the CSE. Additional information regarding the CCAA proceeding can be found on the Monitor's website at https://kpmg.com/ca/heritage. About Heritage Cannabis Holdings Corp. Heritage is a leading cannabis company offering innovative products to both the medical and recreational legal cannabis markets in Canada and the U.S., operating two licensed manufacturing facilities in Canada. The company has an extensive portfolio of high-quality cannabis products under the brands Purefarma, Pura Vida, RAD, Adults Only, Juicy Hoots, Premium 5, Thrifty, feelgood., the CB4 suite of medical products in Canada and ArthroCBD in the U.S. IMPEL PHARMA: Amended Joint Plan of Liquidation Takes Effect ------------------------------------------------------------ IPI Legacy Liquidation Co., formerly known as Impel Pharmaceuticals Inc., ("Impel") and its affiliate, Impel NeuroPharma Australia PTY LTD, (together with Impel, the "Debtors") announced April 5, 2024 as the effective date of their Revised First Amended Joint Plan of Liquidation (the "Effective Date" and the "Plan," respectively). This follows the confirmation of the Plan by the U.S. Bankruptcy Court for the Northern District of Texas on April 2, 2024 and the closing of the sale of substantially all of the Debtors' assets to JN Bidco LLC on February 12, 2024. Following the Effective Date, the Debtors' remaining business and assets will be liquidated, and Impel will be dissolved. The shares of Impel's existing common stock (CUSIP No. 45258K109) (the "Common Stock") will also be cancelled as of the Effective Date, with no action required by shareholders. The CUSIP for the Common Stock will not remain open, and there will be no post-Effective Date trading of the Common Stock. There will be no exchange of the Common Stock, and holders of the Common Stock do not need to surrender their shares. Stakeholders with questions can contact the Company's claims agent, Omni Agent Solutions, at ImpelInquiries@OmniAgnt.com or (888) 202-6183, or (747) 288-6396 for international calls. Details of the restructuring, the wind-down of the Debtors, the terms of the Plan, and the other agreements entered into as part of the Plan may be viewed at Omni's case website at https://omniagentsolutions.com/Impel. The Debtors were represented in their chapter 11 cases by Sidley Austin LLP (lead restructuring counsel), Fenwick & West LLP (special corporate counsel), and Teneo Capital LLC (Chief Restructuring Officer and additional personnel). About Impel Pharmaceuticals Impel Pharmaceuticals Inc. is a commercial-stage pharmaceutical company developing transformative therapies for people suffering from diseases with high unmet medical needs. Impel offers development opportunities that pair its proprietary POD technology mwith well-established therapeutics. In September 2021, Impel received U.S. FDA approval for its first product, Trudhesa nasal spray, which is approved in the U.S. for the acute treatment of migraine with or without aura in adults. On the Web: https://impelpharma.com/ Impel Pharmaceuticals Inc. sought relief under Chapter 11 of the U.S. Bankruptcy Code (Bankr. N.D. Texas Lead Case No. 23-80016) on Dec. 20, 2023. In the petition filed by its chief restructuring officer, Brandon D. Smith, Impel Pharmaceuticals disclosed total assets of $35,073,000 and total debt of $126,978,000 as of Sept. 30, 2023. The case is overseen by the Honorable Bankruptcy Judge Stacey G. Jernigan. Impel is being advised by Moelis & Company LLC as its investment banker; Teneo Capital LLC as its financial advisor; and Sidley Austin, LLP and Fenwick & West, LLP as legal counsel. Omni Agent Solutions is the claims agent. INSOURCE SUPPLIES: Samuel Dawidowicz Named Subchapter V Trustee --------------------------------------------------------------- The U.S. Trustee for Region 2 appointed Samuel Dawidowicz as Subchapter V trustee for Insource Supplies, LLC. Mr. Dawidowicz will be paid an hourly fee of $525 for his services as Subchapter V trustee and will be reimbursed for work-related expenses incurred. Mr. Dawidowicz declared that he is a disinterested person according to Section 101(14) of the Bankruptcy Code. The Subchapter V trustee can be reached at: Samuel Dawidowicz 215 East 68th Street New York, NY 10065 Phone: (917) 679-0382 About Insource Supplies Insource Supplies, LLC is a New York-based medical supply company operating mainly in the secondary market. It was first organized in 2020 and was able to immediately capitalize on the demand for personal protective equipment (e.g. gloves and masks) arising out of the Covid-19 pandemic. Insource Supplies filed a petition under Chapter 11, Subchapter V of the Bankruptcy Code (Bankr. S.D. N.Y. Case No. 24-10571) on April 2, 2024, with $1 million to $10 million in both assets and liabilities. Judge John P. Mastando, III oversees the case. J. Ted Donovan, Esq., at Goldberg Weprin Finkel Goldstein, LLP represents the Debtor as legal counsel. INTRUSION INC: Whitley Penn Raises Going Concern Doubt ------------------------------------------------------ Intrusion, Inc. disclosed in a Form 10-K Report filed with the U.S. Securities and Exchange Commission for the fiscal year ended December 31, 2023, that its auditor expressed that there is substantial doubt about the Company's ability to continue as a going concern. Dallas, Texas-based Whitley Penn LLP, the Company's auditor since 2017, issued a "going concern" qualification in its report dated April 1, 2024, citing that the Company has suffered recurring losses from operations, negative cash flows from operations, and has a net working capital deficiency that raise substantial doubt about its ability to continue as a going concern. For the fiscal years ended December 31, 2023, and 2022, the Company generated revenues of approximately $5.6 million and $7.5 million, respectively, and reported net loss of approximately $13.9 million and $16.2 million, respectively, and cash flow used in operating activities of approximately $7.8 million and $13.2 million, respectively. As of December 31, 2023, it had a stockholders' deficit of $9.6 million and a working capital deficit of $13.1 million. As a result of the Company's historical recurring losses from operations, negative cash flows from operations, net working capital deficiency as well as our dependence on equity and debt financings, there is a substantial doubt regarding our ability to continue as a going concern. As of December 31, 2023, the Company had $6.25 million in total assets, $15.8 million in total liabilities, and $9.56 million in total stockholders' deficit. A full-text copy of the Company's Form 10-K is available at https://tinyurl.com/muw2hnju About Intrusion Inc. Intrusion, Inc. is a cybersecurity Company based in Plano, Texas. The Company offers its customers access to its exclusive threat intelligence database containing the historical data, known associations, and reputational behavior of over 8.5 billion Internet Protocol ("IP") addresses. After years of gathering global internet intelligence and working exclusively with government entities, the company released its first commercial product in 2021. ITTELLA INTERNATIONAL: Court Approves Disclosure Statement ---------------------------------------------------------- Judge Sandra R. Klein has entered an order that the First Amended Disclosure Statement (As Modified) Describing Debtors' First Amended Joint Chapter 11 Liquidating Plan (As Modified) dated February 21, 2024 of Ittella International LLC, et al. is approved These dates and deadlines will govern solicitation and confirmation of the First Amended Joint Chapter 11 Liquidating Plan (As Modified) Dated February 21, 2024: * April 12, 2024, at 3:00 p.m. (Pacific Time) is the deadline for ballots accepting or rejecting the First Amended Joint Chapter 11 Liquidating Plan (As Modified) Dated February 21, 2024. * April 16, 2024, is the deadline for the Debtors to file a motion for confirmation of the First Amended Joint Chapter 11 Liquidating Plan (As Modified) Dated February 21, 2024 and a memorandum of points and authorities and all declarations and evidence in support thereof (collectively, the "Confirmation Motion"). * April 23, 2024, at 3:00 p.m. (Pacific Time) is the deadline for any and all creditors and parties in interest to file and serve any objections to the Confirmation Motion and any and all declarations and evidence in support thereof. * April 25, 2024, is the deadline for the Debtors, creditors, and any parties in interest to file any replies to any objections to the Confirmation Motion and any and all declarations and evidence in support thereof. * May 8, 2024, at 9:00 a.m. (Pacific Time) is the hearing to consider confirmation of the Plan. About Ittella International Ittella International, LLC, is a supplier of plant-based products based in Paramount, Calif. Ittella International and seven affiliates sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. C.D. Cal. Lead Case No. 23-14154) on July 2, 2023. In the petition signed by its chief executive officer, Salvatore Galletti, Ittella International reported $10 million to $50 million in both assets and liabilities. Judge Sandra R. Klein oversees the cases. The Debtors tapped David L. Neale, Esq., at Levene, Neale, Bender, Yoo and Golubchik, LLP as bankruptcy counsel; Rutan and Tucker, LLP as their special corporate and SEC counsel; SC&H Group, Inc. as investment banker; and Grant Thornton, LLP as accountant. The U.S. Trustee for Region 16 appointed two separate committees to represent unsecured creditors of Ittella International and its affiliate, New Mexico Food Distributors, Inc. The committee of New Mexico Food Distributors tapped Brinkman Law Group, PC as counsel. JD MOTORSPORTS: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: JD Motorsports, Inc. 1210 Champion Ferry Road Gaffney, SC 29341 Business Description: JD Motorsports is a NASCAR racing team competing in the NASCAR Xfinity Series. Chapter 11 Petition Date: April 8, 2024 Court: United States Bankruptcy Court District of South Carolina Case No.: 24-01274 Judge: Hon. Helen E. Burris Debtor's Counsel: W. Harrison Penn, Esq. PENN LAW FIRM LLC 1517 Laurel Street Columbia, SC 29201 Tel: (803) 771-8836 E-mail: hpenn@mccarthy-lawfirm.com Estimated Assets: $500,000 to $1 million Estimated Liabilities: $1 million to $10 million The petition was signed by Johnny K. Davis as president. A full-text copy of the petition containing, among other items, a list of the Debtor's 20 largest unsecured creditors is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/ENHSLYI/JD_Motorsports_Inc__scbke-24-01274__0001.0.pdf?mcid=tGE4TAMA JLK CONSTRUCTION: FCCI Opposes Plan Shield for Kagarices -------------------------------------------------------- FCCI Insurance Company ("FCCI") objects to JLK Construction, LLC's Third Amended Disclosure Statement, as revised, dated February 6, 2024 and Third Amended Plan of Reorganization as revised dated February 6, 2024 filed by the Debtor. FCCI is a surety company authorized to issue, among other products, construction surety bonds. In order to obtain certain construction contracts, the Debtor was required to provide surety bonds, which the Debtor sought from FCCI. To protect itself from loss on any bonds that might be issued on behalf of the Debtor, FCCI required an indemnity agreement from the Debtor and others with an interest in the Debtor. Accordingly, to induce FCCI to issue the surety bonds, the Debtor, along with nondebtors Jesse Kagarice and Jayme Kagarice (sometimes collectively, the "Kagarices") executed a General Indemnity Agreement – Contract Bonds ("Indemnity Agreement") in FCCI's favor, which required Debtor and the Kagarices to indemnify and place FCCI in collateral upon demand as a result of claims being made on any surety bonds issued by FCCI, as more fully spelled out in the Indemnity Agreement. FCCI asserts that the Court should deny confirmation of the Plan on the grounds that the Plan impermissibly enjoins creditors from proceeding against the non-debtor Kagarices pending completion of the Plan. If the Plan were confirmed, the Kagarices would be shielded from FCCI meaningfully exercising its contractual rights against them for more than 10 years, with FCCI (and likely other creditors) receiving at best a small fraction of its claim over the 10-year Plan period. FCCI argues that the the proposed Plan with its Post-Confirmation Injunction violates Sec. 1123(b)(6) of the Bankruptcy Code because the injunction is not warranted under the facts of this case. There is no identity of interest between the Debtor and the Kagarices such that FCCI's indemnity claim against the Kagarices is a suit against the Debtor or will deplete the assets of the estate. The Indemnity Agreement provides that the obligations of the undersigned/indemnitors (the Debtor, Jesse Kagarice and the Kagarices) are joint and several and FCCI is not required to first proceed against JLK. Pursuant to Paragraph XII. V. of the Indemnity Agreement, the Kagarices waived and relinquished any claim or right to payment from the Debtor so that at no time would they become creditors of Debtor. Paragraph XII.W. of the Indemnity Agreement further provides that the Kagarices have no rights of indemnity against Debtor or its property until the obligations to FCCI under the Indemnity Agreement have been satisfied. The enforcement of the Indemnity Agreement against the Kagarices is not a suit against the Debtor and will not deplete Estate property. FFCI notes that Jesse Kagarice's commitment of $150,000 over a five year-period of time is not a substantial contribution to the success of the plan -- it is a payment for the equity interest in the Debtor and is expressly contingent upon receiving the proposed injunctive relief to protect him from his personal creditors. The proposed financial contribution is not linked to the ability of JLK to obtain ongoing financing and is not sufficient by itself to facilitate a successful reorganization. It is not a financial contribution that is central to the ability of the debtor to continue operations. "Jesse Kagarice's efforts and focus, while admirable, are not essential. The Debtor represented the steps it has taken to address the cause of its financial demise: upgrading JLK's financial record keeping, which permits more detailed analysis and has resulted in better business decisions and more profitable work. This upgraded financial record-keeping is being supplemented by the retention of a bookkeeper and a CPA. According to JLK, the causes of its unprofitability have been addressed with staff other than Mr. Kagarice. The fact that Mr. Kagarice works many hours is not enough to justify the injunctive relief sought. Mr. Kagarice is being paid a minimum annual salary of $160,000 plus benefits to perform that work. The pursuit of FCCI's indemnity claim will not undermine Mr. Kagarice's incentive to remain employed with the Debtor," FCCI points out. "FCCI's claim for indemnity is a straightforward collection action seeking reimbursement for the payment of three payment bond claims asserted by creditors of the Debtor, scheduled by the Debtor as undisputed, and associated attorney's fees and expenses. Further, under the Indemnity Agreement, the Kagarices agreed that in any suit between them and FCCI, an itemized statement of the loss and expense, sworn to through affidavit or otherwise by a representative of FCCI, or evidence of the disbursements by FCCI is prima facie evidence of the fact and extent of the Kagarices' liability." The Debtor is not subject to an indemnity or contribution claim from the Kagarices resulting from FCCI's claim. And, the indemnity claim is straight-forward. Enforcement of the Kagarices' indemnity obligations will have no effect on the consummation of the Plan. Further, withholding injunctive relief will not expose the Kagarices to a floodgate of litigation on personal guaranties. The unsecured class, including creditors like FCCI, are scheduled to receive only 5% of their respective claims over a 10-year period. While there is a theoretical possibility that unsecured creditors would receive 50% of net recoveries from avoidance actions, no value of those avoidance actions has been provided, and the 50% net recovery is after payment of legal fees and satisfaction of Newtek's lien against avoidance recoveries. This factor militates against the non-debtor injunctive relief because the Plan does not provide a mechanism to pay for all, or substantially all, of the classes, affected by the non-debtor injunctive relief. Attorneys for FCCI Insurance Group: Carol Z. Smith, Esq. 700 W. 47th Street, Suite 410 DYSART TAYLOR McMONIGLE BRUMITT & WILCOX, P.C. Kansas City, MO 64112 Tel: (816) 931-2700 Fax: (816) 931-7377 E-mail: csmith@dysarttaylor.com About JLK Construction JLK Construction, LLC, moves dirt, excavates dirt and does basic concrete flatwork. It is a union shop. The Debtor sought protection under Chapter 11 of the Bankruptcy Code (Bankr. W.D. Mo. Case No. 23-50034) on Feb. 13, 2023. In the petition signed by Jesse L. Kagarice, managing member, the Debtor disclosed up to $10 million in both assets and liabilities. Judge Brian T. Fenimore oversees the case. Colin N. Gotham, Esq., at Evans and Mullinix, P.A., and Steven R. Fox, Esq., at The Fox Law Corp., Inc., represent the Debtor as legal counsel. Newtek Small Business Finance, LLC, as lender, is represented by Jonathan A. Margolies, Esq. KRAIG BOCRAFT: M&K CPAs Raises Going Concern Doubt -------------------------------------------------- Kraig Biocraft Laboratories, Inc. disclosed in a Form 10-K Report filed with the U.S. Securities and Exchange Commission for the fiscal year ended December 31, 2023, that its auditor expressed that there is substantial doubt about the Company's ability to continue as a going concern. The Woodlands, Texas-based M&K CPAS, PLLC, the Company's auditor since 2013, issued a "going concern" qualification in its report dated April 1, 2024, citing that the Company has suffered net losses from operations and has a net capital deficiency, which raise substantial doubt about its ability to continue as a going concern. According to the Company, it incurred a net loss of $3,029,780 during the year ended December 31, 2023, and losses are expected to continue in the near term. The accumulated deficit is $49,686,780 at December 31, 2023. "We have been funding our operations through private loans and the sale of common stock in private placement transactions. Our cash resources are insufficient to meet our planned business objectives without additional financing. These and other factors raise substantial doubt about our ability to continue as a going concern." the Company said. As of December 31, 2023, the Company had $3,232,822 in total assets, $8,939,978 in total liabilities, and $5,707,156 in total stockholders' deficit. A full-text copy of the Company's Form 10-K is available at https://tinyurl.com/y4k2mh65 About Kraig Biocraft Ann Arbor, Michigan-based Kraig Biocraft Laboratories, Inc., a Wyoming corporation, is a corporation organized to develop high strength fibers using recombinant DNA technology for commercial applications in technical textile. L.O.F. INC: Case Summary & 20 Largest Unsecured Creditors --------------------------------------------------------- Debtor: L.O.F., Inc. DBA L.O.F., INC. DBA RED HOUND AUTO DBA L.O.F., INC. DBA TRUCKCHAMP DBA L.O.F., INC. DBA FASTLANEUSA DBA L.O.F., INC. DBA POLAR WHALE DBA L.O.F., INC. DBA STORECHAMPION DBA L.O.F., INC. DBA VIEW CHAMP DBA L.O.F., INC. DBA WEHAVEITAUTO DBA L.O.F., INC. DBA BESTINAUTO DBA L.O.F., INC. DBA CONGOWORLDAUTO DBA L.O.F., INC. DBA HITCH.SUPERSTORE DBA L.O.F., INC. DBA MEGA.JEEP DBA L.O.F., INC. DBA FLOOR.GUARD DBA L.O.F., INC. DBA STRONG FAST PARTS DBA L.O.F., INC. DBA SMARTCHAMP DBA L.O.F., INC. DBA YOUR PERFORMANCE EXPERTS DBA L.O.F., INC. DBA I LOVE MY TRUCK DBA L.O.F., INC. DBA I LOVE TRUCKS DBA L.O.F., INC. DBA ILOVEMYTRUCK.COM DBA L.O.F., INC. DBA WELOVEYOURTRUCK DBA L.O.F., INC. DBA LEGROOM AUTO DBA L.O.F., INC. DBA SPEEDY TRUCK DBA LOF WHOLESALE, INC. DBA L.O.F., INC. DBA DECO GABLES DESIGNS 11924 Forest Hill Boulevard Suite 10A #163 Wellington, FL 33414 Business Description: L.O.F., Inc., was founded in 1968 in Northwest Indiana as a retail Recreational Vehicle sales operation. In 2011, the Company changed its focus to replacement automotive and industrial products under its brands such as Best In Auto, TruckChamp, Red Hound Auto, and Polar Whale. Chapter 11 Petition Date: April 8, 2024 Court: United States Bankruptcy Court Southern District of Florida Case No.: 24-13350 Judge: Hon. Mindy A. Mora Debtor's Counsel: Craig I. Kelley, Esq. KELLEY KAPLAN & ELLER, PLLC 1665 Palm Beach Lakes Blvd The Forum - Suite 1000 West Palm Beach, FL 33401 Tel: 561-491-1200 E-mail: craig@kelleylawoffice.com Total Assets: $1,198,800 Total Liabilities: $8,259,975 The petition was signed by Laszlo Kovach as president. A full-text copy of the petition containing, among other items, a list of the Debtor's 20 largest unsecured creditors is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/FKUJNXI/LOF_Inc__flsbke-24-13350__0001.0.pdf?mcid=tGE4TAMA LATAM AIRLINES: Okayed to Start NYSE ADRs Listing Process Again --------------------------------------------------------------- Reuters reports that LATAM Airlines said early April 2024 that its board gave approval to begin the process of re-listing American Depositary Receipts (ADRs) on the New York Stock Exchange. In a filing to Chile's stock exchange, the company said the process involves meeting various requirements from the NYSE and the U.S. Securities and Exchange Commission and could take up to six months. The Santiago-based carrier traded ADRs, which foreign companies use to list their shares on U.S. stock exchanges, on the NYSE before declaring bankruptcy in 2020. The company emerged from bankruptcy proceedings with an $8 billion reorganization plan in late 2022. Re-listing will require consent from the principal creditors that supported the company's Chapter 11 reorganization plan, "without whom the company would not have emerged from the reorganization process," the filing said. About LATAM Airlines Group LATAM Airlines Group S.A. -- http://www.latam.com/-- is a pan-Latin American airline holding company involved in the transportation of passengers and cargo and operates as one unified business enterprise. It is the largest passenger airline in South America. Before the onset of the COVID-19 pandemic, LATAM offered passenger transport services to 145 different destinations in 26 countries, including domestic flights in Argentina, Brazil, Chile, Colombia, Ecuador and Peru, and international services within Latin America as well as to Europe, the United States, the Caribbean, Oceania, Asia and Africa. LATAM and its 28 affiliates sought Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 20-11254) on May 25, 2020. Affiliates in Chile, Peru, Colombia, Ecuador and the United States are part of the Chapter 11 filing. The Debtors disclosed $21,087,806,000 in total assets and $17,958,629,000 in total liabilities as of Dec. 31, 2019. The Hon. James L. Garrity, Jr., is the case judge. The Debtors tapped Cleary Gottlieb Steen & Hamilton LLP as bankruptcy counsel, FTI Consulting as restructuring advisor, Lee Brock Camargo Advogados as local Brazilian litigation counsel, and Togut, Segal & Segal LLP and Claro & Cia in Chile as special counsel. The Boston Consulting Group, Inc. and The Boston Consulting Group UK LLP serve as the Debtors' strategic advisors. Prime Clerk LLC is the claims agent. The official committee of unsecured creditors formed in the case tapped Dechert LLP as its bankruptcy counsel, Klestadt Winters Jureller Southard & Stevens, LLP as conflicts counsel, UBS Securities LLC as investment banker, and Conway MacKenzie, LLC as financial advisor. Ferro Castro Neves Daltro & Gomide Advogados is the committee's Brazilian counsel. The ad hoc group of LATAM bondholders tapped White & Case, LLP as counsel. Glenn Agre Bergman & Fuentes, LLP, led by managing partner Andrew Glenn and partner Shai Schmidt, has been retained as counsel to the ad hoc committee of shareholders. LENDINGTREE INC: S&P Upgrades ICR to 'B-', Outlook Stable --------------------------------------------------------- S&P Global Ratings raised its issuer credit rating on LendingTree Inc. to 'B-' from 'CCC+'. At the same time, S&P lowered its issue-level rating on the company senior secured debt to 'B-' from 'B' and revised the recovery rating to '3' from '1' due to the additional senior secured debt in the capital structure reducing recovery prospects for existing senior secured debtholders. The stable outlook reflects S&P's expectation for LendingTree to generate positive FOCF and maintain sufficient liquidity to meet its upcoming debt obligations despite its expectations for elevated S&P Global Ratings-adjusted gross leverage of about 6.7x in 2024 amid a challenging macroeconomic environment. LendingTree's recent $175 million term loan issuance ($125 million up front and $50 million delayed draw) improves the company's ability to meet its upcoming $284 million senior unsecured convertible notes maturity in July 2025. S&P said, "The 'B-' rating reflects our view that LendingTree's capital structure is sustainable following its recent debt issuance, which better positions it to meet its upcoming July 2025 debt maturity. LendingTree's recent debt issuance, along with cash on hand ($112 million as of Dec. 31, 2023) and expected reported FOCF generation ($30 million-$35 million in 2024) provide sufficient liquidity for it to meet its upcoming $284 million convertible notes debt maturity in July 2025. In 2023, through a series of negotiated transactions, the company reduced the outstanding principal on its convertible notes to $284 million from $575 million. At the same time, the company's revenue stabilized and its restructuring efforts improved its profitability. We believe these actions are reflected in its improved trading levels, with its convertible notes now trading at 92 (compared with below 80 in Dec. 2023). "While the new term loan results in higher interest (an increase of about $15 million over the next 12 months), and amortization, we expect FOCF to debt coverage will remain above 5% over the next 12 months. Still, we believe there is little room for underperformance because the new term loan places new covenant restrictions on the company that it will need to manage its operations to. Additionally, the incremental first-lien debt could restrict LendingTree's availability under its $200 million revolving credit facility, which has a $20 million springing first-lien net leverage covenant of 2.5x that we believe the company would not be able to meet if triggered. "LendingTree's advertising revenue is exposed to economic cyclicality. Despite our expectations for near-term improvement, LendingTree's performance is still highly susceptible to economic cyclicality, and insight into 2024 and beyond remains highly uncertain. We expect its S&P Global Ratings-adjusted EBITDA to increase to $83 million in 2024 from $62 million in 2023 despite relatively flat revenue. This is due to workforce reductions, the rolling off of restructuring and severance costs, and increased demand in its insurance business as regulatory rate increases drive consumers looking for less expensive insurance coverage. This results in S&P Global Ratings-adjusted gross leverage of 6.7x in 2024 compared with 9.9x in 2023." "LendingTree's performance remains strongest during periods of favorable economic conditions and expansion because its revenue depends on consumer discretionary spending. S&P Global economists expect a continued low-growth environment for the remainder of 2024 and into 2025, which may limit the company's ongoing recovery. If economic conditions deteriorate or stagnate beyond our current expectations, LendingTree's revenue and EBITDA generation will likely be much weaker than we currently forecast. "The stable outlook reflects our expectation for LendingTree to generate positive FOCF and maintain sufficient liquidity to meet its upcoming debt obligations despite our expectations for elevated S&P Global Ratings-adjusted gross leverage of about 6.7x in 2024 amid a challenging macroeconomic environment." S&P's could lower our rating on LendingTree over the next 12 months if it views the company's capital structure as unsustainable. This could occur if: -- Macroeconomic conditions deteriorate, resulting in sustained revenue and EBITDA losses; and -- FOCF deteriorates such that company cannot meet its 2025 convertible notes maturity or its increased debt service requirements over the long term. S&P views an upgrade as unlikely during the next 12 months given LendingTree's challenged operating performance and uncertainty toward future expected cash flows. However, S&P could raise the rating if: -- Interest rates decline and macroeconomic conditions improve such that the company's business rebounds, resulting in a period of sustained revenue and EBITDA growth; and -- S&P expects it to continue to generate sustainably positive FOCF such that FOCF to debt remains above 5% and leverage declines and is sustained below 6x. ESG factors have no material influence on S&P's credit rating analysis of LendingTree. LITIGATION PRACTICE: May 15 Hearing on Disclosure Statement ----------------------------------------------------------- The Official Committee of Unsecured Creditors of The Litigation Practice Group P.C. and Richard A. Marshack, in his capacity as the chapter 11 trustee of the debtor filed a motion for an order (i) approving the Disclosure Statement Describing Joint Chapter 11 Plan of Liquidation (Dated May 22, 2024); (ii) approving the solicitation and voting procedures; (iii) approving the proposed notice and objection procedures for confirmation of the Joint Chapter 11 Plan of Liquidation (Dated May 22, 2024), as may be amended; (iv) establishing the Challenge Deadlines; and (v) granting related relief. A hearing on the Disclosure Statement is scheduled for May 15, 2024, at 1:30 p.m., in Courtroom 5C, located at 411 W. Fourth Street, Santa Ana, CA 92701. The Trustee and the Committee propose these key dates in connection with the approval of the Disclosure Statement and confirmation of the Plan: * Voting Record Date will be on May 15, 2024. * Solicitation Commencement Deadline will be on May 29, 2024. * Deadline to Object to Claims for Voting Purposes Only will be on June 5, 2024. * Rule 3018(a) Motion Deadline will be on June 19, 2024. * Fund Challenge Deadline will be on June 19, 2024. * Ownership Challenge Deadline will be on June 19, 2024. * Rule 3018(a) Objection will be on Deadline June 26, 2024. * Voting Deadline will be on July 3, 2024. * Confirmation Objection Deadline will be on July 3, 2024. * Deadline to File Tabulation Report, Memorandum of Law in Support of Confirmation, Proposed Confirmation Order and Response to Objections to the Confirmation will be on July 17, 2024. * Confirmation Hearing will be on July 31, 2024, at 1:30 p.m. The Disclosure Statement provides "adequate information" to allow Holders of Claims in the Voting Classes to make an informed decision about whether to vote to accept or reject the Plan. Specifically, the Disclosure Statement contains categories of information that courts consider "adequate information," including: (i) An overview of the Plan (Section III); (ii) The corporate structure and indebtedness of the Debtor (Sections II & III.A.); (iii) The operation of the Debtor's business (Section II); (iv) Key events leading to the commencement of the Bankruptcy Case (Section II.B.); (v) Significant events that occurred during the Bankruptcy Case (Section II.C.); (vi) Information regarding Litigation (Sections II.C. & III.B.); (vii) Financial information that would be relevant to determinations of whether to accept or reject the Plan (Section IV); (viii) Tax consequences of the Plan (Section III.C.10.); (ix) Risk factors affecting the Plan and the Debtors (Sections III.C.9. & IV); (x) Requirements for confirmation of the Plan (Section IV); (xi) A liquidation analysis under chapter 7 of the Bankruptcy Code (Section IV.A.); and (xii) Description of exculpations, releases, and injunctions (Sections III.B.2.ff. & III.C.4.). The Plan Proponents submit that the Disclosure Statement complies with all aspects of Sec. 1125 of the Bankruptcy Code. About The Litigation Practice Group The Litigation Practice Group P.C. sought protection for relief under Chapter 11 of the Bankruptcy Code (Bankr. C.D. Cal. Case No. 23-10571) on March 20, 2023, with as much as $1 million in both assets and liabilities. Judge Scott C. Clarkson presides over the case. The Debtor tapped Khang & Khang, LLP as legal counsel and Grobstein Teeple, LLP as accountant. The U.S. Trustee for Region 16 appointed an official committee to represent unsecured creditors in the Debtor's Chapter 11 case. The committee is represented by Fox Rothschild, LLP. LITIGATION PRACTICE: Trustee and Committee Propose Liquidation Plan ------------------------------------------------------------------- The Chapter 11 trustee of the Litigation Practice Group P.C. and the Official Committee of Unsecured Creditors formed in the case filed a Joint Chapter 11 Plan of Liquidation of the Debtor on March 22, 2024. As of the Petition Date, the Debtor operated as a law firm that provided consumer debt validation services to its clients. On July 7, 2023, Richard A. Marshack (the Trustee) filed a motion to approve a sale of substantially all of the Debtor's assets. The sale motion sought approval of an Agreement of Purchase and Sale and Joint Escrow Instructions by and between the Trustee and CLG (the "CLG PSA"). Under the CLG PSA, CLG would purchase certain of the Debtor's assets for the following consideration: (i) an $8 million deposit; and (ii) a post-closing "earn-out," after deducting a 20% administrative fee, calculated as (a) 20% of all amounts collected by CLG on "Active Executory Contracts," and (b) 15% of all amounts collected by CLG on "Inactive Executory Contracts." The CLG PSA included other provisions such as the appointment of an ethics compliance monitor to ensure compliance with applicable regulations in the post-closing operations of the Debtor's business. The bidding process resulted in the selection of Morning Law Group ("MLG") as the winning bidder, pursuant to an Agreement of Purchase and Sale and Joint Escrow Instructions by and between the Trustee and MLG (the "Purchase Agreement"). The Purchase Agreement provided for the transfer of certain of the Debtor's assets to MLG. The purchase price was calculated as: (i) a deposit in the amount of $5.5 million; and (ii) an post-closing "earn-out" calculated as (a) 50% of all amounts collected by MLG on "Active Executory Contracts," and (b) 40% of all amounts collected by MLG on "Inactive Executory Contracts." The Estate was not entitled to receive earn-out payments until MLG satisfied the financing it obtained to fund the deposit. At the hearing, the Trustee valued the MLG bid and Purchase Agreement to be as high as $84,490,990, based on certain pro forma assumptions on the performance of the Active Executory Contracts and the ability of MLG to the recover Inactive Executory Contracts. The actual amount to be received is estimated to be substantially lower based on, among other things, MLG's actual retention of active and inactive executory contracts. The combined recovery under the Sale Transaction, including the deposit, is estimated at approximately $14.1 million. On August 2, 2023, the Court entered an order approving the sale, and on Aug. 4, 2023, the sale closed. Under the Plan, Class 3A consists of General Unsecured Claims. Unless the Holder of an Allowed Class 3A Claim agrees to less favorable treatment, the Holder of an Allowed Class 3A Claim will receive on the Effective Date a Trust Beneficial Interest in the amount of such Allowed Class 3A Claim and become a Trust Beneficiary in full and final satisfaction of its Allowed Class 3A Claim. Class 3 is impaired The Debtor shall be dissolved, under applicable non-bankruptcy law, on the Effective Date or as soon thereafter as is practicable to accomplish the purposes of the Plan. The Debtor's interests and rights shall be vested, for all purposes, in the Liquidating Trust. On the Effective Date, the authority, power, and incumbency of the persons acting as directors and officers of the Debtor shall be deemed to have been resigned, solely in their capacities as such, and the Liquidating Trustee shall be appointed as the sole manager and sole officer of the Debtor and shall succeed to the powers of the Debtor's directors and officers. From and after the Effective Date, the Liquidating Trustee shall be the sole representative of, and shall act for, the Debtor to the extent necessary to implement and effectuate the terms of the Plan. The Debtor shall continue in existence solely for the following limited purposes: (i) making any Effective Date payments required under the Plan; (ii) transferring the Debtor's assets to the Liquidating Trust under the terms of the Plan; and (iii) taking all steps to execute all instruments and documents necessary to effectuate the Plan. Upon entry of a Confirmation Order, a Liquidating Trust Agreement in a form approved by the Bankruptcy Court shall be executed, and all other necessary steps shall be taken to establish the liquidating trust (the "Liquidating Trust") and the Trust Beneficial Interests therein, which shall be for the benefit of all creditors entitled to Trust Beneficial Interests under the Plan. General Counsel for Chapter 11 Trustee Richard A. Marshack: D. Edward Hays, Esq. Laila Masud, Esq. MARSHACK HAYS WOOD LLP 870 Roosevelt Irvine, CA 92620 Tel: (949) 333-7777 Fax: (949) 333-7778 E-mail: ehays@marshackhays.com lmasud@marshackhays.com Counsel for Official Committee of Unsecured Creditors: Keith C. Owens, Esq. Nicholas A. Koffroth, Esq. FOX ROTHSCHILD LLP 10250 Constellation Blvd., Suite 900 Los Angeles, CA 90067 Tel: (310) 598-4150 Fax: (310) 556-9828 E-mail: kowens@foxrothschild.com nkoffroth@foxrothschild.com A copy of the Plan of liquidation dated March 22, 2024, is available at https://tinyurl.ph/KJMes from PacerMonitor.com. About The Litigation Practice Group The Litigation Practice Group P.C. sought protection for relief under Chapter 11 of the Bankruptcy Code (Bankr. C.D. Cal. Case No. 23-10571) on March 20, 2023, with as much as $1 million in both assets and liabilities. Judge Scott C. Clarkson presides over the case. The Debtor tapped Khang & Khang, LLP as legal counsel and Grobstein Teeple, LLP as accountant. The U.S. Trustee for Region 16 appointed an official committee to represent unsecured creditors in the Debtor's Chapter 11 case. The committee is represented by Fox Rothschild, LLP. LORDSTOWN MOTORS: Settles Ex-CEO Steve Burns Fraud Charges ---------------------------------------------------------- The Business Journal reports that the U.S. Securities and Exchange Commission announced Friday, March 22, 2024, that it has settled fraud charges against the former CEO and chairman of Lordstown Motors Corp., Steve Burns. The charges and settlement are part of litigation filed in U.S. District Court in Washington D.C. The SEC's complaint charges Burns with violating the anti-fraud provisions of the Securities Act of 1933. Without admitting or denying the SEC's allegations, Burns consented to a permanent injunction, to pay a $175,000 civil penalty, and to be prohibited from serving as an officer or director of a publicly traded company for a period of two years. The settlement is subject to court approval. According to the SEC's complaint, Burns made misleading statements about Lordstown's business in SEC filings and other public statements, including that Lordstown had an established base of customer demand evidenced by more than 100,000 nonbinding pre-orders for its flagship vehicle, the Lordstown Endurance electric pickup. As the complaint alleges, these statements were misleading because most of the pre-orders were not submitted by commercial fleet customers, but rather by companies that did not operate fleets or intend to buy the truck for their own use, thereby creating an unrealistic and inaccurate depiction of demand for the truck from commercial fleet customers, the SEC said in a statement. Burns and the company's chief financial officer resigned in 2021 after a short-seller report questioned executive statements related to pre-orders. An internal inquiry found that some of these statements were misleading. In February 2024, the SEC charged Lordstown Motors with violating federal securities law. Lordstown agreed to a cease-and-desist order and disgorgement of $25.5 million to satisfy pending class action actions against the company. Lordstown Motors filed Chapter 11 bankruptcy on June 27, 2023. The EV company once owned and operated out of the former General Motors Lordstown plant. In late 2021, Foxconn purchased the plant and entered into a contract manufacturing agreement with Lordstown Motors to produce the Endurance. In October, Burns, through his investment company LAS Capital LLC, purchased Lordstown Motors' assets out of bankruptcy court for $10 million. He has since started a new venture LandX. Meanwhile, Lordstown Motor emerged from bankruptcy last week as a reconstituted company, Nu Ride. About Lordstown Motors Corp. Lordstown Motors Corp. -- http://www.lordstownmotors.com/-- is an electric vehicle OEM developing innovative light duty commercial fleet vehicles, with the Endurance all electric pickup truck as its first vehicle. It has engineering, research and development facilities in Farmington Hills, Mich. and Irvine, Calif. On June 27, 2023, Lordstown Motors Corp. and two affiliated debtors filed voluntary petitions for relief under Chapter 11 of the Bankruptcy Code (Bankr. D. Del. Lead Case No. 23-10831). The cases are pending before Judge Mary F. Walrath. The Debtors tapped White & Case, LLP and Richards, Layton & Finger, P.A., as bankruptcy counsels; Baker & Hostetler, LLP as special counsel; Jefferies, LLC as investment banker; KPMG, LLP as auditor; and Silverman Consulting as restructuring advisor. Kurtzman Carson Consultants, LLC is the Debtors' claims and noticing agent and administrative advisor. The U.S. Trustee for Regions 3 and 9 appointed an official committee to represent unsecured creditors in the Debtors' Chapter 11 cases. The committee tapped Troutman Pepper Hamilton Sanders, LLP, as legal counsel and Huron Consulting Group Inc. as financial advisor. MAJESTIC GARDENS: Unsecureds Will Get 100% of Claims in Plan ------------------------------------------------------------ Majestic Gardens Condominium C Association, Inc. filed with the U.S. Bankruptcy Court for the Southern District of Florida a Disclosure Statement in support of Plan of Reorganization dated April 2, 2024. The Debtor is a condominium association created under the laws of the State of Florida, with an office at 4045 NW 19th Street, Lauderhill, Fl 33313. The Debtor has 41 units. The filing of state case actions by homeowners and the recording of two Code violation liens by the City of Lauderhill prompted the Debtor to file in Chapter 11 on September 3, 2021. During the administration of the Estate, the two lawsuits were resolved. The resolution of the Code violations is still pending. The revenues of the Debtor were $218,396.00 in 2020; $505,551.00 in 2021; $188,223.00 in 2022, and; $217,156.00 through November 30, 2023. The reduced amount in 2022 was the result of certain condominium owners failing to pay HOA fees and assessments on approximately 11 units resulting in a severe shortfall. In addition, the prior board had allowed the property to fall into disrepair resulting in the violations and necessary, expensive repairs. Class 2 consists of General Unsecured Creditors. There is only one general unsecured creditor and it will be paid 100% of its allowed claim on the Plan Effective Date. The only claim is for $3,571.25 for the law firm of Valancy & Reed P.A. who filed a claim for $9,990.00. However, by Court Order at DE 27, the claim is reduced to $3,571.25. This Class is impaired. Class 3 is comprised of possible litigants and has only one member, Sharon Gobin (POC 1- 1), who was injured when a roof fell on her. The extent of her injuries and possible recovery of money damages is unknown. No lawsuit has ever been filed. Debtor believes that its exposure is limited to its insurance coverage. Ms. Gobin is receiving no distribution through the Plan. On the Effective Date, all property of the Debtor's Estate, including all real and personal property interests, shall vest in the Debtor. The funds to make the initial payments will come from the Debtor in Possession's Bank account. Funds to be used to make cash payments pursuant to the Plan shall derive from Debtor's income from assessments levied against, and collected from, HOA unit owners. A full-text copy of the Disclosure Statement dated April 2, 2024 is available at https://urlcurt.com/u?l=qn0tnE from PacerMonitor.com at no charge. Counsel to the Debtor: Chad T. Van Horn, Esq. Van Horn Law Group, PA 330 N. Andrews Ave., Suite 450 Fort Lauderdale, FL 33301 Telephone: (954) 765-3166 Email: Chad@cvhlwgroup.com About Majestic Gardens Condominium C Association Inc. Majestic Gardens Condominium C Association, Inc. is a condominium association created under the laws of the State of Florida, with an office at 4045 NW 19th Street, Lauderhill, Fl 33313. The Debtor filed its voluntary petition for Chapter 11 protection (Bankr. S.D. Fla. Case No. 21-18653) on Sept. 3, 2021, listing up to $500,000 in assets and up to $50,000 in liabilities. Judge Peter D. Russin oversees the case. Van Horn Law Group, P.A. and the Law Offices of Valancy & Reed, P.A. serve as the Debtor's bankruptcy counsel and general counsel, respectively. MIDCAP FINANCIAL: Moody's Affirms 'Ba3' CFR, Outlook Stable ----------------------------------------------------------- Moody's Ratings has affirmed MidCap Financial Issuer Trust's Ba3 corporate family rating and B1 senior unsecured and backed senior unsecured debt ratings. The outlook is stable. RATINGS RATIONALE The affirmation reflects MidCap's strong level of diversification, healthy earnings and favorable asset performance over a long period of time, supported by the company's high proportion of first lien investments. The company's capital position also supports the rating, although it remains weaker than many higher-rated commercial lender peers as well as rated business development companies (BDCs), which typically have leverage around 1.0x debt to equity. MidCap also benefits from its deep team of professionals and relationship with Apollo Asset Management, Inc. (A2 Stable). MidCap is an important component of Apollo's private credit origination platform, which continues to grow in significance as Apollo exhibits further growth in assets under management ($651 billion as of December 31, 2023). Additionally, MidCap has nearly 300 employees and continues to have solid management continuity, including long-standing employees and co-founders in key roles. Credit weaknesses include the nature of the company's assets, the majority of which consist of loans to highly leveraged middle market companies, the company's low level of earnings retention, and its heavy reliance on secured funding, which dampens its funding flexibility relative to companies with higher levels of unsecured debt. 2023 marked another year of solid credit and earnings performance for MidCap. Specifically, the company's return on average assets was 3.0%, adjusted for profit participating note interest expense, up from 2.9% in 2022. The company's portfolio continues to benefit from elevated reference rates, which buoy the company's almost exclusively floating rate portfolio. However, earnings retention remains low given substantially all of the company's income continues to be paid out in the form of profit participating note interest expense. While an eventual decline in rates will temper the company's profitability, the company's largely floating rate interest expense will help mitigate this contraction from 2023's elevated levels. Meanwhile credit losses have remained very modest, as has been the case throughout the company's history, although net charge-offs did rise modestly to 0.7% of average loans in 2023 versus 0.3% in 2022. Since inception in September 2008, MidCap has experienced cumulative losses of only around 30 basis points on a significant amount of funded assets. This favorable and steady performance is supported by the highly secured nature of the company's investment portfolio which remains focused on first lien investments. Further, portfolio granularity and diversification among asset types is a differentiator versus BDCs. MidCap had leverage of 4.7x on a debt to tangible equity basis, modestly above the top end of the company's expected target leverage range of 4.0x to 4.5x, and tangible common equity to tangible assets of about 17% as of December 31, 2023. While this provides good additional loss absorbing support to creditors, especially in light of the company's long-term, low-loss track record, these metrics compare unfavorably to higher-rated commercial lender peers and BDCs. The company's secured debt to assets ratio was 68% as of December 31, 2023. While the company's secured funding remains well diversified by counterparty and has limited mark to market risk, this ratio compares unfavorably versus higher rated peers, indicating a weaker ability to pledge assets in order to gain additional liquidity and weaker levels of asset coverage for the company's unsecured notes. Although MidCap has no near-term unsecured debt maturities, it has significant unfunded commitments that it must meet if drawn, presenting a liquidity risk. However, this historically, including in 2020, has been well managed. The stable outlook reflects Moody's expectation for MidCap to continue to report solid earnings and low credit losses over the next 12-18 months while managing its leverage within its target range. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS The ratings could be upgraded if MidCap reduces its leverage to comfortably within its target range and lowers its reliance on secured forms of funding while demonstrating continued solid asset quality metrics, including low loan losses, and profitability. MidCap's ratings could be downgraded if it experiences a significant deterioration in asset quality causing its profitability to materially weaken or become more volatile. The ratings could also be downgraded if MidCap sustains leverage clearly outside of its target range or its liquidity position weakens. The long-term senior unsecured debt instrument rating could also be downgraded as a result of changes to the company's capital structure, specifically if Moody's expected the ratio of secured borrowings outstanding on recourse facilities to unsecured obligations to increase. The principal methodology used in these ratings was Finance Companies Methodology published in November 2019. MKS REAL ESTATE: Unsecureds Owed $582K to Get 100% Over 71 Months ----------------------------------------------------------------- MKS Real Estate, LLC, filed a Second Amended Plan of reorganization. The Plan will pay all allowed claims in full from the proceeds from the sale of Debtor's real property pursuant to the Order Authorizing Debtor to Sell Real Property Located at 9100 NW US 287, Tarrant County, Fort Worth, Texas 76177 Free and Clear of All Liens, Claims, and Encumbrances. The Class III Allowed General Unsecured Claims are impaired. The Holders of Allowed General Unsecured Claims are entitled to vote on the Plan. The Allowed General Unsecured Claims are estimated to be $581,859 or less. The Holders of Allowed General Unsecured Claims will be paid 8.92% of their allowed claims in cash on or before the Effective Date. Such Holders will thereafter receive monthly distributions from the Reorganized Debtor of $8,000 per month plus applicable interest, if any, pro rata over 71 months commencing approximately one month after the Effective Date until all Allowed General Unsecured Claims are paid in full. The Debtor believes the treatment will be sufficient to pay the Holders of Allowed General Unsecured Claims in full, providing an estimated recovery of 100%. The cash necessary to pay allowed claims and interests under the Plan will be the cash generated from the sale proceeds of the Real Estate and subject to approval and disbursement on or before the Effective Date of this Plan. Bankruptcy counsel to MKS REAL ESTATE, LLC: M. Jermaine Watson, Esq. CANTEY HANGER LLP 600 West 6th Street, Suite 300 Fort Worth, TX 76102 Tel: (817) 877-2800 Fax: (817) 333-2961 E-mail: jwatson@canteyhanger.com A copy of the Plan of Reorganization dated March 22, 2024, is available at https://tinyurl.ph/RDDCk from PacerMonitor.com. About MKS Real Estate MKS Real Estate, LLC owns and operates an office building valued at $14.4 million. It is based in Fort Worth, Texas. MKS Real Estate filed a Chapter 11 petition (Bankr. N.D. Tex. Case No. 21-40424) on March 1, 2021. On Oct. 28, 2021, the court entered an agreed order dismissing the bankruptcy case for one year or until such time that the claim was paid in full, or the property is foreclosed, whichever was later. In consideration for the Debtor being given one year to sell the real property, the court ordered "that [Cadence (formerly known as BancorpSouth)] will have the right to post the real property for non-judicial foreclosure and proceed with the foreclosure on Nov. 1, 2022 in the event the claim is not paid in full on or before Oct. 31, 2022." MKS Real Estate again filed a Chapter 11 petition (Bankr. N.D. Tex. Case No. 22-42618) on Oct. 31, 2022. In the petition filed by Olufemi Ashadele as owner, the Debtor reported assets between $10 million and $50 million and liabilities between $1 million and $10 million. Judge Edward L. Morris oversees the 2022 case. The Debtor is represented by M. Jermaine Watson, Esq., at Cantey Hanger, LLP. MV REALTY: Unsecureds to Get Share of GUC Distributions ------------------------------------------------------- MV Realty PBC, LLC, filed with the U.S. Bankruptcy Court for the Southern District of Florida a Disclosure Statement in support of Joint Plan of Reorganization dated April 2, 2024. PBC FL was founded in 2014 and initially operated as a traditional real estate brokerage firm. In October 2018, PBC FL began focusing its efforts on marketing a unique product to residential homeowners. Generally speaking, (a) the MV Realty Subs would entered into HBAs with homeowners, thus giving the MV Realty Subs the exclusive right to list homes in the event a homeowner ever decide to sell their home, (b) the receivables under the HBAs were to be sold or otherwise assigned to MV Receivables II, and (c) Monroe Capital then advanced at a rate of 45% of the net present value of eligible receivables under the HBAs. Monroe is currently owed approximately $55,000,000.00. In or around October 2018, PBC FL implemented the "Homeowner Benefit Program" (the "HBP"). As part of the HBC, the MV Realty Subs enter HBAs with residential homeowners. The HBA is not a listing agreement but is a contract pursuant to which the MV Realty Subs pay an upfront cash payment to homeowners in exchange for the exclusive right to list a homeowner's home if the homeowner ever decides to sell their home. The homeowner is under no obligation to repay the upfront cash payment. The term of the HBA is 40 years subject to certain early termination events. At the present time, the MV Realty Subs are parties to approximately 34,000 HBAs with residential homeowners (the "HBA Parties"). Class 5 consists of the Allowed General Unsecured Claims of Government Parties against the Debtors. Each holder of an Allowed Class 5 Claim shall be paid such holder's Pro Rata Share of Unsecured Claims Distributions. The Class 5 Claims are Impaired. Classes 6 to 39 consists of the Allowed General Unsecured Claims against the Debtors. Each holder of an Allowed Class 6 to 39 Claims shall be entitled to each such holder's Pro Rata Share of the Unsecured Claim Distributions. The Class 6 to 39 Claims are Impaired. Class 40 consists of Allowed Equity Interests in MV Realty Holdings, LLC. The holders of Allowed Class 40 Equity Interests shall retain their Interests in the MV Realty Holdings, LLC subject, however, to the following: (i) the holders of Allowed Class 40 Equity Interests shall not be entitled to any Distributions under the Plan unless and until the holders of the Allowed Class 2, Allowed Class 3, Allowed Class 5, and Allowed Class 6 through Allowed Class 39 Claims are paid in full; (ii) in the event that any Class of Allowed Claims against MV Realty Holdings, LLC does not vote in favor of the Plan (a "Holdings Dissenting Class"), and unless the Allowed Claims of such Holdings Dissenting Class shall receive 100% of the Allowed Amount of such Claims in such Holdings Dissenting Class, an Equity Auction for the Equity Interests in MV Realty Holdings, LLC shall be implemented prior to the Effective Date of the Plan. Thereafter, any Distributions to holders of the Allowed Class 40 Interests shall be determined in accordance with applicable law. Class 41 consists of Allowed Equity Interests in MV Realty PBC, LLC (Florida). The holders of Allowed Class 41 Interests shall retain their Interests in MV Realty PBC, LLC subject, however, to the following: (i) the holders of Allowed Class 41 Equity Interests shall not be entitled to any Distributions under the Plan unless and until the holders of Allowed Class 2, Allowed Class 3, Allowed Class 5, and Allowed Class 6 through Allowed Class 38 Claims are paid in full; and (ii) in the event that any Class of Allowed Claims against MV Realty PBC, LLC does not vote in favor of the Plan (a "PBC Dissenting Class"), and unless the Allowed Claims of such PBC Dissenting Class shall receive 100% of the Allowed Amount of such Claims in such PBC Dissenting Class, an Equity Auction for the Equity Interests in MV Realty PBC, LLC (Florida) shall be implemented prior to the Effective Date of the Plan. Thereafter, any Distributions to holders of the Allowed Class 41 Interests shall be determined in accordance with applicable law. Class 42 consists of Allowed Equity Interests in the MV Realty Subs. The holder of the Allowed Class 42 Interests shall retain its Interests in the MV Realty Subs subject, however, to the following: (i) the holders of Allowed Class 42 Equity Interests shall receive all Net HBA Proceeds on account of HBAs, which shall be used for the purposes of paying Operating Expenses. Thereafter, Net Cash Flow From Operations shall be used for purposes of funding Distributions on account of Allowed Claims in accordance with the Plan; (ii) in the event of any Allowed Unsecured Claims against any MV Realty Sub, if any such Class of Allowed Claims against any MV Realty Sub does not vote in favor of the Plan (a "Sub Dissenting Class") and shall not receive 100% of the Allowed Amount of such Claims in such Sub Dissenting Class, an Equity Auction for the Equity Interests in any such MV Realty Sub shall be implemented prior to the Effective Date of the Plan. Class 43 consists of Allowed Equity Interests in MV Receivables II, LLC. The holders of Allowed Class 43 Equity Interests shall retain their Interests in the MV Receivables II, LLC subject, however, to the following: (i) the holders of Allowed Class 43 Equity Interests shall receive all Net HBA Proceeds on account of HBAs, which shall be used for the purposes of paying Operating Expenses. Thereafter, Net Cash Flow From Operations shall be used for purposes of funding Distributions on account of Allowed Claims in accordance with the Plan; (ii) in the event of any Allowed Unsecured Claims against MV Receivables II, LLC, if any such Class of Allowed Unsecured Claims does not vote in favor of the Plan (a "MV II Dissenting Class") and shall not receive 100% of the Allowed Amount of such Claims in such MV II Dissenting Class, an Equity Auction for the Equity Interests in MV Receivables II, LLC shall be implemented prior to the Effective Date of the Plan. Class 44 consists of Allowed Equity Interests in MV Receivables III, LLC. The holders of Allowed Class 44 Equity Interests shall retain their Interests in the MV Receivables III, LLC subject, however, to the following: (i) the holders of Allowed Class 44 Equity Interests shall receive all Net HBA Proceeds on account of HBAs, which shall be used for the purposes of paying Operating Expenses. Thereafter, Net Cash Flow From Operations shall be used for purposes of funding Distributions on account of Allowed Claims in accordance with the Plan; (ii) in the event of any Allowed Unsecured Claims against MV Receivables III, LLC, if any such Class of Allowed Unsecured Claims does not vote in favor of the Plan (a "MV III Dissenting Class") and shall not receive 100% of the Allowed Amount of such Claims in such MV III Dissenting Class, an Equity Auction for the Equity Interests in MV Receivables III, LLC shall be implemented prior to the Effective Date of the Plan. Upon confirmation of the Plan, and in accordance with the Confirmation Order, the Debtors, Reorganized Debtors, and the Plan Administrator, as the case may be, will be authorized to take all necessary steps, and perform all necessary acts, to consummate the terms and conditions of the Plan. In addition to the provisions set forth elsewhere in the Plan, the following shall constitute the means for implementation of the Plan. Distributions under the Plan shall be made from Cash available for Distributions in accordance with the Plan. Such Cash shall include available Cash on hand, as well as Net Cash Flow from Operations, Net Proceeds of Actions, D&O Claims Proceeds, and Equity Auction Proceeds. The Debtors have filed 2 sets of financial projections. The first set of projections assumes that the Debtors prevail in the Primary State Actions, while the second set of projections assumes that the Debtors do not prevail in the Primary State Actions. Beginning in 2025, the Reorganized Debtors expect to transition from having a team of agents, to operating under third-party flat fee brokerages. These flat fee brokerages will allow the current team of agents to provide full real estate listing services, while paying a flat fee, typically $200.00 or less per transaction, to the flat fee brokerage, while still enabling the Reorganized Debtors to receive the full commission. This will result in decreased costs related to the ongoing payment of salaries to the Reorganized Debtors' licensed brokers, as well as eliminating certain costs in connection with dues and rent obligations necessary to maintain individual brokerages in all 32 states. A full-text copy of the Disclosure Statement dated April 2, 2024 is available at https://urlcurt.com/u?l=3jpBdL from PacerMonitor.com at no charge. Attorneys for the Debtors: Michael D. Seese, Esq. Seese, P.A. 101 N.E. 3rd Avenue, Suite 1500 Ft. Lauderdale, FL 33301 Tel: (954) 745-5897 E-mail: mseese@seeselaw.com About MV Realty PBC MV Realty PBC, LLC, is a real estate brokerage firm based in Boca Raton, Fla. MV Realty and its affiliates filed Chapter 11 petitions (Bankr. S.D. Fla. Lead Case No. 23-17590) on Sept. 22, 2023. In the petitions signed by Antony Mitchell, authorized party, MV Realty disclosed $10 million to $50 million in assets and $50 million to $100 million in liabilities. Judge Erik P. Kimball oversees the cases. The Debtors tapped Seese, PA as bankruptcy counsel; Young Moore and Henderson, PA as local counsel; and Carpenter Lipps LLP and Frascona Joiner Goodman and Greenstein PC as special litigation counsel. NEVER SLIP: $30MM DIP Loan from Antares Has Interim OK ------------------------------------------------------ The U.S. Bankruptcy Court for the District of Delaware authorized Never Slip Holdings, Inc. and affiliates to use cash collateral and obtain postpetition financing, on an interim basis. The Debtor is permitted to obtain senior secured priming and superpriority postpetition financing, which if approved on a final basis would consist of (x) a letter of credit facility for up to $800,000, and (y) a term loan facility for up to $30 million, of which an initial amount of $20 million will be made available upon entry of the Interim Order, Antares Capital LP, serves as administrative agent and collateral agent, under the DIP facility. The DIP facility will be used to: (A) fund, among other things, ongoing working capital, general corporate expenditures and other financing needs of the Debtors, (B) subject to entry of a Final Order, convert on a cashless basis up to $83.9 million of the outstanding principal amount of the Loans under the Prepetition First Lien Credit Agreement and up to $6.168 million of the outstanding principal amount of the Loans under the Prepetition Sidecar Credit Agreement in connection with the DIP Term Loans to DIP Obligations under the DIP Loan Documents, as provided in the Final Order. The Debtors are required to comply with these milestones: (a) Immediately following the Petition Date, the marketing process related to the Debtors' Sale must be initiated. (b) No later than five calendar days after the Petition Date, the Bankruptcy Court must have entered the Interim DIP Order authorizing and approving, on an interim basis, the DIP Facility (including the Commitments, all documents and lender fees related thereto, and the payment of the fees and expenses of the Administrative Agent's and Prepetition First Lien Agents' advisors. (c) No later than five calendar days after the Petition Date, the Debtors must file a motion, in form and substance acceptable to the Administrative Agent and the Required Lenders, requesting (x) an order from the Bankruptcy Court (i) approving the proposed bid procedures attached to the Sale Motion related to the sale of substantially all of the assets of the Debtors, and (y) an order from the Bankruptcy Court approving the sale of the Debtors' assets to the highest and best bidder for such assets pursuant to Section 363 of the Bankruptcy Code determined in accordance with the Bid Procedures. (d) No later than 35 calendar days after the Petition Date, the Bankruptcy Court must have entered the Final DIP Order authorizing and approving, on a final basis, the DIP Facility (including the Commitments, all documents and lender fees related thereto, and the payment of the fees and expenses of the Administrative Agent's and Prepetition First Lien Agents' advisors. (e) No later than 35 calendar days after the Petition Date, the Debtors must have obtained the Bid Procedures Order, in form and substance reasonably satisfactory to the Administrative Agent and the Required Lenders. (f) No later than 45 days after the Petition Date, the Debtors must have completed an auction, as necessary, in connection with the Sale in accordance with the Bid Procedures Order. (g) No later than 50 days after the Petition Date, in the discretion of the Administrative Agent at the direction of the Required Lenders, the Bankruptcy Court must have entered a final order approving a Sale. The Debtors have an immediate need to obtain the DIP Facility and use cash collateral to, among other things, permit the orderly continuation of the operation of their businesses, to maintain business relationships with vendors, suppliers, and customers, to make payroll, to make capital expenditures, to satisfy other working capital and operational needs, to complete the Debtors' marketing and sale process, and to otherwise preserve the value of the Debtors' estates. Pursuant to the First Lien Credit Agreement, dated October 27, 2015, among (i) SHO Holding I Corporation, as borrower, (ii) the guarantors party thereto, (iii) the other financial institutions party thereto, and (iv) Antares Capital LP, as administrative agent and collateral agent, the Prepetition Initial First Lien Lenders agreed to extend loans and other financial accommodations to the Borrower. As of the Petition Date, the applicable Debtors owed the Prepetition First Lien Secured Parties, an aggregate principal amount of not less than $257.107 million with respect to the Term Loans, not less than $25.125 million with respect to the Revolving Loans, and not less than $800,000 with respect to the LC Obligations. Pursuant to the Second Lien Credit Agreement, dated as of October 27, 2015, among (a) SHO Holding I Corporation, as borrower, (b) the guarantors party thereto, (c) the other financial institutions party thereto, and (d) Ares Capital Corporation, as administrative agent and collateral agent, the Prepetition Second Lien Lenders agreed to extend loans and other financial accommodations to the Borrower pursuant to the Prepetition Second Lien Loan Documents. As of the Petition Date, the applicable Debtors owed the Prepetition Second Lien Secured Parties an aggregate principal amount of not less than $147.292 million with respect to the Loans. As adequate protection, the Prepetition First Lien Agents and Prepetition Second Lien Agent, will receive, adequate protection liens and allowed superpriority administrative claims. A final hearing on the matter is set for April 25, 2024 at 11 a.m. A copy of the order is available at https://urlcurt.com/u?l=i5DfxF from PacerMonitor.com. About Never Slip Holdings, Inc. Never Slip Holdings, Inc. and affiliates, including affiliates Shoes for Crews, Inc., SHO Holding I Corporation, SHO Holding II Corporation, SFC Canada, Inc., and Sunrise Enterprises, LLC, are the category creator of slip resistant footwear and other safety products for employers, employees, and individual consumers. The Debtors sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. D. Del. Lead Case No. 24-10663) on April 1, 2024. In the petition signed by Christopher Simm, chief financial officer, Never Slip Holdings disclosed up to $500 million in assets and up to $1 billion in liabilities. Judge Laurie Selber Silverstein oversees the case. The Debtors tapped ROPES & GRAY LLP as general bankruptcy counsel, CHIPMAN BROWN CICERO & COLE, LLP as co-bankruptcy counsel, SOLOMON PARTNERS SECURITIES, LLC as investment banker, BERKELEY RESEARCH GROUP, LLC as financial advisor, OMNI AGENT SOLUTIONS, INC. as claims agent, and C STREET ADVISORY GROUP, LLC as strategic communications advisor. NORTHERN DYNASTY: Deloitte LLP Raises Going Concern Doubt --------------------------------------------------------- Northern Dynasty Minerals Ltd. disclosed in a Form 40-F Report filed with the U.S. Securities and Exchange Commission for the fiscal year ended December 31, 2023, that its auditor expressed that there is substantial doubt about the Company's ability to continue as a going concern. Vancouver, Canada-based Deloitte LLP, the Company's auditor since 2009, issued a "going concern" qualification in its report dated April 1, 2024, citing that the Company incurred a consolidated net loss of $21 million during the year ended December 31, 2023 and, as of that date, the Company's consolidated deficit was $697 million. These conditions, along with other matters, raise substantial doubt about its ability to continue as a going concern. As of December 31, 2023, the Company had C$143.8 million, C$20.6 million in total liabilities, and C$123.3 million in total equity. A full-text copy of the Company's Form 40-F is available at https://tinyurl.com/223k7ykp About Northern Dynasty Minerals Northern Dynasty Minerals Ltd. is incorporated under the laws of the Province of British Columbia, Canada, and its principal business activity is the exploration of mineral properties. The Company is listed on the Toronto Stock Exchange ("TSX") under the symbol "NDM" and on the NYSE American Exchange under the symbol "NAK". ONDAS HOLDINGS: RRBB PA Raises Going Concern Doubt -------------------------------------------------- Ondas Holdings Inc. disclosed in a Form 10-K Report filed with the U.S. Securities and Exchange Commission for the fiscal year ended December 31, 2023, that its auditor expressed that there is substantial doubt about the Company's ability to continue as a going concern. Somerset, New Jersey-based Rosenberg Rich Baker Berman, P.A., the Company's auditor since 2017, issued a "going concern" qualification in its report dated April 1, 2024, citing that the Company has experienced recurring losses from operations, negative cash flows from operations and a working capital deficit as of December 31, 2023. The Company has incurred losses since inception and has funded its operations primarily through debt and the sale of capital stock. On December 31, 2023, the Company had an accumulated deficit of approximately $198,360,000. On December 31, 2023, the Company had net long-term borrowings outstanding of approximately $5,368,000 net of debt discount and issuance costs of approximately $392,000 and short-term borrowings outstanding of approximately $26,213,000, net of debt discount and issuance costs of approximately $1,968,000. On December 31, 2023, the Company had cash and restricted cash of approximately $15,022,000 and a working capital deficit of approximately $12,334,000. "We expect to fund our operations for the next 12 months from the filing date of this Annual Report on Form 10-K from the cash on hand as of December 31, 2023, proceeds from the 2024 financing activities discussed above, gross profits generated from revenue growth, potential prepayments from customers for purchase orders, potential proceeds from warrants issued and outstanding, and additional funds that we may seek through equity or debt offerings and/or borrowings under additional notes payable, lines of credit or other sources. There is substantial doubt that the funding plans will be successful and therefore the conditions discussed above have not been alleviated. As a result, there is substantial doubt about the Company's ability to continue as a going concern for one year from April 1, 2024, the date the Consolidated Financial Statements were available to be issued," the Company said. For the years ended December 31, 2023, and 2022, the Company reported a net loss of $44,844,872 and $73,241,805, respectively. As of December 31, 2023, the Company had $92,164,682 in total assets, $47,108,861 in total liabilities, $11,920,694 in redeemable noncontrolling interest, and $33,135,127 in total stockholders' equity. A full-text copy of the Company's Form 10-K is available at https://tinyurl.com/mrfeshmp About Ondas Holdings Marlborough, MA-based Ondas Holdings Inc. is a leading provider of private wireless, drone, and automated data solutions through its subsidiaries Ondas Networks Inc., Ondas Autonomous Holdings Inc., Airobotics, Ltd, and American Robotics, Inc. ONEMETA INC: M&K CPAs Raises Going Concern Doubt ------------------------------------------------ OneMeta Inc. disclosed in a Form 10-K Report filed with the U.S. Securities and Exchange Commission for the fiscal year ended December 31, 2023, that its auditor expressed that there is substantial doubt about the Company's ability to continue as a going concern. The Woodlands, Texas-based M&K CPAS, PLLC, the Company's auditor since 2022, issued a "going concern" qualification in its report dated April 1, 2024, citing that the Company has incurred recurring losses from operations and had not yet achieved profitable operations as of December 31, 2023, which raises substantial doubt about its ability to continue as a going concern. The Company had a net loss of $6,147,063 for 2023 as compared to $1,343,572 for 2022. Revenue for 2023 was $70,903 as compared to $1,295 for 2022. As of December 31, 2023, the Company had not yet achieved profitable operations and expects to incur further losses in the development of its business, all of which raise substantial doubt about the Company's ability to continue as a going concern. The Company's ability to continue as a going concern is dependent upon its ability to generate future profitable operations and/or to obtain the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they come due. Management has no formal plan in place to address this concern but considers that the Company will be able to obtain additional funds by equity financing and/or related party advances, however, there is no assurance of additional funding being available. As of December 31, 2023, the Company had $1,143,690 in total assets, $1,025,919 in total liabilities, and $117,771 in total stockholders' equity. A full-text copy of the Company's Form 10-K is available at https://tinyurl.com/3a3tzpwd About OneMeta Inc. Bountiful, UT-based OneMeta Inc. develops and markets artificial intelligence products that eliminate language barriers in daily communications by providing high-quality, accurate, and efficient interpretation and translation services using natural language processing (NLP) technology. The Company's focus is on developing a proprietary architecture that is faster and more accurate than any other company, with a commitment to providing superior quality services to its customers. The Company intends to serve a wide variety of markets and customers and is focused on becoming a leader in the creation of products for the interpretation and translation industry. ORENGO AIR: Case Summary & 18 Unsecured Creditors ------------------------------------------------- Debtor: Orengo Air Corporation Parcelas Jauca 245, Calle 3 Santa Isabel, PR 00757 Chapter 11 Petition Date: April 9, 2024 Court: United States Bankruptcy Court District of Puerto Rico Case No.: 24-01434 Debtor's Counsel: Jose M Prieto Carballo, Esq. JPC LAW OFFICES Cesar Gonzalez # 474 urb Roosvelt San Juan, PR 00918 Tel: (787) 607-2066 Fax: (787) 200-8837 E-mail: jpc@jpclawpr.com Total Assets: $2,366,403 Total Liabilities: $5,312,448 The petition was signed by Luis D. Torres Orengo as president. A full-text copy of the petition containing, among other items, a list of the Debtor's 18 unsecured creditors is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/NTZQGJI/ORENGO_AIR_CORPORATION__prbke-24-01434__0001.0.pdf?mcid=tGE4TAMA PEAR THERAPEUTICS: To Seek Plan Confirmation on May 6 ----------------------------------------------------- Judge Thomas M. Horan has entered an order that the Combined Disclosure Statement and Plan of Pear Therapeutics, Inc., et al. is approved on an interim basis for solicitation purposes under 11 U.S.C. Sections 105 and 1125, Bankruptcy Rule 3017 and Local Rule 3017-2. Any objections to the adequacy of information contained in the Combined Disclosure Statement and Plan on a final basis are expressly reserved for consideration at the Confirmation Hearing, unless overruled on the record at the hearing to approve the Combined Disclosure Statement and Plan on an interim basis, if applicable. The following Plan Confirmation Schedule, as may be modified, is approved: * Voting Record Date was on March 18, 2024 at 11:59 p.m. * Solicitation Date will be within 3 business days following entry of the Solicitation Procedures Order. * Deadline to File Plan Supplement will be on April 22, 2024. * Deadline to Object to Claims for Voting Purposes will be on April 1, 2024. * Deadline to File 3018 Motions April 15, 2024 Voting Deadline will be on April 29, 2024, at 5:00 p.m. (prevailing Eastern Time). * Deadline to Object to Final Approval of Disclosure Statement and/or Confirmation of Plan will be on April 29, 2024, at 4:00 p.m. (prevailing Eastern Time). * Deadline to File Reply to Objections to Final Approval of Disclosure Statement and/or Confirmation of the Plan and the Confirmation Brief will be on May 1, 2024 at 4:00 p.m. (prevailing Eastern Time). * The Plan Confirmation Hearing Date will be on May 6, 2024 at 2:00 p.m. (prevailing Eastern Time). Plan of Liquidation Pear Therapeutics, Inc., et al., filed a a Combined Disclosure Statement and Chapter 11 Plan of Liquidation. The Combined Disclosure Statement and Plan constitutes a liquidating Chapter 11 plan for the Debtors and provides for Distribution of the Debtors' assets already liquidated or to be liquidated over time to Holders of Allowed Claims in accordance with the terms of the Combined Disclosure Statement and Plan and the priority provisions of the Bankruptcy Code. The Combined Disclosure Statement and Plan contemplates the appointment of a Plan Administrator to, inter alia, implement the terms of the Combined Disclosure Statement and Plan and make distributions in accordance therewith. Except as otherwise provided by an order of the Bankruptcy Court, Distributions, if any, will occur at various intervals after the Effective Date as determined by the Plan Administrator. Pear is a commercial-stage healthcare company pioneering a new class of software-based medicines, sometimes referred to as Prescription Digital Therapeutics ("PDTs"), which use software to treat diseases directly. The Debtors are both corporations organized under the laws of the State of Delaware. Holdings was formerly known as Thimble Point Acquisition Corp. ("THMA"), a corporation organized under the laws of the State of Delaware. Pear US was formerly known as Pear Therapeutics, Inc. and was incorporated on August 14, 2013. As of the Petition Date, Pear held cash of approximately $5.2 million, exclusive of retainers held by the Debtors' professionals and deposits held by certain of the Debtors' landlords and vendors. Through the Business Combination, Holdings went public in December 2021 to gain access to the capital markets, but only raised $175 million, which was less than half of the expected $400 million in capital raising. Since the Business Combination, the Debtors have implemented cost-cutting measures, including three (3) reductions in force, reducing investment in their pipeline candidates, discovery programs and business development, but they had been unsuccessful in raising the capital necessary to operate the business any further. After considering all available options, the Debtors ultimately determined that seeking protection under chapter 11 of the Bankruptcy Code and focusing their efforts on the marketing and sale of their assets and distribution of proceeds was in the best interests of the Debtors and their stakeholders. The Combined Disclosure Statement and Plan provides for the substantive consolidation of the Assets and Liabilities of the Debtors. Accordingly, for purposes of the Combined Disclosure Statement and Plan only, the Assets and Liabilities of the Debtors are deemed the Assets and Liabilities of a single administratively consolidated entity. Claims filed against both Debtors seeking recovery of the same debt shall be treated as a single, non-aggregated Claim against the consolidated Estates to the extent that such Claim is an Allowed Claim. On April 7, 2023, the Debtors filed the Bidding Procedures Motion, which sought to approve bidding procedures, approve stalking horse bid protections, authorize the Debtors to designate a stalking horse bidder, schedule an auction, approve assumption and assignment procedures, schedule a sale hearing, approve the proposed sale and the assumption and assignment of executory contracts and unexpired leases. On April 27, 2023, the Debtors filed a Notice of Proposed Sale Order and Revised Bid Procedures Order. See Docket No. 97. On April 28, 2023, the Bankruptcy Court entered the Bidding Procedures Order,4 which among other things, authorized, but not directed, the Debtors, to designate one or more Stalking Horse Bidders and enter into Stalking Horse Agreements (as defined in the Bidding Procedures Order). See Docket No. 116. Ultimately, however, the Debtors did not designate a stalking horse bidder or enter into a Stalking Horse Agreement. The Bidding Procedures Order fixed May 15, 2023 at 4:00 p.m. (prevailing Eastern Time) as the deadline for the submission of bids for the Assets (the "Bid Deadline"). Prior to the Bid Deadline, the Debtors received twelve (12) written offers which the Debtors, after consultation with the Consultation Parties, determined were Qualified Bids. In consultation with the Committee and pursuant to the Bid Procedures, the Debtors determined that the most efficient way to conduct the Auction was to form a total of thirteen (13) bid lots (each, a "Lot"). Pursuant to the Bidding Procedures, on May 18, 2023, the Debtors commenced the Auction for a sale of the Debtors' Assets by Lot. The Auction concluded that same day. On May 19, 2023, the Debtors filed the Notice of Auctions Results for the Sale of the Debtors' Assets and announced, in accordance with the Bidding Procedures, that the Debtors, in consultation with the Consultation Parties, determined the bids submitted by the Purchasers to be the Successful Bids (as defined in the Bidding Procedures Order). Specifically, the Successful Bidders for certain of the Debtors' Assets were as follows: 1. Click was selected as the Successful Bidder for the Debtors' assets related to all Pear Platform patents, excluding patents related to the ISF Assets [Lot 8] (the "Pear Platform Assets"). The terms of Click's bid, pursuant to which Click purchased the Pear Platform Assets for a purchase price of $70,000 cash, were set forth in Click Asset Purchase Agreement. 2. Harvest Bio was selected as the Successful Bidder for the Debtors' assets related to the Invention Science Fund licenses and patents [Lot 1] (the "ISF Assets"), schizophrenia (Pear-004) [Lot 2] (the "Schizophrenia Assets"), multiple sclerosis and depression (Pear-006) [Lot 3] (the "MS/Depression Assets"), major depressive disorder [Lot 5] (the "MDD Assets"), other pipeline assets [Lot 6] (the "Other Pipeline Assets"), corporate trademarks [Lot 9] (the "Trademark Assets"), PearConnect [Lot 10] (the "PearConnect Assets"), and reSET® and reSET-O® [Lot 12] (the "reSET Assets," and together with the ISF Assets, the Schizophrenia Assets, the MS/Depression Assets, the MDD Assets, the Other Pipeline Assets, the Trademark Assets, and the PearConnect Assets, the "Harvest Bid Assets"). The terms of Harvest Bio's bids, pursuant to which it purchased (i) the ISF Assets for a purchase price of $50,000 cash; (ii) the Schizophrenia Assets, the MS/Depression Assets, and the Other Pipeline Assets for a total aggregate purchase price of $50,000 cash; (iii) the MDD Assets for $50,000 cash; (iv) the Trademark Assets for a purchase price of $50,000 cash; (v) the PearConnect Assets for a purchase price of $180,000 cash; and (vi) the reSET Assets for a purchase price $1,650,000 cash, for an aggregate purchase price of $2,030,000 cash for all of the Harvest Bid Assets, were set forth in Harvest Bio Asset Purchase Agreement. 3. Nox was selected as the Successful Bidder for the Debtors' assets related to Somryst [Lot 11] (the "Somryst Assets"). The terms of Nox's bid, pursuant to which it purchased the Somryst Assets for a purchase price of $3,900,000 cash, were set forth in the Nox Asset Purchase Agreement. 4. WELT was selected as the Successful Bidder for the Debtors' assets related to migraine (Pear-014) [Lot 4] (the "Migraine Asset"). The terms of WELT's bid, pursuant to which it purchased the Migraine Assets for a purchase price of $50,000 cash, were set forth in the WELT Asset Purchase Agreement. On May 23, 2023, the Court entered the four (4) Sale Orders, which approved the sale of substantially of the Debtors' Assets pursuant to the terms of each of the Asset Purchase Agreements by and among the Debtors and each of the Purchasers. The Sales closed in accordance with the terms of the Sale Orders and the Asset Purchase Agreements on or about the following dates: with Click – June 21, 2023; Harvest Bio – June 16, 2023; Nox – June 16, 2023; and WELT, June 5, 2023. On June 30, 2023, the Debtors filed the Notice of Assumed and Assigned Contracts Pursuant to Sale Orders, notifying counterparties to contracts or leases that were assumed and assigned to the Purchasers. Following the Sales, the Debtors are focused principally on winding down their remaining operations, affairs and business. This Combined Disclosure Statement and Plan provides for the Assets, to the extent not Purchased Assets or already liquidated, to be liquidated over time and the proceeds thereof to be distributed to Holders of Allowed Claims in accordance with the terms of the Combined Disclosure Statement and Plan and the treatment of Allowed Claims described more fully herein. The Plan Administrator will effect such liquidation and distributions. After the Effective Date, one or more of the Debtors will continue its corporate existence for Distribution purposes, and the Debtors will be dissolved by the Plan Administrator as soon as is reasonably practicable. Under the Plan, Class 4: General Unsecured Claims total $24,790,666 and will recover 21% of their claims. Each Holder of an Allowed General Unsecured Claim shall receive in exchange for such Allowed General Unsecured Claim: (A) such Holder's pro rata share of the Liquidating Trust Interests; or (B) such other treatment which the Debtors or the Liquidating Trust, as applicable, and the Holder of such Allowed General Unsecured Claim have agreed upon in writing. Class 4 is impaired. "Liquidating Trust Interests" shall mean the non-transferable interests in the Liquidating Trust that are issued to the Beneficiaries pursuant to the Combined Disclosure Statement and Plan. The Combined Disclosure Statement and Plan will be implemented by, among other things, the establishment of the Liquidating Trust, the transfer to the Liquidating Trust of the Liquidating Trust Assets, including, without limitation, all Cash and Retained Causes of Action, and the making of Distributions by the Liquidating Trust in accordance with the Combined Disclosure Statement and Plan and Liquidating Trust Agreement. Counsel for the Debtors: Alison D. Bauer, Esq. Jiun-Wen Teoh, Esq. FOLEY HOAG LLP 1301 Avenue of the Americas, 25th Floor New York, NY 10019 Tel: (212) 479-6000 E-mail: abauer@foleyhoag.com jteoh@ foleyhoag.com -and- Euripides Dalmanieras, Esq. Christian A. Garcia, Esq. Jasmine N. Brown, Esq. FOLEY HOAG LLP 155 Seaport Boulevard Boston, MA 02210 Tel: (617-)832-1000 E-mail: edalmani@foleyhoag.com cgarcia@foleyhoag.com jnbrown@foleyhoag.com -and- Chantelle D. McClamb, Esq. Katharina Earle, Esq. GIBBONS P.C. 300 Delaware Avenue, Suite 1015 Wilmington, DE 19801 Tel: (302) 518-6300 E-mail: cmcclamb@gibbonslaw.com kearle@gibbonslaw.com -and- Robert K. Malone, Esq. Kyle P. McEvilly, Esq. GIBBONS P.C. One Gateway Center Newark, NJ 07102 Tel: (973) 596-4500 E-mail: rmalone@gibbonslaw.com kmcevilly@gibbonslaw.com Counsel for the Creditors Committee: Mark T. Power, Esq. Joseph Orbach, Esq. THOMPSON COBURN HAHN & HESSEN LLP 488 Madison Avenue New York, NY 10022 Tel: (212) 478-7200 Fax: (212) 478-7400 E-mail: mpower@thompsoncoburn.com jorbach@thompsoncoburn.com -and- Bryan J. Hall, Esq. CHIPMAN BROWN CICERO & COLE, LLP Hercules Plaza 1313 N. Market Street, Suite 5400 Wilmington, DE 19801 Tel: (302) 434-4405 Fax: (302) 295-0199 E-mail: Hall@ChipmanBrown.com A copy of the Order dated March 22, 2024, is available at https://tinyurl.ph/TcyJm from Stretto, the claims agent. A copy of the Plan of Liquidation dated March 22, 2024, is available at https://tinyurl.ph/wDsaj from Stretto, the claims agent. About Pear Therapeutics Pear Therapeutics, Inc., is a commercial-stage healthcare company pioneering a new class of software-based medicines, sometimes referred to as Prescription Digital Therapeutics, which uses software to treat diseases directly. Pear Therapeutics, Inc. and Pear Therapeutics (US), Inc., filed their voluntary petitions for relief under Chapter 11 of the Bankruptcy Code (Bankr. D. Del. Lead Case No. 23-10429) on April 7, 2023. Christopher Guiffre, chief financial officer and chief operating officer, signed the petitions. In the petitions, the Debtors reported $10 million to $50 million in both assets and liabilities. Judge Thomas M. Horan oversees the cases. The Debtors tapped Foley Hoag, LLP as general bankruptcy counsel; Gibbons, P.C. as Delaware counsel; Wilmer Cutler Pickering Hale and Dorr, LLP as special counsel; and Sonoran Capital Advisors, LLC and MTS Health Partners, L.P. as financial advisors. Stretto, Inc., is the administrative advisor and claims and noticing agent. PLANET GREEN: YCM CPA Raises Going Concern Doubt ------------------------------------------------ Planet Green Holdings Corp. disclosed in a Form 10-K Report filed with the U.S. Securities and Exchange Commission for the fiscal year ended December 31, 2023, that its auditor expressed that there is substantial doubt about the Company's ability to continue as a going concern. Irvine, California-based YCM CPA, Inc., the Company's auditor since 2022, issued a "going concern" qualification in its report dated April 1, 2024, citing that the Company records an accumulated deficit as of December 31, 2023, and the Company currently has a working capital deficit, continued net losses and negative cash flows from operations. These conditions raise substantial doubt about the Company's ability to continue as a going concern. The Company has incurred a net loss of $20,843,796 attributable to common shareholders for the year ended December 31, 2023. As of December 31, 2023, the Company had an accumulated deficit of $140,724,597, a working capital deficit of $6,675,220, its net cash used in operating activities for the year ended December 31, 2023, was $5,282,343. These factors raise substantial doubt on the Company's ability to continue as a going concern. The accompanying audited consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty. Management's plan for the Company's continued existence is dependent upon management's ability to execute the business plan, develop the plan to generate profit; additionally, Management may need to continue to rely on private placements or certain related parties to provide funding for investment, for working capital and general corporate purposes. If management is unable to execute its plan, the Company may become insolvent. As of December 31, 2023, the Company had $42,629,996 in total assets, $23,189,784 in total liabilities, and $19,440,212 in total stockholders' equity. A full-text copy of the Company's Form 10-K is available at https://tinyurl.com/vee6uycb About Planet Green Holdings Planet Green Holdings Corp., headquartered in Flushing, NY, is not an operating company in the PRC but a Nevada holding company with its operations conducted through its subsidiaries in the PRC, U.S., Hong Kong and Canada and through contractual arrangements with its variable interest entity, Jilin Chuanyuan, which is a company incorporated in the PRC. Planet Green is engaged in a number of diverse business activities, including consumer products, chemical products, and online advertising and mobile game. POLYMER EXTRUSION: Unsecureds Owed $706K to Get 6% of Claims ------------------------------------------------------------ Polymer Extrusion Technology Incorporated submitted a Chapter 11 Plan of Reorganization and a Disclosure Statement dated March 22, 2024. The Plan proposes that the Debtor will restructure the value or payment of the Debtor's various claims (or treat said claims as otherwise agreed to by the parties) and provides for a distribution to the holders of all claims. The Debtor is a corporation with the sole business of providing industrial products located in Fort Lauderdale, Florida. The Debtor is owned by Violet Howes (33.3%), Gerhard Reichert (33.3%) and the remaining one-third ownership being of indeterminate status given the death of former owner Stephen Howes during the post-petition period. Owing to a garnishment against its financial accounts by a judgment creditor, the Debtor filed this bankruptcy case to obtain "breathing-room" afforded to it by the automatic stay. On March 27, 2023, the Debtor filed a voluntary petition under Chapter 11 of the Code. Since the Petition Date, the Debtor has continued in possession of its property and managed its business as debtor in possession pursuant to Secs. 1107 and 1108 of the Bankruptcy Code. On April 10, 2023, the Debtor filed its schedules in bankruptcy and its statement of financial affairs. Below are the unsecured claims with corresponding treatment: Class 2 consists of the Allowed Unsecured Claim of Glasshape Manufacturing Ltd., in the total agreed amount of $315,323.66 payable as follows: (i) $15,323.66 currently held in the trust account of Christian Somodevilla, Esquire being payable upon confirmation, and the remaining $300,000 payable in 60 equal monthly payments of $5,000, commencing 30 days after confirmation for the Plan. Class 2 is not an Insider and is impaired under this Plan. Class 3 consists of Allowed General Insider Claims in the total amount of $705,791.64. Class 3 will be paid a 6% distribution in the total approximate amount of $52,717, which shall be paid in 60 equal monthly payments commencing 30 days after confirmation of the Plan. Class 3 consists of Insiders, and is impaired under this Plan. The Debtor's operations during the post-petition period have demonstrated a stabilization of profitability, with consistent if moderate profits being generated from approximately March 2023 through March 2024 of approximately $18,500.00 per month. The Proponent therefore believes that the Debtor will be able to meet its obligations under the Plan owing to its ameliorated debt service, and steadily improving services when compared to its competitors. During the pendency of the Chapter 11 case, the Debtor has accumulated cash reserves sufficient to fund payment of the Class 1 claim as of the Effective Date. Continued operations of the Debtor will be sufficient to commence payments to Classes 2 and 3 during the plan period. Counsel for the Debtor: David A. Ray, Esq. DAVID A. RAY, P.A. 303 Southwest 6th Street Fort Lauderdale, FL 33315 Tel: (954) 399-0105 A copy of the Disclosure Statement dated March 22, 2024, is available at https://tinyurl.ph/YINrq from PacerMonitor.com. About Polymer Extrusion Technology Polymer Extrusion Technology Incorporated, doing business as Glasslam, is engaged in plastic products manufacturing. The company is based in Pompano Beach, Fla. Polymer filed its voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Fla. Case No. 23-12348) on March 27, 2023, with $100,000 to $500,000 in assets and $1 million to $10 million in liabilities. Violet Howes, director at Polymer, signed the petition. Judge Scott M. Grossman presides over the case. The Debtor tapped David A. Ray, Esq., at David A. Ray, PA as bankruptcy counsel; John D. Heffling, Esq., at Hall Booth Smith, PC as special appellate counsel; and Hylton Wynick, CIRA, CRFAC, at YIP Associates as financial advisor and accountant. PRIDE GROUP: Chapter 15 Case Summary ------------------------------------ Lead Debtor: Pride Group Holdings Inc. 6050 Dixie Rd. Mississauga Ontario L5T 1A6 Business Description: The Pride Group was founded by Sulakhan Johal and his brother Jasvir Johal in 2010 as a used truck dealership operating from the back of a single tractor trailer in Mississauga, Ontario, Canada. The Pride Group's businesses consist of, among other things, (i) new and used truck and trailer sales; (ii) truck leasing and financing to individuals or corporate owners; (iii) trucks servicing and truck parts sales; (iv) logistics; and (v) owning and operating real estate properties across Canada and the United States as dealerships, truck stops, and service centers. Chapter 15 Petition Date: April 1, 2024 Court: United States Bankruptcy Court District of Delaware Twenty-six affiliates that concurrently filed voluntary petitions for relief under Chapter 15 of the Bankruptcy Code: Debtor Case No. ------ -------- Pride Group Holdings Inc. (Main Case) 24-10632 Pride Group Logistics International Ltd. 24-10647 TPine Truck Rental Inc. 24-10660 TPine Rental USA, Inc. 24-10658 Pride Truck Sales Ltd. 24-10657 TPine Leasing Capital Corporation 24-10656 TPine Financial Services Inc. 24-10655 Pride Group Real Estate Holdings Inc. 24-10654 TPine Financial Services Corp. 24-10653 Pride Group Logistics USA, Co. 24-10652 Pride Group EV Sales Ltd. 24-10651 Pride Fleet Solutions USA Inc. 24-10650 Pride Group Logistics Ltd. 24-10649 Pride Fleet Solutions Inc. 24-10648 Parker Transport Co. 24-10646 Parker Global Enterprises, Inc. 24-10645 DVP Holdings, Corp. 24-10644 Dixie Truck Parts Inc. (US) 24-10643 Dixie Truck Parts Inc. (Canada) 24-10642 Coastline Holdings, Corp. 24-10641 Arnold Transportation Services, Inc. 24-10639 1000089137 Ontario Inc. 24-10638 2692293 Ontario Ltd. 24-10637 2554194 Ontario Inc. 24-10636 2554193 Ontario Inc. 24-10635 2043002 Ontario Inc. 24-10634 Judge: Hon. Craig T. Goldblatt Foreign Proceeding: Ontario Superior Court of Justice (Commercial List), Court File No.: 24-00717340-00CL Foreign Representative: Randall Benson 1450 Meyerside Drive, Suite 401 Mississauga, Ontario L5T 2N5 Canada Foreign Representative's Counsel: Derek C. Abbott, Esq. Andrew R. Remming, Esq. Austin T. Park, Esq. MORRIS, NICHOLS, ARSHT & TUNNELL LLP 1201 North Market Street P.O. Box 1347 Wilmington, DE 19899-1347 Tel: (302) 658-9200 Fax: (302) 658-3989 Email: dabbott@morrisnichols.com aremming@morrisnichols.com apark@morrisnichols.com - and - Penelope J. Jensen, Esq. Christopher J. Hunker, Esq. Clark L. Xue, Esq. LINKLATERS LLP 1290 Avenue of the Americas New York, NY 10104 Tel: (212) 903-9000 Fax: (212) 903-9100 Email: penelope.jensen@linklaters.com christopher.hunker@linklaters.com clark.xue@linklaters.com Estimated Assets: Unknown Estimated Debt: Unknown A full-text copy of the Lead Chapter 15 petition is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/RY7G6NA/Pride_Group_Holdings_Inc_and_Pride__debke-24-10632__0001.0.pdf?mcid=tGE4TAMA RAPID P&P: United Bank Says Disclosure Inadequate ------------------------------------------------- United Bank objects to Rapid P&P LLC's Disclosure Statement. United Bank asserts that the Disclosure Statement does not provide adequate information as defined by 11 U.S.C. Sec. 1125(a)(1) and required by 11 U.S.C. Sec. 1125(b). According to United Bank, specifically, the disclosure statement is confusing and misleading with respect to its description of the treatment of United Bank's claims, referred to as "Class 1A, 1B, and 1C." As stated in the disclosure statement, it is impossible for United Bank to ascertain exactly how debtor proposes to treat its claims. The Bank adds that the Disclosure Statement lacks sufficient information for any person to understand whether United Bank is being treated as an oversecured creditor as provided by 11 U.S.C. s 506(b). The Plan, it says, should acknowledge that United Bank is oversecured and state whether any impairment is a consequence of the proposed repayment terms or otherwise. The disclosure statement does not address how United Bank, or a hypothetical investor of the relevant class, should reconcile this inconsistency in terms. Further, according to the Bank, the disclosure statement is incomplete because it identifies 98% of Debtor's membership interests (78% + 24%) but does not identify the owner of the remaining 2% equity interest of Debtor. Based on Debtor's disclosure statement, it is impossible for United Bank or a hypothetical investor to ascertain whether the owner of the remaining 2% membership interest in Debtor is a creditor or otherwise has an interest in a creditor of any class. Based on Debtor's disclosure statement, no creditor or interest holder can make an informed judgment whether to approve Debtor's proposed plan of reorganization. Even if the Debtor's inadequate disclosures are corrected to resolve the inconsistencies and confusing elements, United Bank reserves the right to reject the Plan. United Bank does not intend to approve a proposed plan that fails to provide for: (a) post-petition interest; (b) interest at the contract rate; and (c) attorneys' fees to which it is entitled under the contract and as an oversecured creditor. Attorney for United Bank: Andrew King, Esq. 124 W. Capitol Ave., Suite 2000 Little Rock, Arkansas 72201 Tel: (501) 975-3000 Fax: (501) 975-3001 E-mail: andrew.king@kutakrock.com About Rapid P&P Rapid P&P, LLC, doing business as Rapid Prototypes, is a Bentonville-based packaging services company founded in 2003. It builds corrugated packaging and display prototypes for retail suppliers, which are abundant in Northwest Arkansas. Rapid P&P filed a petition under Chapter 11, Subchapter V of the Bankruptcy Code (Bankr. W.D. Ark. Case No. 23-70907) on June 30, 2023, with $3,097,943 in assets and $6,399,344 in liabilities. Donald Brady, Esq., at Brady Law Firm has been appointed as Subchapter V trustee. Judge Bianca M. Rucker oversees the case. Stanley V. Bond, Esq., at Bond Law Office, is the Debtor's counsel. RICEBRAN TECH: WithumSmith+Brown Raises Going Concern Doubt ----------------------------------------------------------- RiceBran Technologies disclosed in a Form 10-K Report filed with the U.S. Securities and Exchange Commission for the fiscal year ended December 31, 2023, that its auditor expressed that there is substantial doubt about the Company's ability to continue as a going concern. Whippany, New Jersey-based WithumSmith+Brown, PC, the Company's auditor since 2023, issued a "going concern" qualification in its report dated March 29, 2024, citing that the Company has an accumulated deficit at December 31, 2023 and, since inception, has suffered significant operating losses and negative cash flows from operations that raise substantial doubt about its ability to continue as a going concern. The Company has incurred losses and generated negative cash flows from operations since its inception. As of December 31, 2023, the Company had an accumulated deficit of $333.3 million and cash and cash equivalents of $1.1 million. Net loss in 2023 was $17.6 million, compared to a net loss of $7.9 million in 2022. Loss from continuing operations in 2023 was $8.6 million, compared to a loss from continuing operations of $6.7 million in 2022 As of December 31, 2023, the Company had $9.3 million in total assets, $12.3 million in total liabilities, and $3 million in total shareholders' deficit. "Our history of operating losses and negative operating cash flows from continuing operations raises substantial doubt about our ability to continue as a going concern within one year from the date of this filing," the Company said. A full-text copy of the Company's Form 10-K is available at https://tinyurl.com/mrsmnnmz About RiceBran Technologies Tomball, TX-based RiceBran Technologies IS a specialty ingredient company focused on the development, production, and marketing of products derived from traditional and ancient small grains. It creates and produces products utilizing proprietary processes to deliver improved nutrition, ease of use, and extended shelf-life, while addressing consumer demand for all natural, non-GMO and organic products. SAVAGE ENTERPRISES: Fitch Assigns 'B+' LongTerm IDR, Outlook Stable ------------------------------------------------------------------- Fitch Ratings has assigned Savage Enterprises, LLC and Savage Companies (collectively Savage) first-time Long-Term Issuer Default Ratings (IDR) of 'B+'. The Rating Outlook is Stable. Fitch has also assigned Savage Enterprises, LLC's $650 million revolving asset-based loan (ABL) 'BB+'/'RR1' ratings and the $1.2 billion first-lien term loan B 'BB-'/'RR3' ratings. Savage's ratings reflect its operations in high cost of failure niche infrastructure markets and strategically located agribusiness assets that benefit from its logistical expertise. Commodity price exposure is mitigated by a hedging strategy that ensures profit per unit. Consistent with the 'B+' rating, Fitch expects EBITDA interest coverage in the mid-3.0x, leverage in the high-3.0x, and that post-completion free cash flow (FCF) turns positive in 2025. To fund the Texon acquisition, Savage will incur $275 million of incremental term loan borrowings. Fitch also considers the smaller scale and concentrated agricultural (ag) commodity sourcing, which introduces risks of profitably sourcing commodities, and moderate exposure to U.S. coal production. Fitch believes Savage will pursue capital projects and acquisitions aimed at growing its cash flow profile but this could cause temporary variability in credit metrics. KEY RATING DRIVERS Steady Infrastructure Demand, Cash Flows: Fitch views the infrastructure segment's operating profile aligned with the low/mid 'BB' rating category, a relative strength to the rating, owing to its steady demand dynamics and the mission-critical nature of its operating and maintenance services that support earnings and cash flow stability. Demand stability reflects the consistency in output-linked services provided for power and refinery facilities as well as the multi-year service contracts in place. Savage provides essential services with high cost of failure and low wallet share, including the handling, transportation, and logistical support required for the safe movement and management of hazardous materials such as petroleum coke. A portion of Savage's infrastructure segment services the U.S. coal industry and the slow secular decline in coal production is moderated by the relatively small proportion of EBITDA from the end market. Fitch estimates overall exposure is around 10% of company EBITDA. Agribusiness Smaller Scale; Concentrated Operations: Fitch considers Savage's EBITDA, which is below $500 million, along with its regional concentration and focus on a few agricultural commodities, as aligned with the high 'B' rating category. This concentration results in a degree of regional variability in sourcing agricultural commodities due to reliance on local seasonal conditions and fluctuating harvest productivity. Fitch recognizes the company's operational capabilities provide sourcing and production optionality that helps reduce these risks. Savage plays a crucial role in Mexico's grain supply chain and benefits from the continuous global demand for agricultural commodities, which remains relatively stable through economic cycles. However, it faces competition from larger counterparts. These larger competitors have some scale-linked operational advantages, which help buffer regional harvest shortfalls and geopolitical tensions, among other considerations. However, Fitch notes that Savage has implemented effective risk management practices that significantly mitigate the margin impact of price volatility. Forecast High-3.0x Leverage: Fitch expects pro forma EBITDA leverage, after considering the Texon acquisition and full-year contribution from the soybean crushing facility to be in the high-3.0x range in 2024-26, improving towards mid-3x in 2027. Management plans to prioritize growth investments and allocate excess FCF towards debt reduction. Fitch notes the company's financial policy to deleverage to 2.5x on a company-calculated net leverage basis following project or acquisition investment but expects leverage to oscillate. Positive FCF Generation in Projection: Fitch expects FCF generation, which Fitch calculates after owner distributions, to improve to the $40 million to $70 million range in 2025-2026, up from negative levels in 2024, and supportive of small to mid-size projects. Fitch also considers the fluctuations in working capital flows, which have been driven by ag commodity harvests and can lead to multi-year high or low inventory investment with 2024 and 2025 expected to be relatively high investment years. Capex, excluding growth-oriented projects, is expected to be fairly steady around the $60 million to $70 million range. Projects Support Diversification, Vertical Integration: Fitch believes the addition of the soybean crushing facility and Texon provides incremental diversification, scale and vertical integration. The facility is expected to allow Savage to capture additional margin in the supply chain and accelerate growth, largely driven by regulation and private sector demand for renewable diesel fuel. Texon allows Savage to own the energy commodities it manages, like the structure on the ag side, strengthening its position in the supply chain and increasing cross-selling opportunities due to a shared customer base. These benefits are balanced against execution and integration risks over the next couple of years while it solidifies a customer base for the soybean facility and steps into a new but similar market with Texon. According to management, Texon has risk management practices in place that mitigate price-linked margin risks, similar to Savage's agribusiness. Inventories Bolster Contingent Liquidity: The market for Savage's main ag commodities are highly liquid through business cycles and afford the company access to incremental liquidity, if necessary. The majority of Savage's ag inventory balance of $309 million at YE2023 was highly liquid, predominantly made up of wheat, corn, and soybeans. For normal operating needs Savage maintains access to an ABL facility with commitments up to $650 million, although the borrowing base was unusually low at YE2023 due to low inventory balances and high deductions, which are common toward the end of the year. It also had $323 million of cash on hand, which along with ABL capacity was more than adequate to fund start of the year payments on inventory purchases. Fitch expects EBITDA interest coverage to remain in the mid-3.0x, further indicating a cash flow profile supportive of the 'B+' rating. DERIVATION SUMMARY Compared with rated ag peers Tereos SCA (BB/Stable) and Andre Maggi Participacoes S.A. (BB/Stable), Savage has a relatively smaller scale and more geographical concentration, which leads to heightened operational/sourcing risks. Savage's operating profile considerations are similar to Aragvi Holding International Limited (B+/Stable) with both sharing regional concentration, limited scale and focused product offerings. Fitch also compares Savage to plant services providers such as WEC US Holdings Ltd (Westinghouse Electric Company; B+/Stable). Westinghouse provides a high degree of recurring operational and fueling offerings that create a steady cash flow stream while maintaining a uniquely strong market share. Fitch expects Savage's EBITDA leverage to remain in the high-3.0x which is relatively lower than Westinghouse at 4.5x. Aragvi's readily marketable inventory-adjusted net EBITDA leverage was 2.8x in 2023. KEY ASSUMPTIONS - Revenue grows organically by low-single-digits annually throughout the forecast; - Gross EBITDA grows by low-single-digits throughout the forecast; - Capital intensity has been elevated in 2022-2024 due to Project Crush and is expected to normalize around 1% of revenue through the forecast; - Higher working capital investment in 2024-2025 tempers in subsequent years with grain inventory investment; - Annual owner distributions remain steady; - Savage balances growth-oriented capital deployment with maintaining its leverage profile around the high-3.0x. RECOVERY ANALYSIS The recovery analysis assumes that Savage would be reorganized as a going-concern in bankruptcy rather than liquidated. Fitch has assumed a 10% administrative claim. The going concern (GC) EBITDA estimate reflects Fitch's view of a sustainable, post-reorganization EBITDA level upon which Fitch bases the valuation of the company. GC EBITDA at $300 million, which accounts for contributions from Texon and Project Crush, considers a scenario of extended severe weather conditions impacting the ability to profitably source commodity inputs, an accelerated decline in coal business, or persistent operational challenges/economic weakness. The GC multiple of 4.75x reflects the blended multiple of the ag and infrastructure business, considering the company's scale, commoditized nature of its agriculture products and relative steadiness in the infrastructure business. It also considers comparable valuations among peers in the ag and infrastructure services markets. In Fitch's calculation of ABL utilization Fitch considers the average historical borrowing base, including expected additions from Texon and is assumed to be fully drawn. The waterfall results in a 'BB+'/'RR1' Recovery Rating for the ABL facility of $650 million and a 'BB-'/'RR3' for the first-lien term loan B of $1.2 billion. RATING SENSITIVITIES Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade: - Demonstrated commitment and track record of financial policies leading to EBITDA leverage sustained below 3.5x; - Improved financial flexibility as indicated by sustaining EBITDA interest coverage above 3.5x; - Improved scale and diversification of operations that increase the stability of Savage's FCF profile; Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade: - EBITDA leverage sustained above 4.0x; - Reduced financial flexibility, as reflected in EBITDA interest coverage sustained below 3.0x or an inability to sustain mid-cycle ABL availability around 50% or more; - Operating challenges or a change in strategy that leads to heightened earnings variability or constrains Savage's cash flow profile. LIQUIDITY AND DEBT STRUCTURE Fitch considers the company's liquidity adequate. As of December 31, 2023, Savage's liquidity was approximately $500 million, comprising $323 million in cash and equivalents and $178 million of availability on its committed $650 million ABL. The borrowing base availability under the ABL facility has been constrained due to weaker wheat harvests, impacting inventory purchases and levels. The borrowing base will likely increase with a normalization of harvest yields, and in turn inventory balances, and the addition of Texon. There are no near-term debt maturities. The ABL facility matures in 2026, followed by the term loan that amortizes 1% per year prior to coming due in 2029. Fitch deconsolidates the Savage Gulf Rail (SGR) subsidiary from Savage and as a result has not included the $150 million of notes due 2041 in its standalone credit metrics. Likewise, the subsidiaries assets, note collateral and earnings stream are excluded from the analysis. Fitch views the notes as adequately ring-fenced and funded by note receivables from customers that utilize the underlying rail terminal facility. Fitch also assumes Savage would not support the SGR entity upon financial distress given its limited operational and financial contribution to Savage. ISSUER PROFILE Savage, established in 1946 and headquartered in Utah, is a privately-held transportation logistics materials handling and industrial services company that serves diverse industries including oil refining, power generation, railroads, food, agriculture, oil & gas, mining, chemicals, petrochemicals, ports, terminals and construction. DATE OF RELEVANT COMMITTEE 04 April 2024 ESG CONSIDERATIONS The highest level of ESG credit relevance is a score of '3', unless otherwise disclosed in this section. A score of '3' 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. Fitch's ESG Relevance Scores are not inputs in the rating process; they are an observation on the relevance and materiality of ESG factors in the rating decision. Entity/Debt Rating Recovery ----------- ------ -------- Savage Enterprises, LLC LT IDR B+ New Rating senior secured LT BB+ New Rating RR1 senior secured LT BB- New Rating RR3 Savage Companies LT IDR B+ New Rating SAVAGE ENTERPRISES: S&P Affirms 'BB-' ICR on Acquisition of Texon ----------------------------------------------------------------- S&P Global Ratings affirmed all our ratings on Savage Enterprises LLC, including its 'BB-' issuer credit rating and its 'BB-' issue-level rating on the senior secured credit facility. The recovery rating remains '3', indicating its expectations of meaningful (50%-70%; rounded estimate: 50%) recovery in the event of a simulated default. The stable outlook reflects S&P's expectation that the company will manage leverage around the mid- to high-3x area over the next 12 months as it integrates the Texon acquisition and completes the construction of the soybean crush plant (Crush). Agribusiness and industrial transportation services provider Savage Enterprises has announced the acquisition of Texon L.P., a midstream service provider to energy markets that primarily operates a long-term contracted Butane blending business. The company plans to upsize its existing term loan B by $275 million to fund the acquisition. S&P expects the add-on to be fully fungible to the existing term loan B. S&P said, "We view Texon as a relatively small acquisition to expand Savage's industrial services offerings, and leverage will remain within bounds. "We estimate that pro forma S&P Global Ratings-adjusted leverage will increase to the high-3x area from 3.5x at the end of 2023 (the company's calculated leverage at the end of 2023 is 2.6x as it nets cash and does not include our S&P Global Ratings specific adjustments including the adjusted readily marketable inventories in Savage's grain merchandising segment). We expect leverage to decrease to 3x by 2025 as a full year of EBITDA generation for Crush and TEXON are incorporated. Savage has taken several portfolio alignment actions over the lats eighteen months to build out its capabilities and footprint. While the Texon acquisition is a first Butane blending business Savage has acquired, we believe it will benefit from Savages' existing transportation and logistics know-how in its infrastructure business, which currently services oil refining, power generation, oil and gas, mining, chemicals, and petrochemical customers. "The Crush facility is on track to be completed in the third quarter of 2024 as planned and we expect leverage and cash flow to improve significantly in 2025. "Given the favorable industry outlook for oilseed processing because of biofuel demand and tight industrywide production capacity, we believe the contribution from the facility will likely result in higher margins and better growth rates once it is fully operational." In addition, it increases Savage's scale in its agribusiness segment and adds soybean processing to its exiting footprint (which comprises lower-margin flour milling and grain origination and merchandising business). Management has demonstrated its ability to maintain leverage below 4x and expand its EBITDA through periodic investments and divestitures. The company partially funded its soybean crush facility with proceeds from the sale of the environmental services business in January 2023 and have managed leverage below our downgrade trigger of 4x. S&P said, "In addition, we view the Texon acquisition as consistent with the management goal of growing the business while managing leverage below 4x. We believe the company will continue to grow its EBITDA, both organically and through mergers and acquisitions (M&A), while operating with leverage above 3x but restoring it closer to its 2.5x target 12-18 months following future investment outlays. In addition, the company ended 2023 with over $300 million of cash to support its investments, even after the seasonal farmer paydown in the first quarter, and we expect available excess cash will be sufficient to fund the rest of the Crush investment without incremental strain on its liquidity and credit metrics." S&P said, "The stable outlook reflects our expectation that Savage will maintain leverage around mid- to high-3x area in 2024 as it integrates the Texon acquisition and completes the Crush facility as planned in the third quarter of 2024. "We could lower our ratings if the company either becomes more aggressive with its M&A and growth strategy or faces a significant unexpected earnings shortfall that causes it to sustain leverage above 4x." This could occur if the company fails to: -- Fails to successfully integrate and operate the Texon acquisition; or -- Fails to capture the planned EBITDA from its expansion, possibly due to a very pronounced cyclical downturn in soybean crush margins. -- Faces a significant (10%-20%) EBITDA decline in any of its key businesses while incurring incremental debt to fund future growth investments. S&P could raise its ratings if the company continues to build scale across its business portfolios and improves its business risk profile while sustaining S&P Global Ratings-adjusted leverage well below 4x and maintaining a commitment to its stated (non-S&P Global Ratings adjusted) leverage target of 2.5x before undertaking another large debt funded investment project. SCHULTE INC: Case Summary & 20 Largest Unsecured Creditors ---------------------------------------------------------- Debtor: Schulte Inc. 85 South Main St #2 Newton, NH 03858 Chapter 11 Petition Date: April 8, 2024 Court: United States Bankruptcy Court District of New Hampshire Case No.: 24-10225 Judge: Hon. Bruce A. Harwood Debtor's Counsel: William S. Gannon, Esq. WILLIAM S. GANNON PLLC 740 Chestnut Street Manchester, NH 03104 Tel: 603-621-0833 E-mail: bgannon@gannonlawfirm.com Estimated Assets: $1 million to $10 million Estimated Liabilities: $1 million to $10 million The petition was signed by Christopher E. Schulte as president. A full-text copy of the petition containing, among other items, a list of the Debtor's 20 largest unsecured creditors is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/MHLF6NQ/SCHULTE_INC__nhbke-24-10225__0001.0.pdf?mcid=tGE4TAMA SKYX PLATFORMS: M&K CPAs Raises Going Concern Doubt --------------------------------------------------- SKYX Platforms Corp. disclosed in a Form 10-K Report filed with the U.S. Securities and Exchange Commission for the fiscal year ended December 31, 2023, that its auditor expressed that there is substantial doubt about the Company's ability to continue as a going concern. The Woodlands, TX-based M&K CPAS, PLLC, the Company's auditor since 2018, issued a "going concern" qualification in its report dated April 1, 2024, citing that the Company has an accumulated deficit, negative cash flows from operations and recurring net losses, which raises substantial doubt about its ability to continue as a going concern. The Company's liquidity's sources include $22.4 million in cash and cash equivalents and $3.1 million of working capital. However, the Company has a history of recurring operating losses and its net cash used in operating activities amounted to $13 million and $13.8 million during 2023 and 2022, respectively. For the year ended December 31, 2023, the Company reported a net loss of $39.7 million, compared to a net loss of $27 million for the same period in 2022. The Company has also generated net cash provided by financing activities of $22.7 million and $20.9 million during 2023 and 2022, respectively. Accordingly, the Company's management cannot ascertain that there is no substantial doubt that it will be able to meet its obligations as they become due within the next 12 months. Management intends to mitigate such conditions by continuing to support its continued growth by decreasing its cash used in operating activities through increased revenues and increased margins from products sold to large retailers and its internet portals, and to the extent necessary, generating cash provided by financing activities through it's at the market offering or other equity or debt financing means. As of December 31, 2023, the Company had $76.3 million in total assets, $60.1 million in total liabilities, and $16.2 million in total equity. A full-text copy of the Company's Form 10-K is available at https://tinyurl.com/49b85tb4 About SKYX Platforms Pompano Beach, Florida-based SKYX Platforms Corp. has a series of highly disruptive advanced-safe-smart platform technologies, with over 60 U.S. and global patents and patent pending applications. SOILOGIC INC: Unsecureds Get Paid Over 5 Years or Until Fully Paid ------------------------------------------------------------------ Soilogic, Inc., filed a Disclosure Statement, dated March 22, 2024. The Debtor's assets primarily consist of the following, as of the Petition Date: (i) Cash in bank accounts in the amount of $3,200 ("Cash"); (ii) Accounts receivable in the amount of $255,400.25 ("Accounts Receivable"); (iii) Office equipment consisting of ten (10) comuters and 4 printers, valued at $7,000 (the "Office Equipment"); (iv) Vehicles consisting mainly of work trucks, valued at $94,975 (the "Vehicles"); and (v) Intellectual property consisting of the copyrighted Soilogic logo and customer lists, valued at $100 (the "Intellectual Property"). With respect to the Vehicles, subsequent to the Petition Date, the Debtor's 2006 Ford F450 Drill Truck exploded, such that Debtor purchased a 2014 Ford F350 to replace the same. The Debtor's Plan contemplates a sale of all of the above-identified assets ("Acquisition Assets") to Substrata, LLC (the "Purchaser") for $175,000 pursuant to the terms of an Asset Purchase Agreement (the "Purchase Agreement"), to be approved upon Confirmation of the Plan. Class One consists of allowed unsecured claims against the Debtor. Class One is Impaired under the Plan. The Debtor is not aware of any Allowed General Unsecured Claims at this time, other than potential attorneys' fees and costs payable to Hall & Evans, LLC arising out of their representation of the Debtor in the State Court Litigation. Upon information and belief, insurance funds may have paid for such attorneys' fees and costs. To the extent any Allowed General Unsecured Claims exist, any unsecured creditors will receive monthly payments pro rata over the course of five years (or until they are paid in full) from the Plan Payments under the Purchase Agreement, which shall begin upon the expiration of the Administrative Claims Final Bar Date and shall be subject to the Debtor's ongoing receipt of Plan Payments under the Purchase Agreement. Amounts included in Class One shall accrue interest at the Federal Judgment Rate until paid, and such interest shall be paid the unsecured claimholder with the monthly payments described herein. The Debtor, in its sole discretion, may pay the claims in Class One in full, with accrued but unpaid interest, at any time prior to the end of five years. For the avoidance of doubt, this Plan proposes to pay allowed Unsecured Claims in Class One in full. Following confirmation of the Plan, the Debtor will implement its Plan as follows: Debtor has agreed to the terms of the Purchase Agreement with the Purchaser which will provide for funds in the amount of $175,000, to be paid in monthly installment payments of $3,645.83 in exchange for the Acquisition Assets. The Debtor shall retain all liabilities as stated under the Purchase Agreement. The Debtor will be permitted retain Reserve Cash in its Debtor-in-Possession bank account to fund payment of Allowed Administrative Expenses and Claims due on the Effective Date of the Plan. Any Administrative Expenses and Claims due thereafter shall be paid from Plan Payments. Thereafter, and following the Administrative Claims Final Bar Date, the Plan Payments shall then be used to fund payments to Allowed Unsecured Claims, if any, and thereafter, payments to Interests in the Debtor. Counsel for SOILOGIC, INC.: Patrick D. Vellone, Esq. Jeffrey A. Weinman, Esq. Bailey C. Pompea, Esq. ALLEN VELLONE WOLF HELFRICH & FACTOR P.C. 1600 Stout Street, Suite 1900 Denver, CO 80202 Tel: (303) 534-4499 E-mail: pvellone@allen-vellone.com jweinman@allen-vellone.com bpompea@allen-vellone.com A copy of the Disclosure Statement dated March 22, 2024, is available at https://tinyurl.ph/lQQoG from PacerMonitor.com. About Soilogic, Inc. Soilogic, Inc., is a Colorado geotechnical engineering and construction materials testing corporation, which was formed on February 2, 2005 by its president and sole shareholder, Wolfram "Wolf" Von Carlowitz. Throughout the years, it has worked on several commercial and residential projects, including commercial development projects, multi-family residential developments, single-family residential homes and private residential exploration drilling. Soilogic, Inc., filed a Chapter 11 bankruptcy petition (Bankr. D. Colo. Case No. 23-14217-KHT) on Sept. 19, 2023. The Debtor tapped Allen Vellone Wolf Helfrich & Factor P.C. as counsel. SONIC AUTOMOTIVE: Fitch Affirms 'BB' LongTerm IDR, Outlook Stable ----------------------------------------------------------------- Fitch Ratings has affirmed Sonic Automotive, Inc.'s Long-Term Issuer Default Rating (IDR) at 'BB'. The Rating Outlook is Stable. Sonic's Automotive, Inc.'s 'BB' rating reflects its position as one of the leading players in the U.S. new and used auto dealership industry. The rating also reflects expected medium-term revenue and EBITDA of around $15 billion and around $500 million, respectively, following strong organic growth in 2021 and 2022, as well as the late 2021 acquisition of RFJ Auto Partners, Inc. The rating is supported by the balanced gross profit mix across segments, which helps limit financial sensitivity to the cyclical new and used vehicle market, a strong liquidity position underpinned by expected positive free cash flow (FCF), and Fitch's expectation that EBITDAR leverage (capitalizing leases at 8x) will be around 4x, in line with the company's EBITDAR leverage in 2023. KEY RATING DRIVERS Recent Moderation in Performance: Sonic's operating results in 2020-2022 benefited from a strong vehicle pricing environment and used car volume growth at its franchised dealerships. EBITDA in 2022 was $700 million, more than twice the $300 million in 2019 despite new vehicle supply challenges, demonstrating Sonic's business model resilience to the inherently cyclical auto retail industry. The industry tailwinds in recent years are starting to reverse as interest rates rise, consumer health moderates and OEMs increase new car production, driving lower pricing and vehicle gross profit. As a result, Sonic's EBITDA fell to about $530 million in 2023. However, EBITDA margins of 3.7% in 2023 remained above the 2019 level of 2.8%. Supply and Demand Reversal Expected: The combination of a somewhat softening consumer and improving new vehicle supply could pressure selling prices and, consequently, industry-wide margins. However, Fitch expects EBITDA could stabilize around $500 million as near-term pressure on new car margins are offset by profitability improvements at EchoPark, Sonic's used car superstore segment, as it moves from EBITDA of negative $80 million in 2023 to breakeven or slightly positive. Fitch believes Sonic could sustain EBITDA margins in the mid 3% range over the medium term, above the high 2% range prior to 2020, but below the 5% reported in 2022. Structurally higher margin forecasts are largely due to expectations that the new vehicle industry could retain some of the recent pricing strength through tighter supply. Leading Player in Fragmented Industry: Sonic benefits from its scale as one of the largest U.S. automotive dealership groups with good OEM relationships. It operates 108 franchises and 18 EchoPark used car superstores, with most in the southeastern region of the U.S., California and Texas. The company has broad vehicle brand exposure and healthy ancillary businesses, including parts and service and finance and insurance, which generate around 40% and 30% of franchised dealership gross profits, respectively. Sonic's scale and cash flow generation allow it to navigate complex industry dynamics, as well as invest in its core businesses, M&A and newer initiatives like EchoPark. High Barriers to Entry: Industry incumbents, such as Sonic, benefit from high barriers to entry due to protected franchise agreements that are regulated at both the state and federal levels. Additionally, dealerships require a significant upfront capital investment for initial construction and working capital. Success in the industry is also predicated on good relationships with financing partners, including automotive captive-finance entities, to achieve favorable floorplan financing terms. EchoPark Longer-Term Opportunity: While Sonic sees growth opportunities in its core dealership business, its primary longer-term expansion channel is the EchoPark segment, which is focused on simplified, no-haggle sales of high-quality, one- to four-year old vehicles priced up to $3,000 below competitors. While revenue for this segment has grown from around $250 million in 2017 to $2.4 billion in 2023, overall EBITDA generation was negligible prior to 2020 and has weakened to a deficit of approximately $80 million in 2023 due to inventory sourcing challenges and negative customer response to rising used car prices. Echopark has growth potential in the fragmented used auto market and has made near-term efforts to improve profitability, including store closures, expense reductions and initiatives to improve customer affordability, like sourcing older vehicles. However, given recent operating challenges, Fitch expects EchoPark's contribution to Sonic's EBITDA over the next two to three years to be negligible at best. Strong Medium-Term FCF; Reasonable Leverage: FCF was a deficit of approximately $280 million in 2023 following a nearly $400 million negative working capital swing. Fitch expects FCF of around $100 million annually beginning in 2024 from improved working capital, despite some EBITDA moderation in 2024. Sonic's good cash flow generation provides financial flexibility through cycles and allows the company to invest in strategic initiatives, including M&A to help grow and diversify its business. EBITDAR leverage, which was in the low-3x range between 2020 and 2022, increased to 3.9x in 2023. Fitch expects EBITDAR leverage of around 4x beginning 2024. This assumes debt levels of around $1.7 billion, in line with outstanding debt at the end of 2023. The company does not have a public leverage target, and its 'BB' rating assumes it operates with EBITDAR leverage below 4.25x. DERIVATION SUMMARY Sonic's peers include dealership groups Asbury Automotive, Inc. (BB/Stable) and AutoNation, Inc. (BBB-/Stable), and auto parts retailer AutoZone Inc. (BBB/Stable). Asbury's 'BB' rating reflects its top five position in the new and used auto dealership industry following recent acquisitions, with projected 2024 revenue and EBITDA around $18 billion and $1 billion, respectively. The rating is supported by good cash flow and balanced gross profit mix across segments that limit sensitivity to the cyclical new and used vehicle markets, and Fitch's expectation for EBITDAR leverage (capitalizing leases at 8x) to trend in the high-3x range, slightly higher than the company's historical EBITDAR leverage range of around 3x. AutoNation, whose business model is similar to that of Asbury and Sonic, holds a leading position in the auto retail segment and has a history of good cash flows, which allows it to invest in growth initiatives while effectively managing through an inherently cyclical automotive industry. AutoNation's 'BBB-' rating considers the company's financial policy yielding expectations of EBITDAR leverage at or below 3.25x over time. Unlike Sonic, AutoZone competes in the retail auto parts and accessories aftermarket. AutoZone's 'BBB' rating reflects its leading position in auto parts retail, steady operating results, high profitability margins and steady credit metrics, with EBITDAR leverage expected to trend in the high 2x range longer term. AutoZone's operating trajectory is supported by generally benign competition from direct peers and the industry's resilience to discount and e-commerce competition due to inventory investment requirements, a heavy service component and purchase immediacy requirements. The ratings consider AutoZone's financial policy and the expectation that debt balances could grow over time to support the company's share buyback program, in line with the company's publicly articulated financial policy. KEY ASSUMPTIONS Fitch's Key Assumptions Within the Rating Case for the Issuer - Revenue in 2024 could be close to flat given continued weakening in the vehicle pricing environment after several strong years, somewhat mitigated by improved new vehicle supply and a return to sales growth at EchoPark after optimizing its store footprint. Longer term, organic revenue growth could be around 2% assuming a normalization in vehicle supply and modest growth at Sonic's existing dealerships, including EchoPark; - Fitch expects EBITDA margins in 2024 to trend in the mid 3% range (lower than the 5% in 2022 but above the high 2% range in pre-pandemic 2019) given expectations of structurally tighter new vehicle supply in the medium term and some scale benefits post the RFJ acquisition. Fitch expects EchoPark's EBITDA to turn positive in 2024 but to remain negligible over the next two to three years; - Fitch expects FCF to be around $100 million annually beginning in 2024 given Fitch's EBITDA forecast and assuming neutral working capital. Fitch expects FCF to be used for strategic initiatives, including M&A and share repurchases; - Fitch projects EBITDAR leverage could trend near 4x in the medium term given Fitch's EBITDA projections and assuming debt of around $1.7 billion; - Sonic's credit facilities have a floating interest rate structure and Fitch assumes around 3.5% to 5% SOFR base rates over the forecast horizon, given the higher interest rate environment. Sonic's non-mortgage related notes have a fixed interest rate structure. RECOVERY ANALYSIS Fitch does not employ a waterfall recovery analysis for issuers' assigned ratings in the 'BB' category. The further up the speculative-grade continuum a rating moves, the more compressed the notching between the specific classes of issuances becomes. Fitch rates Sonic's secured ABL facility at 'BBB-'/'RR1', indicating outstanding recovery prospects. Sonic's $1.15 billion unsecured notes are rated 'BB'/'RR4', indicating average recovery prospects. RATING SENSITIVITIES Factors that could, individually or collectively, lead to positive rating action/upgrade: - Increased confidence in Sonic maintaining EBITDAR leverage (capitalizing leases at 8x) below 3.75x, either through a publicly articulated or demonstrated financial policy, alongside operating performance in line with Fitch's current expectations. Factors that could, individually or collectively, lead to negative rating action/downgrade: - Financial policy decisions, including debt financed M&A or share repurchases, that result in EBITDAR leverage (capitalizing leases at 8x) sustained above 4.25x; - Weaker than expected operating results due to market share loss and/or execution missteps, evidenced by EBITDA trending below $500 million, would also lead to negative action. LIQUIDITY AND DEBT STRUCTURE Good Liquidity: Total liquidity as of Dec. 31, 2023 was $501 million comprised of $29 million in cash on hand and $472 million in available liquidity resources under its various lines of credit. Total liquidity includes $299 million available (net of LOCs) under the company's $350 million asset-based loan (ABL) revolver maturing in 2029 and $173 million available under a $500 million mortgage facility maturing in November 2027. Sonic also has $345 million in floorplan deposit balances that can be used towards liquidity. Total debt as of Dec. 31, 2023 was $1.7 billion, consisting of $311 million in borrowings under the mortgage facility, $239 million in mortgage debt with various maturities through 2033, and $1.15 billion in unsecured notes due 2029 and 2031. Floorplan Facilities: Automotive retailers, including Sonic, finance their inventories with floorplan facilities, which have characteristics of both payables and debt. Companies primarily use the facilities for new car inventory and the source of these facilities is typically from either financing arms of various automotive manufacturers or lending institutions. The accounting treatment of these payables is similar to that of accounts payables. For example, floorplan financing is categorized as a floorplan payable, shown as short-term liabilities on the balance sheet, with the change in floorplan payables treated as a working capital change (trade payable) of financing activity (non-trade payable) on the statement of cash flows. Additionally, these facilities lack a fixed maturity date (loans due on demand) and a duration that is generally paid within days after a car is sold. These loans are often tied to manufacturer subsidies, which offset a portion, if not all, of the borrowing costs. These facilities are provided on a vehicle-by-vehicle basis. Floorplan financing also incurs an interest expense (distinct from debt interest) and in a liquidation scenario, floorplan payables are secured by the collateral of the vehicle, gaining priority over unsecured debt. Fitch excludes floorplan financing from its primary leverage ratio calculation in deriving its rating for Sonic. Fitch also adjusts EBITDA by moving floorplan-related interest expense to cost of goods sold (COGS). In 2023, this adjustment increased COGS and reduced EBITDA by $67 million. These floorplan facilities are secured and would receive priority over unsecured claims in a bankruptcy. ISSUER PROFILE Sonic Automotive, Inc. is a new and used automotive retailer that provides additional services including parts & repair services and finance & insurance through lending institutions. SUMMARY OF FINANCIAL ADJUSTMENTS In addition to treating floorplan interest expense as an operating cost within cost of goods sold, Fitch adjusts for stock-based compensation expense, impairment charges and loss or gains on asset disposals. ESG CONSIDERATIONS The highest level of ESG credit relevance is a score of '3', unless otherwise disclosed in this section. A score of '3' 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. Fitch's ESG Relevance Scores are not inputs in the rating process; they are an observation on the relevance and materiality of ESG factors in the rating decision. Entity/Debt Rating Recovery Prior ----------- ------ -------- ----- Sonic Automotive, Inc. LT IDR BB Affirmed BB senior unsecured LT BB Affirmed RR4 BB senior secured LT BBB- Affirmed RR1 BBB- STARCO BRANDS: Macias, Gini, & O'Connell Raises Going Concern Doubt ------------------------------------------------------------------- Starco Brands, Inc. disclosed in a Form 10-K Report filed with the U.S. Securities and Exchange Commission for the fiscal year ended December 31, 2023, that its auditor expressed that there is substantial doubt about the Company's ability to continue as a going concern. Irvine, California-based Macias, Gini, and O'Connell LLP, the Company's auditor since 2022, issued a "going concern" qualification in its report dated April 3, 2024, citing that the Company has an accumulated deficit of approximately $63.8 million at December 31, 2023 including the impact of its net loss of approximately $46.4 million for the year ended December 31, 2023. Net cash provided by operating activities was $0.7 million for the year ended December 31, 2023. The Company's ability to raise additional capital through the future issuances of common stock and/or debt financing is unknown. The obtainment of additional financing and the successful development of the Company's contemplated plan of operations, to the attainment of profitable operations, are necessary for the Company to continue operations. These conditions and the ability to successfully resolve these factors raise substantial doubt about the Company's ability to continue as a going concern. As of December 31, 2023, the Company had $83.3 million in total assets, $57.7 million in total liabilities, and $25.7 in total stockholders' equity. A full-text copy of the Company's Form 10-K is available at https://tinyurl.com/22jvp74t About Starco Brands Santa Monica, CA-based Starco Brands (OTCQB: STCB) invents consumer products with behavior-changing technologies that spark excitement in the everyday. Starco Brands publicly trades on the OTCQB stock exchange so that retail investors can invest in STCB alongside accredited individuals and institutions. STEWARD HEALTH: Plans to Sell Its Managed Services Organization --------------------------------------------------------------- Reshmi Basu of Bloomberg News reports that Steward Health Care has engaged Leerink Partnersto explore a possible sale of the hospital operator's managed services organization, according to people familiar with the situation who asked not to be identified discussing a private matter. Messages left with Steward, which has been facing liquidity troubles, weren't returned Monday while a spokesperson for Leerink declined to comment. Steward and a group of its private credit lenders have been working with a cadre of advisers for balance sheet help, Bloomberg News previously reported. About Steward Health Care Steward Health is a physician-owned private for-profit health care network in the United States and attends to 2.2 million people during more than twelve million physician and hospital visits annually. SUNSTOCK INC: Fruci & Associates II Raises Going Concern Doubt -------------------------------------------------------------- Sunstock, Inc. disclosed in a Form 10-K Report filed with the U.S. Securities and Exchange Commission for the fiscal year ended December 31, 2023, that its auditor expressed that there is substantial doubt about the Company's ability to continue as a going concern. Spokane, Washington-based Fruci & Associates II, PLLC, the Company's auditor since 2022, issued a "going concern" qualification in its report dated April 2, 2024, citing that the Company has an accumulated deficit and negative cash flows from operations. These factors, among others, raise substantial doubt about the Company's ability to continue as a going concern. The Company has rarely posted net income since inception. For the year ended December 31, 2023, the net income was $5,886, an increase of $3,657,718 from a net loss of $3,651,833 for 2022. It has an accumulated deficit of $65,910,092 as of December 31, 2023. The Company's continuation as a going concern is dependent on its ability to generate sufficient cash flows from operations to meet its obligations, which it has not been able to accomplish to date, and/or obtain additional financing from its stockholders and/or other third parties. Therefore, there is substantial doubt about the Company's ability to continue as a going concern. There is no assurance that the Company will ever be profitable. In early 2020, the Company had discussions with a third party in regards to raising funds through a private placement of equity. Those discussions with that third party have since been terminated. The Company intends to initiate discussions with an undetermined third party in regards to raising funds through a private placement of equity which, if it occurs, will provide the Company with funds to expand its operations and likely eliminate the going concern issue. As of December 31, 2023, the Company had $2,148,013 in total assets, $777,734 in total liabilities, and $1,370,279 in total stockholders' equity. A full-text copy of the Company's Form 10-K is available at https://tinyurl.com/27zkkax5 About Sunstock Sacramento, California-based Sunstock, Inc. engages in buying, selling and distribution of precious metals, primarily gold. The Company emphasizes investment in enduring assets that we believe may provide 'resource to retail' conversion upside. SURGE TRANSPORTATION: Unsecureds get Share of Exit Loan Facility ---------------------------------------------------------------- Surge Transportation, Inc., submitted a Disclosure Statement, dated March 29, 2024. Once a petition for reorganization is filed, actions to collect pre-petition debts are stayed, and other contractual obligations may not be enforced. These protections give debtors the opportunity to restructure their operations under court supervision and guarantee that all creditors will receive fair and equitable treatment. After the commencement date, debtors are given the opportunity to restructure their operations and may obtain credit, sell assets, and reject executory contracts and lease obligations, subject to court approval. The debtor may then propose a plan of reorganization to restructure their obligations. Substantially all liabilities of a debtor as of the commencement date are subject to settlement under a plan of reorganization and are to be voted upon by all impaired. The approval of a plan of reorganization allows a debtor to emerge from bankruptcy and to continue operating its business without continued court supervision. Founded in 2016 by Omar Singh, Surge is a Jacksonville, Florida based trucking/freight broker licensed with the U.S. Department of Transportation and the United States Federal Motor Carrier Safety Administration. It specializes in sourcing extra truckload capacity during peak seasons and other periods of high demand. The dramatic increase in volume during the pandemic ended rather abruptly, however, beginning in April or May 22 when inflation, the war in Ukraine and the easing of Covid-l9 restrictions began to suppress product demand and increase the cost of shipping. Surge, like many others in the industry, suffered from the rapid change in the demand for shipping services and failed to reduce overheads in a timely fashion. As a result, Surge became increasingly delinquent in the payment of carrier claims to the point where accounts payable totaled nearly $13 million owed to approximately 5,000 carriers. This reorganization was filed on July 24, 2023 (the "Petition Date") as a means of addressing those claims in an orderly fashion. Surge does not own the real estate from which it conducts business. There is therefore no value to be attributed to such assets. Its assets instead consisted almost entirely of cash in the bank, receivables, a vehicle and a limited amount of office furniture and equipment having a total value of $11,847,687.06. The balance of the indebtedness owed by the Debtor consisted of trade payables due the various carriers who provided transportation services to Surge or their factors. Unsecured claims totaled approximately $13,183,952 on the Petition Date (scheduled values). In its efforts to stem operating losses, Debtor laid off the majority of its employees, closed its Chicago, Illinois office, and terminated its overseas support operations. The foregoing changes have allowed Debtor to reduce its monthly overhead from a peak of $1.7 million per month in March of 2022, to roughly $125,000 per month presently. At the same time, Debtor has sought to re-establish its relationships with its customers. Those efforts were recently rewarded when Kraft awarded Surge with contracts to place over 9,940 loads per year with approved Carriers. Though overall load volume is significantly below pre-petition levels, greater care is being taken to ensure that margins on the loads are net positive. For example, for the week ending February 10,2024, Surge placed 73 loads with Carriers, for which it received 9179,720 in revenues, with average margins of 11.77%. These improving results have helped establish Surge's continuing viability, allowing it to propose the plan of reorganization. The plan will be funded by the Exit Loan Facility described below and the net proceeds of certain Avoidance Actions. The Exit Loan Facility will enable the Debtor to fund distributions to creditors under the Plan and to settle Declaratory Relief Actions. The proceeds of Avoidance Actions will enable the Debtor to make a supplemental distribution to Unsecured Creditors. The Exit Loan Facility will be secured by (i) a blanket lien on all Assets of the Debtor, existing on and after the Confirmation Date, excluding Avoidance Actions (as defined in the Plan), and (ii) a mortgage and security interest in the real property and improvements owned directly or indirectly by Debtor's principal, Omar Singh, and located at (a) 20651 Holyoke Drive, Ashburn, Virginia, and (b) 44390 Cedar Heights Drive, Ashburn, Virginia (the "Exit Facility Collateral"). From this $2 million Exit Loan Facility, $400,000 will be utilized to settle the Declaratory Relief Actions with the remaining $1.6 million being utilized to fund, in order of priority, distributions to Allowed Administrative Claims, Priority Tax Claims, and the initial distribution to Allowed Claims of Unsecured Creditors in Classes 2 and 3. The Exit Loan Facility will be amortized and paid by the reorganized Debtor over seven years with no interest, secured by the Exit Facility Collateral, and documented in the form of a Secured Promissory Note and Deeds of Trust to secure the real estate. The Exit Loan Facility is conditioned upon the entry of a Confirmation Order, which (i) approves the settlement and compromise of the Declaratory Relief Actions; (ii) approves the Debtor's assumption of the Factoring Agreement; and (iii) allows the Debtor to execute the Secured Promissory Note. The Plan will also be funded by the proceeds of Avoidance Actions pursued by the Debtor, net of all costs, expenses, and attorney fees incurred in connection therewith. The Debtor will make a supplemental pro-rata distribution to the Holders of Allowed Claims in Classes 2 and3 after all of the Avoidance Actions have been adjudicated or settled. As set forth in Section I .2 of the Plan, Factors may elect to receive a release from an Avoidance Action in exchange for (i) a 30%o reduction of their Allowed Unsecured Claim, and (ii) a commitment to permit their carrier customers to factor Surge receivables post-confirmation. Under the Plan, Class 3 consists of General Unsecured Claims. Allowed Unsecured Claims, excluding Triumph's Allowed Unsecured Claim, will share pro rata the balance of the Exit Loan Facility proceeds after payment of all Administrative and Priority Claims in full, with payment to be made within 120 days of the Effective Date. The Exit Loan Facility proceeds shall be free and clear of Triumph's security interests and, after payment of Administrative and Priority Claims, shall be held in a segregated account pending disbursement, at which time the proceeds will be transferred to TriumphPay or such other agent as Debtor may determine for disbursement. Debtor may seek an extension of the initial distribution date if necessary to accommodate resolution of claims objections which may have a material impact on the distributions to other creditors or as a matter of administrative convenience. In addition, the Debtor will make a supplemental distribution of the net proceeds of Avoidance Actions, if any, within sixty (60) days following the conclusion of all such actions. There shall be no distribution on account of any Disputed Claim until such objection or dispute is resolved by Final Order. In accordance with Section 10.1 of the Plan, Debtor shall, however, reserve funds to make the proportionate distribution to such creditors until such time as all claim objections have been finally determined. All funds reserved on account of Disallowed Claims shall be distributed pro-rata to the holders of Allowed Unsecured Claims concurrently with the supplemental distribution of the net proceeds of Avoidance Actions in the manner and time periods described above. Debtor may, in its sole discretion, delay making the initial distribution if it expects resolution of a Disputed Claim within a reasonable time. Pursuant to s 502(d) of the Bankruptcy Code, no payments shall be made to any entity from which property is recoverable under ss 542, 543,550 or 553 of the Bankruptcy Code or that is a transferee of a transfer avoidable under ss 522(0, 522(h),544,545,547, 548, 549 or 724(a) of the Bankruptcy Code, unless such entity or transferee has paid the amount, or turned over any such property from which such entity or transferee is liable under ss 522(i), 542,543,550 or 553 of the Bankruptcy Code. The Claim of any recipient of a payment avoidable under ss 542, 543, 550 or 553 of the Bankruptcy Code who fails to pay or turnover the amount of the payment to Debtor within 60 days of a judgment or order avoiding the transfer or requiring such turnover shall be extinguished and forever barred. Class 3 is impaired by the Plan and is entitled to vote to accept or reject the Plan. For purposes of the Plan, Debtor believes the feasibility test is satisfied by Triumph's commitment to fund the Exit Loan Facility. Nonetheless, attached hereto as Exhibit A is a 24 month forecast of projected income and expenses for the Debtor from and after the anticipated Effective Date which (i) attests to the feasibility of the Plan, and (ii) shows that the Debtor cannot support additional distributions to creditors from operations. The projections were developed by Dundon Advisors after consultation with Debtor and a review of Debtor's historical records and assume that the Plan will be implemented in accordance with its terms. Although Debtor believes the assumptions inherent in the projections are accurate and reasonable in light of the circumstances under which they were made, no assurances can be given that the projections will be realized, or that Debtor's income or expenditures will actually conform to the projections. Attorneys for Surge Transportation, Inc: Richard R. Thames, Esq. Bradley R. Markey, Esq. THAMES IMARKEY 50 North Laura Street, Suite 1600 Jacksonville, FL 32202 Tel: (904) 358-4000 and Stephen Leach, Esq. David I. Swan, Esq. HIRSCHLER FLEISCHER 167 International Drive, Suite 1 350 Tysons, VA 22102- 4940 Tel: (703) 584-8900 A copy of the Disclosure Statement dated March 29, 2024, is available at https://tinyurl.ph/BHxXF from PacerMonitor.com. About Surge Transportation Founded in 2016 by Omar Singh, Surge Transportation, Inc., is a Jacksonville-based trucking and freight broker licensed with the U.S. Department of Transportation and the United States Federal Motor Carrier Safety Administration. It specializes in sourcing extra truckload capacity during peak seasons and other periods of high demand. Surge Transportation maintains satellite offices in Chicago, Ill. and Ashburn, Va. Surge Transportation filed a Chapter 11 petition (Bankr. M.D. Fla. Case No. 23-01712) on July 24, 2023, with $10 million to $50 million in both assets and liabilities. Mr. Singh signed the petition. Judge Jacob A. Brown oversees the case. Bradley R. Markey, Esq., at Thomas Markey, is the Debtor's legal counsel. TASEKO MINES: Fitch Rates Proposed $500MM 2nd Lien Notes 'B-' ------------------------------------------------------------- Fitch Ratings has assigned a 'B-'/'RR4' to Taseko Mines Limited's (Taseko) proposed USD500 million senior secured second lien six-year notes. Proceeds of the notes will be used to finance the repayment of the USD400 million senior secured notes due 2026 and for general corporate purposes. Fitch currently rates Taseko's Long-Term Issuer Default Rating 'B-', its secured revolving credit facility at 'BB-'/'RR1' and its USD400 million senior secured notes at 'B-'/'RR4'. The Rating Outlook is Stable. The ratings reflect Taseko's small size, concentration on one operation and cost position in the fourth quartile of the global copper cost curve. The Gibraltar mine benefits from a stable production profile, a favorable mining jurisdiction and a 21-year reserve life. KEY RATING DRIVERS Limited Scale: Taseko's ratings reflect the company relative limited scale and higher concentration by operation and metal compared with its rated peers. While it owns one large-scale operating copper mine in a favorable mining jurisdiction, its costs are in the fourth quartile of CRU Group's cost curve (Gibraltar in British Columbia [BC], Canada). The company is working to develop its 100% owned Florence Copper project (in Arizona), which Fitch estimates would reduce the company's overall cost position by around 15% and increase production by about two-thirds once fully operational. Modest Execution Risk: The Florence Copper project is now fully permitted and Fitch believes that cash on hand, financing in place, and FCF from Gibraltar will be sufficient to support remaining development. The project is designed to use in-situ copper recovery rather than conventional mining. The project's execution risk is low and Taseko expects first cathode production in 4Q25, followed by another 18 months of ramp up. Drilling of the commercial facility wellfield started in February 2024 and the company recently executed a fixed-price contract with the general contractor for the construction of the SX/EW plant. Minimal Other Longer-Term Development: Fitch does not expect material spending on other development until after Florence Copper has ramped up. The company is evaluating the Yellowhead copper project in BC, and other early-stage projects include: Aley (niobium), and New Prosperity (gold and copper) each in BC. Subsidiaries owning Yellowhead, Aley and New Prosperity are unrestricted subsidiaries under the notes. Copper Sensitivity: Taseko reports that a USD0.25/lb. increase in copper prices increases Gibraltar's annual cash flow by USD28 million based on life of mine averages. Fitch assumes the 2024 average copper price will be about USD3.81/lb, decreasing to about USD3.63/lb. in 2025 and USD3.40/lb. thereafter. This compares with Taseko's 2023 average realized copper price of USD3.84/lb. and current copper prices are about USD3.99/lb. Taseko enters into copper option contracts to reduce short-term copper price volatility. Leverage Inline: Fitch expects EBITDA leverage to be in a range of 3.5x-4.0x through 2025. Longer-term, Fitch expects the completion of Florence Copper to bring higher earnings and allow debt repayment, thereby reducing financial leverage, absent changes to capital allocation policies. DERIVATION SUMMARY Taseko is smaller, less diversified and less profitable than Hudbay Minerals Inc. (BB-/Stable), Ero Copper Corp. (B/Stable) and First Quantum Minerals Ltd. (B/Rating Watch Negative). Taseko has higher leverage than peers, but development of the low-cost Florence Copper project is expected to increase size, improve profitability and lower leverage. KEY ASSUMPTIONS - Taseko's interest in Gibraltar production at about 99 million pounds in 2024 increasing to about 109 million pounds per year thereafter; - Copper prices incorporate Taseko's hedges and Fitch assumptions of USD8,400/tonne in 2024, USD8,000/tonne in 2025, and USD7,500/tonne thereafter; - Gibraltar operating expenses decline from USD2.66/lb. in 2024 to USD2.30/lb. longer-term; - Taseko's share of Gibraltar capex at roughly CAD68 million in 2024 and CAD60 million per year on average thereafter; - The Florence Copper project proceeds roughly in line with the technical report dated March 30, 2023; - Other than announced transactions and potential transactions, no other financing activities. RECOVERY ANALYSIS Key Recovery Rating Assumptions The recovery analysis assumes that Taseko would be reorganized as a going-concern in bankruptcy rather than liquidated. Fitch notes that Florence Copper entities provide unsecured guarantees of the notes but the project is in development, is partially financed on a secured basis, will take 18 months to construct and a further 18 months to fully ramp-up. Fitch does not include Florence Copper production in its recovery analysis. Fitch has assumed a 10% administrative claim. Going-Concern (GC) Approach - Taseko's GC EBITDA assumption comprises it's 100% interest in Gibraltar calculated at copper prices of USD3.25/lb. and cash operating costs at USD2.66/lb. and deducts CAD15 million to reflect the annual carry for the Cariboo obligations; - The GC EBITDA estimate reflects Fitch's view of a sustainable, post-reorganization EBITDA level upon which Fitch bases the enterprise valuation; - An enterprise value (EV) multiple of 4.0x EBITDA is applied to the GC EBITDA to calculate a post-reorganization EV. This reflects Gibraltar's higher cost position as well as solid reserve life and low country risk. The choice of this multiple considered similar public mining companies which trade at EBITDA multiples in the 4x-6x range; - Gibraltar has secured equipment loans which are deemed senior to the revolver. The revolver has priority over the notes; - Fitch assumes the revolving credit facility is fully utilized in its recovery analysis; - The calculated EV assumption, after administrative claim is CAD432 million. The EV after administrative claims results in outstanding recovery for Taseko's first lien secured revolving credit facility corresponding to a recovery rating of 'RR1' and average recovery corresponding to the 'RR4' rating on Taseko's senior secured notes. Unsecured guarantees of Florence Copper loans and Gibraltar stream are assumed to have no recovery under this scenario. RATING SENSITIVITIES Factors that could, individually or collectively, lead to positive rating action/upgrade: - Visibility into completion of the Florence Copper project; - Financial policies in place resulting in EBITDA leverage sustained below 3.5x. Factors that could, individually or collectively, lead to negative rating action/downgrade: - FCF materially below expectations; - Increased costs or material disruption at Gibraltar; - Addition of senior secured debt that weakens recovery prospects of the proposed new second lien notes; - EBITDA leverage sustained above 4.5x. LIQUIDITY AND DEBT STRUCTURE Supportive Liquidity: As of Dec. 31, 2023, Taseko had CAD96 million in cash and CAD79 million available under its USD80 million revolving credit facility maturing on July 2, 2026. The Gibraltar joint venture has an uncommitted CAD7 million credit facility to provide letters of credit (LOCs) to Gibraltar suppliers to support trade finance. At Dec. 31, 2023, CAD3.75 million in LOC were outstanding under the facility. There is also an annually renewable USD4 million LOC facility available to key contractors in conjunction with the development of Florence Copper. Any LOC's to be issued under the facility will benefit from an Export Development Canada guarantee. Fitch expects Gibraltar 2024 FCF to be in the CAD80 million range. ISSUER PROFILE Taseko is a small mining company headquartered in Vancouver, BC that operates one large-scale, high-cost copper mine in Canada (Gibraltar) and owns a pipeline of projects including: Florence Copper, Aley (niobium), Yellowhead (copper) and New Prosperity (gold and copper). Taseko owns and consolidates 87.5% of the Gibraltar mine. The company is working to advance development of the low-cost Florence copper project in Arizona. Exploration and development are expected to be modest at other projects. ESG CONSIDERATIONS The highest level of ESG credit relevance is a score of '3', unless otherwise disclosed in this section. A score of '3' 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. Fitch's ESG Relevance Scores are not inputs in the rating process; they are an observation on the relevance and materiality of ESG factors in the rating decision. Entity/Debt Rating Recovery ----------- ------ -------- Taseko Mines Limited Senior Secured 2nd Lien LT B- New Rating RR4 TASEKO MINES: Moody's Rates New $500MM Senior Secured Notes 'B3' ---------------------------------------------------------------- Moody's Ratings assigned a B3 rating to Taseko Mines Limited's proposed US$500 million backed senior secured notes due 2030. Taseko intends to use the proceeds of this offering to refinance the company's US$400 million senior secured notes due 2026 and for capital expenditures, working capital and general corporate purposes. Taseko has also signed an agreement to buy the remaining 12.5% interest in the Gibraltar mine over a period of 10 years, and now has an effective 100% interest in the mine. RATINGS RATIONALE Taseko is constrained by: 1) the company's concentration of cash flows from primarily one metal (copper) at a single mine (Gibraltar); 2) by the inherent price volatility of copper which periodically results in high leverage during trough market prices; 3) execution risk for its Florence project that includes the technical risks of in-situ mining, which has not been used for a large scale copper projects to date; and 4) Florence project capital spending that has partially been funded with debt that will be supported by Gibraltar cash flow until Florence is producing. The company benefits from: 1) mine locations in favorable mining jurisdictions (Canada and the US); and 2) long reserve life (21 years at Gibraltar, 21 years expected at Florence). The B3 ratings on the secured notes are the same level as the B3 CFR reflecting that the secured debt accounts for the preponderance of debt in Taseko's debt capital structure. Taseko's liquidity is good over the next year with about CAD495 million in sources compared to about CAD180 million of uses. Sources include US$219 million in cash at December 31, 2023 proforma the notes offering; about CAD79 million available on its US$80 million revolving credit facility (expires July 2026); US$40 million remaining to be drawn from an investment from Mitsui & Co. (USA), Inc. for Florence Copper in the form of a copper stream agreement and a US$50 million senior secured debt facility through Societe Generale. Uses include Moody's expectation that the company will have negative free cash flow of about CAD160 million through to the end of 2024 (using a $3.75/lb copper price sensitivity, after deducting capex and stripping costs). Taseko will also pay about CAD 20 million for the 12.5% Gibraltar mine interest acquisition. Taseko will have no debt maturities until 2030 following the closing of the proposed notes. The company's credit facility contains financial covenants that include senior secured debt to EBITDA and minimum interest coverage tests which Moody's expects the company to remain in compliance with. The stable outlook reflects Moody's expectation that Taseko will maintain copper equivalent production at about 115 million lbs/year at Gibraltar and that it will have sufficient liquidity to fund the development of Florence over the next two years. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATING The ratings could be downgraded if Taseko experiences operating challenges at Gibraltar, funding constraints for its Florence project, or if liquidity weakens. The ratings could be upgraded if the company is able to achieve increased mine diversity and improve its cost profile through the development of Florence. An upgrade would also require Taseko to generate sustained positive free cash flow, while maintaining adjusted debt/EBITDA below 4.0x. The principal methodology used in this rating was Mining published in October 2021. Headquartered in Vancouver, Canada, Taseko Mines Limited operates Gibraltar, an open-pit copper and molybdenum mine located in British Columbia (BC), Canada, producing about 120-130 million pounds/year. The company also plans to develop its Florence copper in situ development project (Arizona). TASEKO MINES: S&P Rates New US$500MM Senior Secured Notes 'B-' -------------------------------------------------------------- S&P Global Ratings assigned its 'B-' issue-level rating and '3' recovery rating to Taseko Mines Ltd.'s proposed US$500 million senior secured notes due 2030. The '3' recovery rating reflects its expectation for meaningful (50%-70%; rounded estimate 55%) recovery in the event of default. The recovery rating considers that the proposed notes will be junior in priority to the company's revolving credit facility. S&P said, "We assume the company will use note proceeds to redeem its US$400 million senior secured notes due 2026, with the balance (after fees and expenses) remaining on the balance sheet for the company's Florence copper project development spending and general corporate purposes. "Our 'B-' long-term issuer credit rating and stable rating outlook on Taseko are unchanged and primarily reflect our view of the company's single-mine operations, limited product diversity and the high sensitivity of the company's credit measures to base metals price volatility. "With the proposed note issuance and various forms of debt or debt-like financings put in place over the past year to fund development of the Florence project, we estimate the company's leverage will increase, as previously expected. We forecast adjusted debt to EBITDA will increase to the 4.5x-5.0x range this year and estimate cumulative free operating cash flow (FOCF) deficits of about C$200 million through 2025, stemming from capital expenditures tied to the Florence project. "In our view, the proposed debt proceeds will improve the Taseko's liquidity position and extend the company's debt maturity profile, providing Taseko sufficient funding and financial flexibility to finish construction of the project by the end of 2025. The company also recently purchased the remaining 12.5% interest in its Gibraltar mine from Dowa Metals & Mining Co. Ltd. and Furukawa Co. Ltd. Taseko now owns 100% of the mine, which should modestly increase its earnings and cash flow generation. "The Florence copper project in Arizona should notably increase Taseko's scale and cash flow generation. Once Florence reaches full production, we estimate the company's copper output will almost double to about 200 million pounds (from 2023's attributable production of close to 100 million pounds). This addition of a second operating asset with a relatively lower cost profile could strengthen Taseko's operating breadth and profitability. We estimate the average annual copper production at Florence will be 85 million pounds at a cash cost in the low-US$1.00 per pound of copper area over a 22-year mine life. As a result, Florence should enable the company to expand earnings and generate positive FOCF, leading to stronger cash flow and leverage measures in 2026. We estimate the company will generate positive FOCF in the low-C$100 million area and adjusted debt to EBITDA in low-2x area in 2026. That said, we believe the potential financial and execution risks associated with Florence's development limits ratings upside, at least in the near term." ISSUE RATINGS--RECOVERY ANALYSIS Key analytical factors -- S&P updated its recovery analysis on Taseko to reflect its proposed US$500 million senior secured note issuance. -- S&P assigned a 'B-' issue-level rating and '3' recovery rating to the notes. S&P's '3' recovery rating indicates its expectation for meaningful (50%-70%; rounded estimate: 55%) recovery in its simulated default scenario. -- S&P values the company as a going concern using a 5x multiple (which is consistent with mining peers) of its projected emergence EBITDA, which is linked to Taseko's estimated fixed charges in our simulated default year. -- S&P's default scenario assumes persistent weakness in copper prices and higher-than-expected costs associated with its Florence development, which exhausts the company's liquidity. -- S&P assumes all priority and first-lien secured claims--equipment loans, project level debt facilities, secured debt claim for vendor financing (associated with Dowa and Furukawa transaction), and revolver claims (assumed 85% drawn)--are fully satisfied and there would be value available to second-lien secured note holders. Simulated default assumptions -- Simulated year of default: 2026 -- EBITDA at emergence: About C$119 million -- EBITDA multiple: 5x -- Canada-U.S. exchange rate: C$1.34 Simplified waterfall -- Net enterprise value (after 5% administrative costs): About C$565 million -- Valuation split in % (obligors/non-obligors): 100/0 -- Priority and revolver claims: About C$180 million -- Total value available to second-lien secured noteholders: About C$385 million -- Senior second-lien secured notes claims: About C$700 million --Recovery expectations: 50%-70% (rounded estimate: 55%) All debt amounts include six months of prepetition interest. TEHUM CARE: Court Grill Creditors Over Terms of Proposed Settlement ------------------------------------------------------------------- Randi Love of Bloomberg Law reports that a bankruptcy judge had a slew of questions about prison healthcare provider Tehum Care Services Inc's proposed settlement to end personal injury liabilities as he weighs how to let its bankruptcy proceed. Tehum's Chapter 11 trial garnered widespread attention as it attempts to use a controversial bankruptcy maneuver known as the Texas Two-Step to resolve hundreds of personal injury suits from often incarcerated creditors. Advocacy groups, members of Congress, the company's tort claimants' committee, and even the Justice Department's bankruptcy watchdog urged Judge Christopher Lopez to dismiss the case. About Tehum Care Services Tehum Care Services Inc., doing business as Corizon Health Services Inc., is a privately held prison healthcare contractor in the United States. It is based in Brentwood, Tenn. Tehum Care Services filed a petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Tex. Case No. 23-90086) on Feb. 13, 2023. In the petition filed by Russell A. Perry, as chief restructuring officer, the Debtor reported assets between $1 million and $10 million and liabilities between $10 million and $50 million. Judge Christopher M. Lopez oversees the case. The Debtor tapped Gray Reed & McGraw, LLP as bankruptcy counsel; Bradley Arant Boult Cummings, LLP, as special litigation counsel; and Ankura Consulting Group, LLC, as financial advisor. Russell A. Perry, senior managing director at Ankura, serves as the Debtor's chief restructuring officer. Kurtzman Carson Consultants, LLC, is the claims, noticing and solicitation agent. The U.S. Trustee for Region 7 appointed an official committee to represent unsecured creditors in the Debtor's Chapter 11 case. Stinson, LLP and Dundon Advisers, LLC, serve as the committee's legal counsel and financial advisor, respectively. TENNANT CO: S&P Withdraws 'BB' Issuer Credit Rating, Outlook Stable ------------------------------------------------------------------- S&P Global Ratings withdrew its 'BB' issuer credit rating on Tennant Co. at the issuer's request. The outlook was stable at the time of the withdrawal. THREE SISTERS: Glen Watson Named Subchapter V Trustee ----------------------------------------------------- The Acting U.S. Trustee for Region 8 appointed Glen Watson, Esq., at Watson Law Group, PLLC as Subchapter V trustee for Three Sisters Transport, LLC. Mr. Watson will be paid an hourly fee of $425 for his services as Subchapter V trustee and will be reimbursed for work-related expenses incurred. Mr. Watson declared that he is a disinterested person according to Section 101(14) of the Bankruptcy Code. The Subchapter V trustee can be reached at: Glen Watson, Esq., Watson Law Group, PLLC 1114 17th Av. S., Suite 201 P.O. Box 121950 Nashville, TN 37212 Phone: (615) 823-4680 Email: glen@watsonpllc.com About Three Sisters Transport Three Sisters Transport, LLC has been operating in the truck business since 2010, hauling freight throughout the United States and Canada. It is based in Woodlawn, Tenn. Three Sisters Transport filed a petition under Chapter 11, Subchapter V of the Bankruptcy Code (Bankr. M.D. Tenn. Case No. 24-01133) on April 2, 2024, with $1 million to $10 million in both assets and liabilities. Mihail Vasilev, authorized representative of the Debtor, signed the petition. Judge Charles M. Walker presides over the case. Marc Buchman, Esq., at Manier & Herod, PC represents the Debtor as legal counsel. TRANSMONTAIGNE PARTNERS: Fitch Affirms 'B' IDR, Outlook Stable -------------------------------------------------------------- Fitch Ratings has affirmed TransMontaigne Partners LLC's (Partners) and TransMontaigne Operating Company L.P.'s (Opco) Long-Term Issuer Default Ratings (IDR) at 'B'. The Rating Outlook for both entities is Stable. In addition, Fitch has affirmed the ratings of Opco's senior secured term loan B, including the proposed fungible incremental term loan B, and revolving credit facility (RCF) at 'BB-'/'RR2', and Partners' senior unsecured notes at 'CCC+'/'RR6'. TransMontaigne will use the proceeds from the incremental term loan B to repay the existing drawings on the RCF, and increase the cash balance. Fitch has reviewed preliminary terms for the proposed term loan. The ratings assume no material variations in the final terms, including but not limited to any upsize in issued amount. The ratings reflect relatively elevated leverage at Partners, where EBITDA leverage was 7.3x as of YE 2023. Fitch also expects leverage to increase above 7.5x through YE 2025 before declining below 7.5x by YE 2026, as full-year operations from growth projects are realized in 2026. Concerns over high leverage are weighed against the company's largely fixed-fee contracted business, utilization rates in the low 90% range, and a diversified geographic footprint and customer base. KEY RATING DRIVERS Transaction Improves Flexibility with Some Strings: The proposed transaction increases the Partners' ability to invest in several renewables focused growth projects in the West Coast region post repayment of the RCF borrowings. Fitch expects Partners' leverage will increase over 7.5x through the next two years as debt at Opco increases to fund growth capex. Increased RCF availability allows for increased distributions to parent TLP Finance Holdings, LLC (Holdings) ahead of the upcoming senior secured term loan B maturity date that has been extended to November 2025 from February 2025 in conjunction with this transaction. To the extent the refinancing of the Holdings term loan is completed at Opco, there will be further pressure on Partners' leverage profile. Increasing EBITDA and Leverage Impacts: Partners' EBITDA was slightly stronger than Fitch's prior forecast in 2023, driven by utilization rates rising to approximately 92%. Stronger than expected EBITDA was the primary driver of lower EBITDA leverage of 7.3x at YE 2023 compared to Fitch's prior forecast of 7.5x. Utilization is up from approximately 90% in 2022 but still slightly depressed from historical average tank utilization around 94%. During 2023, utilization rates benefited from the recontracting of open capacity at Collins Mississippi in the Southeast Terminals region, albeit at historically low rates. Fitch forecasts Partners' EBITDA leverage to rise above 7.5x in 2024 and 2025 before declining back to the low 7x range by YE 2026. Notably, Partners is benefiting from high contract rates and the increased need for renewables infrastructure on the West Coast. Future growth initiatives are expected to be made towards renewables projects, which are expected to drive full-year incremental EBITDA growth contributions in 2026 and bring leverage back below 7.5x. TransMontaigne has a successful track record of completing renewables fuels focused projects over the past two years resulting in approximately $15 million of incremental EBITDA. Trend of Increasing Debt at Partners vs. Holdings: Including the term loan B at Holdings, consolidated leverage is forecast to decline closer to the low-8x in 2024, down from approximately 8.7x at YE 2023. Distributions to Holdings from Partners are used to pay down the term loan resulting in an overall lower consolidated interest expense for the company. In 1Q24, $25 million was borrowed on the on the senior secured revolver at Opco to make a distribution to Holdings for debt service payment. This payment is incremental to the regular dividends paid by Partners to service interest expense and amortization. Utilizing Opco RCF borrowings to repay a portion of the of the Holdings term loan affords a lower interest expense on a consolidated basis due to the lower borrowing cost at Opco compared to Holdings. While neutral to debt on a consolidated basis, this payment increases debt at Partners. Diversified Geographic Footprint with Predictable Cash Flows: Approximately 80% Partner's terminaling revenues were underpinned by firm commitment contracts as of YE 2023. These contracts are similar in nature to take-or-pay contracts providing stable and predictable cash flows. Partners weighted average contract life is approximately 2.18 years. While this is relatively short for an average midstream company contract, Fitch views positively that over half of the contracts expiring in one year or less have a history of renewing since the contract inception. In addition to strong contracts, Partners benefits from having a diversified asset footprint with 55 terminals across 20 states. Partners has also proved to have a good mix of counterparties with limited customer concentration with over 50 unique counterparties. Rating Linkages: There is a parent-subsidiary relationship between Holdings and Partners. Fitch considers Partners to have stronger standalone credit profile (SCP) than Holdings, both of which are considered on the respective consolidated credit metrics. Fitch believes Holdings' SCP is in line with a 'b-'. As such, Fitch follows the stronger subsidiary/weaker parent path. Legal-ring fencing is assessed as open demonstrated by the ability to move cash between the entities. Access & control is assessed as porous considering the combination of 100% ownership, common management, and Fitch's assessment that Partners will separately manage its cash and funding needs over the long term. Due to the aforementioned linkage considerations, Fitch will limit the difference between Holdings and Partners to one notch. Fitch also assess a parent-subsidiary relationship between Partners and Opco. Fitch considers Opco to have a stronger SCP than Partners as Opco is closer to the operating assets. As such, Fitch follows the stronger subsidiary/weaker parent path. Legal ring-fencing is assessed as open stemming from the existence of cross-guarantees between the entities. Access & control is assessed as open considering the 100% ownership and common management/board of directors, and free cash movement between the entities. Due to the aforementioned linkage considerations, Fitch views Partners and Opco on a consolidated basis. DERIVATION SUMMARY Following the proposed incremental term loan B at Opco and Fitch's forecast for increased growth capex, Partners' EBITDA leverage is now forecast to peak around 7.7x in 2025 before declining below Fitch's 7.5x negative sensitivity in 2026. The company operates diversified petroleum liquids storage assets with approximately 42.5 million barrels of total capacity across about 20 U.S. states, including assets that distribute product to northern Mexico. In terms of size, Partners is not expected to generate more than $300 million of EBITDA over the forecast period, an important threshold between the 'B' and 'BB' rating categories. Despite the higher leverage, Partners' credit profile is in line with the 'B' rating category. Buckeye Partners LP, rated 'BB' on Rating Watch Negative (RWN), is significantly larger than Partners in terms of both size/scale and diversity of operations. Buckeye is a large liquid petroleum products pipeline operator with more than 117 liquid petroleum products terminals and aggregate tank capacity of over 125 million barrels. Buckeye also has a presence in the Caribbean. Similar to Partners, Buckeye is owned by a private equity sponsor with elevated leverage. The RWN at Buckeye is driven by leverage continuing to range above Fitch's negative sensitivity of 6x unless several credit events occur to bring down Fitch's leverage forecast below 6x by YE 2024. These factors justify the three-notch difference between the IDRs of Partners and Buckeye. Kodiak Gas Services is a 'BB' company offering natural gas compression services. The company has a diversified geographic footprint with some asset concentration in the Permian Basin. Like Partners', Kodiak generates stable cash flows supported by fixed-fee take-or-pay-type contracts. Also similar to Partners, the company's remaining weighted average contract life is relatively shorter compared to higher rated midstream issuers, but is supported by long-standing customer relationships. Leverage is the biggest differentiator between Kodiak and Partners. Pro-forma the recent acquisition, Fitch expects Kodiak's leverage to decline slightly over the forecast from approximately 4.4x in 2024. The significantly lower leverage justifies the three-notch rating differential between the IDRs of the Partners and Kodiak. KEY ASSUMPTIONS - Oil and refined product production consistent with the Fitch price deck for West Texas Intermediate (WTI) of $75/bbl in 2024, $65/bbl in 2025, and $60/bbl in 2026 and 2027; - Base interest rate applicable to the revolver and term loan at Opco and term loan at Holdings reflects the Fitch Global Economic Outlook, e.g., 4.75% for 2024 and 3.5% for 2025; - Growth capex projects with fully contracted customer commitments are completed and placed into service through 2025. Future capex expected to average approximately $55 million-$65 million over the forecast period. Benefits from not currently contracted growth capex are not expected to meaningfully contribute to EBITDA; - Re-commissioned Diamondback pipeline not expected to resume service near-term; - Contracts of one year in duration or less continue to be renewed at market rates though the forecast period; - Holdings does not make other investments outside of its current equity interest in Partners; - The recovery analysis assumes that Partners and Opco would be reorganized as a going-concern rather than liquidated. Fitch has assumed a 10% administrative claim (standard). The going-concern EBITDA of approximately $165 million represents a mid-cycle estimate of sustainable EBITDA for the partnership considering a full year run rate post-bankruptcy emergence and reflecting a repricing of its contracts and loss of some customers. Fitch used a 6x EBITDA multiple to arrive at the going-concern enterprise value. The multiple is in line with recent reorganization multiples in the energy sector. - Fitch used a 6x multiple to arrive at going-concern enterprise value. The multiple is in line with recent reorganization multiples in the energy sector. There have been a limited number of bankruptcies and reorganizations within the midstream space but in the limited sample such as bankruptcies of Azure Midstream and Southcross Holdco, the reorganization multiples were between 5x and 7x by Fitch's best estimates. In Fitch's recent bankruptcy case study report "Energy, Power and Commodities Bankruptcies Enterprise Value and Creditor Recoveries," published in September 2023, the median enterprise valuation exit multiplies for 51 energy cases for which this was available was 5.3x, with a wide range of multiples observed. RATING SENSITIVITIES Factors that could, individually or collectively, lead to positive rating action/upgrade: - A positive rating action could occur if leverage at Partners, defined as total debt at Partners and Opco divided by total Partners EBITDA, is expected to be sustained below 6.5x, while consolidated leverage, defined as the ratio of Holdings consolidated debt to Holdings consolidated EBITDA Leverage is expected to be sustained below approximately 7.5x, given that Fitch is unlikely to rate Partners more than one notch above the consolidated credit profile. Factors that could, individually or collectively, lead to negative rating action/downgrade: - Partners EBTIDA leverage greater than 7.5x for a sustained period of time or consolidated EBITDA leverage, expected to be sustained above 8.5x, given that Fitch is unlikely to rate Partners more than two notches above the consolidated credit profile; - Lack of proactive refinancing at least one year from maturity; - A significant reduction in the percent of revenue from take-or-pay contract terms, or the adoption of a strategy to sign new contracts that are two years or less; - Partners EBITDA interest coverage sustained below 1.8x; - Upsizing of the proposed $150 million incremental term loan B will likely lead to a downgrade of the instrument ratings of both the Opco RCF and term loan B due to Fitch's bespoke recovery analysis; - Impairments to liquidity. LIQUIDITY AND DEBT STRUCTURE Transaction Improves Liquidity: As Dec. 31,2023, Partners had limited liquidity of approximately $68.8 million. Opco's $150 million senior secured RCF had approximately $61.2 million of availability after the $88.4 million of borrowings and $0.4 million in LOCs and about $7.6 million cash on the balance sheet. This liquidity was further reduced during 1Q24 as an additional draw of $25 million on the RCF, which was used for a distribution to parent TLP Finance Holdings, LLC (Holdings) for debt service. Fitch expects that upon closing of the incremental term loan B, proceeds will be used to fully repay the outstanding balance on Opco's RCF. As of Dec. 31, 2023, Partners was in compliance with all financial covenants per the credit agreement including but not limited to a debt service coverage ratio (DSCR) of greater than or equal to 1.1x, and a senior secured net leverage ratio less than or equal to 6.75x. Fitch expects Partners to be in compliance with its covenants over the forecast period. Upcoming Maturities: As part of the proposed transaction, the maturity of the term loan at Holdings has been extended to November 2025 from February 2025. Additionally, the Opco RCF will become due in the event Partners' senior unsecured notes are not refinanced prior to November 2025. The senior unsecured notes at Partners has a maturity date of February 2026. ISSUER PROFILE TransMontaigne owns and operates diversified petroleum liquids products storage, terminaling, and transportation assets across several regions of the United States. TransMontaigne is wholly owned by ArcLight Energy Partners Fund VI, L.P. SUMMARY OF FINANCIAL ADJUSTMENTS Fitch typically calculates EBITDA by removing equity earnings from unconsolidated affiliates and adding back the distributions from unconsolidated affiliates. Fitch measures leverage in a variety of ways for monitoring purposes. This press release features two of them, which are Partners Consolidated Leverage and Holdings Consolidated Leverage. ESG CONSIDERATIONS The highest level of ESG credit relevance is a score of '3', unless otherwise disclosed in this section. A score of '3' 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. Fitch's ESG Relevance Scores are not inputs in the rating process; they are an observation on the relevance and materiality of ESG factors in the rating decision. Entity/Debt Rating Recovery Prior ----------- ------ -------- ----- TransMontaigne Operating Company L.P. LT IDR B Affirmed B senior secured LT BB- Affirmed RR2 BB- TransMontaigne Partners LLC LT IDR B Affirmed B senior unsecured LT CCC+ Affirmed RR6 CCC+ TRANSMONTAIGNE PARTNERS: S&P Affirms 'B' ICR, Outlook Negative -------------------------------------------------------------- S&P Global Ratings affirmed its 'B' issuer credit rating on TransMontaigne Partners LLC (TLP). S&P also affirmed the 'B+' issue-level ratings on the senior secured term loan and 'CCC+' issue-level ratings on the unsecured notes. The '2' and '6' recovery ratings are unchanged. The negative outlook reflects S&P's expectation that it could lower its rating on TransMontaigne Partners if the company does not have sufficient liquidity or funding sources to meet its upcoming debt maturities within the consolidated entity in the coming quarters. S&P said, "The negative outlook reflects our view that despite the maturity extension, we believe refinancing risk at the consolidated entity has increased given the upcoming debt maturities at the holding company level. TransMontaigne plans to issue an incremental $150 million senior secured term loan, the proceeds of which it will use to repay the outstanding borrowings on the RCF. The available capacity will be used to fund future growth projects. At the same time, the company will extend the maturity on the HoldCo loan to November 2025 from February 2025 so that the loan is no longer current. This is the first action the company has taken to address its capital structure, and we expect the company to refinance the entire capital structure prior to any existing debt maturity dates. However, the maturity extension on the HoldCo debt alone does not mitigate the refinancing risk that persists at the consolidated entities. We also note that the RCF, which currently has a maturity date of Nov. 17, 2026, will spring to Nov. 15, 2025, if the $300 million February 2026 senior notes are not refinanced prior to this date. "We consider the organizational structure to be relatively complex given the multiple layers of debt at various entities in the corporate hierarchy. We consider consolidated leverage in our analysis of TLP, as its parent company--TLP Finance Holdings LLC--relies on distributions from TLP to service its debt. The operating subsidiaries hold the assets that generate the cash flows to service the debt at the holding-company level. Therefore, the credit quality of operating subsidiaries is constrained by that of the holding company. There are no additional assets at the parent entity, but there is approximately $230 million of debt as of March 31, 2024, that will mature in November 2025. There is also approximately $300 million of senior notes at TLP and about $1.13 billion in term loan borrowings at operating subsidiary Transmontaigne Operating Co. L.P. (TM OpCo). Each debt instrument has a different maturity date, and we do not believe the company currently has sufficient liquidity and funding sources to repay its upcoming maturities without a refinancing transaction. Therefore, if the company does not address its near-term maturities prior to them becoming current, we could lower our rating. "We now expect S&P Global Ratings'-adjusted EBITDA will be about $200 million-$210 million in 2024. Previously, we expected $205 million-$215 million. Forecasted EBITDA reflects our assumption of modest revenue growth across most segments--in particular, the West Coast--as demand for storage remains robust in the region. This is offset by underperformance from certain assets, including the terminal in Collins, Miss. In addition, the company's customers face regulatory challenges in utilizing the Diamondback pipeline at Brownsville into Mexico. We also expect TransMontaigne to benefit from additional incremental cash flows as growth projects, particularly focused on the West Coast region, come online over the next several years. We expect executed projects, which are a combination of legacy and renewable fuels, to generate an approximate incremental $20 million in EBITDA per year starting in 2025 once they come online. We expect the additional growth projects will help the company gradually deleverage and improve its free operating cash flow. As a result, we expect consolidated S&P Global Ratings'-adjusted debt to EBITDA of 8.0x-8.5x in 2024, improving to 7.5x-8.0x in 2025. "The negative outlook reflects our expectation that we could lower our rating on TransMontaigne Partners if the company does not have sufficient liquidity and funding sources to meet its upcoming debt maturities within the consolidated entity. We expect EBITDA in the $200 million-$210 million range in 2024 and $210 million-$220 million in 2025, with support from stable utilization rates and future growth projects coming online. This will result in consolidated S&P Global Rating'-adjusted debt to EBITDA of about 8x in 2024 and 7.5x-8.0x in 2025. "We could lower our rating on TransMontaigne Partners by the end of 2024 if the capital structure within the consolidated entity becomes current. "We could revise our outlook to stable if the company is able to adequately address debt maturities at the consolidated entity in a timely manner, thereby improving its liquidity position." TREVENA INC: Ernst & Young Raises Going Concern Doubt ----------------------------------------------------- Trevena, Inc. disclosed in a Form 10-K Report filed with the U.S. Securities and Exchange Commission for the fiscal year ended December 31, 2023, that its auditor expressed that there is substantial doubt about the Company's ability to continue as a going concern. Philadelphia, Pennsylvania-based Ernst & Young LLP, the Company's auditor since 2007, issued a "going concern" qualification in its report dated April 1, 2024, citing that the Company has suffered recurring losses from operations and has stated that substantial doubt exists about the Company's ability to continue as a going concern. At December 31, 2023, the Company had an accumulated deficit of $588.1 million, working capital of $27.7 million, cash and cash equivalents of $33.0 million and restricted cash of $0.5 million. In November 2020, the Company filed a $250.0 million shelf registration statement, which includes our at-the-market program with H.C Wainwright & Co., LLC., of which there was approximately $33.7 million of available capacity as of December 31, 2023. "Our primary use of cash is to fund operating expenses, which consist of research and development expenditures, commercialization expenditures, and other selling, general and administrative expenditures. We anticipate these expenses to decrease in 2024 as we reduce commercial support of OLINVYK, while we continue to make OLINVYK available for purchase by customers and continue to advance our other product candidates. Cash used to fund operating expenses is impacted by the timing of when we pay these expenses, as reflected in the change in accounts payable and accrued expenses. Net cash used in operating activities was $33.0 million and $51.5 million for the years ended December 31, 2023 and 2022, respectively. We incurred net losses of $40.3 million and $53.7 million for those same periods," the Company said. "Our success is dependent on finding a commercial partner for OLINVYK and obtaining adequate capital to fund operating losses until we become profitable. We expect that our existing balance of cash and cash equivalents as of December 31, 2023 is not sufficient to fund operations for one year after the date of this filing and therefore management has concluded that substantial doubt exists about our ability to continue as a going concern," the Company said. Management's plans to mitigate this risk include raising additional capital through equity or debt financings, or through strategic transactions. Management's plans also include the deferral of certain operating expenses unless and until additional capital is received. However, there can be no assurance that the Company will be successful in raising additional capital or that such capital, if available, will be on terms that are acceptable to the Company, or that the Company will be successful in deferring certain operating expenses. As a result, management concluded that such plans do not alleviate the substantial doubt. If the Company is unable to raise sufficient additional capital or defer sufficient operating expenses, the Company may be compelled to reduce the scope of its operations and planned capital expenditures. As of December 31, 2023, the Company had $40.6 million in total assets, $48.3 million in total liabilities, and $7.7 million in total stockholders' deficit. A full-text copy of the Company's Form 10-K is available at https://tinyurl.com/5n92w5ta About Trevena Inc. Chesterbrook, PA-based Trevena, Inc., or the Company, is a biopharmaceutical company focused on the development and commercialization of novel medicines for patients affected by central nervous system, or CNS, disorders. TRILOGY METALS: Raises Going Concern Doubt ------------------------------------------ Trilogy Metals Inc. disclosed in a Form 10-Q Report filed with the U.S. Securities and Exchange Commission for the quarterly period ended February 29, 2024, that substantial doubt exists about its ability to continue as a going concern. According to the Company, as at February 29, 2024, the Company had working capital of $1.7 million (2023 - $2.4 million) and an accumulated deficit of $85.4 million (2023 - $81.8 million). The Company recorded a loss of $3.6 million for the three-month period ended February 29, 2024, compared to a net loss of $5.1 million for the three-month period ended February 28, 2023, and cash outflow from operations of $0.6 million for the quarter ended February 29, 2024. The continued operations of the Company are dependent on its ability to obtain additional financing or to generate future cash flows. The Company has no recurring source of operating cash inflows at its current stage. The Company intends to finance its future requirements through a combination of debt and equity issuance. There is no assurance that the Company will be able to obtain such financings or obtain them on favorable terms. These material uncertainties raise substantial doubt about the Company's ability to continue as a going concern. As of February 29, 2024, the Company had $136.6 million in total assets, $464,000 in total liabilities, and $136.1 million in total shareholders' equity. A full-text copy of the Company's Form 10-Q is available at https://tinyurl.com/mr3dp32j About Trilogy Metals Trilogy Metals Inc. is a metal exploration and development company holding a 50 percent interest in Ambler Metals LLC, which has a 100 percent interest in the Upper Kobuk Mineral Projects in northwestern Alaska. TROIKA MEDIA: Posts $3.2 Million Profit in February --------------------------------------------------- Former TRKA Media Group, Inc. (f/k/a Troika Media Group, Inc.) filed with the U.S. Securities and Exchange Commission its monthly operating report for February. The Debtor's statement of operations reflected a profit of $3.2 million for the current reporting period. As of February 29, 2024, the Debtor listed $79.6 million in total assets, $102.18 million in total liabilities, and -$22.5 million in total shareholders' equity. The Debtor started the month with -$1.19 million cash. It listed total receipts of $7.82 million and total disbursements of $1.66 million. At month end, the Debtor had $4.97 million cash. A copy of the monthly operating report is available at the SEC at: https://tinyurl.com/3w3jjwdu About Troika Media Group Troika Media Group, Inc., a New York-based company, and its affiliates operate a media advertising professional services company. Troika Media Group's core asset is the business segment run by Converge Direct, LLC, which Troika Media Group acquired in March 2022 for $125 million. Converge is a data-and-audience-centric media buying agency. It differentiates itself from the typical agency model in favor of deeper engagement with its clients and investing in its own lead generating activities. Converge provides complementary services such as advertising strategy and customized advertising campaigns, utilizing its proprietary attribution analytics software tool, Helix. Troika Media Group and its affiliates filed Chapter 11 petitions (Bankr. S.D.N.Y. Lead Case No. 23-11969) on Dec. 7, 2023. As of Oct. 31, 2023, Troika Media Group had total assets of $86.5 million and total debts of $130.7 million. Judge David S. Jones oversees the cases. The Debtors tapped Willkie Farr & Gallagher, LLP as legal counsel; Jefferies, LLC as investment banker; and Arete Capital Partners, LLC as financial advisor. Kroll Restructuring Administration, LLC is the notice, claims, solicitation and balloting agent and administrative advisor. The U.S. Trustee for Region 2 appointed an official committee to represent unsecured creditors in the Debtors' Chapter 11 cases. The committee is represented by McDermott Will & Emery, LLP. King & Spalding represents the lenders and the agents under the Debtors' prepetition secured credit facility and the lenders and the agents under the Debtors' debtor-in-possession financing facility. TWO RIVERS: Unsecured Creditors to Recover 100% Under Plan ---------------------------------------------------------- Two Rivers Corporate Centre Limited Partnership submitted a Combined Disclosure Statement and Chapter 11 Plan of Reorganization. The Debtor is Two Rivers Corporate Centre Limited Partnership ("TRCC" or the "Debtor"). TRCC was formed in 2001 and is the owner of the Office Park, a 3-building 283,789 SF single story office park situated on one parcel of 33 acres located at 2501 McGavock Pike, Nashville, Tennessee. The land is zoned CA (Commercial Attraction) which also allows for high density residential and industrial development by right in addition to office space and retail uses. TRCC filed the Chapter 11 case on February 7, 2024 to protect the substantial equity in the Office Park and to maximize the return to all creditors, including Wells Fargo. According to the Debtor's financial projections, the Office Park will generate income from rents during the 24-month Plan period to make substantial interest payments until a sale that fully pays Wells Fargo and all other Claims. Specifically, the Plan provides for $1.2 million in interest payments to Wells Fargo over the 24-month life of the Plan. Any accrued and unpaid interest due to Wells Fargo will be paid in full upon closing of a sale. The Debtor has engaged the Nashville office of CBRE, Inc. to market and sell the Office Park over a period not to exceed 24 months after the Effective Date. A copy of the Exclusive Listing Agreement between TRCC and CBRE (the "CBRE Listing Agreement"). The CBRE Listing Agreement is being assumed in connection with this Combined Disclosure Statement and Plan. The Debtor anticipates selling the three occupied buildings first at a sales price sufficient to pay Wells Fargo in full. Following the residential subdivision discussed above, the remainder of the Office Park will be sold. Under the Plan, Class 4 consists of General Unsecured claims and will recover 100% of their claims. Each Holder of an Allowed Class 4 Claim shall be paid its Allowed Claim in full without interest no later than 30 days after the Confirmation Date. Class 4 is impaired. The Debtor shall use proceeds from operations and the sale of the Office Park to make all required payments on the Effective Date and all payments due under the Plan on an on-going basis. The Debtor, as landlord, is and will be obligated to make certain tenant improvements pursuant to existing and future leases with tenants. After Confirmation, the Debtor shall be authorized but not obligated to borrow up to $4,688,990 for such purposes on terms reasonably acceptable to the Debtor secured by a first-priority priming lien on the Office Park. Counsel to the Debtor: Robert J. Gonzales, Esq. Nancy B. King, Esq. EMERGELAW, PLC 4235 Hillsboro Pike, Suite 300 Nashville, TN 37215 Tel: (615) 815-1535 E-mail: robert@emerge.law nancy@emerge.law A copy of the Combined Disclosure Statement and Chapter 11 Plan of Reorganization dated March 27, 2024, is available at https://tinyurl.ph/WWTHj from PacerMonitor.com. About Two Rivers Corporate Centre Two Rivers Corporate Centre was formed in 2001 and is the owner of a 3-building, 283,789 square foot single story office park situated on one parcel of 33 acres located at 2501 McGavock Pike, Nashville, Tennessee. The land is zoned CA (Commercial Attraction) which also allows for high density residential and industrial development by right in addition to office space and retail uses. The property has a number of Tenants that are government agencies with long-term leases in place as well as government contractors that serve governmental agencies. The Debtor sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. M.D. Tenn. Case No. 3:24-bk-00399) on Feb. 7, 2024. In the petition signed by Floyd Shechter, chief manger of GP, RS Development of Nashville, LLC, the Debtor disclosed up to $50 million in both assets and liabilities. Robert J. Gonzales, Esq., at EmergeLaw, PLC, is the Debtor's legal counsel. VENTURE INC: Debtor Will Liquidate in Order to Pay Claims --------------------------------------------------------- Venture, Inc., et al., filed a a Disclosure Statement. The Debtors own 7 Save-A-Lot foods stores in Mississippi, 6 of which are still operating (collectively, the "Stores") and are parties to the License & Supply Agreements with Moran Foods, LLC d/b/a Save-A-Lot, LTD ("SAL"). The Debtors commenced Chapter 11 cases following a series of defaults under the listed License Agreements and Supply Agreements, and in order to avoid loss of their business licenses following alleged failure to pay certain franchise taxes, as well as to sell their assets under relevant provisions of the Bankruptcy Code. Under the Plan, Class 8 consists of General Unsecured Claims. Debtors believe that the aggregate amount of Allowed unsecured claims after duplicate Claims are disallowed will be approximately $1.5 Million. Each holder of a General Unsecured Claim will receive a pro rata share of the Unsecured Creditor Distribution, provided such Distribution is included in the SAL Stalking Horse Offer and the Offer is received, or such greater sum as is provided in an alternative Offer for Debtors' assets accepted as the Winning Bid. Class 8 is impaired. Debtors' assets will be sold pursuant to the procedures set forth in the Competing Bid Procedures Order (not yet entered) which contemplate: Debtors' receipt of a Stalking Horse Offer from SAL (in the form of an executed Asset Purchase Agreement, with closing contingent on approval of the Bankruptcy Court as evidenced in the Confirmation Order and any additional orders the parties may seek and the Court enter); solicitation of competing bids from potential purchasers identified by SAL and any other interested party, including pursuant to a Bankruptcy Court approved Notice of Solicitation of Competing Bids; Stephen Smith and HRK's establishment of a due diligence room available to potential interested purchasers; qualification of potential purchasers as: (i) Eligible Competing Bidders based on ability to close; and (ii) as assignees of Debtors rights to use the Save-A-Lot name and purchase inventory from SAL pursuant to the License & Supply Agreements (to the extent the Bidder seeks such an assignment) ; submission of competing bids to Stephen Smith and HRK, and if any Competing Bids are higher and better offers than the SAL Stalking Horse Offer, then an auction sale among SAL and all Eligible Competing Bidders . Debtors anticipate, subject to the Bankruptcy Court's ruling on, and anticipated approval of the Competing Bid Procedures, as modified as necessary, that the sale of assets would occur no later than June 15, 2024 if there are no Eligible Competing Bidders; or August 16, 2024 if there are Eligible Competing Bidders. Deadlines and hearing dates with respect to the Debtors' sale of assets will be set forth in the final/entered version of the Competing Bid Procedures Order (and may be different than the proposed deadlines and hearing dates set forth in the Competing Bid Procedures filed with the Competing Bid Procedures Motion). Debtors anticipate the SAL Stalking Horse Offer will contain a purchase price sufficient to: pay in full all Allowed Priority Claims (the aggregate amount of which is $227,650 pursuant to Proofs of Claims timely filed as of March 20, 2024, but exclusive of claims for income taxes, if any, for years as to which returns have not been filed) ; all Allowed Secured Claims (the aggregate amount of which is $ 11,274,500 pursuant to Proofs of Claims timely filed as of March 20, 2024, and to fund a Wind Down Reserve in an amount yet to be determined. The sale of Debtors' assets will be free and clear of all liens claims and encumbrances as provided in section 363(f) of the Bankruptcy Code and permitted under sections 1123(b)(2) & (4), with all such liens, claims and encumbrances to attach to the proceeds of sale. On or before May 15th, Stephen Smith shall file with the Bankruptcy Court a proposed amount for the Wind Down Reserve. Any objections to the Wind Down Reserve shall be heard at the Confirmation Hearing. From and after the Effective Date, Stephen Smith and HRK will continue to perform applicable duties under the HRK Employment Order, including filing of reports with the United States Trustee (UST) 's Office and payment of any fees due the UST.. Stephen Smith and HRK shall be compensated after the Effective Date at the same rate and on the same basis as before the Effective Date. All post-closing date compensation for Stephen Smith and HRK and his professionals shall be paid from the Wind Down Reserve. Upon the completion of Stephen Smith and HRK's duties, debtors shall be authorized to file motions for final decrees in each of the Chapter 11 Cases. Since the Plan calls for the liquidation of the Debtors' assets, the Bankruptcy Court need not make a finding of feasibility under s 1129(a)(11). Counsel for Debtors: J. Talbot Sant, Jr., Esq. Steven N. Beck, Esq. BECK & SANT, LLC 640 Cepi Drive, Suite A Chesterfield, MO 63005 Tel: (636) 240-3632 E-mail: tal@beckandsantlaw.com steve@beckandsantlaw.com A copy of the Disclosure Statement dated March 22, 2024, is available at https://tinyurl.ph/GcvaG from PacerMonitor.com. About Venture Inc. Venture Inc. and its affiliates filed their voluntary petitions for relief under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Miss. Lead Case No. 23-02186) on Sept. 22, 2023. In the petitions signed by Daniel K. Myers, president, Venture Inc. disclosed up to $1 million in estimated assets and up to $10 million in total liabilities. Judge Jamie A. Wilson oversees the case. The Debtors tapped Newman & Newman and the Law Offices of Craig M. Geno, PLLC as counsel and Harper Rains Knight & Company, PA as financial advisor. VIEW INC: Unsecured Creditors Unimpaired in Prepackaged Plan ------------------------------------------------------------ View, Inc. and its Debtor Affiliates filed with the U.S. Bankruptcy Court for the District of Delaware a Disclosure Statement for the Joint Prepackaged Plan of Reorganization dated April 2, 2024. The Company is a leading provider of smart building technologies, transforming buildings to improve human health and experience, reduce energy consumption, and generate additional revenue for building owners. View has faced certain systematic and unique challenges that have made its balance sheet unsustainable. Although the Debtors are confident in the Company's ability to grow revenue and improve profitability and cash flows, the culmination of negative headwinds and the Debtors' existing debt structure have made it clear that a restructuring transaction that allows for a substantial deleveraging of their debt structure was imminently necessary. The transactions contemplated in the Prepackaged Plan are the culmination of an intensive strategic review process dating back to April 2023. As a result of this process, the Debtors have negotiated a value maximizing balance-sheet restructuring memorialized in the Prepackaged Plan, which, as of the date of this Disclosure Statement, has the overwhelming support of the Company's stakeholders. As evidenced by the restructuring support agreement (the "Restructuring Support Agreement"), approximately 90.3% in principal of the Prepetition Convertible Notes Claims, 100% in principal of the Prepetition Term Loan Claims, and approximately 8% of the holders of Existing Equity Interests have signed on to the Restructuring Support Agreement. The Prepackaged Plan provides for a comprehensive restructuring of the Debtors' prepetition obligations, resulting in a significant deleveraging of the Debtors' capital structure. In particular, the Prepackaged Plan provides for: * $17.5 million DIP Financing provided by the lenders under the Prepetition Term Loan that will be rolled into the New Exit Facility at closing of the Prepackaged Plan; * In addition to the rolled DIP Claims, an additional $32.5 million of new money to be funded pursuant to the New Exit Facility; * Equitization of over $274 million of Prepetition Term Loans and Prepetition Convertible Notes Claims into 64.2% of the equity of New TopCo (which may be either Reorganized Parent or a new entity holding 100% of the equity interest of Reorganized Parent); * Issuance of 35.8% of New Common Interests to the Exit Lenders that provide the Tranche C Commitment, as more fully described in the Restructuring Support Agreement and the New Exit Facility Term Sheet; * Payment in full in the ordinary course of the Company's ongoing business of all General Unsecured Creditors, including employee and trade claims; and * Prompt emergence from chapter 11. On the Effective Date, (i) New TopCo shall issue the New Common Interests to fund distributions to certain Holders of Allowed Claims and Interests in accordance with Article III of the Prepackaged Plan; (ii) New TopCo shall enter into the New LLC Agreement; and (iii) the Reorganized Debtors shall enter into the New Exit Facility. The Debtors or the Reorganized Debtors, as applicable, shall fund distributions under the Prepackaged Plan with (i) the Debtors' Cash on hand, (ii) Cash generated from operations, (iii) funds from the DIP Facility, and (iv) funds from the New Exit Facility. As a result of the Restructuring, the Holders of Prepetition Term Loan Claims and Prepetition Convertible Notes Claims will, on the Effective Date, collectively own 100% of the New Common Interests, and accordingly, indirectly own all or substantially all of the Reorganized Debtors' assets, including any and all retained rights, claims, and causes of action. Class 6 consists of all General Unsecured Claims. The legal, equitable, and contractual rights of the holders of Allowed General Unsecured Claims are unaltered by the Prepackaged Plan. Except to the extent that a Holder of an Allowed General Unsecured Claim agrees to different treatment, on and after the Effective Date, the Debtors shall continue to pay or dispute each General Unsecured Claim in the ordinary course of business as if the Chapter 11 Cases had never been commenced. Class 6 is Unimpaired under the Prepackaged Plan. The Debtors or the Reorganized Debtors, as applicable, shall fund distributions under the Prepackaged Plan with the (i) Debtors' Cash on hand, (ii) Cash generated from operations, (iii) funds from the DIP Facility, and (iv) funds from the New Exit Facility. A full-text copy of the Disclosure Statement dated April 2, 2024 is available at https://urlcurt.com/u?l=XQ0zAN from PacerMonitor.com at no charge. Proposed Counsel to the Debtors: Patrick J. Reilley, Esq. Stacy L. Newman, Esq. Michael E. Fitzpatrick, Esq. COLE SCHOTZ P.C. 500 Delaware Avenue, Suite 1410 Wilmington, Delaware 19801 Telephone: (302) 625-3131 Facsimile: (302) 325-3117 Email: preilly@coleschotz.com snewman@coleschotz.com mfitzpatrick@coleschotz.com Michael D. Sirota, Esq. David M. Bass, Esq. Daniel J. Harris, Esq. Matteo Percontino, Esq. COLE SCHOTZ P.C. Court Plaza North 25 Main Street Hackensack, New Jersey 07601 Telephone: (201) 489-3000 Facsimile: (201) 489-1536 Email: msirota@coleschotz.com dbass@coleschotz.com dharris@coleschotz.com mpercontino@coleschotz.com About Majestic Gardens Condominium C Association Inc. Majestic Gardens Condominium C Association, Inc. is a leading provider of smart building technologies, transforming buildings to improve human health and experience, reduce energy consumption, and generate additional revenue for building owners. The Debtor filed its voluntary petition for Chapter 11 protection (Bankr. S.D. Fla. Case No. 21-18653) on Sept. 3, 2021, listing up to $500,000 in assets and up to $50,000 in liabilities. Judge Peter D. Russin oversees the case. Van Horn Law Group, P.A. and the Law Offices of Valancy & Reed, P.A. serve as the Debtor's bankruptcy counsel and general counsel, respectively. WHITTAKER CLARK: Fox Rothschild, Others Lose Official Committee Bid ------------------------------------------------------------------- Randi Love of Bloomberg Law reports that law firms that represented a defunct Berkshire Hathaway Inc.-affiliated talc supplier can address their interests through mediation without forming an official creditors' committee, a bankruptcy judge ruled. Fox Rothschild LLP along with other firms and advisers that worked for Whittaker, Clark & Daniels Inc. say they're owed some $14 million, and want to have a bigger say in the company's bankruptcy. In February 2024, they asked the US Bankruptcy Court for the District of New Jersey to appoint an official committee of general unsecured commercial creditors, raising concerns about how any settlement funds would be shared with tort claimants. About Whittaker, Clark & Daniels Whittaker, Clark & Daniels, Inc., and affiliates, Brilliant National Services Inc., Soco West Inc. and L.A. Terminals Inc., were engaged in nonmetallic mineral mining and quarrying. On December 14, 2007, an indirect subsidiary of Berkshire Hathaway Inc. acquired the equity of Whittaker, Clark & Daniels, Inc., Brilliant National Services, Inc., L.A. Terminals, Inc., and Soco West, Inc. These companies had ceased their operations in 2004 and sold all their operating assets prior to the acquisition, though they continued to face liabilities arising from asbestos, talc and environmental claims. No Berkshire company ever operated, or had any involvement in, the manufacturing and chemical operations that gave rise to the companies' liabilities, and no Berkshire insurer issued it any insurance in connection with the acquisition. Whittaker, Clark & Daniels, Inc., and affiliates Brilliant National Services, Inc., Soco West, Inc., and L.A. Terminals, Inc., sought Chapter 11 protection (Bankr. D.N.J. Lead Case No. 23-13575) on April 26, 2023. The Hon. Michael B. Kaplan is the case judge. The Debtors tapped Kirkland & Ellis LLP as general bankruptcy counsel; Cole Schotz P.C. as co-bankruptcy counsel; and M3 Partners LLC as financial advisor. Stretto, Inc. is the claims agent. The U.S. Trustee for Regions 3 and 9 appointed an official committee to represent talc claimants in the Debtors' Chapter 11 cases. The talc committee is represented by Cooley, LLP. The Hon. Shelley Chapman was appointed as the future claimants' representative (FCR) in these Chapter 11 cases. Willkie Farr & Gallagher, LLP is the FCR's counsel. WISA TECHNOLOGIES: BPM LLP Raises Going Concern Doubt ----------------------------------------------------- WISA Technologies, Inc. disclosed in a Form 10-K Report filed with the U.S. Securities and Exchange Commission for the fiscal year ended December 31, 2023, that its auditor expressed that there is substantial doubt about the Company's ability to continue as a going concern. San Jose, California-based BPM LLP, the Company's auditor since 2016, issued a "going concern" qualification in its report dated April 1, 2024, citing that the Company's recurring losses from operations, a net capital deficiency, available cash and cash used in operations raise substantial doubt about its ability to continue as a going concern. The Company has incurred net operating losses each year since inception. For the year ended December 31, 2023, the Company reported a net loss of $18.7 million, compared to a net loss of $16.2 million for the same period in 2022. As of December 31, 2023, the Company had cash and cash equivalents of $0.4 million and reported net cash used in operations of $14.8 million during the year ended December 31, 2023. The Company expects operating losses to continue in the foreseeable future because of additional costs and expenses related to research and development activities, plans to expand its product portfolio, and increase its market share. The Company's ability to transition to attaining profitable operations is dependent upon achieving a level of revenues adequate to support its cost structure. Based on current operating levels, the Company will need to raise additional funds in the next 12 months by selling additional equity or incurring debt. To date, the Company has funded its operations primarily through sales of its securities in public markets, proceeds from the exercise of warrants to purchase common stock and the sale of convertible notes. Additionally, future capital requirements will depend on many factors, including the rate of revenue growth, the selling price of the Company's products, the expansion of sales and marketing activities, the timing and extent of spending on research and development efforts and the continuing market acceptance of the Company's products. These factors raise substantial doubt about the Company's ability to continue as a going concern for the twelve months from the date of this report. Management of the Company intends to raise additional funds through the issuance of equity securities or debt. There can be no assurance that, in the event the Company requires additional financing, such financing will be available at terms acceptable to the Company, if at all. Failure to generate sufficient cash flows from operations, raise additional capital and reduce discretionary spending could have a material adverse effect on the Company's ability to achieve its intended business objectives. As a result, the substantial doubt about the Company's ability to continue as a going concern has not been alleviated. As of December 31, 2023, the Company had $4.8 million in total assets, $9.7 million in total liabilities, $247,000 in commitments and contingencies, and $5.2 million in total stockholders' deficit. A full-text copy of the Company's Form 10-K is available at https://tinyurl.com/b9223ecj About WISA Technologies Inc. WiSA Technologies, Inc. (NASDAQ: WISA) is a leading provider of immersive, wireless sound technology for intelligent devices and next-generation home entertainment systems. Working with leading CE brands and manufacturers such as Harman International, a division of Samsung; LG; Hisense; TCL; Bang & Olufsen; Platin Audio; and others, the company delivers immersive wireless sound experiences for high-definition content, including movies and video, music, sports, gaming/esports, and more. WiSA Technologies, Inc. is a founding member of WiSA(TM) (the Wireless Speaker and Audio Association) whose mission is to define wireless audio interoperability standards as well as work with leading consumer electronics companies, technology providers, retailers, and ecosystem partners to evangelize and market spatial audio technologies driven by WiSA Technologies, Inc. The company is headquartered in Beaverton, OR with sales teams in Taiwan, China, Japan, Korea, and California. WOM SA: Downgraded by Moody's to 'Ca' After Chapter 11 Filing ------------------------------------------------------------- Moody's Ratings on April 3, 2024, said it has downgraded WOM Mobile S.A. and subsidiaries' ("WOM") Corporate Family Rating (CFR) to Ca from Caa3. At the same time, Kenbourne Invest S.A.´s 2024 and 2028 Backed Senior Unsecured Notes ratings were downgraded to Ca from Caa3. The outlook remains negative. WOM Mobile S.A. and subsidiaries is the parent company of WOM S.A., Conect S.A., and Multikom S.A. The existing notes issued by Kenbourne Invest S.A. are backed by WOM Mobile S.A. and its subsidiaries. Following today's actions, all WOM's ratings will be withdrawn, in accordance with Moody's Investors Service Policy for Withdrawal of Credit Ratings. Moody's views WOM's Chapter 11 filing as a default on all its debt. RATINGS RATIONALE The downgrade follows WOM's announcement of a voluntary capital structure reorganization under the United States Bankruptcy Code's Chapter 11 protection and Moody´s view that losses to existing unsecured creditors could be higher than 50%. The company´s decision comes amid continuous delays in arranging a refinancing package for the outstanding CLP312 billion ($346 million) unsecured notes due in November 2024, as well as rapidly deteriorating liquidity. In connection to the filing, WOM announced that it has secured a $210 million 10% interest plus fees Debtor-in-possession (DIP) financing agreement with JPMorgan Chase & Co. to address its immediate liquidity needs. However, there is still no clarity on how the company plans to address the 2024 notes as maturity date nears. The negative outlook reflects the company's untenable capital structure and lack of liquidity which has led to the proposed voluntary capital structure reorganization under Chapter 11 protection. It also considers the company´s deteriorating liquidity and the negative impacts of this distressed situation on the company´s ability to maintain operations and market share. Furthermore, the negative outlook considers Moody´s expectation that the company will continue to operate in a challenging environment, with slow economic growth and intense competition pressuring performance and profitability. ESG CONSIDERATIONS Governance factors have been a key driver of the rating actions and reflect WOM´s private ownership by NC Telecom AS II, a Novator Group-controlled Norwegian fund, and its aggressive financial policies and high leverage tolerance. Despite a partial tender offer in October 2022 funded by tower portfolio sales, gross debt remained steady due to the increased lease liabilities and the shareholder´s decision to prioritize dividend distributions over debt reduction. In March 2023, WOM planned to use half of the anticipated $200 million tower sales proceeds over the next two years for investment in WOM Colombia, evidencing high risk tolerance and less shareholder commitment to deleveraging the Chilean operation. This investment plan, however, was later suspended amid concerns about the company's liquidity position. Furthermore, WOM's failure to meet a 5G antenna rollout deadline in October raises questions about management's execution capabilities and may lead to regulatory fines, which could significantly strain its already precarious liquidity position. Subsequent to today's actions, all WOM´s ratings will be withdrawn as Moody's considers the filing of the judicial recovery as a default by WOM in all of its debt. Please refer to the Moody's Investors Service Policy for Withdrawal of Credit Ratings, available on its website, https://ratings.moodys.com. The principal methodology used in these ratings was Telecommunications Service Providers published in November 2023 and available at https://ratings.moodys.com/rmc-documents/411275. Alternatively, please see the Rating Methodologies page on https://ratings.moodys.com for a copy of this methodology. About WOM WOM is a Chilean telecommunications provider, focused on offering mobile voice, data, and broadband services, along with a rapidly expanding "Fiber to the Home" broadband offering, to consumers and businesses in Chile. Since the acquisition of Nextel Chile in 2015 through Novator Partners LLP's investment vehicle NC Telecom AS, WOM has expanded from having virtually no market share to establishing itself as the second-largest mobile network operator in Chile. WOM sought relief under Chapter 11 of the U.S. Bankruptcy Code (Bankr. D. Del. Lead Case No. 24-10628) on April 1, 2024. In the petition filed by Timothy O'Connoer, as independent director, the Debtor reports estimated assets and liabilities between $1 billion and $10 billion each. The Honorable Bankruptcy Judge Karen B. Owens oversees the case. The Debtors tapped WHITE & CASE LLP as general bankruptcy counsel, RICHARDS, LAYTON & FINGER, P.A., as local bankruptcy counsel, RIVERON CONSULTING LLC as financial advisor, and ROTHSCHILD & CO US INC. as investment banker. KROLL RESTRUCTURING ADMINISTRATION LLC is the claims agent. WORMHOLE LABS: Unsecured Owed $27.5M Get 95% of New Equity Interest ------------------------------------------------------------------- Wormhole Labs, Inc., Disclosure Statement for Debtor's Plan of Reorganization. This Plan contemplates a for a reorganization of the Debtor based on its interests in two joint ventures: Wormhole Information Technology Systems, LLC, which owns technology and operates a business based on vegetation management for electric utilities, and Wormhole Tours, which owns technology relating to remote residential real estate showings. The Plan contemplates conversion of existing indebtedness to equity, and continued operations of the Reorganized Debtor until the sale of such interests occurs as set forth in Section 5.01.1. Under the Plan, Class V consists of General Unsecured Creditors. Debtor estimates that Allowed Class IV Claims total approximately $27.5 million. Holders of Allowed General Unsecured Claims will receive pro-rata distributions representing 95% of the New Equity Interests in the Reorganized Debtor, with each holder of an Allowed General Unsecured Claim receiving a pro-rata share of such New Equity Interests in the Reorganized Debtor based on the percentage that such holder's Claim bears to the Class of Allowed General Unsecured Creditors. This Class is impaired. All Cash necessary for the Reorganized Debtor to make payments pursuant to the Plan shall be obtained from operations of the Debtor and the sale Debtor's interests in Wormhole the Ventures, and any additional equity interests as deemed reasonable and necessary in the exercise of its business judgment. Attorneys for Wormhole Labs Inc: Mark C. Taylor, Esq. William R. "Trip" Nix, III, Esq. HOLLAND & KNIGHT, LLP 100 Congress Avenue, 18th Floor Austin, Texas 78701 Tel: (512) 685-6400 Fax: (512) 685-6417 A copy of the Disclosure Statement dated March 22, 2024, is available at https://tinyurl.ph/bzYvI from PacerMonitor.com. About Wormhole Labs Wormhole Labs develops a globally scalable new technology platform called Wormhole. It allows people and businesses anywhere in the world to 'teleport' to each other to interact, socialize, play, and shop as if they are actually present and physically walking around anywhere in the world. Wormhole Labs, Inc. filed its voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. W.D. Tex. Case No. 23-11107) on Dec. 23, 2024, listing $1 million to $10 million in assets and $10 million to $50 million in liabilities. The petition was signed by Mark Mitroka as CAO and secretary. Judge Shad Robinson presides over the case. Mark C. Taylor, Esq. at HOLLAND & KNIGHT LLP represents the Debtor as counsel. ZEVRA THERAPEUTICS: Ernst & Young Raises Going Concern Doubt ------------------------------------------------------------ Zevra Therapeutics, Inc. disclosed in a Form 10-K Report filed with the U.S. Securities and Exchange Commission for the fiscal year ended December 31, 2023, that its auditor expressed that there is substantial doubt about the Company's ability to continue as a going concern. Orlando, Florida-based Ernst & Young LLP, the Company's auditor since 2022, issued a "going concern" qualification in its report dated April 1, 2024, citing that the Company has sustained recurring losses and negative cash flows from operations, and has stated that substantial doubt exists about the Company's ability to continue as a going concern. During the year ended December 31, 2023, the Company incurred a net loss of $46 million, compared to a net loss of $26.8 million in 2022 and, as of December 31, 2023, has an accumulated deficit of $399.8 million as well as cash and investments on hand of $67.7 million. The Company has sustained operating losses for the majority of its corporate history and expects to continue to incur operating losses and negative operating cash flows until revenues reach a level sufficient to support ongoing operations. The Company's liquidity needs will be largely determined by the success of operations through the progression of its product candidates in the future. The Company also may consider other sources to fund operations including: (1) out-licensing rights to certain of its technologies and product candidates, pursuant to which the Company would receive cash royalties and milestones; (2) raising additional capital through equity or debt financings or from other sources; (3) obtaining product candidate regulatory approvals, which would generate revenue, milestones and cash flow; (4) reducing spending on one or more research and development programs, including by discontinuing development; and/or (5) restructuring operations to change its overhead structure. The Company's ability to continue operating as a going concern is contingent upon its ability to secure sufficient financing and/or reduce spending to maintain operations. Unless the Company is able to restructure the amounts outstanding on its margin loan facility, it may be required to repay the loan and thereby deplete the cash available to fund our operations. If this occurs, the Company forecasts reflect a shortfall in cash available for operations as early as mid-2024. While the Company expects to obtain the necessary financing that is needed, there is no assurance that the Company will be successful in obtaining the necessary funding for future operations. These factors raise substantial doubt as to the Company's ability to continue as a going concern within the next 12 months. As of December 31, 2023, the Company had $172.3 million in total assets, $110.5 million in total liabilities, and $61.9 million in total stockholders' equity. A full-text copy of the Company's Form 10-K is available at https://tinyurl.com/444fxztj About Zevra Therapeutics Celebration, FL-based Zevra Therapeutics, Inc. is a rare disease company combining science, data, and patient needs to create transformational therapies for diseases with limited or no treatment options. Its mission is to bring life-changing therapeutics to people living with rare diseases. With unique, data-driven development and commercialization strategies, the Company is overcoming complex drug development challenges to make new therapies available to the rare disease community. [] Seward & Kissel Formalizes Private Credit Group -------------------------------------------------- Seward & Kissel LLP on April 9, 2024, disclosed that it has formalized its Private Credit group to handle its growing work within the rapidly expanding private credit asset class, now valued at $1.6 trillion. The group combines the deep knowledge of the attorneys in Seward & Kissel's Corporate Finance group who routinely work on credit transactions with the abilities of its renowned Investment Management practice, offering unique advantages to asset managers engaged in the private credit sector as lenders, as well as to investors, borrowers, and other participants in the industry. "Economic and regulatory factors have attracted a variety of asset managers and investors to the benefits of private credit in recent years, including those who have traditionally focused on equity investments," said Kevin Neubauer, partner and co-head of Seward & Kissel's Investment Management Group. "We are uniquely positioned to serve all participants in the growing private credit markets, supporting them in connection with fund formation, structuring and negotiating a variety of loan and other financing transactions, as well as implementing their exit strategies." High interest rates, global instability, and other forces have all contributed to the boom in private credit, which grew at a 23% annual rate from 2020-23 and has facilitated record-breaking deals. In this active space, Seward & Kissel's Private Credit practice will continue the firm's work for lenders and other parties in a variety of industries using direct lending for acquisitions, working capital, rescue financing, and other needs. The firm's unrivaled experience in forming private credit funds provides unique value for private credit lenders across the entire life cycle of direct-lending funds. "We regularly execute private credit transactions across various industries from food delivery services to medical staffing," said Seward & Kissel Corporate Finance partner Sophia Agathis. "This group formalizes our commitment to the private credit space and concentrates our knowledge in one interdisciplinary group for the benefit of asset managers, borrowers, and others involved in private credit transactions." The new practice will reside within Seward & Kissel's Corporate Finance practice and draw on the firm's experience in areas including Investment Management, Credit Funds, Business Transactions, Capital Markets and Corporate Securities, Private Equity, Real Estate, Corporate Restructuring and Bankruptcy, and Tax. About Seward & Kissel LLP Seward & Kissel LLP, founded in 1890, is a leading U.S. law firm with offices in New York City and Washington, D.C., with particular expertise in the financial services, investment management, banking, and shipping industries. The firm is well known for its representation of investment advisers and related investment funds, broker-dealers, major commercial banks, institutional investors, and transportation companies (particularly in the shipping area). Its practices primarily focus on corporate, M&A, securities, litigation (including white collar), restructuring/bankruptcy, real estate, regulatory, tax, employment, and ERISA for clients seeking legal expertise in these areas. ********* Monday's edition of the TCR delivers a list of indicative prices for bond issues that reportedly trade well below par. Prices are obtained by TCR editors from a variety of outside sources during the prior week we think are reliable. Those sources may not, however, be complete or accurate. The Monday Bond Pricing table is compiled on the Friday prior to publication. Prices reported are not intended to reflect actual trades. Prices for actual trades are probably different. Our objective is to share information, not make markets in publicly traded securities. Nothing in the TCR constitutes an offer or solicitation to buy or sell any security of any kind. 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